Monday, June 28, 2010

Gannett's paywalls

A low-key announcement buried in the business briefs of my local (McClatchy) paper this weekend alerted me to the impending pay wall going up at Gannett's Greenville News beginning Thursday.

It's an interesting experiment by Gannett that hasn't gotten the play I think it probably deserves -- and that's probably because everyone has long since tired of the pay wall debate. But this is one of the world's top media companies, and I suspect the paywalls going up in Greenville, Tallahassee and St. George, Utah. portend an experiment that not only Gannett, but also the entire industry, will be watching closely. (The announcement was followed in St. George by promises of a lot more great material in print online.)

As Steve Buttry rather acerbically points out - and right on target - each announcement buried the lede, telling people how much their paper spends to do great things for them instead of getting to the point that they would now have to pay a minimum of about $120 a year for basic online access. (I also find myself dryly wondering if the papers will leave those announcements up and out from behind the paywall.)

The Salt Lake City Tribune article that Buttry points to at least gets the important news in the lede - this is an experiment by Gannett, a seemingly desperate one from the sound of it, to figure out if some - any - kind of pay wall will work.

That Greenville was chosen makes sense to me. It's a midsized paper of nearly 100,000 circulation in a middle-class city with a stronger economy than most these days, an economy that also has an international flavor with the likes of BMW and Michelin.  Tallahassee, being a state capital town, has a similar if slightly different profile. I don't know enough about St. George to comment other than that it is a smaller paper in an isolated area, but from what I read it seem to have an above-average income and high online use.

Greenville allows Gannett to test this in a somewhat more competitive market. Along with two TV stations with robust news departments (a third station is in Asheville, N.C.), there is the nearby daily Herald-Journal of Spartanburg, a smaller but nonetheless substantial alternative source of news. It is a N.Y. Times regional paper that also has a smaller paper under its wing in Hendersonville, N.C. (about halfway to Asheville). While the Herald-Journal does not normally cover Greenville (25 miles to the east) regularly, it could conceivably look at doing more regional news. There also is the Greer Citizen, a smaller twice-weekly paper between the two cities that covers Greenville County.

In other words, there are plenty of alternative sources, but it's a smaller market so Gannett does not have to risk the potential of a "failure" that could bring more unwanted publicity it done at one of its larger papers, such as Indianapolis, Rochester or Phoenix (or in a major media area like White Plains, N.Y.).

(Greenville also has been a good place to experiment with other things. It was one of the first of Gannett's bigger papers to be almost entirely copy edited and designed elsewhere - Louisville, Ky.)

When he left Gannett earlier this year, the company's chief digital officer, Chris Saridakis, warned against paywalls implemented in the traditional ways, as this seems to be. He pushed for charging, but for specialized packaged delivered how the user wanted them.

Gannett is not known for being loquacious about its business, but I hope some information on the results of this do come out and with a bit more publicity than I've seen about the initial announcements. If these are successful, they could have a major impact on newspaper sites throughout the country because, as we know, other chains have never followed Gannett's lead ...

I thought this was an interesting observation from "Partisan62" in the comments to the Greenville story:

This so called business model is like charging us to enter the store to browse. How about charging for access to GN original content (like those wonderful sotries on the symphony or the phony writeups of local homes) and leaving the comments and forums free? We post our thoughts and generate that content (not GN) while we look over those great rollover ads and banners.
(Update 7/2): Checking the Greenville site, it appears the comments are remaining under free access.

A lot of the comments on all three sites basically come down to this - we're willing to put up with the ads to read what is there because it isn't all that compelling. Start charging, however, and the content doesn't measure up to the value.

Update thought: In recent years, AP bureaus have come to rely on newspaper and broadcast Web sites as a quick way to pick up stories throughout the day, instead of having to rely on the old, weirdly named "electronic carbons," which were direct feeds into AP's system from member computers. I wonder if Gannett will grant AP continued free access to the sites.
Update 7/2: Bill Mitchell's Poynter column on the experiment.

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At 7/8/10, 2:49 PM, Blogger AGS said...

Doug -

Nice piece and I think it's certainly an experiment that the rest of the world will be watching.

The paywall, however, will be a failure. Traffic will decline and revenue won't make up for it. It's a simple equation online. Friction means people go elsewhere, or give up - and the money is only a small part of the friction generated between me, the reader, and the story I want to read.

I recently went through the process of getting around the paywall on the Tallahassee Democrat, one of the papers in question. I wrote a blog post about it here:

The experience was terrible, and after completion I saw a 500 word article with flashing banner ads all over it, which left me asking....what did I just pay for?

At 7/8/10, 9:37 PM, Blogger Doug Fisher said...


Yours is also a good post and highlights something that too few think about - the costs go beyond the monetary to the transactional, and things that cost me too much energy, both physical and mental, have high transaction costs and are more likely to fail.

Not sure what big-G was thinking on this -- if it was thinking at all -- except to see a) how much data it could gather for later marketing lists and b) make it hard to see what readers' thresholds really are.

I don't sense Gannett see this as a winner or a failure the same way you do; I think it really is trying to get some data on where the balance point may be and what kind of content stands up best behind a pay wall (think Clemson sports). Even if that data shows a greater drop-off rate, I'm not sure in that frame that G would call it failure.



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