The Technology Behind Paywalls: Constructing a Paid Content Scheme Is Not Only a Significant Strategic Change, but a Technological One, Too

By Mickey, Bill | Folio: the Magazine for Magazine Management, April 2010 | Go to article overview

The Technology Behind Paywalls: Constructing a Paid Content Scheme Is Not Only a Significant Strategic Change, but a Technological One, Too


Mickey, Bill, Folio: the Magazine for Magazine Management


ONLINE PAYWALLS ARE STILL being scrutinized as a possible revenue stream to supplement declining revenues in print and online display advertising. Yet, there are still relatively few publishers that have found success in the strategy. What's conspiring against more rapid implementation, especially these days, are significant capital investments in technology, a strategic about-face, a possible decline of total audience, and the daunting prospect of determining if your content can be fashioned into a service or experience, thereby unlocking its value.

There are different models of online paid content-metered, pay-per-article, subscription, and so on. At The Deal, LLC, a b-to-b media company serving the financial and investment sector, an enterprise subscription model was selected.

Even in the b-to-b world, where content is valued for its depth of data and service orientation, adjusting to a paid model can be painful. The Deal which had a paid model that CIO Michael Lonier called a "mixed bag" of individual subscription packages, re-engineered its platform into one that provides access on an enterprise license level. The decision was based on a conclusion that a fully-licensed model offered a steadier income stream that smoothed out the "cyclical and longer-term secular changes in sponsored advertising," says Lonier.

"We're about a year and a half into a significant transformation of our product, and prior to that we had a more conventional b-to-b kind of product mix with a qualified magazine and free stuff and some paid stuff and some premium products. It was a mixed bag of products, which we supported with a subscription strategy and sold primarily via telemarketing," says Lonier.

The Deal moved away from that strategy to one where all the content was streamlined onto a common platform and format where it could be sold as an enterprise-level service called The Deal Pipeline, complete with its own dedicated sales team. "We sell with a relationship model like you would sell almost any other high-end service," says Lonier. "There's a sales team that works with different accounts."

The jump, as all publishers know, was both risky and painful. In The Deal's case, the publisher went all in. Not only is the content at a much higher price point, but the company is targeting a smaller customer universe. "The first year is tough for this sort of thing," says Lonier. "It will be for anyone. You have the baggage of the way you used to do things. Especially, in our case, since we are shooting for a higher price point."

Lonier is careful to make an important distinction that the value proposition for The Pipeline is what the content does for the customer, not the content itself. "We don't sell content, we're selling an enterprise information service. Content is part of it. The other part is access and deliverability. All of that is designed to add value."

Subscription Paywalls

Harvard Business Review has a paywall that's primarily accessed via a subscription model. Print subscribers don't have automatic access. Readers can subscribe to print ($79/year) or digital ($99/year), or both ($129). …

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