Paywall inevitable – Herald boss

A paywall for the Herald website is inevitable, says its publisher's CEO.

The APN newspaper launched a new-look website last night, and its tabloid format in print this morning.

“I think inevitable somewhere in the future there’ll be a paid model for online,” APN CEO Martin Simons said on TVNZ’s Breakfast this morning, echoing recent comments by Herald editor Shayne Currie.

“In the Melbourne market very similar to Auckland where you’ve got two major publishers, News Ltd has moved to a paygate and we’re looking at that and I think inevitably we’ll get there at some stage,” Mr Simons said.

Asked if a paywall would happen in the next three to five years, Mr Simons replied, “Possibly in that sort of time frame. It really depends. The world is moving to that sort of space.”

He added, “I think as newspapers around the world become challenged, you do have to find a mechanism to pay for the journalism.”

Tabloid economics
Mr Simons said ad revenue would not be hit by small ad size in the new tabloid print edition. “Generally people who had a full page in the broadsheet are going for a double-spread in the tabloid. So it’s roughly equivalent.”

This morning, at least, the first two full-page display advertisers (New World and Noel Leeming) had singles.

Hints of a shift in editorial emphasis between print and online were not immediately apparent this morning as both editions led with the same David Bain story.

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Herald paywall inevitable – editor comes clean

Sept 3: It is inevitable APN will put a paywall around the Herald's website, editor Shayne Currie says.

Appearing on the Media3 TV programme at the weekend, Mr Currie was asked about rumours that nzherald.co.nz content would be put behind a paywall next year.

"I think see it as inevitable," he told host Russell Brown. "I can't see it not happening.

"We can't go on in the way we are at the moment," Mr Currie said.

"If we want to fund journalism and keep quality there has to be some kind of monetisation of the internet."

He admitted an early Herald effort at subscriber-only content, focused on columnists, did not work.

"I think New York Times model works best of all of all the models we've looked at overseas," Mr Currie said.  "So 20-30 stories that you might get for free and then pay after that."

The Times began its metered paywall last year by giving readers 20 free articles. It recently tightened that to 10.

Mr Currie added that "we have to take into account what we do for our subscribers that are buying the paper every day, whether they have certain access to the website that others might not", indicating that print subscibers might get a discounted or free or online subscription.

This is a common model for mainstream newspapers overseas. NBR ONLINE, which has largely unique content to the weekly print edition, offers no discount.

Barry Colman, whom on Thursday revealed he had sold NBR to CEO Todd Scott, also featured on the episode (watch it ondemand here).

The outgoing publisher said uptake in NBR ONLINE subscriptions had helped balance a decline in print.

Mr Currie was seen chatting with Mr Colman after filming of this week's Media3 finished on Wednesday night. If it was paywall numbers the Herald man was after, he may have found them encouraging.

NBR recently said it had just under 3000 individual paid subscribers, plus some of New Zealand's largest companies on its fast-growing new IP subscriber programme, which lets all staff in an office access NBR ONLINE without logging on. See the latest member list here.

The New York Times has enjoyed apparent success with paid online subscriptions, but the situation is clouded by the fact print subscribers have the option of taking free digital access.

NBR head of digital Chris Keall says people often put an NBR ONLINE subscription on their work expense account or take advantage of a group subscription bought by their employer.

Others are motivated by the fact paid sites like NBR ONLINE and Consumer.org.nz help them in their work, or help them save money.

Mainstream news is a tougher sell, and more so when so many free options are available. 

Fairfax's flagship metro titles across the Tasman – The Sydney Morning Herald and Melbourne Age – will move to paywall model early next year.

But Fairfax NZ CEO Allen Williams recently told Mr Keall his group has no plans to introduce paywalls for its New Zealand properties, which include stuff.co.nz.

With online ad yields remain miserably low for mainstream news sites, many publishers question whether there is any point to having the most online traffic, Mr Keall says.

Subscriber-based online content at least deliver advertisers a qualified audience, mimicking one of traditional advantages of print.

WHERE'S THE AD MONEY GOING?

Recent advertising trends emphasise the need for online publishers to seek alternative sources of revenue.

Advertisers are following eyeballs online, but favouring search engines, directories like Yellow and classifieds (including Trade Me, 51% owned by Fairfax) over the display ads commonly sold by mainstream news sites.

The AFR estimated Google (which bills Australasian ads to its tax-haven subsidiary in Ireland) sucked more than $1 billion away from traditional media across Australia and New Zealand last year.

Source: Advertising Standards Authority. Click table to enlarge.

Source: IAB. Interactive = internet advertising. Click chart to enlarge.