Financial Times chief sees paywalls as 'morally' necessary to protect journalism

ft.png In making "the commercial and moral case for newspaper paywalls," the Financial Times' John Ridding points out that people do pay for access to high quality journalism such as his organization produces. Interviewer Roy Greenslade of The Guardian concludes with this:
But he clearly backs all such moves and concludes our conversation with a sharp observation about the digital revolutionaries who have argued that "information wants to be free." It is, he says, "an absurd notion."
A "sharp observation?"
It isn't. Few ever cite this ancient, shopworn slogan except entertainment executives and fellow travelers in need of an easy zinger. Ridding has no-one to attribute it to, so his usage of it gives the impression that he's not arguing entirely in good faith. Taken in the economic context of the rest of the interview, it makes him appear ignorant of the fact market forces, not the opinions of free culture advocates, are what's hurting his traditional industry. Not a smart impression to give, even if you are turning a profit. Perhaps the 'case' here, however, is actually intended to service similar prejudices in his audience about how the internet works. I.W.T.B.F. is so inherently empty of meaning when context-shifted that defensive critics can't resist wheeling it out: If the audience believes that newspapers are really under threat from inane news-pirating bloggers, it's easier to conceptually link paywalls to quality as well as revenue. An interesting part of this is that it makes typical objections to paywalls -- how will people link in? how will people share it? -- read like appeals to vulgar popularity. Wouldn't you rather be in on the exclusive? But there are practical consequences for the silo: sealed-off from the internet and social networks, it can make money, but it's no longer part of the web. It loses influence and public accountability in proportion to its inaccessibility. It trades established guidelines for avoiding advertiser influence in favor of being directly financially tied to readers' own expectations and prejudices. That may certainly be preferable to readers, but it shouldn't be hard to figure out how superficial a 'moral' improvement it could end up in practice. The really ingenious part, however, is that if you take Ridding's use of the term 'information' literally rather than as a proxy for journalism, it hints at a competitive advantage the FT has already established. A successful paywall reinforces the notion that information monopolies and the quality journalism that result are more valuable as private services for professional and cultural elites than as something you might read for free on a train. There's nothing wrong with that -- think LexisNexis. But this isn't a case for paywall journalism: it's a clever escape hatch for a screwed business model. Take, for example, what happens when the product is of little interest to niche customers and commands no premium over competitors. Ridding finds himself unable to be "drawn into talking on other publishers' initiatives" when asked to comment on the 90% traffic drop suffered at the now-paywalled Times. A moral case for paywall is also presented: subscriptions make newspapers less reliant on advertising for revenue, and therefore more independent from them. But just as many won't see through the "Information wants to be free" hogwash, they won't know that even with paywalls, the FT will still depend on advertisers for money: "Reach 12 million executives!". Print was always overwhelmingly reliant on ad revenue. To newspapers, cover price and subscriptions exist not to generate a bulwark against advertiser influence but to increase the value of advertising space. Paid circulation is more valuable to advertisers because it means someone paid to look at their ads. "If you have an audience that is paying for your journalism they are engaged and that is an important message for advertisers," Ridding said in an earlier interview. So much for the "morally abhorrent" formula of advertiser dependence that paywalls will free his paper from. Paid circulation might not command ten times the ad rate (bad luck, Rupert!) but if the FT can make a go of it, good for the FT. But let's not pretend that this is about whether information wants to be free: it's about how effectively the Financial Times can control the information it sells to readers.


  1. At risk of committing an etymological fallacy, this guy’s problem is trying to publish news [from Latin publico, meaning to make public] without making the news, well, public. You can publish privately — that’s called gossip — or you can do journalism and publish publicly.

    In this irony-filled world, we ought to notice that journalists and their publishers are now trying to *restrict* the amount of people accessing their publishing. They want *less* circulation, not more. When did this shift happen?

  2. My town’s local daily charges $7 a month for an online-only subscription. Or, you can read the same articles for free if you block their cookies.

