
The New York Times Paywall Is Working Better Than Anyone Had Guessed - lucaspiller
http://go.bloomberg.com/tech-blog/2012-12-20-the-new-york-times-paywall-is-working-better-than-anyone-had-guessed/
======
carbon8
Regarding what any of this means for other content paywalls, note this section
from Post Industrial Journalism: Adapting to the Present
(<http://towcenter.org/research/post-industrial-journalism/>):

 _"Finally, a note about why we will not be concentrating very much on the
fate of the New York Times. A remarkable amount of what has been written about
the fortunes of American journalism over the past decade has centered on the
question of what will happen to the Times. We believe this focus has been
distracting._

 _"In the last generation, the Times has gone from being a great daily paper,
in competition with several other such papers, to being a cultural institution
of unique and global importance, even as those papers—the Washington Post,
Chicago Tribune, Los Angeles Times, Miami Herald, among others—have shrunk
their coverage and their ambitions. This puts the Times in a category of one.
Any sentence that begins “Let’s take the New York Times as an example ...” is
thus liable to explain or describe little about the rest of the landscape._

 _"The Times newsroom is a source of much interesting experimentation—data
visualizations, novel partnerships, integration of blogs—and we have talked to
many of our friends and colleagues there in an effort to learn from their
experiences and make recommendations for other news organizations. However,
because the Times is in a category of one, the choices its management can
make, and the outcomes of those choices, are not illustrative or predictive
for most other news organizations, large or small, old or new. We will
therefore spend comparatively little time discussing its fate. While the Times
serves as an inspiration for news organizations everywhere, it is less useful
as a model or bellwether for other institutions."_

~~~
jusben1369
I think that's a really valid point and fair observation but perhaps too
simplified. Put another way, had the Times _failed_ at creating a successful
paywall then all others could be assumed to be doomed to failure. Now that the
Times has proven it's successful, can others borrow some or all of their
approach? The answer is partially in your quote above I suspect. Just whacking
up a paywall is likely not the answer. However, using your deep resources
(relative to other sites and bloggers) to create a superior experience can
create a sustainable business. Just as the Internet threatened their
traditional business it also dramatically increased their reach in other ways.

~~~
AnthonyMouse
I think people are doing it a disservice by calling it a paywall. There is no
wall. Bypassing it is trivial. What it is is an effective donation drive the
likes of Wikipedia: You go to the site, you get the content for free, and you
get a notice that says "hey, somebody has got to pay for this stuff you're
reading, how 'bout you pay your share?"

An _actual_ paywall would be a lot less likely to work, because when people
get to a paywall, they can't see what they're supposed to be buying, so they
just go away and never come back. By contrast, this "works" because it gives
people what they want unconditionally and then having accepted it without
paying, guilts them into making a donation. Nonprofits have been running on
this model forever.

But the real question is whether it's actually "working" -- the conversion
rate to paid subscribers is evidently around 2%. That's pretty bad. And then
they call it a success because it makes up 50% of their revenue instead of 20%
as was traditionally true, but is that because subscriptions are up or because
print advertising has been falling for so long? They only quote the most
recent rate of change rather than the long-term numbers, and there may be one
of these going on: [<http://xkcd.com/605/>]. When you first open a new revenue
model, you can pretty well expect the first couple of years to have a higher
growth rate than the ensuing years. Once everyone is subscribed who wants to
subscribe, you have a hard time achieving any more subscription growth. And if
subscriptions stop growing faster than advertising is falling, they're right
back into the death spiral of cutting costs to save money which reduces
readership which loses revenue which induces cost cutting.

~~~
mjfern
The porous New York Times paywall works because it effectively segments the
market. [1]

The first segment consists of customers with a higher willingness to pay that
aren't aware of the paywall workarounds or enjoy accessing the Times without
futzing around. Who are these readers? Readers with high disposable income,
older readers, and heavy readers.

The second segment consists of customers with a lower willingness to pay, who
have identified the workarounds, and are willing to deal with the additional
steps involved in bypassing the paywall. Who are these readers? Readers with
lower disposable income, younger readers, and light readers.

The result of this segmentation is that the New York Times has been able to
attract a significant number of online paying subscribers (segment 1), without
decimating its overall readership figures (segment 1 + 2). By maintaining its
overall readership figures, the New York Times has been able to preserve its
online advertising revenue.

\------

[1] Since the product is nearly the same for both segments, aside from the
steps involved in bypassing the paywall, you might consider this as an example
of price discrimination.

