Oxford on paying for news online

Posted on July 4, 2013


Oxford’s Reuters Institute for the Study of Journalism put out a digital-news surveyrecently that’s well worth your time.

It found that in the U.S., just 12 percent said they paid for digital news last year. Eighty-five percent said they did not. Of those not paying, nine percent say they expect to at some point in the future.

So about 20 percent of the adult population say they are willing to consider paying for news online. That number sounds low, which is why Mathew Ingram wrote a postheadlined, “The paywall mirage: More are paying for news, but most aren’t and likely never will.”

Well, yes. Most aren’t. Even in the good old days of newspapers, most weren’t, either. In 1993 at the industry’s circulation-volume peak, less than one-in-three adults bought a Sunday newspaper in an average week. That ratio is at about one-in-five now.

Remember that we are in the early days of paying for news online. Rest assured, the number paying for news one way or another will be higher than 20 percent in a decade.
Still, that 20 percent number works out to about 48 million people, which also happens to be the number who buy a print newspaper every Sunday.

I’ve talked a lot over the years about loyal readers and junk traffic. The conventional wisdom of the digital era has been to get as many eyeballs as possible and sell ads against them. That’s finally begun to change somewhat in the last couple of years as papers have come to realize that their core readers are where the money (such that it is) is at.

Point is, it’s not necessarily failure if you don’t get 50.1 percent of people paying for newspapers. Newsrooms have to focus on the hard-core news readers that make up roughly a quarter of the population. Find out what they want, give it to them, get money from them.

The most interesting nugget of info out of the Reuters Institute study is that younger people are much more willing to pay for news online than older folks. About 20 percent of 18 to 34 year olds (in all surveyed countries; the report doesn’t break out the U.S. here) have paid for news online, double the rate of those 45 and up.

That’s surely due to the fact that younger people are more wired than older ones, but it’s positive nonetheless. Of course, there’s a big difference between paying 99 cents one time for a news app and subscribing to one for $8 or $10 a month. But in the U.S., 60 percent of online payments for all age groups were subscriptions.

Also good: The proliferation of tablets and smartphones, whose owners are dramatically more likely to buy news than those using desktops and laptops. Sixteen percent of tablet and smartphone owners in the U.S. had paid for news online in the previous week—quadruple the overall rate.

It’s not just demographics either. Reuters controlled for income and age and the like and found that owning an iPad makes you two-and-a-half times more likely to purchase digital news.

It’s best not to hang too much on one survey. I blogged about a different one in 2009 that found half of Americans said they’d be willing to pay online for news.

Back then there were no iPads, for instance and few news sites charged, so it’s hard to imagine the number of people willing to pay dropped by 30 percentage points since. Either that number was too high or the Reuters Institute number is too low.

by Ryan Chittum , a former Wall Street Journal reporter, is deputy editor of The Audit, CJR’s business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu.