A reader offers ydr.com advice on the paywall

Sometimes people just complain. But once in a while, people who have a complaint offer real, tangible options to consider.

This happened recently when I received an email titled “You’ve lost a reader.” The woman who wrote this said it would be OK for me to write about our exchange, though she asked that I use her first name only.

Here’s what Cathy wrote:

I can’t believe your paper wants to charge people to read online stories. Bad idea. The news is out there, everywhere. I will get it elsewhere, as will hundreds more like me. Sure you will have some die hard locals that subscribe but meanwhile you are turning your back on the NATION. Don’t you understand how search engine results work? Stories that are read a lot and forwarded a lot show up in news feeds more frequently. They get picked up by CNN and other big news websites. The people that read your stories the more hits your website gets. The more hits your website gets the more valuable your ad space is. You are limiting your hits and devaluing your ads and I am sure the couple bucks a month you charge your subscribers does not make up for that. Readership of printed papers is down. That is the new reality. If you want to stay ahead of this new curve you will do your best to INCREASE your online readership, not turn them away. Meanwhile, you’ve lost another potential reader. I will get my York news from sources like WGAL.com and PennLive (patriot news)

I got back to her with a personal response, much of which was based on some standard language I have used to explain why we are charging for online access.

Thank you for sharing your thoughts on this matter. I can tell by your response that this is important to you.

The local content we post online requires the dedicated resources of local reporters, photographers, designers and editors. The internet has transformed our newsroom from a once-a-day production effort into a round-the-clock news and information hub. We must provide all the content the community has come to expect from a traditional newspaper as well as be the leader in online news. We are now videographers as well as writers. Our social media network includes Facebook, Twitter, MySpace and dozens of blogs. All of this is terrific. But we must flourish as a business if we are to flourish as a news source. We cannot afford to give away this content online.

Your point about the value of serving readers through search engines and social media links is well met. And that is why we allow such readers to access such articles at no cost. However, to gain the full experience of our sites, and to continue to have unlimited access to our content, a subscription is required.

We offer a number of online subscription plans, and if you choose to subscribe, I’m sure that you will find more than your money’s worth.

You can choose to receive unlimited access to everything we offer at ydr.com, GameTimePa.com and FlipsidePa.com, as well as everything offered at InYork.com and YorkDispatch.com. If you are a home delivery customer, you can get all of that online content for just $1.99 a month, or $19.99 a year.
If you do not receive the paper at home, you can get an online-only subscription for just $5.99 a month or $59.99 a year.

Or, for even less money, you can get a subscription to what we call the “e-edition”. This is an online replication of each day’s newspaper. You will see the same paper you would have received if you got home delivery. You can view this on any computer, and we have a special app for this if you use an iPad tablet. You can subscribe to the e-edition at this site:
http://www.inyork.com/e-edition

I suspect that your objection to an online subscription is more a matter of principal than a matter of finances, since it is such a small amount. And I can understand that. You have come to count on the online site as a source of news and information throughout the day. For a long time, it made sense for this to be free. But the growing costs of providing news online has forced us to change the way we do business there. I hope you can understand that, and that we can continue to be your No. 1 source of news and information for York County.

Mostly, Cathy, I want to thank you for taking the time to write. This is important to you, and I wanted you to know that we hear you, and take your thoughts into consideration.

Regards,

Randy Parker

Nine times out of 10, such an exchange stops there. I rarely hear back from readers after I offer an explanation. Does that mean I’ve persuaded them, or that they just don’t wish to debate further? Hard to tell. But Cathy got back to me with a clear, coherent, and passionate response:

Randy-
I appreciate your thoughtful response. And you are correct, it is a matter of principal, not cost. I am all in favor of your paper making money. Not just covering expenses but earning a profit. The more money you bring in the better your product will be and the readers benefit from that.

