Wednesday, August 01, 2012

Post-Star paywall gets bigger

The Post-Star seems intent on making its reach as small as possible, somehow calculating this will help their bottom line. Despite plummeting quality, such as managing to misspell the name of its own hometown in a baseball box score yesterday, and a rapidly shrinking workforce, the Glens Falls daily has seen fit to nearly triple its newsstand price in the last few years.

On May 1 of this year, the paper announced that it would be imposing a paywall on its website. Users would be limited to 15 free article views per 30 days.

Apparently without warning (I can not verify this due to the restrictions), the paper at some point recently has reduced this to 10 free articles.


Stephen said...

The Guardian in the UK is one of the few papers that has really broken down how much they make on their banner ads. It turn out that they made 23 million dollars for all of 2011 and had to slash their newsroom by 15 percent. A great paper is dying because their Harry Fucking Potter imbecile dreamer publisher Alan Rusbringer thinks he's gonna master the web. Meanwhile the NYT just announced that they grew revenue. They GREW revenue, for the first time in ages, and it is ALL due to the paywall. Meanwhile, an arguably superior paper across the pond is killing off its reporter staff because its callow publisher is enamoured with an undefined futurism and not making a financially feasible operation. We will all suffer greatly.
As for The Post Star- it seems to have lost half of their pageviews and a sliver of their readership. According to Quantcast, people are still coming, and coming just as often, just clicking fewer stories. It is hard to know how much the PS was making pre-paywall, but if the Guardian is any guide, it was not much. Using the same meterics as the Guardian, (a huge assumption, since the Guardian get get much better ads than the PS), the PS was making probably 6k per month in revenue on banner ads. They have lost half of their pageviews, but keep in mind that digital ad revenue has not fallen by half. Did you ever notice the syndicate ads that used to be on the PS website? The weight loss crap and insurance crap? That remnant-rate inventory is what the lost and it was probably no more than a thousand bucks a month in revenue. If the PS has managed even 200 subscribers, they are doing better.
The Guardian shows us that reach means nothing. Reach is what the Guardian has, and it is covered in red ink. Revenue means something. Revenue is the final metric. Reach used to correlate with revenue but not anymore.

Brian said...

Links to cited stats would be useful in such comments.

Stephen said...

Here are the stand-alone revenue numbers at the Guardian. The figure of 23m in pounds is 14.7m.

And then a general view of their woeful financial condition

My estimates of reveue are based upon the following math...that 23million dollars (converted from pounds) divided by 60 million users makes for less than 40 cents per unique user per year. Per Quantcast, the PS has about 200,000k unique users, so this would make for $80,000 per year in digital advertising revenue, or $6,666 per month.

This assumes of course that the PS gets as good of advertisers that the Guardian does....
I am not saying that a paywall will save the
PS like it has clearly saved the NYT, but it is a better option right now than digital advertising. Heck...shutting down the website may even be a better option. (only half joking) ANYTHING would be a better option for the PS than relying on digital ads to fund their website. They will be bring in scads more money with a paywall, at least for now. This may provide an opening for small-time talent like Howard Owens and his wonderful Batavian, but I am skeptical. I have been hearing about local blog scenes taking over news for 20 years and The Batavian has only a dozen or so other cohorts as successful as it is.

Brian said...

They have roughly the same number of unique users, just each going there less frequently? That's a self-evident, entirely predictable result.

I doubt numbers are available, though I could be wrong, but I'd be surprised if the Post-Star is getting $6,666 a month in paywall revenue.

Stephen said...

Well, it is important that they are keeping their audience, even if that audience does not come around as much. More problematic would be if they lost people forever, which may still happen.

I doubt the PS paywall is getting $6,666 at this point too, but they have probably made dozens of times the amount on the paywall that they have lost in advertising revenue.

Here is why: Newspapers rarely sell more than 50% of their digital ad space (i.e. number of pageviews X number of ads per page). The rest of this 'remnant' ad space gets sold to ad syndicates, for whatever the paper can get, kinda like a hospital will sell an outstanding bill to a collection agency for whatever the hospital can. These 'remnant' rates are vanishingly small, sometimes as little a few cents per thousand pageviews.
This is why the PS lowered their pageview threshhold to 10. In part to pressure readers to buy, but MOSTLY to squeeze out their remnant advertising, I presume. Indeed, why, as an advertiser, would you buy directly from the PS for 40 dollars per thousand pageviews, when you could but it from an ad syndicate for literally pennies?

This is the problem all papers face with free web. No pricing power. The Batavian avoids this by not dealing with ad syndicats and having an amazing relationship with the community. This is, of course, the ideal, but seems hard to replicate elsewhere.

Brian said...

The difficulty with the paywall is that the print newspaper is a tangible item. It's distinctive from other media. It has a look and a feel. Reading a newspaper is a distinctive experience. Reading a newspaper online is just another another news website.

And, I've said this countless times, as long as newspapers like the PS continue to follow the increasingly outdated model of trying to be something for everybody, they will struggle. If you want people to pay for something, give them something worth paying for. Mediocre, badly massacred AP articles aren't worth me paying for. Good local journalism is. Stop wasting money on the crap people can get better for free elsewhere. Pour the resources into good local journalism.

Anonymous said...

NYT hasn't been saved by it's paywall.

Brian said...

Anon: Ugh... also on the list was AMD, which NYS is subsidizing to the tune of over a billion dollars.

Stephen said...

That article is garbage...
"The Times has not been able to show significant top-line growth, even with its digital subscription efforts."
This is wrong. The New York Times has been showing topline growth for over a year. The entire company is also now growing revenue. This man is saying that 2+2 is 5.
Just cause someone says it on a finance site does not make it true. Here is an actual company filing.

Oh...and that gentleman probably did not hear that online subscriptions have been accellerating, not shrinking, the exact opposite of what new media pundits predicted.

Stephen said... for your comments on local journalism, you are totally correct. I could not agree with you more. Local is the only way to go. The AP model in general seems quite outdated. Considering that the AP is owned by newspapers collectively, it is a wonder that they dont just shut it down. All it does is produce bland copy that no one cares about. I say keep the international bureaus, and shut down the national operation. The AP seems a relic of an era when information was harder to transmit. Get rid of it I say. Kill it off.

Anonymous said...

okay okay we get it stephen. you object to "new media". the dead horse has been flogged enough