As the Rupert Murdoch owned Times and Sunday Times lost 90% of its online viewers during the first week it went behind the pay walls , all hell broke loose in the media world. After the successful monetization of the financial dailies, the London based Financial Times and the New York based Wall Street Journal, two iconic daily newspapers had planned to follow suit. Since the moves to pay wall had been planned nearly two years in advance and the effects thoroughly debated by their own columnists and predicted by external media experts the dramatic drop in viewers was an expected setback for the newspaper that essentially caters to London’s wealthy and better educated segment.
Needless to say that this will not deter Murdoch or even New York Times which plans to go behind the pay walls in the year 2011. With $3 weekly subscription, Murdoch would have earned $154 per year per subscriber through the pay wall. Had he been able to retain all his 150,000 online subscribers that would be a cool $23.1 million annually. However with online distribution costs minimal even retaining a tenth would pay for the additional costs an established newspaper needs to incur on its online version, even if advertising income are not included. Besides both publications are individually profitable and have enough financial muscle to bear the transformation and learn the ropes of monetizing online content.
Of the two methods being widely debated today in the pay wall world is the metering system and the micropayments structure. Whereas Reuter’s Felix Salmon prefers the metering system he is opposed to the FT method of slam bang refusal after the minimum number of free page views are consumed by the reader. The celebrated columnist is banking on the Apple tablet linked to an iTunes account providing an usage based payment mode that he says NYT plans to use, as right fix.
The Nielsen survey of consumers however shows that consumers reluctance to pay for online content would go with the adaptation of micropayment structure . As per a survey conducted in February 2010 around 85 % of online users are reluctant to pay for online content among 27,000 consumers interviewed by them in 52 countries that account for major on line traffic worldwide. However over 50 % of the people were agreeable to a micropayment mode where the reader would pay for reading an article of his choice instead of paying for the full newspaper. Though this would be more difficult to achieve, it would in effect be the extension of an usage based system for payments, but for use of parts of the newspaper, instead of the whole paper. This technique would bring in sophisticated feed back to the news paper management on reader preferences and consumer trends worldwide, that would be very important while globalizing content and increasing online viewership.
I love to write on anything and everything under the sun from Project Management to Poetry, Economics to Travel and Technology. But most of all I love to write about our planet earth, about which you can read more in my blog Ecology to Economics. You may also meet me at http://www.twitter.com/ecothrust
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