Misc: One News Page Alert: Newspaper sites warned of paywall peril

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Newspaper sites warned of paywall peril
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Universal move to paywalls would alienate almost all readers, Oliver
& Ohlbaum predicts Ã¢Â€Â" but mixed strategy holds promisePutting up
paywalls around online content will not on its own transform the
finances of national newspapers, but a mixed strategy of subscriptions
and micropayments could prove more successful, according to new
research published today.In a report based on interviews with 2,600
consumers over a week in early November, media consultancy Oliver &
Ohlbaum concluded that paying even a small sum Ã¢Â€Â" as little as Ã‚Â£2 a
month Ã¢Â€Â" to access national newspapers sites is unlikely to prove
popular, particularly if every title introduces payment systems at the
same time.The O&O report concluded that micropayments Ã¢Â€Â" charging
small sums for individual articles Ã¢Â€Â" is likely to prove a more
effective way of making money, particularly if they are introduced
alongside online subscriptions that allows users to access most but
not all content.Per article charges allow users to remain promiscuous
so would be the best way for the sector to pursue payment from most
users, who prefer to mix and match news sources, the report said. If
all newspaper websites charged for access using article charges of
10p, the likely take-up doubles compared to a monthly charge of Ã‚Â£2 a
month.The report's authors also argued that restricting access to some
online content, but making all of it available to those who subscribe
to the newspaper might help extract more money from the most loyal
readers.They pointed out that 13% of regular readers surveyed said
they would convert to a print subscription if full online access was
bundled in for no extra charge.O&O also forecasts that the advertising
downturn across all media, one of the steepest and longest for
generations, will improve only moderately next year before starting to
lift in 2011. O&O said an Indian summer in 2012 and 2013 will be
followed by a return to low growth in 2014.The report comes amid a
debate on web charging in the newspaper industry debates triggered by
the News Corporation chairman and chief executive, Rupert Murdoch, who
said earlier this year that his portfolio of newspapers planned to do
so in 2010.Yesterday Murdoch told US media regulators in Washington
that he was confident consumers would pay for online news to get the
information they need to rise in society. Our customers are smart
enough to know that they can't get something for nothing, he added.O&O
found that 15% to 20% of respondents said they would pay Ã‚Â£2 a month
for their favourite news website if it was the only one that
charged.However, the number who said they would be willing to pay
varied significantly between readers of the mass-market press and
those who regularly buy so-called quality papers.More than a quarter
Ã¢Â€Â" 26% Ã¢Â€Â" of those who cited the Guardian website as their favourite
source of online news said they would pay Ã‚Â£2 a month to access it if
it was the only one to charge. The same percentage of Times Online
website users said they would be willing to pay.Only 15% of those who
cited the Sun as their favourite news site said the same for Sun
Online, and that fell to 2% when consumers were asked if they would
pay Ã‚Â£5 a month.A similar trend was evident for other newspaper sites,
although the fall was less pronounced. A fifth of Independent readers
said they would pay Ã‚Â£5 a month for independent.co.uk, for example,
down from 29% who said they would pay Ã‚Â£2 a month.Only 15% of those
who said the Times or the Guardian were their preferred website said
they would pay Ã‚Â£5. The Guardian is published by Guardian News &
Media, along with MediaGuardian.co.uk. GNM has said it no plans to
charge for its online content.When asked to imagine a scenario in
which all newspapers charged, very few readers said they would pay
anything at all. O&O said that was because most people use a variety
of websites for online news and were unwilling to pay to use all of
them, or to drop most of them and use only their favourite.However,
there were some exceptions to this trend, most notably amongst regular
users of the Guardian and the Times websites, with 16% of the former
and 7% of the latter saying they would still be prepared to pay Ã‚Â£2 a
month if all UK national newspapers put their online content behind a
pay wall. A smaller number of Daily Telegraph readers Ã¢Â€Â" 5% Ã¢Â€Â" would
also pay.The same proportion of Guardian and Times users said they
would pay Ã‚Â£2 if TV news websites charged as well as all newspapers.
But none of the respondents said they would pay Ã‚Â£5 in the same
circumstances, apart from those who read Mail Online, where 4% said
they would part with this sum every month.O&O also predicted that the
advertising market will recover in 2011, as the economy improves and
UK companies act quickly to reverse earlier spending cuts, but that
long-term structural trends means that Indian summer will be over by
the end of 2013.Those structural shifts include a growing
fragmentation in traditional media markets, including TV, print and
radio, as more ways of consuming the same information emerge via new
digital outlets.A significant fall in revenues from 2007 to 2010 will
be reversed from 2010 until 2014, although that recovery will vary in
different sectors.Network TV will see its Compound Annual Growth Rate
(CAGR) fall by 4.3% on average over the earlier period, for example,
before it recover from 2010 to 2014, rising by an average of 3.5% each
year.National newspapers, which will have seen display advertising
record a steep drop in 2007-2010 of 9.7%, will rebound more strongly,
with 7.4% average CAGR until 2014. Classified advertising revenue will
continue to fall after 2010, however.Traditional display advertising
revenue across all media will recover from 2010 (although at very
different speeds), the O&O report said. Traditional classified
revenues will continue to fall and will only be partially replaced by
new online revenues.Ã¢Â€Â¢ To contact the MediaGuardian news desk email
editor@mediaguardian.co.uk or phone 020 3353 3857. For all other
inquiries please call the main Guardian switchboard on 020 3353
2000.Ã¢Â€Â¢ If you are writing a comment for publication, please mark
clearly for publication.