Metered Paywalls Are Better Than Freemium

Posted on October 1, 2013

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New data from an internal Piano Media study reveals that media partners who adopted Piano’s Solo metered paywall in May 2013 are gaining revenue and subscribers faster than those who remain with its freemium solution.

The report, available exclusively to Piano Media partners, shares data from Piano’s partners who implemented the national paywall provider’s metered payment solution. On those sites, revenue grew 103% year-over-year, more than doubling their average revenue growth while total payments from May increased 48%, the company said.

“After more than two years of promoting the freemium model, we now know that metered paywalls are simply more effective,” Rado Bat’o, Piano’s head of marketing and analytics, said in a statement. “Exposure to the paywall increases significantly because publishers no longer decide what content to lock. The meter shifts the focus from a premium content model to a usage based model.”

Piano Media provides digital subscription solutions for more than 75 media websites from 25 different major publishing houses in Europe. The company is currently expanding its roll out of metered paywalls to its existing partner base and is selling its “Solo” metered content monetization solution to publishers in Western Europe.

Another finding was the importance of offering discounted one-month trials, using opt-out as a method to drive subscriptions. “When a publisher launches a metered paywall, a low price opt-out is proving highly effective in attracting subscribers,” Peter Richards, Piano’s head of international operations, said in a statement.

The three-month study revealed that more than 70% of new subscribers selected an opt-out trial price of 0.01 euros compared to the standard monthly subscription price of 3.90 euros. More than 67% of initial opt-out users were retained the following month. Further, after four months, more than 44% of May’s opt-out users were still Piano subscribers. By introducing opt-out subscription, new monthly subscriber inflow increased 79%, the company said

Piano recently completed detailed user behavior analysis for publishers in Germany, France and Spain, finding results similar to those in central Europe. “The majority of users are reading fewer than five articles per month,” Bat’o said. “We found that after implementing a meter, consumption patterns do not change.”