But I feel your method of making money is misdirected. If you were to encourage online reading for free and actively support efforts that encourage the reading and sharing and commenting on articles you would increase your readership substantially. That increase would justify higher advertising rates. Not just local ads, but National ads. It seems to me your paper (and the Lancaster newspaper too, I suspect a similar business plan if not joint ownership) is trying to apply the old rules to this new online media. In the past if you wanted to read the news you bought a paper. Ads and subscriptions and newsstand purchases paid the bills. Seems logical to think the same could apply online, pay to read like before, but it does not. I’m a click away from the same news for free.

The ads, however, have also changed. When I bought a printed paper the same ads appeared on the page for me as they did for every reader. This morning, when I logged on to my (free) email account, and ad appeared that showed me a sweater that is on sale at Old Navy. The difference from a newspaper ad is that I had shopped the Old Navy site last weekend. I had put that EXACT sweater in my virtual shopping cart but chose not to complete the transaction. Today’s ad was not a coincidence of course. Old Navy was specifically targeting me with that specific ad based on my ip address. That is the new advertising. It is effective. I bought the sweater. Valuable advertising information is collected every day and sites with lots of hits can capitalize on that.

But hey, that is just my opinion. And I’m just one reader.

Best wishes!
Cathy

So Cathy’s just one reader, but here we have an audience of much more than that. What do you think about our new business model? And if you don’t like the idea of subscribing for online content, what do you propose we do? I doubt you’d be reading this article if you did not have a distinct interest in seeing local news organizations thrive.

If you were the boss, what would you do?

And for further discussions and debate on this issue, follow our series of paywall posts at YDR Insider.

About Randy Parker

Managing Editor, York Daily Record/Sunday News and ydr.com
This entry was posted in Behind the scenes, Business, Community engagement, Digital Subscriptions, Hate Mail and tagged , , , , , , , , . Bookmark the permalink.

14 Responses to A reader offers ydr.com advice on the paywall

  1. Ashley says:

    I totally agree with Cathy…YDR has lost a lot of “customers” because of requiring the paid online subscription. I downloaded the iphone app for YDR and I can access an unlimited number of articles through that but only 10 per month for free via the computer/internet? YDR would probably make a lot more money by using the targeted advertising that Cathy describes instead of charging $10 a month for a subscription — which tech savvy people are not going to buy.

  2. John Tierney says:

    Whenever I hear someone complain about paying a fee for using an ATM machine that isn’t the ATM for ‘their’ bank, I ask them if they ever considered the cost of the machine to the bank, the person or company, like Brinks or Dunbar, who service these machines; and if they are local, where is their banks nearest ATM? I hate fees, too. I don’t like automobile service centers adding several dollars to my bill for the cost of oil recovery, or other materials, that were never revealed in the past. But marketing today is based on price alone and no longer on class and quality, and people flock to stores of blue instead of red. And it’s even reflected in the quality of the employees, their pride, and their talent. You will get what you pay for.

    I was an NT subscriber until I moved east and returned to school, a so-called non-traditional student. That means ‘over 40.’ Maybe ‘over 50.’ The only reason I’m not an online subscriber is time that I have to devote to schoolwork. But simply knowing that your business has added immediate
    reporting that the public yearns for, and local stories that townsfolk always look for their friends in, and the obituaries they claim to check to make sure they aren’t in there; is cause enough for the daily ready to appreciate not
    waiting 24-24 hours for a report.

    I don’t like paying for cable television. Advertising financed it before. Now we pay and still get bombarded by ads. Again, there are salaries to be paid to those people who install and maintain these services, like the ATM. Except
    the cable companies ask more than a fair amount. That’s the stock market.

    But writer Cathy, as I, have a choice. We can choose to have these services
    or not. Aside from cable, most services charge less when the volume goes up.
    Yet, the public has never equated the economics of scale to their lives; not even their paychecks.

    Now, would you like to discuss the Post Office?

    John Tierney

  3. DLS says:

    I live in Myrtle Beach, SC. I will read the YDR website, and I would even be willing to pay for it. $59.99 is absurd. Obviously I do not subscribe to the print version. It would be delivered 4 days after the fact, and would only contribute to the landfill crisis. Perhaps you have not noticed that I can access the free info from WGAL, FOX 43, or the Harrisburg and Lancaster newspapers. $10 a year would keep me as a customer.

