Paying for content
This morning I’ve been reading about how some of the news sites which require readers to pay for a subscription are faring. Funnily enough the article is published on paidContent.org – website that doesn’t charge for subscriptions.
The first newspaper has 670 subscribers paying $2.95 per week and lost 40% of their traffic in the first 3 weeks of requiring a subscription. At current rates the model is bringing in just $102,778 per year which isn’t going to be enough to cover the cost of 2 people to run the site.
The best quote comes from the Newport Daily News:
Publisher Buck Sherman told us that the goal was to “drive people back to the printed paper†and not to bring in online revenue. He says that so far “we have done well,†adding that single-copy sales are up 8 percent. Website traffic is down by about 30 percent since the paper began to charge, according to Compete figures.
An equally backward view comes from the Arkansas Democrat-Gazette:
Publisher Walter Hussman told the Guardian that the Democrat-Gazette charges in order to drive newsstand sales. The paper’s average daily paid circulation is down about 1 percent since it put up its pay wall. Revenue from online subscription sales amounts to only about $200,000 a year.
How can these local sites be so badly run? If a local newspaper was to carry out some SEO and then charge 1000 local businesses £100 per month each to advertise on the site and on relevant landing pages that would be £1.2 million per year in revenue for doing very little work. Surely somebody should be explaining this?
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Patrick Altoft is Director of Search at Branded3, a Leeds SEO & Digital Agency specialising in SEO, Web Design, Development & Social Media.
Comments
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1000 businesses at 100 quid each? no mean feat, especially if your a small city.
It’s not that simple unfortunately. Newport County (served by the Newport Daily News quoted above) has a population of around 85,000. Back of a fag packet calc gives around 4,000 businesses. Assume a 10% penetration, with $50 a month, that gives $240,000 per annum.
Simply put traditional newspapers were very good at extracting large amounts of cash from a small local population. A website cannot extract the same amount.
There are lots of other things a website can do of course, an easy win is to extract cash from visitors. Newport is a popular summer resort I understand. Hotel bookings, holiday home rentals, car hire, ticket sales etc, you know the norm. Lots of diverse revenue streams.
However, this not the business model that a local newspaper knows.
Some are trying though, http://newsinnovation.com/ is an interesting read.
I’m not too sure about this. I won’t dwell on the point about overestimating the ad revenue potential as it’s already been made well enough, but I also think there’s a lot more revenue in their subscription scheme than on the surface too. 670 subscribers seems surprisingly high for a few weeks, and should turn into several thousand after a few months.
After this point they can try and sell all sorts of related goods and services to these folks (including advertising). It’s infinitely easier to persuade people who’ve already bought one product from you, no matter how small, to buy another. It’s also a lot easier to advertise to them when you know a lot more about them (assuming they didn’t opt out in subscribing)
Advertising space is a tried and tested monetisation method but the problem I have is that everybody is doing it. If everyone’s sole answer to making money from their website is advertising then independence and quality inevitably suffer, and the pendulum swings away from ad-supported content.
“£100 per month each to advertise on the site”
Good luck with that. It’ll be hard enough to get them to pay £100 per year, let alone per month.
I’ve seen a lot of discussion on the issue recently, with the BBC News site even being suggested as a site that could charge in the future. Newspapers cannot make an acceptable level of revenue from their online sites, and paper sales are down in general, so you can understand the thinking.
However as clearly illustrated here by the Newport Daily News example, if you charge for something that has now been free for a considerable number of years, people will not pay for it, especially when they can just go to another news site (the BBC news site for example) and get an equal quality of service there for free.
It seems to me the only option for the online news sites is to make their revenue from advertising. This can be overlooked and accepted by the reader as a fair trade off (such as on Facebook, where people accept advertisements as they understand the site requires revenue to fund the service it offers), but having to pay for content that can be found for free elsewhere will not be overlooked, the readers will simply go elsewhere.
I have worked as a journalist for 4 years. Small and particularly local newspapers are very difficult to make enough revenue from their online editions. Even nation wide newspapers find that difficult. I would say though that is because is not possible to monetise their sites, but more because the people involved on the online editions don’t have the knowledge of how to monetise them.
From my experience when i was working as a journalist, the online edition was nothing more than a copy of the printed. No added value to the reader and even more no idea how the site can be monetised as the people involved have no experience from online promotions.
A good content will get high amount when you have an ability to create a good content. So, no doubt when paying a good amount with a good content. Thus, I am also very familiar of content writer because i did that sometimes. It is good to make that specially it’s involving of quality and relevant articles.