    Initially I just subverted their paywall in order to see how decent the paper was. Turns out it’s not worth $7 a month. Now there a handful of good articles every week that aren’t covered anywhere else but the writing and journalism just don’t justify paying for it.

    1. Local newspapers are one of the contexts paywalls can work pretty well. I always figured it was because they have an effective news monopoly, and the local blogger types too few to cover much of it independently.

      1. Yep. I’m still on the fence about subscribing just for the local coverage. They run 1 good local story for maybe every 6 junk stories that were covered better elsewhere.

        Unfortunately, I don’t think they’d take $1 per month and grand access just to the local section.

  3. According to Noam Chomsky, the Financial Times is the only newspaper that reports the news objectively, as it really is – because its readership needs to know the real story, as there’s money involved.

    Perhaps the reason the FT is doing well is because it’s doing journalism.

      1. I don’t recall saying that Chomsky was The Final Authority of what news sources were reliable. I do recall saying that Chomsky has said, many times, that he thought that the FT was a reliable source.

        In case it’s not clear enough why, here’s a bit on thought control via education:
        “Sam Bowles and Herb Gintis … pointed out that the educational system is divided into fragments. The part that’s directed toward working people and the general population is indeed designed to impose obedience. But the education for elites can’t quite do that. It has to allow creativity and independence. Otherwise they won’t be able to do their job of making money.

        You find the same thing in the press. That’s why I read the Wall Street Journal and the Financial Times and Business Week. They just have to tell the truth.”< .b>
        [Emphasis and formatting mine]

  4. It’s true that the FT is so good I’ve considered paying up. $22 a month is just a bit too steep. I’m not personally bothered by paywalls, I just think that adopting them without realizing it means you’re leaving the public sphere is self-delusional. The FT works as a kind of private service because of its extraordinary quality and focus, but the Times, for example, is just another decent broadsheet.

  5. While I can understand the psychological need for affirmation of value that a successful paywall would create. The reality is that the math simply doesn’t work. Publications are facing three tiers of economic reality.

    1. The number of willing paying subscribers X monthly fee = a small number.

    2. The reduction of subscribers has a very large impact to reach. The result is a steep drop in advertising revenue. Many publications will argue that each subscriber should be worth more to advertisers, but the total impact to unique users more that counteracts the incremental rise is CPM.

    3. The relevance of a publication is dramatically reduced when the subscriber base is cut. The unanticipated impact here is to actual journalists. Politicians, movies stars and publicists want to spread their message. A publications prestige value isn’t worth muh to newsmakers if they aren’t reaching anyone. This makes it MUCH harder to produce the journalism that supports the brand.

  6. I took “sharp observation” to imply not so much “trenchant and incisive” as “pointed and bitter”… but it’s certainly ambiguous.

  7. I will say that the difference in ad rates between free-to-read and paid circulation is quite substantial from what I remember, at least in print. It’s a game-changer, not an incremental thing.

    If the Times reported that it’s ad revenues went up despite losing 90% of its readers, I’d be surprised — but not shocked.

  8. subscriber fees mean the publication will have less conflict of interest. It’s no wonder that BBC reporting is of much higher quality than the news networks in the US, everybody from Big Pharma to politicians to the media comglomerates who own the networks have a vested interest in the way the news is reported, and present only their side of the story to the public.

    1. The BBC is pretty much owned by our government; they’re also not as biased as I’d like, normally swaying with public opinion and morality, rather than being neutral. This just gives the perceived effect of neutrality.

      No news source is free from corruption or lies. It’s the one thing that’s consistent with news.

      Everyone has an agenda, especially the media.

  9. I suggest that much of today’s media like to refer to as “journalism” resembles that craft much in the same way that a McDonald’s meal resembles a healthy diet. Which means that even when distributed free, much of the corporate spam that some would pass as journalism is overpriced and indeed harmful.

    Have you noticed what actually happens to the world’s media when an elephant decides to walk into “our room”? They respond as one like a creature as allergic to pachyderms as they appear to be unaware of their shape, bulk or position. In short, they begin to dissemble and babble without ceasing. In this fashion, they so far they have managed to avoid noticing the arrival of any number of wars, coups and economic disasters.

