Paywall
An online paywall is a method that creates a barrier to access online content that is surpassed using a paid subscription.[1] A paywall asks a user for payment in exchange for online content. Paywalls are commonly used by news outlets to provide their content in a digital format while still maintaining a subscription model, maintaining ties to the traditional paper news outlets of the past.[2] As advertising becomes less viable (except on very large platfoms), many sites have turned to paywalls as an alternative revenue stream. According to a 2019 study, 69% of newspapers surveyed utilized some kind of paywall, the average price of which is about $15.75 per month.[3]
The term paywall is also used to refer to academic and scholarly articles or journals that require a subscription or other payment to access.[4] Scholarly journals are often owned by a large parent company, who maintains the quality of the journal and charges a fee to access its contents.
There is debate and lack of consensus surrounding the moral and ethical soundness of paywalls.[2] Those in favor of paywalls claim that they allow content-producers to create higher-quality, original content that wouldn't otherwise be possible. [5] On the other hand, those against the use of paywalls claim that access to information is stratified among the population based on the ability and willingness to pay for quality information. They claim that paywalls push lower-income readers towards lower-quality free news.[6]
Contents
History
Before the digital age, the business model employed by newspaper outlets was traditionally a system where content was sold to audiences, and audience attention was sold to advertisers which created a positive feedback loop with both markets growing over time. More subscriptions increased revenue from both subscriptions and advertising value.[6] The digital age has forced companies to change this model because advertising no longer provides the revenue that it once did, and print subscriptions have decreased significantly due to the internet.
In the 1990's, personal computers were becoming more commonplace in the American household. Companies initially created websites where they posted articles in an attempt to be involved in the digital scene; initially these publications were free, but eventually companies realized that probability would become an issue. After first attempting to use online advertising, publishers explored alternative revenue options. The paywall was one of these innovations.[7] In 1996, The Wall Street Journal was the first national newspaper that created a paywall across the entire site (known as a hard paywall, see below).[1] Since then, many news outlets have found success using this new subscription model. [8]
In particular, after the recession in 2008 newspapers were motivated to find a method to protect print circulation (and get user data), and paywalls were a method they tested to do this. There was (and is) concern, however, that the implementation of paywalls would decrease user traffic thereby decreasing revenue earned from advertising.[6] There is a tradeoff between ad revenue (driven by high reader counts) and paywall revenue (driven by the number of subscribers) and companies attempt to find an optimal balance between the two where a paywall is not too restrictive where the number of page views decreases too drastically, but not too lenient to the extent that paywall revenue is too low. The effect of this tradeoff has encouraged the development of different types of paywall implementations, detailed below.
Classifications
There are various types of paywalls. They are typically categorized based on how they balance the offering of free content versus the offering of premium (paid subscription only) content, although a given implementation may not fit neatly into a category. The most common sub-categories recognized by experts are hard paywalls, soft (metered) paywalls, and freemium (Combination) paywalls. [9]
Hard
A hard paywall is the most restrictive type of paywall. Content obscured behind a hard paywall can only be accessed when a user has paid the subscription or fee for access. The content is not offered via other channels: there are no free versions, there are no limited free articles, and there are no free trials. A hard paywall restricts access to a site or service in its entirety without exceptions. In some implementations, there may exist several different subscription tiers; each tier would allow access to increasingly more content for an increasingly higher price. [1] The Times is a notable news outlet that employs a hard paywall, which it first implemented in 2010. [10] In this particular implementation, users are allowed to read approximately the first paragraph of content before being prompted to subscribe. The Times is still categorized as a hard paywall because no article can be read in its entirety for free; the only purpose of offering the first paragraph is to show non-subscribers the articles that could be made available to them if they paid.
Amongst those who question the ethical implications of paywalls, this type of paywall is considered to be the most unethical and restrictive.
Soft
Soft, or metered, paywalls allow access to some premium content for free while restricting the remaining content to paid subscribers only. A common implementation of a soft paywall is a metered paywall which allows access to a particular number of articles per time period (typically monthly), and requires payment to read more than this predefined number. This is a model that The Washington Post has implemented; users are allowed to view between 7 and 10 articles for free each month, and to gain access to additional articles requires a paid monthly subscription.[1]
This method aims to be a be a balance between offering users free content and allowing the company to collect subscription fees. Soft paywalls allow companies to balance ad revenue and subscription revenue. As detailed in a 2019 study, the implementation of paywalls causes a general decrease in readership on the site for both page views and unique visitors.[6] The decrease in site visitors as a result of a paywall will decrease ad revenue, but increase subscription revenue. Companies attempt to maximize their overall revenue by iteratively changing the restrictiveness of their paywall in order to balance ad revenue and subscription revenue.
