PHD strategy director Simon Bird says the paywall is an understandable reaction to the dramatic drops in revenue that newspapers have suffered in the last decade, but his feelings are mixed.
“As an avid reader, I hope it works for them, but as an advertiser, the jury is out and I’m sceptical.”
From the consumer point-of-view, Bird says he doesn’t believe NZME has done enough in recent months to prove some of its content is worth paying for.
“The premium content could be a positive but it all depends on how good the content is and how much of the premium content is from the likes of Harvard Business Review and the [New York] Times is made available.
“I doubt the average news reader would say there’s much difference in the content between the likes of Stuff and NZ Herald.”
Bird expects Stuff will initially end up with an influx of new readers as a result of NZME’s paywall, and predicts they will not make significant changes in the long term – however, he says if the paywall is a success New Zealand audiences should expect out media companies to follow suit.
While the Herald may be the first major newspaper in New Zealand to introduce a paywall, trade publications are no stranger to monetising online content. The National Business Review has charged its readers since 2009, Consumer NZ requires a paid online membership, and Newsroom already has a paywall in place for ‘premium content’.
Adding paywalls to online news is not a new thing.
Perhaps one of the most well-known (and reasonably early adopter) of the paywall is The New York Times. The Times is now eight years into its ‘metered paywall’ which it introduced in 2011 after falling print advertising revenue and projections of continued decline. The metered paywall charges frequent readers for access to its online content, initially allowing other readers access to up to 20 articles free per month.
The number of free articles was reduced to ten per month in 2012, and then again to five in December 2017. There are a number of packages available for customers looking for a digital subscription and during semi-frequent new subscriber promotions, the cost can be as low as $1 per week. As withThe New Zealand Herald, subscribers to the paper’s print edition get full access without any additional fee.
The New York Timesalso reserves the right to remove the paywall at certain times, such as for 72 hours during the 2016 US presidential election, plus it lifted the paywall on political content during the 2018 US midterm elections. The New York Times recently lifted the paywall for three days – May 3-5 – in celebration of World Press Freedom Day.
While The New York Times runs a different model of paywall to The New Zealand Herald’s ‘premium content’ model, it’s metered paywall has cemented the paper’s place as one of the world’s most trustworthy sources of news. In February 2018 it was reported that online subscription sales had jumped 46 percent in 2017 to $340 million and digital ad sales rose 14 percent to $238 million.
At the same time, The New York Times had cultivated more than 2.2 million paying online readers, as well as an extra 400,000 who pay for the Times’ standalone crossword and cooking apps.