“Digital Paywall Design: Implications for Content Demand and Subscriptions”, Sinan Aral, Paramveer S. Dhillon2020-08-14 (; backlinks; similar)⁠:

Most online content publishers have moved to subscription-based business models regulated by digital paywalls. But the managerial implications of such freemium content offerings are not well understood.

We, therefore, used microlevel user activity data from the New York Times to conduct a large-scale study of the implications of digital paywall design for publishers. Specifically, we use a quasi-experiment that varied the (1) quantity (the number of free articles) and (2) exclusivity (the number of available sections) of free content available through the paywall to investigate the effects of paywall design on content demand, subscriptions, and total revenue.

The paywall policy changes we studied suppressed total content demand by about 9.9%, reducing total advertising revenue. However, this decrease was more than offset by increased subscription revenue as the policy change led to a 31% increase in total subscriptions during our seven-month study, yielding net positive revenues of over $311,845.74$230,0002013. The results confirm an economically-significant impact of the newspaper’s paywall design on content demand, subscriptions, and net revenue. Our findings can help structure the scientific discussion about digital paywall design and help managers optimize digital paywalls to maximize readership, revenue, and profit.

Figure 5: Average Number of Articles Read on the Browser Num-Articles-i-t-Browser by Subscribers and Non-subscribers. ¶ Notes: (1) “High Quantity” represents access to all the published content and “Low Quantity” denotes access to 3 articles per day. Similarly, “High Diversity” represents access to all sections whereas “Low Diversity” represents access to content from only top news and video sections. (2) For simplicity of exposition, the plot only shows readers who stayed subscribers or non-subscribers throughout. (3) The fitted line in the plot is the least-squares line.
Figure 5: Average Number of Articles Read on the Browser NumArticlesitBrowser by Subscribers and Non-subscribers. ¶ Notes: (1) “High Quantity” represents access to all the published content and “Low Quantity” denotes access to 3 articles per day. Similarly, “High Diversity” represents access to all sections whereas “Low Diversity” represents access to content from only top news and video sections. (2) For simplicity of exposition, the plot only shows readers who stayed subscribers or non-subscribers throughout. (3) The fitted line in the plot is the least-squares line.

…During our observation period, the NYT paywall allowed 10 free articles per month via channels (1) and (2). Visitors could, however, read an unlimited number of articles through the mobile app but only from the top news and video sections. However, on 2013-06-27, the NYT started metering their mobile apps such that unsubscribed users could only read 3 articles per day. At the same time, those articles could now be accessed from any section and not just from the top news and video sections. If, after hitting their quota, a user tries to access more articles, they see a pop-up in the mobile app urging them to become a subscriber.9 To kick off the update, users had a one-week trial period from the time they updated the app during which they could freely read any number of articles from any sections…Estimation results are shown in Table 10, and it’s easy to see that the impacts of the various variables are qualitatively and directionally similar as in Table 2. The policy change decreased total readership by 9.9% using the Poisson regression specification and ~7% using the log-linearized specification.

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Digital Paywall Design: Implications for Content Demand and Subscriptions