No prize for being first with paywall - APN

RICHARD MEADOWS
Last updated 12:24 06/06/2013

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New Zealand Herald publisher APN says there is "no prize for being first" in the inevitable shift towards charging people to read news online.

The business models of the country's major newspapers are under the spotlight after a report by PwC yesterday said paying for online news content would become "the new normal".

Stuff.co.nz and NZHerald.co.nz are the two behemoths of the New Zealand online news world, capturing audiences of 1.27 million and 986,000 respectively in April.

Both APN and Fairfax, publisher of Stuff, are considering introducing paywalls for their various online brands.

But they are acutely aware that the first mover risks bleeding readership to its rival publisher if disgruntled readers - long accustomed to free content - refuse to pay up.

"The traditional kind of thinking around that is there is no prize for being first, because some audience will move," APN's chief marketing officer Kursten Shalfoon said.

"However, somebody has to be first."

While there had been some suggestion that the two competitors could launch a paywall in tandem, Shalfoon said each would have to weigh it up on its own merits.

"As publishers, we need to make the decision independently and make sure the business case stacks up," he said.

Earlier today, Fairfax Australia unveiled details of its online paywalls that will come into effect next month.

The PwC report forecast a boom in online advertising and a continued decline in newspaper advertising revenues over the next five years.

PwC partner and technology specialist Paul Brabin said newspapers needed to urgently find a way to make money from their digital channels.

Newspaper paywalls around the world have generally been introduced under three models.

The "freemium" model, as used by Rupert Murdoch's The Australian paper, allows users to get selected content for free and pay for the rest.

A "hard" paywall, employed by the likes of The Wall Street Journal, makes content available only to paid subscribers.

Many others use a "metered" paywall, which grants access to a certain number of articles for free each month.

"We're looking at all three," said Shalfoon.

"However, that last one tends to be the most popular model, and it's probably the most popular model for a reason."

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A metered paywall allowed people to sample the quality of content, and deeply engaged consumers would be the ones more likely to pay, he said.

In a written statement, Fairfax New Zealand's acting managing director Andrew Boyle said the company would watch with interest as flagship Australian publications deployed paywalls this year, but at this stage had "no definitive plans" to introduce them here.

Last month he told Stop Press there was "a lot of modeling and research work being done".

The few newspapers to put their online content behind a paywall in New Zealand are the privately owned Whakatane Beacon, Ashburton Guardian, and National Business Review.

Prices for a year's online subscription range from $91 for the Beacon to $149 for the Guardian and $220 for the NBR.

- BusinessDay.co.nz

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