Freemium
Freemium or Combination paywalls provide access to a mix of free content while restricting access to premium content behind a paywall. Sites using this model will usually offer a limited free version of their content; the premium (paid) version has additional benefits, such as higher quality or additional functionality.[10] Some sections of a site may be free, and others may be subscription-only. This is different from a metered paywall described above. In metered paywalls, the limited amount of free content is drawn from the same pool of articles as the premium content. In a combination paywall described here, the free content and premium content are entirely separate. The premium content only is behind a hard paywall; this differs from a site-wide hard paywall in that in this case content is selectively restricted. Therefore, it is not a true hard paywall. [10]
Freemuim paywalls are typically only used by outlets that already have a large reader base with loyal consumers and a wide variety of content. Their size allows them to collect enough ad revenue from the free section of the site. Publishers have the power to decide which content is free and what is premium; a company might choose a couple popular articles to be offered for free in the hopes that readers will want to subscribe, and host the rest of their higher-quality content behind the paywall. [11]
Perception
Industry
Many companies see paywalls as superior to digital advertising, which can have problems and return little profit, except for very large platforms. Especially in the era in which Ad-blockers are popular, paywalls can be an attractive option for companies to generate revenue. Additionally, news outlets are more independent when they implement a paywall; they don't require reliance upon advertising companies (and incentive to generate traffic to serve ads) reducing the pressure to produce "clickbait" style content, which would generally encourage a high volume of lower-quality content, rather than a lower volume of higher quality content. [7] Alex Pareene argues that paywalls are necessary for quality, honest, solid journalism; this kind of journalism requires time and money that can't be supported with ad revenue, and requires revenue that comes from another source, often a paywall. [2] Interestingly, the type of paywall implemented (soft vs. hard) did not have a significant impact on the decrease in readership. In fact, if the audience is more loyal, local, and engaged than the audience lost, they may in fact be more valuable for advertisers. [6]
Readers
Consumers typically resist the implementation of paywalls. In 2010, 82% of people with favorite news sites said they'd find somewhere else to find their news if they started requiring payments. [12] However, according to a study on the affects of a freemium paywall on reader behavior, independent of age, readers with a paid subscription show a higher degree of activity, greater involvement,and increasingly varied usage than readers with a free subscription do. Consumers with a free subscription show a generally negative trend in activity, which is not the case for premium subscribers. [13] This could be because premium subscribers want to ensure that they're consuming the content that they have already paid for. This indicates that paywalls decrease news consumption for those who are not subscribed, but increase news consumption for those who pay for a subscription.
Paywalls in Practice
News
Many popular news outlets employ some type of paywall. Following is a list of the top 10 subscription-based news sites by subscriber count in 2020:
| Publication | Paid Subscriptions |
| The New York Times | 6,100,000 |
| The Washington Post | 3,000,000 |
| The Wall Street Journal | 2,400,000 |
| Game Informer | 2,100,000 |
| Financial Times | 1,100,000 |
| The Athletic | 1,000,000 |
| The Guardian | 790,000 |
| Nikkei | 769,000 |
| The Economist | 516,000 |
| Caixin | 510,000 |
As evident from the list above, consumers need to pay to access many news sites. In a Wired article by Mark Hill, the argument is made that content creators deserve to be paid, and (as detailed in the subscriber counts above) users have shown that they're willing to pay for such content. However, since paywalls have become more common (69% of news sites employing them in 2019)[3], most readers are only willing to pay for one online news subscription at a time. This makes it difficult for a consumer to expose themself to varying viewpoints.[14] This reveals that in practice, paywalls may increase revenue and quality of content locally for one site, but looking from an expanded view companies are increasing competition with each other and consumers are limited to few sources of quality information.
On the other side of the argument, news agencies need to make money somehow, and advertising is becoming a less viable option. If news outlets go out of business, there won't be news for anyone. The popularity of paywalls means that consumers are more accustomed to them: people increasingly expect to pay for quality online content.[5]
Academia
Many academic journals and articles require payment in exchange for access, often subscription fees at a high price. In February of 2019, The UC system, including the University of California, canceled their subscription to Elsevier, the largest academic publishing institution in the world. Their reasons for doing so highlight the state of paywalls in academia today.[15]
Much of academic research is locked behind a paywall, and the price has steadily increased over time. Large companies, like Elsevier, own thousands of academic journals, behaving in a monopolistic way in how they implement their hard paywalls. The publishing companies collect fees from submissions to the journal, and also from subscribers to the journal. Representatives for Elsevier maintain that they add value to each step of the process. They maintain the quality of the journal by reviewing submissions and maintaining the peer-review system. [15]
Proponents of open access to information claim that the business model of scientific journals is due to change, similar to how the music and movie industries have changed in recent years due to streaming.
