As media becomes increasingly digitised, audiences are given more of a chance to articulate preference for content. In the burgeoning years of television, consumers could pick between only a handful of channels. It was a very limited marketplace due to the high cost-price of entering it as a broadcaster. The ability for the market to punish/reward programming they enjoyed/hated was, as a result, also limited.
In 2018 though, the consumer not only has the option to use cable TV with its thousands of channels, but online streaming platforms like Netflix. When there is a high variance and density of content, it’s far easier for the audience analytics to reflect what is actually ‘good’ rather than what is simply ‘on’.
A similar trend towards consumer empowerment is being seen across media, and similarly journalism. Publishers’ audiences are becoming increasingly fragmented in the shift to digital consumption. Once relying on being able to capitalise on a mass readership, news providers across the world are now finding their audience split across multiple platforms, hesitant to pay for content directly and harder to advertise to. Dr Merja Myllylahti outlined in her journal article for Digital Journalism that:
The 2007–2008 global financial crisis and the digitisation of media have fundamentally affected news publishers’ ability to monetise their news content and news audiences […] Digitisation changed the advertising landscape for news publishers as their audiences fragmented, and selling audiences to advertisers became a substantial challenge. (Myllylahti, 2016)
With the struggle to directly sell their audience to advertisers, especially online, circulation is expected to become a larger share of revenue for many outlets. This means, as University of Melbourne professor Dr Andrea Carson said, “consumers may soon become publishers’ biggest source of revenue.” This has started to force news providers to focus more on serving the individual needs of their audience more-so than they ever had to in the world of print media.
This emphasised focus on circulation over advertising, and individual readership has seen the rise of paywalls for the monetisation of digital content, and use of big data, hinting at the broader future of the commodification of journalism. While this idea may make one think in dystopic terms, putting faith in the research and free market in which journalism is nested in actually shows good reason for both healthy cynicism and tempered optimism.
It’s time to build a (pay)wall
Paywalls can be generally characterised as ‘hard’ or ‘soft’. Hard paywalls prevent any free consumption of a sites news content. Soft paywalls (most commonly in the form of a ‘metered’ paywall) lets a reader access a limited number of stories before blocking access.
In Dr Myllylahti’s research on paywalls in New Zealand’s National Business Review, and Australia’s Australian Financial Review she found that the majority of pay walled content was ‘hard news’ i.e news about business, economics and politics. Most of the free content on these sites were articles that were more shareable on social media. Through interviewing journalists from NBR, the research suggested that reporters were forced to work harder and dig deeper to give their subscribers “something which they could not get elsewhere.”
With the pressure of having to appease already reluctant subscribers, outlets have to justify the cost of their content. This notion is corroborated by another study of paywalls by Alfonso Vara-Miguel in 2014, in which research revealed that paywall “payment is closely linked to dissimilar and more specialised content with higher added value that is not easily imitated by the competition.” ( Vara-Miguel, Sanjurjo-San Martin, & Diaz-Espina, 2014, p. 148)
As a result, the worrying trend of newsrooms becoming machines that churn out press releases seems to be one that will only lead to their own demise. Readers are only willing to pay for content that they think is ‘worth it.’ This often means prioritising original reporting, fleshed-out and niche stories, deep-dive investigations, exclusive takes and unique analysis for paywall content. In contrast, more shareable, general and vanilla content is accessible for free, and to generate a declining share of advertising revenue.
This was backed-up by Dr Carson’s 2015 study on paywalls in Australia and abroad that showed:
“The niche content of Wall Street Journal has had more subscription success than mastheads with hard paywalls that provide general news (Times). London’s Financial Times (FT), which provides niche news opted for a metered paywall (allowing 10 free articles) and experienced greater online circulation than print in 2012. Its digital subscription is more expensive than some competitors starting at $325 a year demonstrating readers will pay if they think the content is worth it.” (Carson, 2015)
The pressure of prioritising circulation for revenue amongst outlets, which has led to the widespread use of paywalls, has also in-turn encouraged quality journalism. When the power is in the hands of the consumer, they will not spend money on something that they perceive as having no value. This goes against the notion that most newsrooms are becoming ‘churnalism’ machines for press release, as outlets with paywalls are forced to compete for their readers more-so than ever before.
