The impact was immediate. Reading audiences dropped liked stones. The advertising model, which was starting to gather steam, crashed. Again.
“Mark [Zuckerberg] doesn’t care about publishers but is giving me a lot of leeway and concessions to make these changes,”
“We are not interested in talking to you about your traffic and referrals anymore. That is the old world, and there is no going back.” - Campbell Brown, Facebook Global Head of News Partnerships
Meanwhile, some content producers started to think outside of the proverbial box. Their legacy advertising model didn’t work. Many recognized that a new medium required different revenue streams. Plenty agreed, very few tried.
One of those first trials was direct content monetization via a paywall. This model had fans and detractors. Many believed that the content they produced was inherently valuable. But the market proved them wrong.
The first experiments with gated content failed. One of the biggest lessons was that the readers didn’t want to pay for a content they could have elsewhere. But it was more profound than that. At the time, every piece of content was accessible for free. Users saw gated content as defacement of the Internet’s freedom of information credo.
“Paywalls are not a new idea. The Atlantic previously had a different one for a while in the mid-’00s. The Adweek article announcing that this paywall was being pulled down is a fascinating time capsule. Paywalls, back then, were often seen as a way of protecting the existing print businesses.”
Paywalls had many problems at the time, but one of them was rather ominous, the audience. For the system to work well, it required a large audience that had a taste of the content and then decided to pay for it. The bigger the haystack, the larger the needle. There was one issue though, during the mid-‘00s the online population was still meager.