    • Randy Parker says:

      Well, DLS, if $10 is your price point, we might have something for you.

      Our e-Edition is an online copy of the print edition. You get every page of the paper every day in full, vivid color. It offers several cool online tools, such as the ability to follow links to e-mail addresses and websites directly from the news pages, and to share stories with friends.

      You can get the e-Edition for … you guessed it … $10 a year. Just follow this link: http://www.ydr.com/esubscribe

      The e-Edition is available almost as soon as the paper rolls off the press, and nothing is sent to the landfill.

      As for relying on the other news sources you mentioned, I think it is important to understand what you do not get from them. No disrespect to them, but they do not come close to covering York County as well as the York Daily Record does.

      We commit more than two dozen reporters and photographers to York County, and they are supported by nearly 40 more people. All of those resources go to York County, and York County only.

      In contrast, WGAL uses about the same number of reporters to cover about a dozen counties.

      The Lancaster and Harrisburg newspapers are terrific, but like us, they are focused almost exclusively on their home base. In fact, the three of us routinely use each others’ coverage to report on the surrounding areas.

      Our goal is to provide the best coverage of York County, bar none. The New York Times cannot cover York Township like we do. CNN will never understand Red Lion as well as our reporters do. And the Wall Street Journal will never have to answer to the people of Main Street in Jacobus, but we will.

  4. paul kuehnel says:

    If the pay wall as a model is making money, growing, and people are willing to to pay for the information we work hard to bring, than I think it’s great. I am a paid content provider (multi-platform journalist) for ydr.com. I love what I do and the resources to pay me and continue doing this as a full-time pursuit after 27 years are dwindling.

    However, pay walls hearken back to a time 30 years ago when media was controlled by only newspaper, TV and radio. We were the only game in town for information and advertising and we were able to push that weight around and make people buy it.

    We now compete for attention with other platforms like facebook and G+, apps, twitter, point of sale payments (NFC)… that are free to access and are growing.

    We are shrinking our our ability to be interconnected in the social sphere with a pay wall, grow an audience, tap in to an interconnected base, as we should be seeking to come up with new technologies and better ways to sell advertising to this social base. In the meantime, the free social world grows around us.

    Pay walls punish the very core audience we should be rewarding and growing while the random hits get a free ride.

    Jeff Jarvis http://www.buzzmachine.com/ suggests one idea. Charging $20 for entry, but rewarding readers who click on ads, purchase things, engage in social behavior… things that bring more readers and revenue to your product.
    The way the reader of the York Sunday News can pay for the cost of their paper, plus make money, by cutting coupons.

    Of course, you have to have the ability to execute the infrastructure when you come up with an idea, but you need the people there waiting.

  5. Lee Woodmansee says:

    I have two points:

    Why does a reader with a full subscription have to pay ANY extra for an on-line subscription?

    The question of paying for on-line papers is affected by the paper’s market size. My sister owns a small town newspaper with no competition for local news. She charges almost full freight and people pay. The NYT can’t do that. YDR? Who knows?

  6. Randy Parker says:

    Lee,

    Our thinking has been to let the marketplace guide us. That is, if people want home delivery, they should be able to buy that without having to subsidize all other methods of sharing the news. If someone wants their news online only, we should have a business model built around that. And if someone wants it all, we should have a pricing plan that is appropriate for that as well.

    Some news organizations have gone to a paywall with the express intent of using it to prop up print efforts. I don’t think that is what is guiding us.

    Our approach to using the web cannot be supported by the same model that supported us when we were all about print. If we gave our online services away to all print subscribers, we would have to increase print rates to expand online efforts. That doesn’t seem fair either.

    We’re still in the hunt for a model that allows us to give this community the news coverage it deserves while taking full advantage of all media platforms that develop.

