Last week, the editor of the Winnipeg Free Press wrote an article making a (rather poor) case for their upcoming “innovative” paywall experience. Harvard’s Neiman Journalism Labs even picked it up and wrote a great article breaking down the nitty gritty. Simply put the Winnipeg Free Press plans to charge every single reader $0.27/article (billed monthly). Nobody in North America is doing this and nobody in the world has tried anything quite like this, so in that regard, it truly is an innovative idea.
However, there is a fine line between an innovative and a bad idea.
As far as I can tell based on the information they’ve released, Freep’s plan falls on the bad side of that line. Whatever committee makes these decisions at The Free Press seem to be misunderstanding some fairly basic principles about how the web works.
For starters, any sort of road block that requires a user to create an account before getting to content is a significant barrier to entry. As usability pioneers Neilsen Norman Group put it “Login walls do not belong in the initial experience.” If a user clicks through to a news article from social media and is presented with a login wall, that user will just leave, period. I have a hard time believing that the Free Press’ research would show otherwise. The news market in Winnipeg has a lot of viable free/ad-supported content. Three daily newspapers, a vibrant sub-reddit and blogging scene. If someone wants to find out about something on the internet, they are going to visit the first site that actually displays information without making them jump through hoops.
There is a reason that successful paywalls like the NYT’s show users X number of free articles before ever asking them to sign up or pay. It’s not because these papers don’t need to maximize their online revenues. Precisely the opposite, they understand that presenting a paywall to every; single; drive-by visitor is going to do more harm than good.
$0.27/article is hardly a “micro” payment.
$0.27/article is outrageous, maybe even just plain greedy!
Anybody who’s dealt with online advertising can come to this conclusion fairly quickly. The revenue earned by a individual webpage (ie. the cost to advertise) is calculated in CPM (cost per thousand views), $0.27/article works out to $270CPM. The going rate for the an ad on a highly popular website with a good audience in a desired demographic $70 – $100CPM, possibly upwards of $150 – $200CPM for a large takeover type ad. When The North Face advertises on wired.com, they’re looking at advertising budgets in that ballpark. On the other hand, an ad on Facebook or Google AdSense will cost an advertiser $0.50 – $5.00.
If I had to guess, the rates for advertising on winnipegfreepress.com are likely in the $50CPM range. So from that perspective the Winnipeg Free Press is attempting to charge their readers 2-5x as much as they charge their advertisers!
When compared to other media/entertainment the Free Press’ pricing model doesn’t make a lot of sense either. In the article, the editor writes “If you are a Winnipeg Jets fan, then you can assemble a month’s worth of game stories and Gary Lawless analysis that will cost you as little as $8.00.”
One month’s worth of hockey analysis costs as just shy of a Netflix or Rdio subscription. The pricing is totally out of whack.
Ad-Support. You’re the Product.
When a business is based on an ad-supported model, the reader is not the customer. The readership is the product, the advertisers are the customers. When you read an ad-supported website, you may not be handing over any money, but not getting the content for free either. Every time you load a page you are handing over valuable demographic information. I think most people understand this by now, but it’s worth reiterating.
Normally, when an industry experiences increased production costs, they pass those costs on to the customer. When the price of fuel goes up, airlines increase the costs of fares, grocery stores increase the cost of produce.
If a business is losing revenue, will try to present their customers with new and innovative products. Charging readers for access is doing nothing to create a more innovative product for the Free Press’ real customers, the advertisers. If anything, it’ll turn potential readers aways, decreasing the Free Press’ ad inventory.
6 replies on “On Winnipeg Free Press’ Pay-Per-Article Paywall”
Great article. The Winnipeg Free Press’s new “strategy” is completely insane. They are subjecting themselves to market forces, and if they think that somehow, miraculously, their content is worth $0.27/article more than the rest of the entire internet, they’re going to have a very rough reality check.
Go take a look at their homepage right now. Anything there that you’d be willing to pay $0.27 for, even if the same stories weren’t carried on a dozen different websites? No chance anybody is going to be paying $0.27 for an article headlined “Local theatre creator thrives on collaboration, balancing ambition and art”
The problem with the WFP isn’t entirely it’s paywall strategy, it’s also that they’re just really bad at producing quality news. They just don’t bother printing anything that people would want to read anymore, they’ll print what the largest amount of people WILL read, just because they’re passing the time. Britney Spears is in town, and the Premier of the province is embroiled in a scandal, they’ll put Britney Spears on the front page each and every time. Not because it’s important, but because their front page has become click-bait hoping to sell a handful of extra newspapers and selling out any journalistic integrity they had left.
Yes, quality news production costs money. But that’s not what the WFP does. Most of the content in the paper is acquired from the Canadian Press and Associated Press… content that is available on multiple different websites for free. Most of the writers that they employ are opinion columnists who are often shocking out of touch with the community they aim to serve. The only people who will pay $0.27 to read Dan Lett are the same people who firmly believe all taxes should always go up and the government should control every aspect of our lives. There might be a few dozen of those in the city, but not enough to keep a pile of staff paid.
The ugly fact of the matter is that they’re trying to do business the same way they did newspapers in the 19th century. There are LOTS of news organizations that have been successful in the Internet age. Politico, Mother Jones, even Ezra Levant’s Rebel.tv are all fine examples. The fact that Rebel.tv is able to produce enough content in a single day to fill a half day’s worth of TV news coverage, with only a handful of staff, just shows how news can produced for much cheaper than what many mainstream media organizations pay.
My guess is this experiment lasts for less than a year before they admit failure.
I purposely didn’t have comment on the quality of their news because a) I’m not really a media critic, b) I’m willing to give them the benefit of the doubt and believe that they are re-focusing on the quality news.
The great irony is when I tried to read the WFP editor’s article, I was confronted by the login box. I just closed the window.
I grew up in Winnipeg and like to keep up a basic understanding of current events there, but it’s not worth paying for. Most of the articles are crap and just CP/AP newswires. I hope this winds up biting them in the a**. Go back to the 10 free articles a month.
I stopped going to their website because of this new tactic. Guess they will go bankrupt soon, Bye Bye FP.
I was disgusted to see the Winnipeg Free Press charge to allow access to view the Winnipeg obituaries. I will never purchase the Winnipeg Free Press newspaper or access their Web site in the future.
I agree with Laurie Rose. Putting a price on the obits is tasteless. CBC, CTV, CJOB, to name a few have free local news. Google can provide you with great international news. I will never pay another red cent to the WFP.
no sympathy when they go belly-up