Metered subscription model works for newspaper company

May 1, 2015

By Stanley Schwartz
Managing Editor | Publishers’ Auxiliary

Newspapers are all about being open, transparent and breaking through barriers. That’s why Matthew Ipsan, the chief digital officer for Community News Holdings Inc., believes the term paywall is a poor word choice.

“That’s like calling a vacation resort a Gulag,” he said. “Who would want to vacation there? Paywall has a negative connotation.”

He considers it the P-word. Instead, two years ago, CNHI started implementing a metered subscription service at its various media properties.

The trend, he added, has been a tremendous success.

“All we’re really doing is asking our customers to pay for goods and services,” Ipsan said. Nowhere else does an industry just give away its products and services and still remains viable. “Our content is valuable. And customers will pay for it. So we have to provide it on whatever platform they want it.”

To make sure CNHI could do that, he said, the company turned to Tecnavia for its digital needs. Because of the many different types of hardware and software available, Ipsan said it was important to make the metered subscription model as easy to use as possible. CNHI didn’t want any barriers between its customers and the content it was providing.

In the last two years, it has implemented this process in 60 of its daily newspapers. Although Ipsan said the company has not metered the weeklies, it doesn’t mean it won’t happen.

“We are looking at each market we’re in,” he said. “And we will see if that newsroom can provide content 24-7.” If the newspaper can provide service 7-days-a week, CNHI will make the move to a metered subscription model.

Once the news is online, Ipsan said he knows some people find a way around the meter. He’s even seen people post on Facebook how to “beat the meter” at CNHI’s papers.

“Even so,” he said, “I have not seen a drop in electronic subscriptions. People value hard work and an honest day’s wage for an honest day’s work. They know it’s not right and not legal to beat the meter.”

Ipsan said the company’s expectations for revenue from the metered subscription model has exceeded what it expected. Because the company is privately held, he could not get into the specific numbers, but he noted that the original projections were not conservative at all, and still they did better than they thought they would.

Although some customers who were used to getting something for free might have been upset at the change, Ipsan said advertisers loved the move to a metered approach.

“They thought if someone is willing to pay for this, it has more value,” he said. And even after raising online ad rates, Ipsan said the company was still able to increase the number of advertisers it has online.

There are still items that the company does not charge for online. Anything to do with e-commerce, such as ads and classified, are not metered.

“Breaking news is free, too,” he said.

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