~~~
tripzilch
I never identified any workaround. In fact, I never even identified this
paywall. I just have my browser set to throw away cookies on exit, except for
a small whitelist of sites I want to stay logged in to (Opera can keep per-
site preferences, but even before I found out about that feature, I preferred
not to keep my cookies around forever). Assuming that's the "workaround", it
appears that I have never read more than 10 NY Times articles per browser
session, since they started doing this.

I also keep a rather extensive blocklist of URL-patterns I don't need my
browser to load, ever. It took quite a while before I noticed (on a friend's
computer, about 1.5y ago) that YouTube makes you watch ads before a video. I
actually have no idea how that particular URL-pattern got into the blocklist,
since I honestly hadn't seen those ads before. I _suppose_ I was messing
around with the webdev tool one day, noticed some resources that seemed
unnecessary, I disabled them, videos continued to work fine, and forgot about
it.

I realize this places me securely in the second segment, of course.

------
daenz
There was a recent NY Times story I took a look at. I didn't read it, only
scrolled through it, but I was impressed at how immersive the experience was.
It had full screen animated backgrounds that scrolled in, with beautiful white
titles overlaying. It reminded me vaguely of a graphic novel, I wish I could
find it again. It was something about mountains and snow, possibly some kind
of rescue story.

~~~
rch
This is the one you want: [http://www.nytimes.com/projects/2012/snow-
fall/#/?part=tunne...](http://www.nytimes.com/projects/2012/snow-
fall/#/?part=tunnel-creek)

~~~
Groxx
That is an extremely shiny article, but I dare say it actually pulls it off
quite well. Thanks for the link!

------
downandout
The paywall is extremely simple to bypass using Google as the referrer (just
Google _site:article URL_ and click over from it). They do the Google thing to
avoid a potential cloaking penalty which would get them de-indexed altogether.

So the interesting part of all of this is that people choose not to bypass it
and pay. The reminder that they need to pay alone seems to be working.

~~~
ngoel36
Wall Street Journal does the same. My guess is that it's intentional - they
don't want to necessarily block you from reason their content, just convince
those who can to pay.

~~~
thefreeman
It's intentional, but not because of that. In order to be indexed, they have
to show the content to google. It is against googles TOS to show them content
and not display it to visitors referred by their index.

~~~
wahnfrieden
This is incorrect, there is special allowance for paywalled media to serve the
content to googlebot but not necessarily all Google referrals.

------
austenallred
This article, and many other similar to it, completely miss the point. (Or
perhaps, beg the question we are all waiting for an answer to).

I don't know if anyone ever debated the notion that paywalls will produce
revenue, and it's great that the NYT earns more from its paywall than many
industry analysts expected.

But the fact is, even at the revenue levels that it may produce in upcoming
years, it still costs more to produce that content than people are willing to
pay for it. This is the big hold-up with journalism. Even if people will spend
a billion dollars a year purchasing your newspaper, if it costs you two
billion dollars to produce it you're screwed.

~~~
personlurking
Not to take the focus off of your point, but the phrase "beg the question"
caught my eye due to reading about it recently. I recommend the section below.
Cheers

[http://en.wikipedia.org/wiki/Begging_the_question#Modern_usa...](http://en.wikipedia.org/wiki/Begging_the_question#Modern_usage)

~~~
joe_the_user
The thing is that "begs the question" has such nice ring to it even when used
incorrectly.

I'd say most people mean "the question remains..", "...fails to answer the
initial question" or "...leaves the question X unanswered" when they say
"...begs the question". Unfortunately, none of these more correct phrase have
the same flourish. What to do...

------
venomsnake
The fun part is that the paywall is extremely porous. There has never been a
case that I could not access a nytimes content because of the paywall. Sadly
their pricing is above what I would consider good value for money so I am not
a converted subscriber yet.

I am glad that this is working model/experiment. To not alienate much of the
eyeballs while putting effort to make the paying subscribers experience
better.

