July 24th

A paywall paradise lost

The sale of the Financial Times this week and potential sale of sister publication The Economist highlight how successful newspaper paywalls can be.

But those two belong to a small group of (mainly business) news publications that have had success transitioning from print to digital subscriptions, helped by having readers with expense accounts and a strong business need for timely news. Most newspapers that have set up paywalls need to convince fickle, freeloading consumers to cough up. It’s a strategy that’s not working as well as they might have hoped, as NiemanLab illustrates in a story about the digital struggles of two Hawaiian newspapers, the Honolulu Civil Beat and Honolulu Star-Advertiser.

The trajectory of each publication’s paywall appears to be mimicking industry-wide trends of slow paywall growth: It looks as if there’s a limit in the number of people who are willing to pay for news online.

The AAM audit reports of the Honolulu Star-Advertiser doesn’t just highlight the trend of stagnating subscriptions, however.

Buried in the numbers is evidence of another trend having a huge impact on the digital news industry — note the green line, below: