This piece by Felix Salmon is the smartest post on paywalls I've read in a long time. In it, he talks about how the porousness of the NY Times paywall is a feature, not a bug:

"It allows anybody, anywhere, to read any NYT article they like. That makes the NYT open and inviting — and means that I continue to be very happy to link to NYT stories."

The NYT paywall of-course, does not attempt to be an impermeable barrier in the way those of the WSJ or the Times of London do. People who don't subscribe can still read a certain number of articles before the wall comes up. If you arrive via a link shared on Facebook, Twitter or a blog you won't hit a paywall. And as many quickly worked out, there seems to be plenty of none-too-complex ways to work around it.

Salmon compares it to a polite "Keep Off The Grass' notice, rather than a tall fence with razor wire on the top. It is, as Dan Gillmor puts it, more of a 'suggestion wall' than a paywall. Yet the early signs indicate that it appears to be working.

So in this, and in many other ways (as is so often the case with digital models), the NY Times paywall is counterintuitive to traditional media practice. And that's what makes it interesting.

Last year, Jeff Jarvis questioned the 'cockeyed economics of metering reading', and the logic of apparently charging (and, he suggested, sending away) "the readers who are worth the most while serving free those who are worth least". In a similar vein, typical print subscription models reward the most loyal readers with lower cover prices. Those who read the most are the most valuable, so get to pay the least.

Conventional wisdom also tells us that people who get something for free will never pay for it. So if you have something of value, and you want to charge for it, you have to isolate it and protect it at all costs. Build a big wall around it. Make it as impenetrable as possible. Then charge people to come through the gate.

Yet as Salmon points out, it seems that in spite of the ability to gain (albeit) limited free access, and (for many) the ability to work around those limitations, a large enough segment of the population seem to feel that they're getting sufficient value in NYT content that it's only proper to pay. And in being open and still allowing people access the NY Times are maximising the number of people who might feel the same.

At the other end of the scale, The Times of London paywall takes an approach that it is the inconvenience of not being able to read their content that will force you to pay. You might argue that at one level they are succeeding, but it is an unsubtle, closed door policy.

As Jeff Sonderman puts it, motivations such as convenience, duty or appreciation are more compelling than coercion, and this is especially important when talking about intangible goods, like information. He also points out that newspapers (and I would add magazines, and indeed any print publication) have always had a 'leaky payment system'. Industry research has long proven that newspapers (and magazines) have an average of more than one reader per copy.

If I was running a closed operation, my fear would be around not only whether it would work in the short-term, but what my long-term future looked like. How will people who are new to my content find it? What will the experience be like when and if they do find it and can't access it? How am I going to attract new, younger readers if they can't see what I do? How can I continue to be part of the wider debate around the issues that really matter when only a tiny proportion of the people involved in that debate can read my analysis? And when so few of them are likely to link to my analysis because they know others won't be able to read it?

A wholly closed approach removes you from the news content sharing ecosystem, and from the way in which people find content they want to consume on the web. In a recent Pew survey of more than 2,200 Americans, 75% of online news consumers said they get news forwarded through email or posts on social networking sites, and 52% said they share links to news with others via those means. I can't remember the last time I saw a Times Of London link being shared.

The results of these paywall experiments could not be more important for the future of news and of journalism. As Clay Shirky and others have long observed, the economics of ‘analog dollars to digital dimes’ (or the ratio of revenue per reader/user) seems to be not a problem, but a feature of reality. Like him, I believe the future of news is likely to be chaotic, and involve a multiplicity of business models. But like Salmon, it feels to me like the NYT model utilises more of the kind of subtle, human approach that often works best on the web. This Autumn, Shirky returns to teaching undergraduates for the first time in 12 years. I'll leave the last word to him:

"The thing I really want to impress on my students is that the commercial case for news only matters if the profits are used to subsidize reporting the public can see"

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Original Post: http://neilperkin.typepad.com/only_dead_fish/2011/08/porous-paywalls.html