Big data for big competition
In this competition, news providers are looking towards big data to better understand, and target, their specific audience amidst a fragmented, highly competitive and variant landscape. Director of Research at Reuters Institute, Robert Picard outlined in his report on paid digital content that most outlets:
“Are no longer satisfied with basic data on paid users, unique visitors, and what stories are read or shared most, but are seeking better metrics and understanding of individual users’ engagement and use patterns across digital platforms. The strategic impetus for this is to improve content provided to users at different times on multiple platforms as well as to drive engagement and loyalty at a time of increased competition.” (Picard, 2014)
As a result, journalists will likely have to continue to widen their skill set, including the ability to integrate patterns from data analytics into their work. While it’s been a mainstay of economic and business reporting for years, being able to wield data at this macro level in the distribution of content, but also the micro level in the integration of content will be key for the future of journalism.
Customers want unique, niche content that is catered to their consuming patterns. Independently mined data being shown meaningfully in an original report published and promoted at the same time as they open their phone would be, in this sense, the perfect broad example of this. The use of data on multiple levels will be a crucial element in how news outlets monetise their digital content via paywalls.
How Australia & average Australian fits in
This increasingly popular model for the monetisation of journalism is, however, not without fault. In the unique context of Australia, paywalls, as Dr Carson outlined in the same report struggle more-so:
“Unlike the British and American markets, Australia does not have a large population base to support a hard paywall market for general news, and perhaps even niche, if the price is too high, particularly when competitors, the ABC and new entrants such as the Guardian, offer news for free.” (Carson, 2015)
Australian outlets in-particular have a harder time of finding a sweet spot for their content. They want to balance the maximisation of clicks onto an article by widening its appeal and shareability, but also make it unique enough to the specific set of values it has. It’s the tension between getting their readers to pay for the work, but also having enough traffic onto the work to have adequate revenue from advertisers.
With a harder time finding that sweet spot, Australian outlets may have to either start refining their niche to find a small group of paying customers, or expand their scope to bring in advertising revenue from a wider audience. Or they could imitate the approach of a country like Slovakia whose publishers grouped together to create a uniform paywall. Slovakian users pay one fee to access a wide variety of news providers, and the revenue created is split respectively amongst the sites. Sarah Marshall from Journalism.co.uk investigated this more unique approach in a podcast which you can listen to below:
The heart of the problem with paywalls, though, is one that’s more abstract than technical.
Paywalls and the commodification of news in-general starts to stray away from news providers being the ‘fourth estate’ for the public. While Australia is fortunate with the SBS and ABC, in-general, why should people have to pay to access high quality journalism and reporting?
Much of the work being done to justify the cost of articles behind paywall is the type of work which directly serves the public's interest. After all, that’s why people are willing to pay for it in the first place. But doing so starts to split access to news between people who can/are willing to pay for it, and those that aren’t. Finnish business daily paper Kauppalehti’s content sales manager, Johanna Suhonen embodied this sentiment by saying in 2015 that:
“We see the content of our website as an online shop. All products must be such that, figuratively speaking, visitors to the website want to add them to their shopping basket. Every article must have a value that makes people want to buy it again and again, news item after news item.” (Myllylahti, 2016)
This seems to be a very effective way of viewing a news providers role in a free market, but not-so as a service to the public. Paywalls, in this sense, are representative of a lot when it comes to the future of journalism. On one hand, they are a means for creating a bastion for quality reporting, and giving journalists the means to investigate what the public wants to know. On the other though, this comes at a cost of narrowing the audience and inherently limiting what percentage of the public can know.
Overall, the shift of news providers strategies seem to reflect an emphasised focus on trying to actively garner paying individual readers rather than maintaining a passive mass audience. This will see a shift towards more niche and high quality reporting for many news sites, but at a cost to potentially the wider consciousness of the public.
REFERENCES:
Carson, A. (2015). Behind the newspaper paywall — lessons in charging for online content: A comparative analysis of why Australian newspapers are stuck in the purgatorial space between digital and print. Media, Culture & Society,37(7), 1022–1041. doi:10.1177/0163443715591669
Myllylahti, M. (2016). What Content is Worth Locking Behind a Paywall? Digital Journalism, 5(4), 460–471. doi:10.1080/21670811.2016.1178074
Picard, R. (2014). New Approaches to Paid Digital Content. Retrieved from http://www.digitalnewsreport.org/essays/2014/new-approaches-to-paid-digital-content/
Vara-Miguel, A., Sanjurjo-San Martin, E., & Diaz-Espina, C. (2014). Paid news vs free news: evolution of the wsj.com business model from a content perspective. Communicaiton & Society, 27(2), 147–149.
