A la carte paywalls have been in vogue with magazine publishers lately.
In July, Esquire put a $1.99 paywall around a nearly 10,000-word investigative story, "The Prophet" by Luke Dittrich. In a note about the paywall, David Granger, Esquire's editor in chief (pictured above), explained that the story took months to produce — and that such journalism doesn't come cheap.
Sports Illustrated also began testing a new variety of paywall this summer, but one that didn't ask readers to pay directly. Instead, it granted online readers access to certain print stories — ones typically not available to non-subscribers until an issue is off the newsstand, like cover stories — in exchange for watching a video ad of their choice. The experiment has been modest so far — about five to six stories have been behind the video paywall to date, a spokesperson for SI says.
In a third experiment, The Atlantic began packaging a selection of free online articles in an ad-free weekly magazine, available for $1.99 in iTunes. Of the decision to charge, editor in chief James Bennet writes that the magazine is exploring paid content options outside of advertising. "This is, for us, another experiment in putting to use any new means available to create and support the journalism of ideas that distinguishes The Atlantic," he explains.
And how are these paywall experiments faring? Granger tells Mashable "The Prophet" sold several thousands copies, but that it was "probably a wash, revenue-wise." Still, he hasn't ruled out another go. Esquire is set to launch a redesign of its site next year and is "working on how we might integrate some kind of paywall into it," Granger says, adding that there are no definite plans for a paywall yet.
SI declined to respond to a question about how much money the video ads are generating, but a source familiar with the initiative says it wasn't "a geyser of revenue."
A spokesperson for The Atlantic would not disclose sales, but did say they were exceeding projections. "Fully three-quarters of them are for monthly or annual subscriptions, which we didn’t expect — we thought there’d be more single copy sales," the spokesperson wrote in an e-mail to Mashable, adding that the company was also surprised to find that 45% of subscribers are reading on smartphones.
"The era of completely free content is probably winding down," says Susan Bidel, a senior analyst at Forrester. "It's time for people to test [paid alternatives]. There has to be some kind of value exchange for all this work that publishers do. .. They can't [support their operations] at current CPMs." (Perhaps not traditional publishers, that is — some web-native publishers are operating profitably.)
Esquire, SI and The Atlantic are aware that it's difficult to get online readers, particularly younger ones, to pay. Esquire is testing to see if people will pay on the web at all. SI is testing to see if a different kind of value proposition — one that doesn't require them to fish out their wallets — is acceptable to readers instead. The Atlantic, meanwhile, is forgoing paid content on the web altogether, asking readers to pay for content in environment where they are conditioned to pay for it: iTunes.
As for the single article payment system, Ken Doctor, a consumer media analyst at Outsell and author of Newsonomics: Twelve New Trends That Will Shape the News You Get, argues that it will be particularly difficult for publishers to charge for leisurely reads like "The Prophet," but that resourceful articles will have a better chance. "If it's pleasurable reading, it's a lot less likely that someone is going to run across a $2 article in a sea of free and pay for it," Doctor says. "But if [readers] are making a decision about health exchanges right now and you can give them an article for that, people will pay $2 for that article." He adds that analytics can and should play and important role in targeting readers for paid content. "If you deliver the right kind of content knowing reader preferences, they're a lot more likely to buy."
"Ninety-nine out of 100 of these experiments won't work that well," Doctor adds. "But that's fine. All you need is some model to succeed, and others will follow those models."