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Digital subscriptions raised via platforms



This exploratory study examines digital subscription services offered to news publishers by prominent platform companies. The paper explores to what extent platform subscriptions may empower news companies and aid their revenue building. Additionally, in the context of platform capitalism and platform power, the paper debates whether the reliance on platform subscriptions increases news companies dependency on them, adding to their problems with digital revenue building. The paper examines digital subscription models offered by Google, Facebook, Apple and Amazon, and attempts to assess what kind of monetary benefits these models deliver for news publishers. The paper is based on a document analysis method and utilises corporate documents, academic articles, industry and media reports to map the field and to investigate the issue. The paper aims to identify core issues related to platform subscriptions and to offer some findings related to news publishers revenues from platform subscription acquisition. The author notes that research in this field is challenging as the platform subscriptions are currently being developed and tested. Additionally, news companies don’t disclose any specific data about their digital subscriptions from platforms and related revenue. These are limiting the scope of the study affecting its findings. Earlier academic studies have warned about news publishers increasing dependency on platform companies as well as of their monopolistic powers (Bell & Owen, 2017; Pickard, 2017; Nielsen & Ganter, 2018; Author, 2018a). Srnicek suggests that in the platform capitalism the companies such as Facebook hold all the power over audience, data and monetisation making subscription acquisitions from the platforms problematic (Srnicek, 2017). In his book The Internet Trap, Matthew Hindman cautions that news companies have not been able to move to ‘post-industrial era’ because they depend “critically on the industrial plants” of platform companies for their audience attention (Hindman, 2018, p.179). He also argues that Facebook’s and Apple’s subscription platforms “are particularly damaging to the autonomy of news outlets” because they only work within these platforms, making monetising outside the platforms problematic (Hindman, 2018, p.179). Some of the news companies have abandoned distribution on social media platforms to avoid this problem and because of poor monetisation opportunities. To exemplify, in 2017 the Guardian pulled out of Facebook’s Instant Articles and Apple News stating its desire to build deeper relations with its readers to grow its memberships (Davies, 2017). Platform companies are increasingly pressured by governments, politicians, news industry and regulators to share their revenue with news media. To compact this increasing pressure from the regulators in the US, Australia and Europe, they have launched digital subscription services which are aimed to aid publishers content monetisation. Google’s head of partnerships, Luca Forlin, comments that “the context behind our subscription initiative is that we do care… we care about news” (“Google, Facebook: different platforms, different acquisition and retention strategies”, 2018). He says that its digital subscription service helps publishers to convert users attention into subscription and works as a retention tool as well. Facebook has stated that it will “continue investing in new ways to enable publishers’ subscriptions business, and improving our marketing tools to make them better suited for publishers needs” (Brown et al., 2017). Based on the preliminary analysis of platform subscription models offered by Facebook, Google, Apple and Amazon, the paper finds that the monetary benefits of digital subscription services offered via platforms are still unproven, and there is not enough empirical evidence to draw any far-reaching conclusions about these benefits. Platforms have promised to share 70-100 percent of the subscription revenue news publishers make via their platforms, but there is currently no data to assess how much revenue news companies make from platform subscriptions. Some of the earlier industry and academic reports offer some guidance related to platform revenue. A 2017 report by the World Association of Newspapers and News Publishers suggests that Facebook made only seven percent of the news publishers digital revenue with most of the revenue coming from advertising (WAN-IFRA, 2017, p.48). Recent academic studies suggest that news publishers rely heavily on Facebook for traffic and user attention as they attempt to turn ‘eyeballs’ into subscription revenue (Author, 2018a; Cornia et al., 2018). A 2018 study found that Facebook offers news publishers insignificant revenue: for the companies studies, less than one percent of their total revenue came from Facebook traffic and social shares (Author, 2018b). Additionally, a report by Cornia et al. (2018) observed that news organisations continue to invest in social media distribution despite the fact that monetisation on these platforms remains challenging. Preliminary investigations for this paper suggest that Facebook drives news publishers traffic, brings more people to their ‘conversation tunnel’, and in some cases converts audiences to subscribers. Additionally, Google subscriptions have been found beneficial because it “simplifies subscription processes” (McClatchy, 2018). However, converting users’ attention from platforms may come with an additional cost. Polish Gazeta Wyborcza, for example, has admitted that it using paid campaigns on Facebook for acquisitions, denting its revenue from platform subscriptions (Cornia et al., 2018). Other problems reported by news companies include lower conversion rates.