  7. Terry Zellers says:

    Excellent exchange! I love the Jeff Jarvis idea of an entry fee and rewards for clicking and buying from an advertiser. Two way benefit for the reader and the newspaper. As for Cathy….well hire her

  8. Stephen says:

    Mr. Parker,
    You are clearly a generously spirited man for adressing these complaints without stating what is a well known price structure in digital media. I am very familiar with the digital side of newspaper advertising and the pricing involved.
    Look, this is how it works: A newspaper will generally sell a set number of ads for online placement for advertisers. Standard prices are very variable but usually sell at the very high end at about $5-15 CPM for a banner ad here in the United States. CPM means ‘Cost Per Mille (thousand)’ This means that for every 1,000 ad impressions (pageviews), the advertiser has to pay 5 dollars. The problem is this… usually only about 40 to 60% of ad impressions sell out, at least here in the United States. The rest of the banner slots are sold at what we call “remnant rate”. This is usually about 0.01-0.05 dollars per thousand ads sold, but often less than one cent, often much less than one cent. Sorry for the yankee conversions below, but you’ll get the idea.
    So, say inyork.com, has about 500,000 page views per month. Considering that only 250,000 pageviews will sell, the ads that sell out will give the paper about 250 x 5 = 1250 dollars per month. Great news! What about the other 250,000 pageviews? Well, they well sell at remnant rate- 0.05 dollars, to be VERY generous. So, this will generate 250 x 0.05 = 12.50 dollars per month. Maybe inyork.com can buy some shiny new pencils with that. And like I said, I was being generous.
    In essence, 1/2 of the visits to inyork.com contribute zero revenue to the company, apart from some new office supplies. So, if inyork.com loses 50% of its pageviews but can get even 2 or 3 new subscribers, they are winning, hands down. So any threats by someone that they will leave the site forever are utterly silly to the accountants of an online newspaper. This is not strictly true, since the ‘excess’ audience has some power with advertisers, but it still has no measureable effect on the balance sheet.
    Sorry to be less than gentle with some of your readers, Mr. Parker, but I’ve been waiting for someone to lower the boom on this rubbish at some point.

  9. Stephen says:

    And I may mention, that when one loses 250,000 pageviews, the savings from decreased online server usage are far, far greater than 12.50 dollars.

  10. Stephen says:

    Heh heh… thought this was an English paper. Sorry, was reading about the travails of the midlands papers over there last week. I just have a general interest in newspapers. Sorry if I insult the hometown crowd.

  11. cathy haynes says:

    @Terry- Hire me for what? Let’s talk!

    I’ve run a business, and I understand the difficulties of paying the bills while not pricing out of comparable market value or perceived customer value. The business that I ran was a “bricks and mortar” dating service which is now out of business because it could not compete with online dating. I spoke with the owner about starting an online dating service but he didn’t see the potential. Obviously he missed that boat. To continue the metaphor, I jumped ship before it sank.

    Yes, Randy, there are some local stories carried only in YDR. A handful of them interest me. And I get to read a handful of stories for free each month. Make that a double handful if I read a few at work on my lunch break and then read a few more from my home computer. The few times I’ve reached my limit I looked for other sources rather than committing to paying for online content. I found other sources and therefore had no need to pay for YDR or Lancasteronline. I may be the exception, but if I’m not, then this current business model isn’t going to work.

    I agree there must be a business model that can make an online newspaper profitable. My hunch is it will look a lot different from the print newspaper business model. Randy’s comment that an all free online paper means charging more for the print version tell me YDR isn’t looking at the big picture. Yahoo is free to the user and quite profitable and certainly not supporting their online content with a printed paper. Of course they do it with advertising. When I log on to Yahoo there are ads for Bare Minerals makeup. When my boyfriend logs on to Yahoo there are ads for Bass Pro Shop. The same targeted marketing can take place at YDR. How is YDR capturing information? The people that click on the headline “Fike takes third place in Pokemon Competition” should be targeted for Game Stop ads, for example.

    The possibilities are endless.

  12. Scott Fisher says:

    Note to readers following this discussion, Randy has put up a related post here here.

  13. Randy Parker says:

    Cathy and others, I’d be interested in your take on the comments that Stephen left in in this related post: http://bit.ly/As1lTv

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