A surge of optimism has spread through the US online media with the success of political blogger Andrew Sullivan’s move to take his popular blog independent and charge subscription fees.
Sullivan, whose popular blog The Dish, is currently hosted by The Daily Beast and was previously backed by The Atlantic, will move his blog to http://www.andrewsullivan.com at the end of the month. He is charging a minimum yearly subscription of US$19.99, though readers can give more if they like.
According to this interview published today, Sullivan has raised US$466,899 in subscriptions so far – and that’s before even launching a major marketing push, just blog posts announcing the changes. The figure would imply Sullivan has attracted a maximum of 23,300 subscribers, or a smaller number of subscribers who are voluntarily topping up their subscriptions.
Early in the New Year he unveiled his plans to part ways with the Daily Beast and to forego advertising on the site.
…we know from your emails how distracting and intrusive it can be; and how it often slows down the page painfully. And we’re increasingly struck how advertising is dominated online by huge entities, and how compromising and time-consuming it could be for so few of us to try and lure big corporations to support us. We’re also mindful how online ads have created incentives for pageviews over quality content.
The Dish, a largely politics-dominated blog from Sullivan, who is backed up by a staff of five, will continue largely unchanged. He will obviously lose a revenue stream from The Daily Beast when his contract expires. But if the new revenue from subscriptions is sufficient, he also plans to branch out into running long-form journalism.
I have this concept of Deep Dish, where we want to get big writers, and pay them real money, or do the Byliner approach and sort of split the revenue with the writer. I do feel there’s a real need for really good, long pieces, and the magazines out there that run them are really dying so fast, and we need that, and I figured if we can make the bloggy thing connected to a more longform thing, I thought that would be a lovely point of contact.
Sullivan’s success at raising money seems to have come as a surprise to himself more than anyone else. But the site does rack up around 250,000 page views per day, making it one of the best-trafficked blogs in the US. Sullivan is well connected, regularly breaking stories. But his unusual position among political pundits – he counts himself as a conservative, A Roman Catholic, but is gay and HIV+, seems to add to his broad appeal.
Plugging in the pay wall
Sullivan’s job in going premium has been made all the more easy by the range of subscription tools available to bloggers and new media start-ups.
The Dish has given a major boost to electronic payments start-up TinyPass, which will be the interface users pay their subscriptions through. As well as acting as a paywall, TinyPass can handle metered subscriptions – so users can access a certain amount of free content, or spend a certain amount of time on the site, before they have to pay for continued access to content.
TinyPass is a fledgling player but seems remarkably flexible – its available on common blogging and website platforms like WordPress and Drupal.
Other payment providers such as Press+ and MediaPass offer similar services, creating plenty of choice for bloggers and website owners looking for flexible payment solutions. Most seem to take a cut of subscription revenue. In the case of TinyPass, content owners are charged a 10 per cent transaction fee on monthly revenue up to US$200 and five per cent on revenue above US$200.
On top of that are “processor fees” charged by e-commerce operators like Paypal, Google Checkout and credit card companies, who sit behind TinyPass.
Here’s what the total transaction costs would look like for Sullivan on a single The Dish annual subscription:
That seems reasonable given the hassle it takes out of managing subscriptions. TinyPass also seems to have some fairly decent analytics to track subscriber behaviour.
Sullivan’s apparent success in attracting pre-orders from readers has attracted widespread attention. But he says it’s too early to gauge whether the model would work for less-traffic blogs.
Would it work here?
Interestingly, Sullivan revealed reasonable early interest from New Zealand subscribers:
…we have four readers in Saudi Arabia, one in Ethiopia, one in Uganda; we have 39 in New Zealand. These are paying readers, who’ve already subscribed. It’s everywhere. In Britain we have 400, Canada 600; I’ve always been amazed at the global nature of it.
So, if Kiwis are willing to pay for The Dish, would they pay for local blogs and news websites?
The equivalent of Andrew Sullivan in New Zealand is David Farrar, who runs the popular Kiwiblog politics blog. Like Sullivan, Farrar is a commentator from the right-wing of politics, but that’s about where the similarities stop.
Kiwiblog currently attracts around 19,000 page views per day, which makes it the second most trafficked blog in the country after Whale Oil, according to statistics compiled by blogger and retired scientist Ken Perrott.
If Farrar were to charge a similar amount to Sullivan, say $25 when currency differences are taken into account, he’d need 3,000 subscribers to get to NZ$75,000 in subscription revenue before tax and processing fees are deducted. Given the difference in comparative scale of The Dish and Kiwiblog, that’s probably a fairly realistic target.
Such revenue would barely sustain one full-time employee, paid at a rate equivalent to a middling journalist’s salary. But then David Farrar has never been in Kiwiblog for the money and makes his living elsewhere, undertaking market research and polling. The only other blogger with the scale and community engagement to attract a similar amount of revenue would be Russell Brown, blogging with others at Publicaddress.net.
So for the country’s leading handful of New Zealand bloggers, going premium might generate a reasonable supplementary income at best, once processing costs and tax are taken into consideration. Advertising could add to this, but as Sullivan points out, one of the key benefits of taking a sub is not being confronted by annoying adverts. Readers might tolerate one or the other but are unlikely to put up with both.
Then there is the fragmentation of the community to consider. Kiwiblog has an active, if often feral comment section (Sullivan doesn’t allow comments but regularly publishes reader emails anonymously). In theory, the appeal of Kiwiblog for readers is partly the commentary on Farrar’s posts. If there was some sort of paywall in place, of as Sullivan calls it, a “freemium-based meter” that restricts free access, commenting would decline and Kiwiblog may not be the hotbed of discussion that diehard kiwibloggers relish.
This is a big move for Sullivan who is off to a good start, but has plenty of goodwill to trade in. Who will be the first New Zealand commentator or blogger to take the plunge?