~~~
danking00
So, I subscribed for a couple years, but cancelled six months ago when I left
the country for a sojourn in Europe. I am returning to the States next week
and I fully intend to re-subscribe to the Times.

I'm curious what price you would be willing to pay for access to all of the
Times content.

Personally, I find that 15 USD a month is a fair price for an abundance of
news that seems high quality (perhaps I've been duped?). There's all the
multimedia, the arts section, the magazine, and, of course the news (both
world and US).

Do you not enjoy as many sections as I do? Or do you share my interests but
find 15 USD too steep a price for the content?

I also wonder, does means affect your choice? I recognize that the value of
money is sometimes inversely related to how much you have.

~~~
DanBC
I'm not interested in reading all of that the Times.

$15 per month is too much for a bunch of content that I'm mostly not
interested in.

In theory I'm paying £200 per year for Wall Street Journal; £270 for Financial
Times (standard, not premium); £117 for the Economist - well, these three are
nearly $1,000 per year. Add in a UK daily paper (because that's where I live);
and Private Eye, and something like Monocle and the costs are easily over
$1,000 per year.

So, I gently write to newspapers and ask them to include tipjars on articles
(so they know how much people actually value good writing); and I leave ads
turned on but ask for single-article payment systems to allow me to view ad-
free articles; and I hope that something gets done to implement micro-payments
because it'd be awesome.

PS: Why are newspaper websites so awful?

(<http://www.independent.co.uk/>)

(<http://www.telegraph.co.uk/>)

EDIT: Here's my complaints screenshoted.

(<http://imgur.com/a/V00kO>)

~~~
danking00
My orginal parent post claims that a month of NYTimes content isn't as
valuable as/worth 15 USD.

Are you saying the NYTimes is not a good value or that, it's simply not a
product you seek because you're already amply satisfied by WSJ, FT, the
Economist, etc.?

It just seems weird to me to call something too expensive when the real reason
is that you've already purchased it, just from someone else.

Unless you think the cost to journalistic quality ratio of the aforementioned
papers and magazines is superior to the NYT?

~~~
DanBC
If I want all of it it's worth $15 per month.

I don't want all of it. I want a couple of articles a week. Those articles are
worth $0.50 at most to me; but probably much less. (I have no idea how much
they'd get for ads for my view for any articles I want to read).

I mention those other journals because there is so much good journalism that
buying all of it for a whole year is not practical for most people. People
will pick and chose. At the moment they chose to include one paper for a year
and exclude other papers for that year. But it'd be better if they could just
pick and chose and pay for any individual article they wanted to read.

------
knowaveragejoe
I work for a niche newspaper that also employs a paywall - in short, it works
great for us. Used correctly, the concept works well for anyone who _produces_
compelling content rather than simply regurgitating the content of others.

Looking forward, Google's attempt at replacing paywalls seems compelling and
definitely a step in the right direction(I'd like to give away all of our
content for free), but it needs to be refined. There is no guarantee the
surveys will deliver accurate results.

~~~
kragen
Are you doing the same kind of thing the NYT is — 10 articles a month free, or
unlimited if you're referred by a popular site? Or do you have a different
strategy?

------
kibwen
While the porous nature of the paywall makes it pretty brilliant, I'm having a
hard time actually hitting it at all.

See if you can reproduce this. Go to nytimes.com and just start clicking on
different stories. After about 10 I got a little popup saying "This is your
last free article of the month", but the next few articles still displayed
with no problem, with the exception of a single full-page click-through ad at
one point. Have clicked on about 50 articles now with no impediment. Pretty
curious. Does it only count clicks coming from external sources? If so, why
does it tell me that I'm on my "last free article" after clicking around for a
bit?

Running Firefox on Linux, with no funny business except Ghostery, which I have
configured to let ads through.

~~~
codewright
> I'm having a hard time actually hitting it at all.

> Ghostery

So I take it you don't know what Ghostery does? That's why you're not bumping
into it.

