I bring this up after reading a Wired piece by Mark Hill evaluating one of the risks of paywalls.
"Limited by financial realities, smaller publications may struggle for subscribers while not everyone will be able to afford access to high-quality news, they said. 'There is a risk those audiences don't get access to the range of information and journalism they need to stay informed in the current era,'..."
I get the concern, and we to ensure local news access is not solely based on ability to pay for it. But the article doesn't mention a reasonable middle ground solution: Registration.
Registration helps publishers walk the line between the need to tighten the paywall and a declining ad model. And in any registration, a verified email address represents the first critical building block of permission-based 1st party data. This will help local news be sustainable in the future, in 2 important ways:
1) A way to engage and pitch subscriptions/membership/donations: Best practices gathered by Google News Initiative shows email and newsletters as a critical step in building reader revenue.
2) A basic identity to support ad rates (which may go down as 3rd party cookies are degraded): This is why many ad industry trade associations formed a coalition called "Partnership for Responsible Addressable Media" which is trying to preserve some ability to determine advertising audiences beyond the top few web platforms and preserve underlying data that supports medium and smaller publishers and their ad revenue.
If you are not familiar with number 2, here is a summary article from AdExchanger about the work that the IAB, along with The Trade Desk, LiveRamp and others, are doing to find an ecosystem-wide solution that will save the CPM ad rates for smaller publishers. After losing classifieds revenue, and much of search and display revenue to bigger players, online ads for local publishers are at risk of be further de-valued as the underlying cookie system changes. The short version: as browsers eliminate 3rd party cookies, ad rates for smaller publishers will be less targeted, less relevant, and less expensive as they lose the underlying "identity" data that 3rd party cookie provided, and advertisers will move more money to sites that have it, namely bigger wall-garden systems.
Interesting to note that the article further emphasizes how important it is for local publishers to make the pitch better:
"Radcliffe says [local news publishers] need to make a better case for why it’s worth the money. That means letting people know the actual cost of producing journalism, and what’s at risk if you don’t financially support it.
I agree, and pitches that feature journalist talking about their work have often been cited as effective. But making that pitch requires a place to pitch it. Off-platform media is an expense. In-house inventory can use up revenue opportunities as well. Again this is where email can help: it may be the cheapest and easiest way for the local publisher to make that pitch for the value of local news.
....of course, how to obtain, manage, understand what a registered user wants and how to communicate with them is an art and science too, and that is where Upside wants to help.
