2010: The Year of the Newspaper Paywall

The Economist declares 2010 "the year of the paywall." Newspapers will try to make readers pay for news next year, it predicts, because ... well, they have no choice. Online advertising pays pennies to the dollars publishers get from print ads, classifieds are doomed, and total advertising has been in a free fall for the last year. What's more, newspapers that are charging readers, like the Wall Street Journal and the Financial Times, are generally considered success stories.

I'm interested to watch the paywall revolution for two reasons: (1) The future of online journalism has a not-insignificant impact on my rent money; and (2) I would consider this a good business move even if I wasn't in this business.


Although the WSJ and FT are considered successes, they're also considered islands. "Those are just the financial newspapers," other publishers tell themselves. "They can support a different model because they have a different audience." So this is what I think will happen. One major publication -- possibly a Murdoch paper -- will announce that it will give readers 10 or so free articles a month, and then it will shut down free access to your IP address unless you register and pay a small fee. Other publishers will wait to see what happens with traffic and revenue. If the results aren't disastrous, another big paper will try something similar. And then another. And then another.

As for readers, I don't think this should seem terribly apocalyptic. As Marion Maneker points out, millions of Americans choose to pay for cable TV, because it offers content they want to watch. This is how media works, and how it has worked for hundreds of years. The '00s represented a brief vacation from history where consumers learned to expect that reading news should be entirely free online. Fifty years ago, that would have seemed crazy. Fifty years from now, I think it will seem equally crazy. But before the journalism business loops back to history (and hopefully to something resembling profitability) we need more walls.

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Derek Thompson is a senior editor at The Atlantic, where he writes about economics, labor markets, and the entertainment business.

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