On Paywalls, Search and the Risk of Irrelevance

So AccMan (Dennis Howlett) has decided to go down a monetization route, in addition to being funded by a vendor content widget, he’s looking at monetizing by charging for a small percentage of “premium content”. It’s an interesting move and one that has been used by a number of traditional print publications for their online properties. I thought I’d write my two cents worth, not specifically about the AccMan move but more generally about paywalls and the validity of the model.

Last year here in New Zealand the National Business Review made a similar move, creating a paywall and putting roughly 20% of their material behind it. They did so for what they considered logical reasons saying:

As you know, there has been endless discussion for a number of years about the crazy model adopted by newspapers in most parts of the free world in which they pay the enormous costs of running professional newsrooms only to give their content away free – while at the same time slashing newsroom numbers to save money as circulation and advertising revenues fall. And to add to the madness it has been the aggregators that have profited the most from the supply of that free news copy…It is only a matter of time before the model collapses. The alternative is newsrooms decimated to the point of processing public relations handouts or unedited government propaganda from their fully staffed team of spin doctors

Bear in mind this is a traditional print newspaper with all the associated costs that go along with that, but for the same reason that NBR’s approach is flawed, so to is a similar approach for all but the biggest and most popular blogs.

There are two reasons I believe this approach is flawed. One is the sheer willingness (or lack thereof) of people to pay for premium content, the second is the ability for that content to be found. Looking at the first point and, as Rommil Santiago pointed out in reaction to AccMan’s decision:

Why pay for one writer’s point of view, when I can find another three writer’s points of view for free – even if it isn’t quite as good…While I respect his work, I simply cannot be bothered to pay to read his insights for a couple of reasons…it’s a blog. As a blog, it is part of the social media eco-system. You can create discussions with blogs and interact with readers with a click of a publish-button. Making people pay to engage with you seems pretty darn anti-social if you ask me – especially for a blog, which really, is often just a vehicle to boost one’s reputation in an industry (*cough*). Simply put, I feel that if someone decides to post actionable advice on his own blog, he has opted to work for free.

It’s a bitter pill to swallow but those of us who have chosen to go down the online media route have, to a great extent, accepted that end users will not pay for content. Now I know that sites such as GigaOm pro have a subscription service, but their ability to do so successfully is predicated on a massive amount of traffic – while conversion rates are very low, the sheer numbers coming into the site mean that a paywall can, to a certain extent, function.

Moving onto the findability issues now, in reaction to the NBR decision in New Zealand last year, fellow New Zealand commentator Lance Wiggs pointed out that:

The aggregators, such as google news, are driving traffic to the NBR site, and without them the NBR would be even worse of than it is. By locking them out of the subscription area NBR will dramatically reduce their ability to make their compelling, original and timely content available to the world. The writers behind the wall will lose relevance, and the newspaper itself will diminish.

AccMan seems to be relying on the fact that, through high levels of social media use, he has created a moderately well known brand for himself and that fact will in some way make up for the traffic he loses by closing the door on Google’s ability to search the premium content. While we’d all like to believe we’ve caught the attention of a huge number of people, the reality is somewhat different. Anyway, in this case it seems the intention is to go it alone, sans Google juice. As he said:

Google can’t index that which chooses not make itself available. Fact. Go check. [they can search only] If I allow it. Which I won’t. Once GOOG has that data then what? Buzz taught us a LOT

Aside from the (to my mind) somewhat bizarre conflation of Google’s teething problems vis Buzz and a Google masked paywall into an argument for anonymity, I believe the contention that a small, niche publication can survive without Google is flawed. I’ll grant that, in this case, only 20% of information lies behind the paywall and potentially this provides an opportunity to deliver interested people to the doorstep of the paywall, the fact is that, the traffic numbers don’t indicate that, web conversion being what it is, this will be a viable model.

As Nat Torkington pointed out in his recent post:

Newspapers locking up their content in paywalls and trumpeting loudly against Google might be effective if Google were merely a predator. But this is the Internet, where copies are free, everyone could be a customer, your competitors are just a click away, and customer loyalty isn’t merely a consequence of geography…To move your content behind a News Corp-style paywall is to be a dinosaur that knows the comet is coming but thinks, “I need thicker armor because I’ve heard that it has a big tail.”

So… there you have it. Information wants to be free, without findability you may as well not exist, readers are generally unwilling to pay for content and paywalls, in all but a handful of cases, are a flawed concept. Watch this space (always here, and always for free!)