Toronto Star to introduce paywall in early 2013

by Andrew Moran (Guest contributor/Digital Journalist)

Toronto Star publisher John Cruickshank announced Monday plans to introduce a paywall structure in 2013. Complete details of the proposed plan have not been released, but it is in line with other Toronto outlets, such as the Globe and Mail.

What other news organization in Toronto is going to enforce a paywall? That is the question on the mind of many Torontonians, who have been used to reading the news on the Internet for free for many, many years.

Readers who headed on over to the TheStar.com on Monday morning may have been surprised (or not surprised depending on your aptitude on the business of media) to learn that the Toronto Star is going to implement a paywall, a measure that offers its visitors a paid-subscription for full access to its content.

“This move will provide a new source of revenue for the Star that will help support our ability to provide readers of both our print and online editions with the best and most comprehensive package of news and information in Canada,” wrote Cruickshank in the announcement. “Under the plan, most print subscribers to the Toronto Star will receive free full access to thestar.com’s content, wherever and however they want.”

Full aspects of the subscription have yet to be released, including the costs, how to register and what features readers can access.The purpose of the subscription is to generate another tool of revenues, while also providing more news stories, video content and podcasts of news from across the Greater Toronto Area and elsewhere in Canada and around the world.

“These additional revenues will strengthen our ability to invest in quality journalism, both in print and online, and provide the high quality of news, information and opinion that our readers throughout the Greater Toronto Area and across Canada have come to expect from the Star,” added Cruickshank. “They will also allow the Star to bolster its long-standing focus on delivering accurate local, national and international news that matters to our readers.”

The Toronto Star joins the likes of the Globe and Mail and National Post of Toronto outlets adding a paywall. In the United States, the Wall Street Journal and the New York Times have performed the same thing. If the Star is looking to make extra revenue, the New York Times posted its third quarter numbers, which include an 85 percent drop in profits.

Some of its readers have already commented that they will not pay for something that they can receive for free elsewhere. Google News offers hundreds of news agencies that provide the news of the day at no cost, such as the Associated Press and Reuters.

This article originally appeared on Digital Journal [Link]

Study: Newspapers losing $7 in print ad revenue for every $1 earned online

by Andrew Moran (Guest contributor/Digital Journalist)

According to a new study by the Pew Research Center’s Project for Excellence in Journalism, newspapers in the United States lose $7 in print revenue for every dollar earned in digital revenue. Will a new business model appear?

Many newspapers in the United States and Canada are starting to adapt to the digital age – some may be faster than others. Some publications have attempted the paywall structure, while others publish their news online for free. But are these business models working?

By analyzing financial data of 38 American newspapers and conducting interviews with senior executives from more than a dozen companies that own 330 dailies with circulations between 25,000 and 100,000, Pew Research Center’s Project for Excellence in Journalism has published a new study that finds some very interesting figures for the newspaper industry.

The most important statistic to report on is the fact that newspapers lose $7 in print advertising for every $1 earned in digital revenue. The research found that digital advertising revenues rose on average 19 percent, but suffered from nine percent losses in print advertising.

“Only 40 percent of the papers that provided data say targeted advertising is a major part of their sales effort,” the report stated. “Even though many newspapers are not focusing on it, smart or targeted digital advertising—in which ads are customized based on consumer online behavior—is expected to dominate local digital revenue by 2014.”

Newspaper executives admitted in their interviews with the institute that cultural difficulties are making it harder to transition from print to digital. One challenge that newspapers face is that their employees are too keen on their “old ways.”

Another trouble newspapers face is that even though they may be attempting to shift towards digital revenue, they are having a tough time trying to convince digital salespersons to the newspaper sector.

Upon further analysis, Pew found that the daily deals offerings (e.g. Groupon, DealChicken, etc.) accounts for only five percent of digital revenue. Meanwhile, mobile device advertising only tallies one percent in digital revenue.

The future seems desolate, according to some of the interviewed executives, who maintain a morose outlook. They believe that many newspapers will shrink, shut down and only provide print editions that would be delivered a few times per week.

“The study suggests that the future of newspapers, rather than being determined entirely by sweeping external trends, can be substantially affected by company culture and management, even at papers of quite different sizes,” said Tom Rosenstiel, PEJ director, in a press release.

Canada’s Media

Although the study primarily focused on U.S. publications, Canadian news outlets face the same issues.It was announced that Torstar Corp., owners of the Toronto Star, Workopolis, TheStar.com and others, reported better-than-expected profits in the fourth quarter. Although executives say advertisers are remaining cautious, digital revenues were up 22.8 percent year over year – digital revenue maintains 10.6 percent of its total revenues.

More than one-third of PostMedia’s revenue comes from online operations. It does not, however, publish its financial data.