There has been much jubilation from certain quarters of the news that The Times paywall is deterring users. The paper has been charging customers for its online content since June and it now costs £1 a day or £2 a week. According to Hitwise, there has been a 66% drop in traffic and some analysts estimate that the site now has only 15,000 users.

It should come as no surprise that there has been a sharp decline in traffic, most news sites are free, and stories from The Times no longer appear in Google News. However, the ‘I told you so’ crowd is claiming victory too soon. Murdoch et al are far from finished and even if the site has only 15,000 paying users, that’s more users than any other UK newspaper website.

Placing a premium on content

The truth is that advertising simply doesn’t pay the rent for many publishers and the extra harsh weather of 2009 saw titles shut down and journalists laid off en masse. I question the sanity of any journalist who doesn’t want the paywall to succeed (even secretly). If he does, he puts the content back at a premium and reconnects the user with the business model in a way that advertising doesn’t. Click-through rates on skyscrapers and banners are a mere fraction of the total traffic on any given site.

Personally, I don’t even see ads when I browse the web thanks to a very useful app called Adblock Plus, one of Firefox’s most useful innovations. Everyone involved in online media can appreciate how vulnerable advertising-centric business models are to publishers and everyone is looking for alternatives.

incentives

News International’s commitment to this project should not be underestimated. It’s a bold move, but his pockets are deep and I predict he will go on for many months, if not years, before conceding defeat. There will be some trial and error along the way, but the company can afford to play the long game. Your marketing team will be constantly coming up with new ways to entice users to spend just £2 a week on your services.

In truth, this will be an easier sale than many initially thought. After all, how much incentive do you need to spend £2, or even £1 a day? News International is a vast media empire and you have options to create any number of packages and extras in exchange for your pounds. Also, once you’ve signed up, how much effort are you going to put into unsubscribing? Curiosity will also play a role. Is it better than other sites? Is the content more interesting? Do you want to find out? It will be £2 please. Can you really not afford that?

Exclusiveness

Perversely, the disappearance of The Times from Google could help its paywall. You don’t feel very special reading a story that three million people have already seen, it’s not even worth tweeting. In fact, The Times is already talking about creating a ‘club feel’ for its readers and everyone likes to join clubs. Rupert Murdoch might not be the president of your favorite club. But he has already made us pay more for television and football matches. My bet is that he will do the same with the news.