~~~
jamesbritt
I use Ghostery and still hit the paywall. I don't recall ever setting anything
regarding any nyt domain.

------
rubyrescue
What's remarkable is the solution to the paywall is "cmd-L, cmd-C, cmd-
shift-N, cmd-V, enter". This will get you through the paywall 100% of the
time. Replace cmd with ctrl on a PC. I want a T-shirt that says this. I've
tried to teach some less-tech-literate friends but they just can't remember
the commands. They don't understand that just pasting the link into incognito
mode in chrome or firefox will give them the content, so they pay.

~~~
MichaelApproved
What's wrong with paying for a service you like using? It sounds like you're
upset that they aren't trying hard enough to steal content.

~~~
dhimes
I agree, Michael. The best way to solve the privacy issues we face is to show
businesses we'll pay for services or content we like. We may be picky, but
we'll pay.

Disclaimer, but hopefully not a disqualifying one: I'll be launching a paid
subscription service next fall.

~~~
prodigal_erik
How do I pay without providing my True Name? Unless anonymous digital payment
becomes commonplace and widely understood, paywalls are one of the biggest
threats to privacy. At least with the dead tree edition, they didn't know
exactly which articles most interested any subscriber.

~~~
dhimes
I can't answer for anonymity- to me that's a separate question. I'm referring
to the spreading of information that I've trusted one seller with. For
instance, I'll give the NYT my true name and email, but I don't want them to
give that information to real-estate developers in FL because they've profiled
me to be an old fart.

------
tyrelb
because the content is good and original - not like most of the other dailies
/ content farms out there... as a subscriber - love it!

------
malachismith
Wait.... this article makes no sense. So subscription revenues are going up,
and subscription revenue as a percentage of total revenue is going up. That's
great. But why is this an indication of success of the paywall? Seriously...

~~~
kgermino
I don't understand your confusion. The only legit way around the pay wall (the
pay) is to subscribe to the Times. Since the pay wall more people are
subscribing to the online and dead tree versions of the paper. These extra
subscribers pay money, which is more revenue for the Times.

Paywall limits access to people who pay (subscribers) => more people pay =>
Times gets more revenue. What's not to understand?

~~~
malachismith
You can make a (stretch) claim at correlation just like you did, sure. But
correlation (stretch or otherwise) is not the same as causation.

~~~
kgermino
True, but unless Im mistaken there is an online only subscription, the sole
purpose of which is admission past the Paywall. If nothing else, every dime
generated from that is related to Times decision to sell an online product.

Additionally, in print media, subscriber revenue surpassing advertiser revenue
is _huge_ and not something that would be likely to happen without a
successful digital product for a couple reasons.

Beyond that, yes, there's nothing here but correlation. However I think there
is enough in the first two paragraphs to make a case.

~~~
malachismith
As a former publishing professional, no - there isn't. If the article were to
differentiate between online subscription revenue and print subscription
revenue, and were to control for other factors that ALSO drive switch to
subscription, then you could make the case that the paywall is "working."

------
Benferhat
You have to take into account the enormous amount of money the NYT is spending
to advertise their paid online service. I've seen countless ads on television
and other types of media. Anyone can build a subscriber base with that kind of
ad blitz.

The question is, how long will these subscriptions take to pay for themselves,
and will paid users stick around that long?

~~~
jspthrowaway2
> _Anyone can build a subscriber base with that kind of ad blitz._

Advertising isn't that simple; if it were, it'd be a lot different.

~~~
Benferhat
Isn't that simple, as simple as _what_? Part of what you pay for in a large ad
campaign is for people to attend to all of the complexities.

Spending tens of millions of dollars airing the high-quality commercials that
the NYT had commissioned? I doubt what they did was simple, but it was damn
sure expensive.

------
mjcohenw
I'm one of the happy subscribers. I prefer the mobile site, even on a Mac,
because I find it easier to read and navigate.

On my Nexus 7, I use Firefox instead of Chrome because (1) I can use stylize
to make it white text on black background, and (2) it has a built-in reader
that makes the articles easy to read.

