IF NEWSPAPER bosses keep their promises, the next few months will see a decisive retreat from free news online. This summer senior figures at big media firms such as News Corporation, Axel Springer Verlag and MediaNews Group have all threatened to start charging. Companies representing more than 700 newspapers have expressed interest in the online-payment platforms being developed by Journalism Online, an American start-up.

It will not be easy. For ten years readers have been enjoying free news online, and the BBC, public-radio stations and commercial television-news outfits such as CNN will continue to supply it. A newspaper that tries to charge will jeopardise online advertising, which often accounts for 10-15 per cent of revenues. But if the obstacles are many so are the potential solutions.

The simplest approach, favoured by a small but growing number of American regional newspapers, is to erect a pay wall around virtually all stories. Print subscribers are often—but not always — allowed to read articles free of charge. Everybody else must pay, often quite a lot. The Newport Daily News, a small Rhode Island newspaper, recently began charging $345 per year for online access to stories.

Few opt to pay such sums. Fully 170,000 people buy the Arkansas Democrat Gazette every day compared with just 3,500 online subscribers. “It does not justify itself as a revenue stream,” admits Walter Hussman, the paper’s publisher. In fact, the Democrat Gazette’s pay wall is more of a revenue dam, intended to stop the flow of readers (and, thus, advertisers) away from print. Since 2002, when the paper began charging online, its average daily circulation has dropped by less than 1 per cent a year — rather better than most.

... contd.