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Do Paywalls Dramatically Impact PR?

New figures from the Pew Project for Excellence in Journalism further demonstrate the financial hurdles the newspaper industry faces: for every dollar newspapers earn digitally, they’re losing seven in print. (PaidContent offers a detailed breakdown of the study.)

“The papers that are succeeding are those that have pushed harder to change their sales staffs, have pushed digital even at the risk of putting less effort into the old categories that pay the bills, have taken more risks — have fought against the deep ‘inertia’ that many of the executives describe,” said Tom Rosenstiel, Pew project director, in an email to the NY Times.

As the number of print readers has declined, many outlets have beefed up online content and tried to add online advertisers. Moreover, paywalls are becoming more popular.

Today, the Los Angeles Times instituted a paywall for full access to its online content (we clicked around and didn’t run into it). The New York Times, Financial Times, and The Wall Street Journal did so a while back. Some Gannett newspapers, which includes the Minneapolis Star Tribune are also going the paywall route.

The Journal calls the success of some paywall programs (that paper, the NYT, and the FT fall into that category) “exceptions more than the rule,” dependent on the early timing of that the paywalls were instituted and the large number of readers that could be converted into paying customers. Although not everyone purchases a subscription, the lower cost of delivering the news to these customers makes them very valuable. At first, the Times actually saw a dip in traffic before leveling out.

The question for PRs is whether a paywall reduces the exposure that clients could potentially get from gated stories in which they appear. Certainly if that media hit is restricted to paying subscribers, the pool of potential readers is more shallow. But, as the Journal points out, “free content is still plentiful online.” And paywall systems often offer a certain amount of content for free.

“Typically, only around 10 percent to 20 percent of their online readers visit the site enough to run into the pay requirement, depending on where the threshold is set,” the story says.

Because news goes viral and paywalls are largely pretty lax, it doesn’t appear that paywalls should have that much of an impact on media relations strategies. Also, taking into account the growing importance of content creation in PR work, any small losses could be offset by the exposure from items produced by clients and their firms.

Thoughts?

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