Digital subscriptions
raised via platforms
To what extent they empower news
companies and their revenue?
Dr Merja
January 24, 2019
Gothenburg, Sweden
Critical platform dependency
Author Matthew Hindman:
“Digital newspapers depend
critically on the industrial plants of
Google, Facebook, or Apple in order
to attract an audience”.
Facebook’s and Apple’s subscription
services are “particularly damaging
to the autonomy of news outlets”
because they only work within their
platforms, making monetising
outside problematic.
Dependency on
traffic and
Multiple researchers have
warned about ‘platform power
(Bell & Owen, 2017; Pickard,
2017; Nielsen & Ganter, 2018).
News companies dangerously
dependent on platform
attention & traffic (Cornia et al.,
2018; Myllylahti, 2018).
ACCCs digital platform inquiry
ruled that Facebook and Google
have too much ‘market power.
Money from attention?
My study Attention
economy trap? of 4 news
companies revenue from
Facebook traffic and
social shares shows that
revenue from both was
under 1% of the news
companies total revenue
Study did not include
potential revenue from
Still, news companies
continue to invest in social
media distribution
Cornia et al. (2018) found that despite
platform risks news companies
continue to invest in social media
distribution, especially on Facebook.
Companies believe that platforms are
generating a short-term return on
their investment.
What about long-term benefits?
While facing
regulatory pressures,
platforms launch new
subscription services
for newspapers.
Apple to relaunch
Texture next Spring.
Aim of the paper
to explore
To which extent platform
increase/decrease news
companies platform
To scope different platform
subscription models and
revenues their may offer.
To explore benefits and
pitfalls of platform
What was researched?
Subscription services offered by platforms
Platform subscription services of Apple, Amazon, Facebook and Google
Statements made by companies including The Baltimore Sun, Bild, FT,
Gazeta Wyborcza, McClatchy, The Economist
Benefits of platform subscriptions
Pitfalls of platform subscriptions
Publishers involved
share for
The NYT, Le Figaro, Fairfax Media, McClatchy,
Les Echos, FT, Gatehouse Media, Grupo
Globo, The Telegraph, The Washington Post,
Subscribe with Google
-users can pay
digital subscription while on Google
-95% of
Bild, The Boston Globe, The Economist, The
Houston Chronicle, The San Francisco
Chronicle, La Repubblica, Le Parisien, Spiegel,
The Telegraph, Tronc, The Washington Post
Facebook subscription/Instant Articles
users can subscribe directly to news
services within Facebook platform
100% of
revenue &
user data
In talks with The NYT, WSJ, The Washington
Apple Texture/Apple News
Not known
News Corp, The Washington Post, Chicago
Tribune, The New Yorker
Subscribe with Amazon
publishers can
sell digital subscriptions directly inside
Amazon’s site
-85% of
The Baltimore Sun
Facebook subscriptions increased
conversion 50%
No substantial uplift through
Facebook Instant Articles
Financial Times
Facebook drives more people in
conversion tunnel
Lower conversions
Gazeta Wyborcza
Facebook biggest driver of new
subscribers, 40% of all new subscribers
from Facebook
Boosted by paid campaigns
acquisitions become costly
Google subscriptions
subscription process
The Economist
Converting through Facebook is cost
effective and scalable
has halved
acquisitions costs
What do we know about the revenue?
Not much….
Facebook says that with its
paywall, news publishers
own the process, they own
the relationship with their
audience and can build their
audience out from there.
Facebook does not take a
But we have an idea about the cost of
To exemplify, in 2018 the NYT announced
that its third quarter marketing expenses
increased to $40.4 from $26.6 million in
the same period in 2017.
Increase in marketing expenses was
largely due a spike in subscription
acquisition and brand marketing costs.
To summarise potential
pitfalls and benefits?
