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Can freemium ever be free? Paywall strategies from news, B2B, and B2C

October 7, 2021 | By Chris M. Sutcliffe – Independent Media Reporter @chrismsutcliffe
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Is there such a thing as a free lunch? For online audiences looking for news, metered and freemium paywalls offer a little taste of the feast that exists beyond the paywall. And if we’re honest, savvy online audiences know that there are ways and means to get at the content behind those paywalls for free, too.

But for the publications that are looking to monetize digital audiences through a paywall, how much to give away for free is an inevitable discussion. Beyond the public service implications – such as The Atlantic and The Financial Times making much of their pandemic information free-to-access – the point at which the paywall kicks in is a constant consideration for digital media companies. Consider all the attention The Economist received for reducing the number of articles readers got for free – from five to three – back in 2019. At the time its MD of global circulation Marina Haydn said the focus was on providing “value over volume.” 

It’s a constantly evolving conversation. Better, more accurate modelling tools allow for flexibility of paywalls based on user habits and demographics, so even within the same publication there are different amounts of “free.” Similarly, there are many sites where the “cost’ of access isn’t monetary, but instead the time and data cost of handing over user information at the registration wall.

There are as many options as users, and often multiple in use across the same publication. But which content is always free at certain publications, and is there best practice for what should always be free in different publishing verticals? How do hard news, B2B and B2C shake out?

Always free

According to the Reuters Institute “more than two-thirds of leading newspapers (69%) across the EU and U.S. are operating some kind of online paywall.”

There is an excellent argument to be made that most news content online should be free to consume at the point of publication. In the article ‘The Truth Is Paywalled But The Lies Are Free’ Nathan J Robinson states that while news paywalls are justified, we need to reappraise that in light of the new economies of disinformation online. 

Given the number of recent revelations about the role of advertising-based outlets in disseminating disinformation, it’s more important than ever that we examine how news sites can act as a bulwark against that trend.

Despite these concerns, of the largest quality news publishers online only the Guardian has a direct audience revenue model and also remains free. But there are other digital publishers that are primarily user-funded that make free news at point-of-consumption a core pillar of their offerings.

Eurogamer, the UK-based consumer news and analysis site, recently launched its own subscription or ‘supporters’ service. Notably when announcing the move its editor-in-chief Oli Welsh was clear that the content that was free-to-access would remain so; its new content would be “additive”:

“One thing we decided very early on was that we didn’t want to lock all of our work behind a paywall. We wanted to keep it freely accessible to everyone. So, inspired by the example of The Guardian (as well as of some of our competitors), we’ve created this supporter program where subscription is entirely optional, but comes with a bunch of (hopefully attractive) benefits, ad-free viewing first and foremost among them.”

That additive model is very similar to that of The Independent, which also creates subscriber-only content while allowing the majority of its content to be free-to-access. It brands the content behind the paywall as ‘Independent Premium’ – which matches Eurogamer and many other titles using the partial paywall model. 

Similarly, back in 2016 the Telegraph abandoned its metered paywall in favour of its current model, which has certain types of content that are always free. It then has a premium option on top and certain perks of registration that encourage users to sign up.

Nor does the free content necessarily need to exist in the same medium as the paid-for content. Quartz, for instance, still offers its newsletters for free while gating some content on its site behind the paywall. It currently has around 27,000 subscribers. 

For news publishers of any stripe, then, the option is there to have a certain amount of content that is always free. That could be, as with the Guardian, from a purely ethical perspective or, as with Eurogamer, because other revenue sources afforded by free access are still a big part of the overall mix.

Never free

This is the easy one. Many of the most well-known subscription success stories have a hard paywall at their heart. In fact, in many cases, any free content that isn’t purely promotional is anathema to their publishing strategies. 

That’s especially true for B2B and business information publishers, which mostly never lost sight of the value of their own expertise. Despite that, even among news publishers the hard and fast paywall remains notably rare. Of the biggest subscription success stories, only the Financial Times, The Wall Street Journal and a handful of others really embody the hard paywall ethos.

It is, as has been pointed out, a fantastic option if you have a rich seam of proprietary information or data, or occupy such a rarefied niche that few if any competitors exist alongside you. 

Free enough

Consumer-facing magazine brand Condé Nast has ultimately said that it wants all its brands to be paywalled. That’s a huge bet upon the ability of titles – mostly based around lifestyle and hobbies – to convert people to paying readers, and on the back of a metered model. But it’s not a contention without some supporting evidence.

On the back of WIRED going behind a paywall in 2019, its editor Nicholas Thompson said that: “I think it can work for every Condé Nast brand. I don’t think it can work for every brand. Think about Forbes, which has this very lucrative contributor network. No one’s going to subscribe to the contributor network, in part because there isn’t really an identity or a style or a voice – why would you subscribe to that?”

But the ability of free, premium content to act as an antennae for potential future subscribers shouldn’t be overlooked. For both the freemium and metered models – which are neck-and-neck alongside one another in terms of popularity in the EU – that free-to-access content puts readers at the beginning of the funnel to a full-blown subscription.

That’s especially true for consumer magazines, which rarely occupy the sort of rarefied niche that would enable a hard paywall. Over the course of the pandemic research from Jellyfish found that UK tech and gaming titles saw a rapid growth in digital subscriptions (268% YOY) – of which most have a metered paywall model.

It would be foolish to say that the never-free model works best for B2B exclusively, or that a metered model is the definitive best for consumer magazines. There are exceptions to each rule, and often the individual brands themselves play around with which content is free at any time.

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