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The magazine and newspaper industry has made a major shift from strictly publishing magazines and selling them in stores to posting their information and articles online. This industry is at risk of bankruptcy because society has stopped buying magazines and newspapers in print. The information in magazines and newspapers is now offered for free online and the online websites are updated constantly throughout the day therefore consumers are getting a lot more information for free online then if they were to actually make a purchase. Consumers also have the electronic devices that allow them to access the internet at any time rendering print unnecessary and ineffective. The solution to the decline of magazine and newspaper sales is for companies to install user charges on their online websites. User charges in the magazine and newspaper industry are called paywalls and the point of installing a paywall on online websites is to bring in the revenue that companies need to cover all of their costs. Not all magazines and newspapers would profit from this solution but business, fashion, sports and old archive magazines and newspapers could profit from paywalls due the importance placed on the information they offer. In last couple of years, many magazine companies have set up lucrative paywalls; setting the example that money can be made through the internet. On the other hand, consumers have had negative reactions to paywalls because what was once free is now not, even though the charge is very low.
Technologies like the Ipods, Ipads, cellphones, wireless internet and portable computers have allowed for consumers to receive internet wherever they go. They no longer need to buy anything in print because they can get the news through the use of their portable devices. Paywalls act complements to these devices because industries are selling their product, in this case articles, to be operated online through the use of these portable devices. Print magazines and newspapers traditionally make most of their revenues through advertisements yet websites can also post advertisements. These advertisements can be in the form of a photo or a video. Websites can contain humorous video advertisements that catch the attention of consumers rather than just a simple picture printed in a journal. Today's society is dominated by the ability to share culture through the internet therefore websites offer what print can not; the ability to contribute information. Websites allow for consumers to post comments and e-mail news to the editors creating an automatic communication link between companies and consumers. They also offer games and puzzles as well as advice columns that are open to suggestion. Online websites can be updated throughout the day whereas magazines are only printed weekly or monthly and newspapers are printed daily but the information is yesterday's news rather than today's. People want to hear the news and trends when they happen and because of social networking sites like Twitter and Facebook, people are able to digitally share the news instead of waiting for it to be printed. Magazine and newspaper companies will continue to shut down unless the location of where they offer their information changes. Setting up paywalls is the solution because it allows for magazines to offer the same information yet they don't need to pay the expensive price of printing them.
Business journals like the Wall Street Journal, The Financial Times and Boston Globe are thriving from their paywalls because they offer pertinent information that is necessary in order to effectively manage investments and finances. The companies are aware of their target audiences and their paywalls are set up differently and priced differently in order to give their customers what they want and at a price that they can afford. The companies use the low price of the paywall as a type of substitute for the price of the physical copy even though they are not perfect substitutes. The Wall Street Journal and The Times UK have reduced their costs by 25% by implementing a paywall. These to companies were able to move from print to digital while at the same time reducing their costs and printing more articles. The Financial Times is a UK based magazine that offers international business news and financial news. It's standard paywall price is about $187 US per year and it's premium package costs about $300 US per year. The Financial Times also offers a "day pass" type of paywall for $3.50 per day and it offers users both standard and premium packages. About 600 corporations subscribe to this magazine and pay a special rate in order to offer financial information to their employees. This specific magazine has about 120,000 premium internet users as well as companies who pay for advertising space on the magazine's website. The Wall Street Journal is known to have set up one of the most lucrative paywalls in history. Since it was first set up in 2007, the paywall has over a million subscribers who pay $2 US per week in order to gain full access to the website. The reason why the paywall is so successful is because it is linked to social networking sites like Facebook, Twitter and Foursquare and posts tweets or status updates on it's followers or friends newsfeed in order to keep them updated. This is a great way for the website to gain recognition and customer loyalty and it is a big contributor to the magazine's success. The Boston Globe charges a bit more per week, a price of 5$ US because marketers established that it's cliental was able and willing to spend a bit more in order to subscribe to this magazine. Online newspapers are beginning to set up paywalls as well. The New York Times is setting up a paywall that should be available by the end of 2011. All of these magazine and newspaper companies agree that pricing and target marketing are key factors in running a profitable paywall.
Other types of magazines like ESPN, Harper's Magazine and Elle offer different types of paywalls. ESPN offers online free subscription but customers must pay $2.50 per week in order to have full access and insider information. Fantasy drafts and gambling in sports is very common among sports lovers therefore they would benefit from insider information in order to make as much money as possible. Also, sports is a major hobby for men and women of all ages and that is why this industry is still very profitable. People are buying less and less sports magazines because the information is very accessible online. If sports magazines keep giving all of their information and top stories out for free then this industry will fail because businesses can't operate if they aren't generating enough revenues. Elle magazine is a world renowned fashion magazine and offers the latest fashion advice and trends. To generate some extra money, they have set up a paywall of a mere 6 dollars a year in order to get unlimited access to their website alone. People in the fashion industry and fashion lovers would benefit from this paywall because it offers news on the latest fashion, insider scoops and coupons to sales. The associate editor of Harper's Magazine, Paul Ford was interviewed in February and was asked about Harper's choice to install a paywall of $16.97 per year. Ford responded by stating that good journalism costs money and that Harper's Magazine wouldn't be as well known as it is if it wasn't for good journalism. Magazine sales have dropped in stores due to the amount of information and articles offered on the online website therefore Paul decided that installing a paywall would be a good solution. People who paid the price of the paywall are able to access all the new and old archives. Paul Ford makes a very good point; if magazines do not find a way to sell their product then they will not be able to pay the salaries of their journalists and columnists and the only solution that has been proposed is paywalls. Paywalls might be the only way to save paid journalism from extinction.