In some cases platform subscriptions
drive conversion contested
In some cases platform acquisition
lowers costs contested
Google subscriptions simplify
subscription process
Facebook drives new subscriptions
Revenue from platform subscriptions
and services - unknown
Digital news project 2019
Nic Newman’s survey of 200 editors, CEOs, and
digital leaders:
Publishers are looking to diversify away from
Facebook and towards other platforms this year.
“Google remains the key priority for most, with
more than eight in ten (87%) saying it will be
‘very’ or ‘extremely important’, but publishers
are also looking again at YouTube, Instagram and
Twitter as they look to reach new audiences.
Apple News (43%) is considered as important as
Facebook, with some publishers reporting sharp
increases in traffic.
Becoming even
Newspaper executive about
platform subscriptions:
“I’d be careful if I were a
newspaper because Id really
want to have a feel for how
much revenue I might be
giving up.
How and what to research next?
Two separate issues:
News companies own
subscription acquisitions via
social media and from
aggregation services
Specific platform services
offered by Google,
Facebook, Apple and
Concrete empirical evidence
needed about benefits and
Myllylahti, M. (2018). An attention economy trap? An empirical
investigation into four news companies’ Facebook traffic and
social media revenue. Journal of Media Business Studies.
Myllylahti, M. (2018). Paywalls
and payment systems. Oxford
Research Encyclopedia of
Communication. Oxford
University Press.
... • Some news publishers gain 40-70% of their new digital subscriptions from social media (Myllylahti, 2019). ...
Conference Paper
Full-text available
Is reader-revenue revolution really here? A comparative analysis of newspapers reader payments in an attention economy The dominance of Google and Facebook in the major Western digital advertising markets has forced news companies to increase their investments on audience monetisation (ACCC, 2019; Hindman, 2018; Author, 2018a; Winseck, 2018). In the context of the political economy of attention, this paper investigates whether news publishers income models have been revolutionised from advertising to reader-supported model. Houston believes that “the reader-revenue revolution is a reality” and suggests that readers have aided news companies to overthrow “tyranny of old ad-only business models” (Houston, 2018). Similarly, the International News Media Association (INMA) observes that disruption in the digital advertising markets has changed the “revenue mix in our industry from its historical equilibrium to one where audience revenue plays a larger role” (Lindsay, 2017, p.9). Additionally, Newman reports that focus on reader revenue means “a huge change of focus for the industry” (Newman, 2019, p.5). However, some recent studies contradict the reader-revenue revolution rhetoric by showing that advertising has remained a “critical part of online revenue” (Nicholls et al., 2018). This paper examines to which extent reader-revenue revolution is happening. In political science, revolution proposes a sudden change from one constitution to another and this paper investigates to which extent the claim of reader-revenue revolution is valid (Houston, 2018). The paper utilises quantitative data from media companies financial documents and announcements as well as from the relevant previous studies (Author, 2014). First, the paper compares digital subscriptions numbers of the Wall Street Journal, The New York Times, the Financial Times, The Times and The Australian in a six year period from 2012 to 2018 to assess revenue from implemented reader payments as well as digital advertising. Secondly, the paper examines voluntary reader memberships and donations to explore if these are aiding news publishers such as The Guardian to move into audience-supported model. Preliminary findings of the paper propose that newspapers digital subscriptions have substantially increased in a six-year period from 2012 to 2018, and their digital earnings have grown accordingly. The paper offers some evidence that news publishers are moving away from advertising based to reader based revenue model, but it contests the view of the emergence of the reader-revenue revolution. News companies reliance of monetisation of readers attention has benefits and pitfalls. Benson believes that the “upside” of digital subscriptions is that readers pay money “for something they really want or need”, but the downside is that “subscriber funded news caters to relatively high-income, high-education elites” (2019, p.146). Newman agrees that “the rise of paywalls is shutting more people off from quality news and making the internet harder to navigate” which can lead to news avoidance (Newman, 2019, p.6). As Hindman asserts in his book “the digital attention economy increasingly shapes public life… and ultimately which news and democratic information citizens see” (Hindman, 2018, p.5). Earlier academic studies have found that digital subscriptions, paywalls, may restrict the public’s access to certain news and information whereas voluntary reader payments are normally supporting non-profit or digital media outlets which offer content for free to the public (Author, 2018b). Increases in reader payments, both in involuntary or voluntary, have societal consequences which require further investigation.
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