Paid digital content opens new revenue opportunities


The hot topic at newspaper conferences these days surrounds paid digital content.

Newspapers Canada staged a panel on the topic at its spring conference in Toronto. The Newspaper Association of America (NAA) did the same at their annual conference a few months ago, and the INMA Audience Summit will have a debate on the topic in October.

In the past few years, newspapers have chosen different positions on the issue, with five main business models emerging:

  1. Free and open: No payment or registration of any type required. The Web site is wide open and relies on advertising or sponsorships to cover costs. Newspapers such as The Toronto Star and The Washington Post currently use this approach.

  2. Closed: Content only available to paid subscribers. The Times of London is one of the notable publishers taking this approach to their Web site.

  3. Freemium/editors choice: In this model, the newspaper editors select what content will be free and what content will be behind a paywall. The Dallas Morning News and The Wall Street Journal employ this technique.

  4. Metered: Appears to be the rising star with a large number of publishers, led by The New York Times, charging for content only after readers have read a certain number of articles.

  5. Free/closed combination: Substantial free content is available on Brand X while Brand Y holds the premium content behind a paywall. The most notable examples are and

The wide range of options reflects the circumstances of the local market. While the metered model seems to be gaining the most traction, publishers using the other models make a compelling case for their business model. 

The open model seems to be waning. Newspapers have used this model for more than 10 years without a business case developing for it. The closed model may work in some markets, but conventional wisdom seems to indicate it is too restrictive. The model is interesting, but might be difficult to implement in most markets, leaving the metered model and the freemium model to duke it out for supremacy.

What I like about the freemium model is how the publisher controls the content. Columnists, investigative reports, and special content areas are all relatively easy to distinguish as special and something that readers should pay to see.

The marketing message to the consumer is a relatively simple one. The obvious downside to this approach is that you will virtually never find new readers. Only those loyal to your brand are likely to convert to paid.

When a publisher chooses a metered approach, a free trial is still encouraged because readers are not prompted to pay until they have hit a selected number of articles, such as five in any given month. At that point a marketing message would appear, communicating the nature of the pay system.

Except for The New York Times, the experience to date has shown relatively small conversion levels. However, this approach has the ability to gain traction. The main downside for the metered approach is the ability of the consumer to avoid the pay level using numerous tactics, tracking usage, using various media sites, or accessing content on multiple devices.

If the meter is set at 10, and I have a laptop at home, one at work, a smartphone, and a tablet, I can do a lot of reading and not be required to pay. All of us, though, hope many readers enjoy our brand enough not to play these games.

Both the freemium and metered models offer publishers a significant upside by maintaining most existing advertising revenues. Both models, though, do somewhat limit the upside of audience growth of the publisher’s brand.

Paid digital content, properly managed in conjunction with your print subscription base, could be a nice revenue source for publishers. Imagine sourcing a new revenue stream via digital and stabilising or growing your print revenues at the same time. Many publishers are already reporting success on both fronts.

Key to this revenue growth is that it’s the paid digital content leap that acts as the catalyst for other print opportunities. Paid digital content is a developing trend worth following.

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