Academic journals use the vast amounts of data in their catalogs to run data analytics on research trends, recommending articles, and suggesting co-authors; all of which add value to the scientific community. [15] The debate does not currently have consensus, but open access is gaining momentum in the academic world.
Ethical Considerations
There is debate between if and to what extent paywalls should be used. As expressed by Stewart Brand, creator of the World Earth catalog, when remarking on the value of information:
On the one hand, information wants to be expensive, because it’s so valuable. The right information in the right place just changes your life. On the other hand, information wants to be free, because the cost of getting it out is getting lower and lower all the time. So you have these two fighting against each other. [16]
- Stewart Brand
This quote documents the dilemma: news and information producers deserve reasonable compensation for providing valuable information to the public; similarly, people deserve equitable access to information.[1] This debate is often central when considering the ethical use of paywalls in a democratic society.
Pay to be Informed
The New Republic author Alex Pareene articulates the argument that subscription models such as paywalls intrinsically select an audience that is seeking high-quality content, and have the means and desire to pay for it. By extension, this excludes people who would otherwise equally benefit from this high-quality content but are unable or unwilling to pay for it. [17] Local and national newspapers are an important and necessary source of information and mediators about news and politics and act as a platform for public discourse and debate. In a functioning democratic society, these spaces and platforms are vital for citizens to make informed decisions on candidates and policies, as well as attitudes and views surrounding current topics and public debates. Politicians use news as a platform for communication, and the news serves as a verification system surrounding the actions of politicians. As explained by the authors of a 2019 study, "Providing the local community with information generates positive externalities, as well-informed citizens will make more informed decisions for the benefit of themselves and society as a whole" [15] Those who do not have a disposable income will gravitate towards free journalism, which can create a bubble of lower-quality information that is difficult to escape from [1]
Quality
Nick Thompson, an editor at Wired, claims that paywalls make online content better. When defending the decision of Wired to introduce a soft (metered) paywall in 2018, he says that "When you create a subscription business model, your incentives change significantly."[5] He is referring to the idea that paywalls incentivize outlets to obtain the largest number of loyal readers that they can. This incentive results in higher-quality content that is original and unique. Without the income from paywalls, it might be less feasible for companies to generate quality content at all.
Power and Open Access to Information
Globalization has accelerated information production in an interconnected world in which research is done by scholars who are more diverse, including non-white racial and ethnic groups, working class people, all genders and sexualities, and non-Western nations. However, some argue that paywalls diminish the benefits provided by this information production. [18]
Those debating the ethics of paywalls ask the question: who has the power to decide which information is obscured by a paywall? The answer, clearly, is content publishers. Those who argue against the use of paywalls cite the growing market domination of a few academic publishers, allowing them to set high prices. These barriers make it more difficult for teachers, economically-disadvantaged people, and policy-makers to access this information.[19] Paywalls limit access to a small proportion of the population, who is able to use this access to further advance their privilege. The debate surrounding the ethics of paywalls requires inquiry into the value of knowledge and information, how we should quantify this value in practice, and who has access to this information and under which conditions. [18]
When a lower amount of news content is consumed and a fewer number of individuals encounter quality news, like when a paywall is implemented, the knowledge gap between audience groups with financial and technological means to access high-quality news and other audience groups left with lower quality, less substantive free news widens. Additionally, research has shown how local news websites place their best journalism behind paywalls, which excludes users who are only able to access free content from benefiting from quality news the same way that subscribers can.[6]
As articulated by the authors of a 2019 study,
Based on our findings, we argue that paywalls are not merely a media business matter, but more profoundly a matter of local democracy that requires attention from media politicians and scholars as well as media practitioners. As argued by Syvertsen et al. (2014) and Ots et al. (2016), there has been a general shift from cultural and political values towards economic and technological arguments in the policy discourse. As such, a growing understanding of the consequences of local newspapers’ attempt to build a business model based on digital user payment is necessary in order to provide important insights for the discussion of a governmental support mechanism to aid local newspapers in their business transition from print to digital and – perhaps more importantly – to stimulate the use of local journalism among citizens in a paywalled local media environment. [6]
Mark Hill argues that those who are forced out of paid news, and pushed towards free news, won't have access to the range of journalistic information that they need to stay informed in a free society. With the increase in the number of news sites that use paywalls, people's media consumption will further narrow to a select few sources, or to free news as a replacement.[14]
References
- ↑ 1.0 1.1 1.2 1.3 1.4 1.5 Shah, S. (n.d.). Understanding the Effects of Online Paywalls on Information Access. Oregon State University.