------
programminggeek
A paywall can work for the same reason iTunes works. Most people aren't
thieves and are willing to pay for quality things. In short, make something
good and charge for it. That business model has worked for a long time and
will continue to work for a long time.

The biggest "problem" is that it will be harder to build as many giant media
companies around general news distribution. On the other hand, a bunch of
smaller players will have a chance to flourish. A lot like modern digital
music.

------
chrisringrose
Proof that paywalls are bullshit: "the company is expected to make more money
from subscriptions than from advertising — the first time that’s happened."

In other words, they're charging so much, and the cost of digital distribution
is so low, that they're making a ton of money from this paywall. They
shouldn't be. Advertising should be the bigger source of revenue. It's like
the government running at a massive surplus - time for a tax cut.

~~~
corin_
Where does this opinion come from? You wouldn't get in a taxi and say "you're
making more money from customers than advertisers, stop overcharging me", what
makes you think that with digital publishing advertising _ought_ to bring in
the most revenue?

~~~
chrisringrose
This is an article glorifying one exception in a sea of rules. This article
gives the false impression that a paywall is a good idea for news sites, (and
perhaps some will extend this to any kind of site, pointing to the success of
the NYT).

The NYT can rely on its name: we all know it's good, and its been around
forever. Their target audience is the educated middle-upper-class. Many will
pay, and they'll make money.

But very few existing news organizations could successfully implement a
paywall, and zero _new_ organizations could. The only really successful
business model on the internet has been "freemium", and free, but ad-based:
Google, Facebook, etc. So this one exception occurs; great. But I'm saying
lets not all get excited and start suggesting that next tech startup launch
with a paywall. "But the NYT did it successfully" will be their last words.

------
chj
If that is working, then it is because they did a great job in content
creation, not because of some fancy business strategy.

I was trying to subscribe to NYT months ago because a wonderful piece they did
and I thought I should offer my share of respect. Unfortunately I tried with
Paypal many times for about one hour and still couldn't get the payment
through. Then I gave up.

------
thisismyname
Goes to show that content is king and people will pay for content they want or
think they need.

------
ed_blackburn
Wondering out loud..so, when are we going to have a micro-payment standard?
i.e. I want to read content on any content provider without having to jump
through cumbersome hoops?

I wonder if Rupert Murdoch has been approached by Facebook or anyone..?

------
ianstallings
They should consider that charity considering how much of a joke it is to get
around. I know that sounds a little snide but as a programmer I cringe at it.

------
rdl
How has it worked for WSJ?

------
jspthrowaway2
It's an interesting reflection on the Hacker News community that a not-
insignificant portion of these comments are about circumventing the paywall.
(I count 13 of 53 as I write this.) There are a number of conclusions to draw
from that, some of them thin, some of them interesting, some of them
depressing.

I pay $20/month to read the _Times_ in bed on my iPad. I mean, it's five trips
to Starbucks/Peet's/whatever, guys. The majority of you are programmers
clearing high-five or even six figures for, in the grand scheme of things,
easy work (not exactly breaking rocks, are we?). Don't forget, those of us who
even know how to edit cookies or alter referrers are a small minority; the
_Times_ doesn't care if _you_ bypass it because they know _you_ will no matter
what.

~~~
rednukleus
"I pay $20/month to read the Times in bed on my iPad. I mean, it's five trips
to Starbucks"

If I have ever read a comment that summed up HN perfectly, that was it.

~~~
jspthrowaway2
It's the most applicable comparison I could drum up. You could also say it's
one typical lunch for two people.

It only keyed in my memory because I watch people pay $4 for coffee _every
work day_ but balk at something that's $80/month, or even $20/month (in this
case). Perspective is strange.

~~~
rednukleus
I don't mean to sound snarky, I just thought it was a wonderful summary of the
stereotypical HN reader - reading a paid Times subscription on an iPad and
comparing the value to Starbucks coffee.

~~~
jspthrowaway2
Definitely not comparing value. Comparing cost.

~~~
pretoriusB
The same thing. I believe he was pointing at the "well-off white male /
hipster" smell of it all, not implying that they underappreciated the NYT.

