Paywalls: How Do They Work?

The word “paywall” describes a payment barrier or wall. As newspapers, magazines and their publishing companies apply them online, paywalls have expanded most widely in the field of digital content. According to the latest studies, almost three quarters of European newspapers use some form of digital paywall. Consequently, Internet users’ days of unlimited access to online journalistic content are coming to an end, and they are increasingly being asked to pay.

The concept is not new in print publishing, where it has long been used successfully as a subscription model. Regular access to the latest issues of a print publication normally required a subscription. People who collected their newspaper from a newsstand also had to pay. Newspapers and magazines were then financed through subscriptions, sales and advertising. They still use these sources today, albeit to a lesser extent, which has increasingly led them to adopt payment systems for digital media as well.

As online journalism expanded, subscription and sales revenue plummeted because, during the 2000s, most digital content from online newspapers was still available free of charge. From the mid-2010s onward, fewer readers bought print newspapers and magazines while the Internet grew in importance as a source of information, changing consumption habits. Print editions sold less and less.

Journalistic content is now read mainly online. Publishers therefore had to find a way to make journalism on the web profitable as well. The answer was the paywall. Since 2014, the proportion of newspapers protecting some content behind a paywall has risen from 23% to 73%, meaning that paywalls have become standard for most European publications.

Publishers can use different payment models to offer digital content to readers. Some paywalls operate so subtly that readers often do not notice them, while others are impassable. According to their flexibility, paywalls are generally classified as hard or soft, with soft paywalls giving media outlets greater freedom to design the options offered to readers.

Under this model, all website content is closed to non-subscribers. Users without a subscription cannot read any article. This variant is uncommon because encountering such a barrier is often enough to make readers seek the information elsewhere. A hard paywall therefore carries a greater risk of losing readers who might otherwise be interested than other models. This reduces website traffic and the number of advertisers willing to pay for placement. Nevertheless, well-known publications such as The Wall Street Journal, Financial Times and The Times use this kind of paywall.

A soft paywall, also known as a freemium model, combines free content with a premium offering on the same platform. Users can access many articles without subscribing or paying fees, while the provider identifies selected articles as high-quality content available only to paying customers. This is the method most widely used by journalistic outlets to monetize at least part of their digital content. In Spain, local newspapers were the first to introduce paywalls. Vocento, publisher of ABC, has deployed them at El Diario Montañés, El Correo, El Diario Vasco and Ideal de Granada and plans to extend them to other outlets. Titles owned by Prensa Ibérica, including La Nueva España, Información, Levante and Faro de Vigo, also have paywalls. More recently, Infolibre has successfully introduced a freemium system, while Argentina’s Clarín was the first newspaper beyond Spain to do so. Major outlets such as El Mundo, La Vanguardia and El País have not yet chosen the model that suits them best. For now, they offer only a traditional subscription combining the print edition with benefits on cultural offers.

Another soft-paywall option is the metered model. All content is initially free, but each user receives a set allowance of articles per month.

Technical tools, often cookies, determine how many articles a user has read during the current month. After reaching the limit, the reader must subscribe or wait until the following month. Because this barrier is easy to circumvent, many sites require registration, allowing them to monitor reading habits more effectively. In Spain, El Español is the only publication using this variant.

Other dynamic barriers adapt immediately to each reader’s consumption. Publishers can analyze recurring-visit data and create user profiles, quickly drawing conclusions about reading habits, interests and the expected monthly number of articles.

A user who visits several times a day for financial news would sooner or later be asked to pay, while an occasional visitor reading only a few articles could continue free of charge. The Swiss newspaper Neue Zürcher Zeitung uses a dynamic paywall and calculates the likelihood of a reader becoming a subscriber from hundreds of indicators, adjusting the barrier accordingly.

Donation- or membership-based models are probably the least aggressive way to monetize digital content. Since its foundation, eldiario.es has relied on this special open-paywall model. Its articles are generally free, but a voluntary monthly donation makes the reader a member, supports the platform’s independence from other economic interests and provides benefits such as early access to breaking news. Other outlets request donations when a reader clicks an article headline.

Paywalls become problematic when they block information and news relevant to public opinion. Critics argue that people on low incomes cannot afford supposedly premium content, undermining the basic principles of a free Internet. Paywalls may also foster digital bubbles: after subscribing to one outlet, readers consume more news from it and less from others, making their opinions easier to influence.

Paywalls can also harm news providers’ marketing. Hard paywalls usually cause a sharp fall in website visits. Because few users will see advertising on these pages, advertisers prefer publishers with more flexible models.

Paywalls remain uncommon in the Spanish-speaking market: only 10% of readers are willing to subscribe, compared with 30% in northern Europe. Spain has one of the world’s lowest rates of payment for news. Only Spain’s Vocento group and El Español, Argentina’s Clarín and Brazil’s O Globo have ventured to introduce paywalls. Nevertheless, several paywall-service providers have become established:

After Piano Media, a manufacturer of SaaS products for e-commerce and media, merged with rival Tinypass in 2015, Piano became the world’s largest metered-paywall provider. More than 1,200 news services now use its products. It also analyzes reader habits using data collected online.

Until recently, this Dutch company sold individual articles through a kind of digital newsstand. Micropayments allowed users to read selected articles without subscribing. In August 2019, it abandoned this strategy for a premium subscription model. Blendle now offers selected content for a modest monthly fee, following the business model of major streaming providers such as Netflix and Amazon.

German company CeleraOne offers customized paywall solutions. Instead of installing a plugin, publications can use a modular system integrated organically into their backend. Its products also include user-analysis solutions and tools for configuring different private areas.

KolMite is a directory of open-source WordPress plugins developed by its community. CoinTent provides a free, fully customizable paywall plugin for WordPress sites supporting every variant from micropayments to metered paywalls, as well as analytical functions for studying reader behavior and adapting the service accordingly. Its members-only directory also contains other paywall plugins, including InPlayer and Fluido.