- ↑ 2.0 2.1 2.2 Harvey, B. (2021, January 20). Should News Sites Have Paywalls? The Prindle Post. https://www.prindlepost.org/2021/01/should-news-sites-have-paywalls/
- ↑ 3.0 3.1 Simon, F., & Graves, L. (2019, May 9). Across seven countries, the average price for paywalled news is about $15.75/month. Nieman Journalism Lab [BLOG]; Newstex. https://www.proquest.com/docview/2251667383/citation/A0A2FC17C0744FF6PQ/1
- ↑ Taylor, M. (2013, January 17). Hiding your research behind a paywall is immoral. The Guardian. https://www.theguardian.com/science/blog/2013/jan/17/open-access-publishing-science-paywall-immoral
- ↑ 5.0 5.1 5.2 Johnson, E. (2018, February 1). Paywalls make content better, Wired editor Nick Thompson says. Vox. https://www.vox.com/2018/2/1/16957324/wired-paywall-nick-thompson-magazine-advertising-subscription-peter-kafka-recode-media-podcast
- ↑ 6.0 6.1 6.2 6.3 6.4 6.5 6.6 Paywalls Impact on Local News Websites Traffic and Their Civic and Business Implications.pdf. (n.d.).
- ↑ 7.0 7.1 The Ethics of News Paywalls—Center for Media Engagement—Center for Media Engagement. (n.d.). Retrieved January 27, 2022, from https://mediaengagement.org/research/the-ethics-of-news-paywalls/
- ↑ 8.0 8.1 Ang, C. (2021, April 26). Ranked: The Most Popular Paid Subscription News Websites. Visual Capitalist. https://www.visualcapitalist.com/ranked-the-most-popular-paid-subscription-news-websites/
- ↑ Pickard, V., & Williams, A. T. (2014). Salvation Or Folly? Digital Journalism, 2(2), 195–213. https://doi.org/10.1080/21670811.2013.865967
- ↑ 10.0 10.1 10.2 Rußell, R., Berger, B., Stich, L., Hess, T., & Spann, M. (2020). Monetizing Online Content: Digital Paywall Design and Configuration. Business & Information Systems Engineering, 62(3), 253–260. https://doi.org/10.1007/s12599-020-00632-5
- ↑ Paradise, J. (n.d.). Metered Paywall vs. Freemium: Which Publishing Model is Right for You? Slatwall Commerce. Retrieved February 13, 2022, from https://www.slatwallcommerce.com/resources/articles/metered-paywall-vs-freemium-which-publishing-model-is-right-for-you/
- ↑ Reagan, G. (n.d.). PEW: 82% Of Users Will Abandon Their Favorite News Site If They Put Up A Paywall. Business Insider. Retrieved January 27, 2022, from https://www.businessinsider.com/pew-82-of-users-will-abandon-their-favorite-news-site-if-they-put-up-a-paywall-2010-3
- ↑ Wadbring, I., & Bergström, L. (2021). Audiences behind the Paywall: News Navigation among Established versus Newly Added Subscribers. Digital Journalism, 9(3), 319–335. https://doi.org/10.1080/21670811.2021.1878919
- ↑ 14.0 14.1 Hill, M. (n.d.). Paywalls, Newsletters, and the New Echo Chamber. Wired. Retrieved February 13, 2022, from https://www.wired.com/story/paywalls-newsletters-and-the-new-echo-chamber/
- ↑ 15.0 15.1 15.2 15.3 Resnick, B. (2019, June 3). The war to free science. Vox. https://www.vox.com/the-highlight/2019/6/3/18271538/open-access-elsevier-california-sci-hub-academic-paywalls
- ↑ Information wants to be free … and expensive. (n.d.). Fortune. Retrieved January 28, 2022, from https://fortune.com/2009/07/20/information-wants-to-be-free-and-expensive/
- ↑ Harvey, B. (2021, January 20). Should News Sites Have Paywalls? The Prindle Post. https://www.prindlepost.org/2021/01/should-news-sites-have-paywalls/
- ↑ 18.0 18.1 Eaves, L. E. (2021). Power and the paywall: A Black feminist reflection on the socio-spatial formations of publishing. Geoforum, 118, 207–209. https://doi.org/10.1016/j.geoforum.2020.04.002
- ↑ Gershenson, S., Polikoff, M. S., & Wang, R. (2020). When Paywall Goes AWOL: The Demand for Open-Access Education Research. Educational Researcher, 49(4), 254–261. https://doi.org/10.3102/0013189X20909834
