Paywalling is Deadwalling

A very good and succinct article in the Sydney Morning Herald today, pointing that News Limited strategy of “paywalling” their newspapers is a doomed strategy.

And I can only agree.

No doubt there is a loyal readership of News Ltd readers with credit cards that will follow suit, though they’re small number of users. Very small.

The absolute majority of News Ltd readers will move on and find an alternative website. It’s just how the Internet works and how we deal with websites we can’t access; we move on. Indeed, the last stat I read was that only 2% of web users pay for 100% of its content, and I’ll bet that’s almost exclusively streaming video, music and porn. Not news.

Which is not to say News Ltd isn’t right in what it is generally attempting to achieve – that being, users paying for its content. Advertising doesn’t pay the bill and so consumers, rightly should.

Though the approach is wrong. And it won’t work. And worse, it will drive users to News Ltd’s competitors who – also under equal financial duress – will at least capture new and additional readers, and advertising income. (Though that too, will not be enough for News Ltd’s competitors to survive.)

Nobody has the answer for how to save newspapers online and certainly, I have argued for a long time that such a model doesn’t work online anyway. 

Bloggers, Twitter and niche websites are filling the void – the web is all about specialisation (with lower production costs, different revenue models). Think portals: we don’t need a bomb of content now that we have search and especially, aggregators such as Google News bringing it all together. News websites have tried to create a gloss and glow around their bomb of news, though it is not enough.

If news websites had scarce content (such as stock tips etc) it might be a model, though they just have news. Nobody is going to swipe for news – it’s free!

But even if newspapers were right for the Internet model, the answer is not charging users at the gate. The web doesn’t work like that.

I guess News doesn’t care anymore. Crash through, or crash. They don’t have an alternative model and neither do I at this point.

Someone has to try paywalling and hats off News, you’re the one. I hope it works, though I won’t hold my breath.

Original article here: http://www.smh.com.au/business/world-business/heres-a-time-to-bet-against-rupert-murdoch-20100601-wuru.html