The Washington Post Plans to Implement a Paywall in 2013

One of the biggest difficulties that media organizations have faced as they transition into the new media world, has been in finding a way to make money off of websites and online content. In today’s ubiquitous internet environment, consumers no longer have to rely on a local daily newspaper to get their news and information. Anyone with an internet connection can visit the website of just about any news organization around the globe to learn about what’s happening around the world. This creates a new element of media competition, and news sites have struggled to figure out the best way to encourage visitors to their sites, while sustaining a profitable operation.

The Washington Post announced recently that it would begin rolling out a metered paywall in 2013. This paywall will likely be similar to those of many other news sites, where users are allowed to read a certain number of articles for free before being prompted to purchase a subscription.

The paywall was announced amid an environment of steep decline for the Post’s core business of print advertising. The Washington Post newspaper division reported an operating loss of $56.3 million for the first nine months of 2012. This represents a 14 percent decline in revenue from 2011.

As with many news organizations, the Post has struggled to restructure its business model to adapt to major changes in the news media industry. In recent years, most other major newspapers have elected to implement a paywall to offset losses in print advertising. Despite this, Post executives have been hesitant to implement a paywall, believing that to do so may threaten their national audience, and likewise their digital advertising revenue that comes from that national audience.

Don Graham, the Chairman of The Washington Post Co. is one of those executives that has been skeptical about the merits of news website paywalls. “We are obviously looking at paywalls of every type,” Graham said. “But the reason we haven’t adopted them yet is that we haven’t found one that actually adds profits immediately.”

As an internationally recognized and visited news website, WashingtonPost.com has developed a worldwide audience. While its online readership has increased exponentially, the Post’s print readership has declined dramatically, as has the print advertising revenues.

Post executives are facing a turning point for their organization where they need to make the difficult decision as to whether to follow suit with other news organizations in implementing a paywall or attempt to hold strong as one of the few major news sites that still provides readers all its content free of charge. The New York Times introduced a paywall 18 months ago and now has over 500,000 online subscribers.

The conundrum The Washington Post faces is in how to produce revenue in an environment where news sites are desperately trying to attract and maintain a wider audience, while their competition is giving it away for free.

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