Tuesday, May 15, 2012

'News Virginian' begins charging for online content ... joins growing number of paywall sites

If you head over to the Waynesboro News Virginian today, you'll be asked to sign up for the online service that will cost $5.00 a month. The question now is whether the readership of this small home town newspaper will fall off as readers turn to other news such as nearby Staunton News Leader although reports indicate it's parent company, Gannett, will begin charging by the end of this year. To my knowledge, there are no plans for requiring subscriptions to the local online Augusta Free Press.

Most Media General newspapers are now charging their readers, and that includes the two that I subscribe to for hard copy -- the News Virginian and the Richmond Times-Dispatch.

American Journalism Review looked into this subject in 2008 and concluded that, even at that time, some who had tried to charge were backing off, noting that their readership would expand more without paywalls.

However, four years later we're seeing a resurgence in newspapers requiring subscriptions for online access. Besides Gannett and Media General, others who charge or plan to begin charging in the future include the Los Angeles Times, Chicago Tribune, and the New York Times.

Vermont Public Radio (VPR) host Jane Lindholm had an interesting audio interview about the ups and downs of paywalls with Praveen Kopalle, a professor of marketing at the Tuck School of Business who specializes in pricing strategies in all kinds of industries. His conclusion was that it worked for some, such as the New York Times, and not for others. In an advertiser-driven industry, he said it may be more worthwhile to leave access free to provide a higher number of readers for online advertisers, noting that charging access may diminish the number of readers, thus resulting in less reason for businesses to advertise. Facts are free, he noted ... what consumers would be paying for is analysis and opinion that may not be available elsewhere.

It's unclear what impact this will have on news headline sites such as Real Clear Politics, Drudge Report, and Memeorandum that offer a one-line teaser with links that drive readers to the now-charging news outlets.

Two years ago the Harrisonburg Daily News Record began charging to access its online copy. As a result, I just stopped reading or linking to it. Not sure if this is good or bad for outlets who search for ways to stay afloat in these financially treacherous times but who can fork out $5 here and $5 there for all these news sites? As a part-time blogger, it's not profitable for me to subscribe to dozens of sites so a few carefully chosen ones will have to do. That may end up hurting some news organizations.

The alternative may be online newspapers. The Washington Examiner has greatly expanded its reporting as well as election coverage and it doesn't cost. Same with the Washington Times and other online sites.

In return for the price of admission, I am going to be a more aggressive consumer who would like to see breaking news covered as it happens -- especially at the local level -- and ready access to content available in the early a.m. when I'm generally checking the sites and researching stories.

Dr. Kopalle sadly admitted in the VPR interview that paywalls are probably here to stay. It will be interesting to watch this latest evolution of the news industry and what impact it will have on news organizations as well as consumers in this latest battle for survival of the fittest.

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