The True Test of the NYT's Paywall Plan Will Be e-Readers

Last Updated Jan 25, 2010 1:34 PM EST

Since The New York Times has elected such a long runway ("the beginning of 2011," according to Arthur and Janet*) until it erects its content paywall, there will be plenty of time to agree or disagree with the company's plans.

There also will be plenty of new data to evaluate its chances for success, should management indeed go through with its promises to enact its plan.

One nugget worth pondering, therefore, is a recent Harris/AdWeek poll indicating that less than a quarter (23 percent) of U.S. users are willing to pay in order to access online newspaper content. Only a tiny fraction of those (5 percent) say they would be willing to pay more than $10/month to do so.

Another data point from that poll that may be even more disturbing is that only 43 percent of U.S. adults say they currently read newspaper content daily either in print or online.

Meanwhile, Forrester projects that traffic to NYT.com will be cut by 80 percent if it erects the paywall.

On the other hand, we also have the following intriguing data, courtesy of L.E.K. Consulting: Those who own e-readers are significantly heavier consumers of print media, i.e., newspapers, magazines, and books than those who don't.

As e-readers are popular among older users, this is not entirely surprising, but it does represent a bit of good news for beleaguered print industry executives like those running the Times.

The essential point here is one we've made before. The opportunity for monetizing content this year or next will not be online -- that horse has long since left the barn.

Rather, the opportunity will be in mobile. Newspapers and e-readers are both mobile devices, and in some markets, such as Japan, they already enjoy a synergistic pricing relationship such that readers pay incrementally for accessing news content when they pay their monthly cellphone bill.

Since the Times execs are talking about implementing a "metered" system of charging for content, it's worth noting that as Google's micro-payment platform emerges later this year, there may be an opportunity online for a bit of revenue action, but the main financial game will be played over mobile devices from here on out.

And that, in the end, is where the Times plan will live or die.

* = Internal memo from Chair Arthur Sulzberger, Jr., and CEO Janet Robinson dated Wed, Jan 20, 2010 at 9:28 AM.
Related BNET Media Links:

Why the New York Times' Paywall Won't Lead to Online Isolation
The New York Times' Paywall: Build Carefully to Avoid Collapse
Latest Attempt by NYT to Erect Paywall Unlikely to Succeed

  • David Weir

    David Weir is a veteran journalist who has worked at Rolling Stone, California, Mother Jones, Business 2.0, SunDance, the Stanford Social Innovation Review, MyWire, 7x7, and the Center for Investigative Reporting, which he cofounded in 1977. He’s also been a content executive at KQED, Wired Digital, Salon.com, and Excite@Home. David has published hundreds of articles and three books,including "Raising Hell: How the Center for Investigative Reporting Gets Its Story," and has been teaching journalism for more than 20 years at U.C. Berkeley, San Francisco State University, and Stanford.