It’s been a little more than two years since the New York Times Company introduced the controversial metered paywall for its online content. In the face of declining print revenues, the company felt it had no choice but to stop giving away its content for free.
Two years later, the New York Times and International Herald Tribune have 699,000 paying digital subscribers, which is remarkable given the reluctance of many people to pay for digital content. More importantly though, the paywall appears to work on a monetary level as well.
In seven out of the nine quarters that have been completed since the paywall’s introduction, overall revenue of the Times Media Group increased. Only slightly so in many cases, but still, the negative trend has been stopped and slow growth is better than continuous erosion.
However, there are people that argue the Times could be better off without the paywall. There are several ways to monetize online content. One of them is charging for it. Another one, which is much more common, is advertising.
The Times’ decision to restrict access to its online content was, to some extent, a concious decision against advertising. Ever since paywall was introduced in March 2011, advertising revenues have declined more or less steeply. In many quarters that decline has been offset by rising circulation revenues, but there’s a limit to digital subscriber growth. Those who argue against the paywall expect that limit to be reached pretty soon, whereas online advertising will continue to rise.
It will be interesting to observe who will turn out to be right in the long term. In the short term, it appears, the paywall is paying off.
You will find more statistics at Statista