AFP InDepth | You’re going to make me pay now?

Local paper puts content behind pay wall

Valley newspaper publishers are watching with great interest how the Daily News-Record in Harrisonburg fares with its recent move to put its online content entirely behind a pay wall.

“That’s a pretty bold move. It will be interesting to see how it works out. I think publishers everywhere are rooting for them hoping that it works so it opens up a new revenue stream,” said Roger Watson, the publisher of the News Leader in Staunton.

“Online revenues nowhere that I know have shown the potential to support the traditional size and scope of news operations run by newspapers. So it makes no sense for newspapers to put their online products in direct competition with their print products, one giving away what the other seeks to sell. The DN-R’s move, I think, recognizes these realities,” said Lee Wolverton, the editor and general manager of the News Virginian in Staunton.

DN-R editor and general manager Peter Yates said the move, which was effective Oct. 1, is based on “the basic premise that our business has been based on for years.”

“We have invested millions of dollars in producing the best in local news and delivering it to our customers. We decided that the disconnect between there being a value assigned to it if we deliver it to your house in print form and there being no value to it if we deliver it to your computer was something that we didn’t care to have anymore,” Yates said.

It’s not as if the Daily News-Record is going at this alone, at least from an industry perspective. The Wall Street Journal has an online subscriber base of more than 1 million readers, and the Journal recently announced plans to start charging readers as much as $2 a week to be able to read its stories on their Blackberrys, IPhones and other mobile communications devices. And dozens of publishers big and small are looking closely at what the Journal has been able to do with the hopes of being able to build their own sustainable web revenue streams.

The News Virginian had been on the forefront of that effort locally with the introduction of its ePaper earlier this year, with the idea being that paid subscribers to the ePaper would be given early exclusive access to premium NV-produced news and editorial content. But staffing issues have slowed the full rollout of the ePaper, and for the time being, at least, all of the paper’s content is back out on the web for free.

“I think the DN-R is on the right track,” Wolverton said in an e-mail. “It’s about placing value on content. We’re in the information business; information is our product. It’s hard to make money giving away product. Operations made up of a tiny number of people – as in a half-dozen employees or fewer in a market like this one – can subsist and thrive on online advertising revenues alone, as you well know. But if you have several dozen employees – still small by almost any measure, but enough that you have significant payroll and other operating expenses – it’s very difficult, if not impossible, in a market this size to generate online revenue enough to sustain the operation, let alone turn a profit.”

Wolverton alluded to the Augusta Free Press in his answer. The AFP has for the duration of its seven-year run offered its online content and the print content associated with the New Dominion Magazine available for free on the web. The company recently launched a paid-subscription campaign to invite readers to voluntarily pay monthly fees to support the news-gathering operation, “sort of a dipping-the-toe-in-the-water approach,” as publisher Crystal Graham described it.

“Like everybody else, we need to find streams of revenue to balance the bottom line and pay the bills,” Graham said.

The dipping-the-toe-in-the-water approach could be what is holding the media industry back. “If we all did it, if every newspaper did it, it would certainly change traffic habits. I’m sure that there are people who read four and five web newspapers a day, whereas if we started charging, you’d probably pick one or pick two or pick three or however many you could afford instead of surfing around like you can do these days,” Watson observed.

Nobody wants to be among the cuts that readers make when they pare down their reading lists. That’s one part of the problem. The more immediate problem is the fear that the papers on the cutting edge of this trend could be the ones taking the lumps for the rest of us as we fall in line after the forerunners get things figured out.

“Most people seem to believe, especially in a certain demographic, that if it’s on the Internet, it must be free,” said Yates, who estimates he gets “three or four very pointed e-mails a day” from readers upset with the new DN-R web pay wall.

“Where the industry is heading with this, I don’t know, but I would think that – I don’t want to say sooner rather than later, but you’re going to see some of the major papers do this. I know they’re all studying it, but it’s when they move from studying it to actually putting it behind a pay wall that will make a difference,” Yates said.

“We’re agnostic as to what platform people want the news delivered to them on. We believe that there is value to what we produce, and that value should be reflected in having people pay for it. We’ve been built on that model for centuries. So if someone doesn’t want it in print, we’re happy to deliver it to you through our website. We have professional journalists with a combined several hundred years of experience, and we believe that what we produce has value. And customers will make their decision as to what value they assign to it,” Yates said.

 

– Story by Chris Graham

 



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