In this week’s Briefing:
Quantifying paywall circumvention remains a challenge
Publishers are well aware that portions of their audiences bypass their paywalls and access content without paying for the privilege. Still, most have opted to turn a blind eye, arguing that it’s a fringe behavior or that it has no meaningful impact on their businesses.
But the reality is that few publishers have an accurate read on what portion of their audiences might be bypassing their paywalls, let alone a nuanced understanding of the impact it could have on their revenues. They may assume it’s a small minority, but most lack robust data to support that assumption.
Measuring paywall circumvention accurately remains technically challenging. Some circumvention tactics make identifying paywall-dodging users difficult, leaving publishers in the dark as to how frequently their content is actually being accessed by non-paying audiences. Publishers and technology providers readily admit that quantifying paywall circumvention accurately remains essentially impossible.
Nevertheless, publishers frequently say they believe the problem is a small one, and that paywall-dodging audiences are “minuscule” and/or “insignificant.” Arvid Tchivzhel, managing director at Mather Economics’ digital consulting practice, estimates around 4-5% of readers bypass publishers’ paywalls successfully, according to Digiday.
That might be accurate, but consumers themselves say they’re attempting to get around paywalls at a far more significant rate. Fifty-three percent of U.S. consumers said they attempt to bypass paywalls on publishers’ websites when they encounter them, and 69 percent say they avoid clicking links to websites they already know use paywalls or registration walls, according to a study of 2,509 U.S. consumers conducted by Toolkits last year. Among consumers who already pay for at least one digital subscription, 66 percent said they attempt to circumvent paywalls.
It’s no secret that publishers have found converting new subscribers more challenging in recent years, partly because of difficult economic conditions and partly because they’ve already converted their most engaged (and therefore easiest to convert) readers. But as consumers become more familiar with paywalls, a growing concern for publishers is that they’re also becoming increasingly adept at avoiding them.
Search activity for terms like “bypass paywall” has accelerated dramatically over the past few years according to Google Trends, and paywall circumvention methods are now passed around online more openly than ever. Meanwhile, growing coverage in mainstream media about subscription price hikes and how to manage and cancel recurring payments is further propelling consumer curiosity about how they might access publishers’ digital content without paying.
Paywall circumvention is also more prevalent among younger audiences, on which some publishers are pinning their growth expectations. Sixty-three percent of 18-25-year-olds attempt to access publishers’ content without paying, and 58 percent of 26-41-year-olds.
A lack of simple solutions can make content security and paywall circumvention thorny issues for publishers to discuss and evaluate internally. But for publishers looking to grow their subscriber bases and subscription revenues long-term, questions around content protection and paywall circumvention rates are escalating from niggling inconveniences to more meaningful priorities.
Click-to-cancel subscription requirements introduced in France
In France, a new decree has entered into force requiring that businesses allow consumers to cancel subscriptions and contracts online in three clicks or fewer. Businesses will have until 1 September 2023 to comply with these new requirements.
The new rules effectively state that self-service termination functionality must be offered to all consumers via businesses’ websites and mobile applications, regardless of how a subscription or contract was initially entered into. They also state that businesses must not require consumers to create accounts or volunteer personal information to access termination features, other than that necessary for termination.
The change is a noteworthy one given the U.S. Federal Trade Commission’s attempts to introduce click-to-cancel requirements for subscription businesses operating in the U.S. It now appears likely that online cancelation mechanisms will become an unavoidable legal requirement for U.S. publishers and media companies as the FTC seeks to formally mandate that companies “make it as easy for consumers to cancel [subscriptions and trials] as it is to sign up.”
The FTC has been attempting to require click-to-cancel mechanisms for years but, by its own admission, “has only gotten part way to fixing the problem” of sellers making it “hard or impossible” to cancel subscriptions. To remedy that, it’s proposed new rules that would require publishers (and other companies selling subscriptions) to offer straightforward self-service cancellation mechanisms. “If you can sign up online, you must be able to cancel on the same website, in the same number of steps,” the commission said.
Also worth noting:
- Sweden’s Bonnier News has attracted 2.2 million paying subscribers. 1.7 million are based in Sweden – a country with a population of 10 million – and half of its total subscribers are digital-only.
- New research dispels hopes around micropayments as an easy revenue source for news publishers and suggests subscriptions remain core.
- Mediahuis-owned subscription analytics firm Mather Economics acquired content curation and analytics platform Sophi from The Globe and Mail.
- It’s becoming increasingly clear that Netflix’s password-sharing crackdown has helped it add new paying subscribers.
- News publishers are increasingly investing in non-news content in an attempt to broaden the appeal of their products and grow subscription revenues.
- The New Statesman says it will publish and distribute its newsletters exclusively through the newsletter and social media platform Substack.