Newsday, a Long Island newspaper, instituted a paywall three months ago. Since then, according to a report in the New York Observer, the paper has sold a grand total of 35 subscriptions at $5 per week. The paper's owners spent $4 million on redesigning the site to prepare for the paywall.On the eve of the Apple tablet announcement, a lot of people are talking about the role the tablet could play in saving the newspaper industry by making paid content a viable alternative to ad-based revenue models. Clearly, though, this strategy won't work for every paper.
Bad News for Paid Content? Or Just a Bad Example?
Newsday was one of the first newspapers in the last few years to erect a full paywall around its site. Unsurprisingly, this has meant that the traffic to the site also slowed down over the last few weeks. By December, the number of unique visitors to Newsday's site was down 43% compared to last year.
The question, however, is how representative Newsday is for the newspaper industry in general. There are quite a few reasons why Newsday's numbers are this low. Among other things, everybody on Long Island who subscribes to Optimum Cable gets a free subscription to Newsday. Maybe this is worthwhile model for Newsday, but it's questionable if this could work for a lot of other newspapers.
According to the paper's publisher Terry Jimenez, 35 subscribers is "35 more than I would have thought it would have been." Jimenez clearly sees the paywall as a way to keep potential readers who don't subscribe to the paper in some other form away from the papers website. Given this attitude, it doesn't come as a surprise that getting home delivery of the paper is cheaper ($4.50 a week) than subscribing to the online version.
What Do You Think?
What do you think? Is Newsday just a bad example for paid content and the site only sold 35 subscriptions because everybody else is getting the paper for free with their cable subscription anyway? Or do you think this is representative of what other papers will experience when they erect their own paywalls?