CJR reporting:
About 14 percent of NYT readers online account for 75 percent of its pageviews, so it’s just not helpful to think of the vast majority of online readers as potential customers. In reality, if you read just one or five pages, you’re almost certainly not going to pay. But if you read more than twenty NYT articles a month, you have to pay, unless you’re willing to cheat the system (and while many people, unfortunately, are, even more aren’t or don’t bother). And this idea ignores the fact that hundreds of thousands of people are already paying for news and magazine subscriptions via iPad apps and e-readers. Are those people going the NPR route or are they paying for digital news because they have to in order to read their favorite publications on their gadgets?

While The New York Times has made it for decades with about a million print subscribers, it now has roughly thirty million online readers in a given month. But absent a paywall, most of those online readers are essentially worth nothing to the paper, visiting it only a few times a year. It’s not going to turn these folks away, but it shouldn’t focus much (if any) effort on them. They’ll continue to come as long as the NYT serves its core readers, which is not some new paywall phenomenon, but something that it’s been doing all along. The paper has calculated, correctly, that it can keep the ad revenue while adding tens of millions of dollars from subscriptions. Traffic (unique visitors) is actually up 2 percent at nytimes.com since the meter went up and it took in 6 percent more in digital advertising in the third quarter than it did a year ago without a meter. Shirky says the new paying online subscribers are a niche, “almost certain to be more political, and more partisan, than the median reader.” But, again, there’s no evidence presented to support that. How exactly are paying digital subscribers different than paying print subscribers, who also choose “sports” or “politics” or “food.”? Come to think of it, if people are paying for unlimited access to the whole newspaper, just like before, is bundling really dead?
In any case, Shirky calls these digital subscribers a “niche,” but six months after launching, the NYT’s paid digital circulation (424,000) is already nearly half its paid daily print circulation. Take out the 100,000 subs paid for by a sponsor, and it’s still more than a third. The Wall Street Journal has more than half a million digital-only subscribers and another half a million-plus who pay for it on top of their print subscriptions. If these are niches, they’re awfully big ones. It’s unclear why a million-circ newspaper is “mass-mass” while a 400,000-circ digital edition isn’t.
Paywalls are hardly a panacea for every third rate paper in the country that disinvested in journalism. But the success of the Times’s metered model shows that people value good journalism and will pay for it when charged.
http://www.cjr.org/the_audit/shirky_and_paywalls.php?page=all