Variety: Murdoch was right

After 3 years of free, Hollywood’s 104-year-old pub will put its website back behind a paywall.

In 2006, Variety made the bold—some would call it visionary—move of lifting its subscription paywall, offering its content for free to the world in the hopes of drawing more traffic and more advertising dollars.

“Meh” seems to have been the response from CMOs—ad money failed to surge even as traffic rose. 

The ailing media industry has suffered as the shift to new online media consumption has caused newspapers across the country close up shop and subscriptions at major publications to nose dive. The only major paper to see an increase in subscription sales last year was the Wall Street Journal, which also uniquely charges for its online content.

Despite the WSJ's success, many online publishers remain fearful that charging for content will decrease readership—and that fear may ultimately provide more established media brands like Variety with its lifeline differentiator.

“We’re not as concerned about traffic as other publications,” Variety President Neil Stiles told the WSJ. “As long as we deliver to core people in the business, that’s what our advertisers expect, not attracting five million ‘Twilight’ fans.”

In the test phase of the new plan, 1 in 10 site visitors will be randomly asked to pay for content. The purpose of the beta phase is not so much assessing revenue possibilities as customer-service needs; ie, how many angry phone calls will they need to field once the walls go up.

When the Wall Street Journal went behind a paywall, the blogosphere—Marc Cuban excepted—regarded it as inane. “Murdoch doesn’t get it,” was the refrain. Seems Variety has similarly abandoned “it” for revenue.

No word yet on whether Variety plans to block Google.

Variety may face more of an uphill battle than the WSJ, though. Whereas the latter is a must-read for anyone in finance, national or international news, Variety serves the shrinking Hollywood entertainment crowd.  On a panel about the future of journalism at AlwaysOn's Summit at Stanford this year, Technology Review editor-in-chief said they found a paywall worked for any content that helped readers make purchasing decisions. If paying helps you save or earn, then it's worthwhile. Whether Variety fits that bill remains to be seen.