Metered model gains traction as digital pay option
The New York Times’ long-expected online payment platform, announced Thursday, reaffirms the metered model as the preferred approach among publishers seeking new ways to monetize their digital content.
Publishers like the metered approach because it represents a “softer” paywall that allows site visitors to view the majority of website content for free, while unlimited access requires a weekly or monthly subscription. This is a critical access point for news and other general-interest content that is widely available on the Web.
With this "freemium" model, users are asked to subscribe after viewing a predefined number of articles a month. To date, I’ve seen thresholds set between 3 and 25 articles before a subscription window pops up. Importantly, users that don’t want to pay can return the following month for their ration of stories – another key point to ensure that casual users continue to come back to the site.
This approach has helped publishers maintain their traffic post-paywall. Most of the two dozen publishers that have deployed payment systems using the Press+ platform are using metering plans, Press+ spokeswoman Cindy Rosenthal confirmed. And those customers “have all kept all their online ad revenue and online visitors month to month,” Rosenthal noted in an email. In other words, people who run into the meter without paying still appear to be coming back the following month for more free content.
In January, Press+ released results from its early customer deployments showing that monthly unique visits to websites that had launched payment platforms fell no more than 7 percent, while page views fell no more than 20%. No publishers reported a drop in advertising revenue.
Press+ co-founder Gordon Crovitz predicted that the New York Times’ payment system could generate an extra $100 million in annual revenue. paidContent’s Joseph Tartakoff offered similar estimates.
The metered approach compares favorably to more restrictive paywalls in terms of retaining traffic. Newsday’s sitewide registration gate, launched in late 2009, caused unique visitors to drop by more than half between September 2009 and September 2010. News Corp.’s Times of London and Sunday Times, which went behind a full paywall last June, lost 4 million unique visitors and 90 percent of its pageviews post-gate.
How metered sites are faring
By contrast, at the Augusta Chronicle, which launched its metering system in December, traffic has actually increased.
Both of those sites are published by Morris DigitalWorks, which is extending its payment system to new iPad editions of the publications.
Pennsylvania’s LancasterOnline, one of the first publishers to go live with Press+ last July, has seen its page views per person increase steadily.
LancasterOnline's subscription system only gates obituaries for out-of-market visitors. Viewing more than seven obits a month requires a fee of $1.99 a month or $19.99 a year.
Meter plus geolocation
Other publishers are also combining the metering system with geotargeting to gate off visitors coming from outside the publisher’s geographic coverage area. The premise is that people who have physically left a community still want to keep up with news about the area – and would be willing to pay for that access.
Oklahoma State University followed this approach to launch a modest subscription plan for its student newspaper, the Daily O'Collegian. After viewing three articles, visitors from outside the school's geographic area are asked to pay a $10 annual membership for unlimited access.
“We've always known that the content our students produce has value well beyond the free drop distribution of our newspaper. Charging a modest fee to access our online content for non-students who live outside Stillwater helps us foster that belief," O'Collegian General Manager Ray Catalino said in a press release announcing the rollout last December.
More publishers join the paywall party
The Utica (NY) Post Dispatch began charging for premium content on March 14. It requires a monthly subscription after viewing 15 articles ($1.49 for print subscribers, $6.95 for everyone else). Access to high traffic portions of the website – breaking news, obituaries, videos, photo galleries, blogs and classifieds – will continue to be freely accessible.
Several GateHouse Media newspapers have also launched metered subscription plans using Press+ over the past month. The Holland (Mich.) Sentinel charges $1.49 a month for existing print subscribers and $6.99 per month for non-subscribers; its threshold is 15 free premium articles a month.
The Rockford (Ill.) Register Star is charging print subscribers 95 cents per month and non-subscribers $7.95 per month for unlimited Web access; its meter also kicks in after 15 premium articles.
ProPublica, as a nonprofit, is taking perhaps the softest paid content approach, using its meter to ask for donations. The system “allows us to seek donations just as readers are accessing our content,” ProPublica GM Richard Tofel said in a statement announcing the launch last November. The donation screen popped up after I clicked on six articles.
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