Newspaper websites: How long before charging for news online kicks in?

It makes sense to sell content, but the risk lies in losing advertisers. Jane Thynne on a growing dilemma

For the hardened newspaper junkie things have never been so good. Many of us, having finished the printed press each morning, move straight online where we can feed our habit with the British press, as well as The New York Times, the Los Angeles Times and The Sydney Morning Herald, all delivered absolutely free. That's before we graze on individual newsletters customised for our particular hobbyhorses. Poetry news? Why not? Health? Absolutely. Janet in the jungle? All tastes catered for.

For the hardened newspaper junkie things have never been so good. Many of us, having finished the printed press each morning, move straight online where we can feed our habit with the British press, as well as The New York Times, the Los Angeles Times and The Sydney Morning Herald, all delivered absolutely free. That's before we graze on individual newsletters customised for our particular hobbyhorses. Poetry news? Why not? Health? Absolutely. Janet in the jungle? All tastes catered for.

Ten years ago the electronic Telegraph blazed a trail on the web, and almost all national papers have followed suit. Far from the early slabs of text, today's content is easier to read and extra features make web editions an extension of rather than a replacement for the print editions.

Yet despite the rocketing growth in online advertising - estimated at more than 30 per cent but up to 60 per cent in some sectors - most papers wonder how long they can depend on banners and pop-ups. Internet purchases may have reached a staggering £40bn, but newspapers seem to be missing out.

"It's the only medium where you get content free," says Alexandra White of the UK Association of Online Publishers. "In other media like TV and film people are used to paying. Revenues from online have all been coming from advertising and that's sustainable for now. But publishers have been keen to look for other revenue. Now they're looking at what unique propositions they can offer, like The Guardian's weblogs."

At the upper end of the market it is widely accepted that paid-for content is the way ahead. It's hard to charge for news, because of its general availability elsewhere, but archive news can be paid for, as can specialist information. FT.com introduced a two-tier subscription last year and has more than 55,000 subscribers, while most of the other nationals have identified niche content that readers value enough to pay for. The Independent charges for some columns, the Telegraph and Times for crosswords and The Times for fantasy football.

Apart from the the Express, which still refrains from offering any more than a picture of its cover and a few headline stories, the mass market has embraced the web too. This spring, after years of hesitation, Associated Newspapers took a deep breath and launched dailymail.co.uk and mailonsunday.co.uk. You can "enjoy the Mail's brilliant columnists for just £2 a week". The site also charges for crosswords and for e-editions. Associated says it is already meeting targets, with half a million users a month.

"The million-dollar question is working out what the unique strengths are that a reader may be prepared to pay for," says Avril Williams, editorial director of Associated New Media. "For us it's our columnists." Nearly 60 per cent of Mail readers use the net. "Our job is to provide up-to-the-minute stories 24 hours a day and to give readers a chance to talk back to us".

Yet there is a delicate balancing act between making money by charging for services and keeping enough free content to maintain traffic for the advertisers. Allow reader numbers to drop and advertising revenue will go the same way, yet having a small group of motivated subscribers can be a great investment when targeting them for other sales.

The Guardian has the largest online readership of any newspaper, with nine million users a month. For Simon Waldman, the director of digital publishing at Guardian Unlimited, the landscape is constantly changing. "The online advertising community is evolving rapidly, and media organisations have to balance these things. There are spectacular opportunities for growth and creativity, but if you miss this opportunity you won't get it back. You won't be on advertising agencies' radars, so it's important to ride the wave."

One of the earliest fears surrounding the birth of internet editions was that newspapers would lose circulation as readers realised they could get it for nothing online. Earlier this month an internal survey under- taken by News International appeared to suggest that The Sun's falling circulation was in part caused by its free website. Some 90,000 people a day visit thesun.co.uk and News International last week refused to comment on suggestions that website features such as page three girls, may be scaled back.

Most newspaper people, however, believe it is far too late to worry about losing circulation to their online editions. "Newspapers are facing challenges to their circulation," says Alexandra White, "but publishers are also finding that they're adding to their readership online and there's a whole new market in overseas readership. It's better to lose readers to your own website and simply make your revenue model work in a different way."

According to Simon Waldman, debates about degrees of paid content are irrelevant. "The big question is how newspapers will fit into an internet which is increasingly providing a "citizen's media" with bloggers and Google - people create their own media and newspapers become less the arbiter of what's important in the world."

In his view, keeping in touch with readers and providing a vital synergy between paper and online as internet use develops is the major challenge: "We spotted very early the critical nature of rolling news to stimulate growth. On the day Diana died we had readers asking, why isn't this on your website?"

Seeing print and online as rivals is no longer the point. "People in newspaper offices debating the threat of the net have a Ptolemaic view, where the Earth is at the centre of the universe," says Waldman. "Things are evolving so rapidly, they need to work out how to stay relevant."

THE NET COST

The Guardian: £10 a month for the digital online Guardian. £5 a month for The Observer. Crosswords £25 a year.

The Independent: main site free. Users pay £1 for a day, £30 a year for Robert Fisk or £60 a year for a portfolio of opinion, a news and sport archive and a crossword section.

The Times: main site free but £10 minimum charge to use the archive and £89.99 a year for digital edition of The Times and The Sunday Times.

FT.com: headlines free. Subscribers pay either £75 or £150 a year.

The Telegraph: free, but charges £30 a year for crossword and fantasy sport.

The Mail: main site free but £2 a week for selected columnists and £19.95 a year for crosswords

The Sun: free

The Mirror: free

The Express: free headlines