Only 5% of web users would pay for online news, reports survey

If Rupert Murdoch thinks readers will pay to read his websites, maybe he should think again. Exclusive research commissioned by from Harris Interactive shows that most readers would run a mile.

If their favourite news site begins charging for access to content, three quarters of people would simply switch to an alternative free news source, people who read a free news site at least once a month told us.

Just 5% of those readers would choose to pay to continue reading the site.

8% would continue reading the site’s free headlines only.

12% of respondents are not sure what they would do.

The findings are the first to be released from paidContent’s research (read paidContent:UK on Tuesday, Wednesday and Thursday for more on price points and models). They will serve as a warning to publishers considering a paid content strategy.

Bitten by the low prices of online ads and the recent slowdown in advertising generally, News Corp (NYSE: NWS) is not alone in re-examining the financial viability of online news provision. Other publishers, too, are considering models including charging-for-content, readers’ clubs with value-added extras, selling physical merchandise and memorabilia and even reader donations.

Although, as our recent analysis showed, newspapers have continually hiked their print cover prices over the last few years, they opted to let web news go free when the web took off more than a decade ago. Those that now opt to charge for stories will have a hard time squeezing back in to the bottle a genie that has been out for all this time.

“This does not look like good news for a pay model in a competitive environment,” says Andrew Freeman, Harris’s senior media research consultant. “As long as free alternatives exist, consumers will turn to them for their daily news information, meaning heavy losses in terms of audience figures for those that charge. It remains to be seen whether the news industry will take the leap and begin charging for that which has been free for so long.”

We think the question for news publishers is this: is 5% of your readership (that’s the number who tell us they would pay) enough to offset the decline in advertising revenue that would come with putting your site behind a pay wall?

Let’s go in to more detail…

Age: Those who have money are less likely to pay
Younger readers are more likely to pay than older – 13 times more 16-24s said they would pay than did 35-44s and 55-64s
Pre-middle agers (35-44s) are most likely to seek out a free alternative news site.
And those stingy 45-54s are most likely to simply read their favourite site’s free headlines. But that’s not good enough for younger folk – 16-24s are four times less likely to do that.

Class: The middle ground loves free most of all…
The upper middle and middle classes (“ABs”) are most likely to pay to continue reading their favourite news site, but that’s just six percent of them.
That’s the same rate for the lower middle class (“C1s”).
The skilled working class (“C2s”) are least likely to pay and most likely to find an alternative free news site.
Interestingly, the number of working class people and those dependent on the state (“DEs”) who would pay is almost the same as ABs.

Regions: Geordies would survive on free headlines…
Londoners are Welsh are most likely to pay for their favourite news site. Yorkshiremen, Midlanders and those in the south-east are least likely.
No-one in the north-west or south-west of England would pay.
Scots, south-westerners and Yorkshiremen are most likely to find free alternative news sites.

Methodology: Harris Interactive surveyed 1,188 adults (aged 16-64) online within the UK between August 26 and September 2, 2009. Figures for age, sex, education, region and internet usage were weighted where necessary to bring them into line with their actual proportions in the population. Propensity score weighting was used to adjust for respondents’ propensity to be online. See raw data.