    Perhaps the editors of the FT (et al) can explain just what proportion of a corporate news brand’s budget is invested in the recycling of information (including corporate data) or re-purposing opinion, as opposed to that which it invests in uncovering and disseminating previously unpublished facts.

    Perhaps if the world’s corporate media had invested a little more in “R&D”, both with regard to its business practices and its devotion to journalism, it would not find itself in the double bind of being both morally AND financially bankrupt. A pay-wall to cover the payslips of Clarkson and Gill? Do me a favour?!

  10. If there is any moral argument to be made, it’s that they borrowed a lot of money from various people and they need to try every way to multiply and return said money to these people.

  11. I pay for the 22 bucks for the FT because it is the only place on the net where I can get the level of reporting, commentary, and analysis they have. In fact, if it were free anywhere else, I’d be highly suspicious, to be honest.

    News outlets like the Economist and the FT are, to my mind, examples of massive niche publications, whose reputation and existing reporting structure means they will remain top flight for a long time to come. Newer outlets just don’t have the cache, and so can’t command that type of revenue. The Times is not the only place to go to find anything, because it’s a large broadsheet. That’s why its paywall will fail, because of the availability of substitutes.

    In my opinion, the phrase “b. It loses influence and public accountability in proportion to its inaccessibility.” just doesn’t apply to the FT at all, because of the market they service: financial types. The information is freely available on and other places, what is missing is the commentary and analysis, as well as the curation and the chance to read people like Larry Summers et al. Regardless of your views on economics and politics, if you care about these matters, or if its your job to care, then you’ve got to subscribe to the FT.

  12. The trouble with all these comparisons is that the FT and the people who run it are in a fundamentally different business to the newspapers- It’s not just the colour of the paper that’s different. In reality, the FT’s competitors are the business data services like Bloomberg or Reuters, which all run on subscription models.

    Also, any time a businessman starts talking about morality, I instinctively check if my wallet’s still in my pocket.

  13. I can see two way to look at this:

    Either this is about the morals of an ad-driven business, in which case you don’t make a decent case as to why the FT /isn’t/ on the moral high ground compared to BB’s advertorial approach.

    Or it’s about business models, in which case I suggest you just shut up and outperform them.

  14. I really don’t understand why a paywall must be incompatible with ‘being part of the web.’ If you allow articles and headlines to be indexed, and allow a small number of free reads, then I think you’re good. To me, the value of the web (as far as news goes) is in helping me FIND things. Consumption is a second step, and one that I don’t mind paying for if the content is good.

    As a second point, I’ve come to learn that I don’t care for ‘targeted’ news, nor do I want to ‘customize’ my news. At least not for my main news source. Part of what I am paying for is for a (good) publication to create that ‘front page’ of the important stories of the day.

  15. The confusion of free-as-in-beer with free-as-in-widespread-and-reusable has made attempting to discuss the phrase hopeless.

    Especially since information doesn’t “want” anything. It just is. And it isn’t always what we want it to be.

  16. I wouldn’t be surprised to see the solution come in the form of “subscription plans” not unlike you see for satellite/cable TV. Your ISP would bundle certain sites’ pay-for content as part of your internet access package. Among other things, this could work because it would eliminate the tediousness of tracking several site subscriptions, as well as the psychological benefits of not having to think about all the individual drain on your wallet, it being just a part of your regular internet bill.

    I can see the web becoming more and more segmented and stratified as time goes on. Unless content providers find more cost-effective ways of tolerating us moochers, the days of the free-for-all information buffet may soon end.

  17. I subscribe to Creative Review, which allows me access to the magazine articles on their website – and back issues (and of course a physical copy every month and extra worthwhile freebies). Aside from these articles their website also has a lot of fantastic free content, and a darn fine blog.

    I suppose this is considered a paywall; but to be honest without it I doubt they’d be able to survive, and the quality they deliver is fantastic so I’ve never had an issue with this. I just don’t think they’d get the kind of revenue they do from subscription costs, individual magazine sales and in-mag advertising. Admittedly they print it beautifully, on a variety of different paper types (each mag is like a high quality brochure for fancy stuff); but I still feel that a large number of their paying readers would just read the content online if it were all free; and PPC can only take you so far with a relatively niche publications such as that.

    I kind of feel my self sympathising with the papers to an extent; as clearly they’re doing this in response to a lack of sales in physical copies, supposedly due to the availability of online content.

    I think the big problem they’re not looking at is that the reason for this isn’t that people are consuming their physical papers content online for free; but consuming it elsewhere as there are so many high quality and diverse alternatives on the net (like BoingBoing!).

    Really the only solution is to adapt their business model, as I don;t agree a paywall will solve their problems (the real issue here); in the same way as the music and film industry has been failing to for so many years now. I don’t have the answers, but then that’s not my job.

  18. At least those in the paywall vanguard seem to be helping establish the probable market size for those considering going that way.

    I understand that when Napster went to subscriptions, it lost 90% of its users as, it appears, did The Times.

    Admittedly a sample size of two ain’t robust, but I suspect the 90% drop/10% take up will stand the test of time, at least for the immediate future.

  19. A paywall is when a site thinks linking to its content is wrong, but still links to (and uses) content from other sites, right?

  20. sharp: in a sudden or abrupt way

    Hence “concludes our conversation with a sharp observation”.

  21. Go on newsmedia – put up paywalls. I dares ya.

    Then, after I’m direct-downloading (or BTing) your shitty publications (as one can presently do for magazines), I won’t even have to see your retina-melting webads anymore. Sweet!

    Information wants to be free, even if you don’t want it to be. SUCK TURD, DINOSAUR.

  22. You can make a case for objective professional journalism being a Morally Good Thing, and worth finding a business model to produce. Whether paywalls are the commercial model you’re looking for is a question for you to ask the free market about; so is the question of whether *you* are the journalist they’re looking for :-)

  23. So what the hell happened to micro payments? I thought they were meant to be the solution to all this. I don’t want a fixed subscription, but might pay per article if the price is low enough.

  24. Well I guess a paywall could work for the Financial Times. I’m not really familiar with their newspaper but I guess it’s mostly read by business types and I assume most companies will not mind subscribing to the FT so their managers can have all the ‘right’ information.

    I can imagine a meeting where some manager would say ‘according to the FT our competitor is doing x’, rather than ‘according to a blog post I read our competitor is doing x’. For these people the FT brand/label carries a lot of meaning and authority.

    So yes, I do think their is a (massive) target audience for FT paid access.

    For newspapers who depend on a more general audience the story is quite different I think.

    General news can be found all over the internet, if someone makes you pay for it, you just go looking somewhere else. And for specialst information, you probably already exactly know what blogs have the information you need (e.g. insightful comments on your favourite sport, the latest treatment for your knee injury, etc.). You probably don’t rely on a general newspaper for this.

  25. Information doesn’t “want” anything. It has the property that infinite copies can be made without degrading the original source. By this property, information is inherently abundant.

    Saying something is “free” carries the assumption that capitalism applies to it, as “free” and “non-free” in the monetary sense are purely capitalist notions. Capitalism is very good at one thing: managing and exchanging scarcity. In the case of goods, the items of exchange are physically finite, in terms of access if not global sum. In the case of services, time is considered finite, and secondary resource use time can be converted to the local cost of sustaining the resource over the same time period.

    Information is not finite in either of these senses. In fact, information passing can be used to waste less finite time and resources on re-discovering the same information, or on extracting imparted efficiencies. Unrestricted information sharing does this more efficiently by avoiding transaction time costs.

    Capitalism has no method of dealing with such abundance. The application of false scarcities to abundance are an attempt to shoe-horn it into capitalist management, but all such attempts degrade any scarcity-offset value in abundance. This waste of abundant resources is uneconomic. This shows that capitalism is an incomplete tool for comprehensive economic progress. Capitalism was perfect for Industrial Age time-scarcity management, but it is completely incompatible with Information Age progress.

Comments are closed.