Nieman Foundation at Harvard
HOME
          
LATEST STORY
Congress fights to keep AM radio in cars
ABOUT                    SUBSCRIBE
Oct. 1, 2024, 2:35 p.m.

Going back to the well: CNN.com, the most popular news site in the U.S., is putting up a paywall

It has a much better chance of success than CNN+ ever did. But it still has to convince people its work is distinctive enough to break out the credit card.

CNN has pulled the trigger on its paywall — previewed back in July, teased in September, and now debuted in October. Here’s freshly returned CNN media reporter Brian Stelter:

CNN, one of the most popular news websites in the world, is starting to ask some of its visitors to pay $3.99 a month for access.

On Tuesday, the news organization is laying the first bricks in a so-called paywall that should, over time, help foot the bill for CNN’s journalism around the world.

“Starting today, we are asking users in the United States to pay a small recurring fee for unlimited access to CNN.com’s world-class articles,” Alex MacCallum, CNN’s executive vice president of digital products and services, wrote in a memo outlining the plan.

The average visitor to CNN’s website, who may only read a few articles a month, will not be prompted to pay at this time. “Only after users consume a certain number of free articles will they be prompted to subscribe,” MacCallum explained. “In addition to unlimited access to CNN.com’s articles, subscribers will receive benefits like exclusive election features, original documentaries, a curated daily selection of our most distinctive journalism, and fewer digital ads.”

A few stray thoughts on a potentially significant moment in digital news:

The ghost of CNN+: CNN has a ton of readers online. Measured by monthly unique viewers (and using Similarweb’s data), it is the most popular news site in the United States, and it’s not especially close — 441 million uniques in August versus 361 million for the No. 2 New York Times. Among news brands globally, CNN is second only to the BBC.

But across its 44 years of existence, CNN has never gotten people used to paying for it — at least not directly. Sure, some fraction of homeowners’ monthly cable bills found their way to Atlanta, but CNN’s residence on nearly all basic cable tiers meant that consumers were rarely given an up-or-down choice on whether to buy what CNN was selling. And a free website has been the core of its digital strategy.

The one time the network tried to change that didn’t work out so well. CNN+ was a flop of Quibiesque proportions. You can tell from our own archives: It went from “With cable subscribers on the decline, CNN makes a big bet on streaming with CNN+” to “CNN, Plus or Minus: The news network’s new streaming platform is dead” in only 23 days. Shackled by a peak-cable cost structure ($300 million!), it drew only a piddling audience — about 150,000 subscribers, nearly all paying $3/month, and fewer than 10,000 viewers at any given time. Past is not always prologue, but it’s reasonable to ask how this paywall iteration will accomplish was CNN+’s epic marketing budget could not.

That price point: While I’m sure CNN has done its research, $3.99 strikes me as an odd choice. I’ve always believed the biggest barrier to payment for digital news was moving people from $0.00 to $0.01 — from free to paying anything at all. Four bucks a month is quite low for a national news brand; compare The New York Times (which pushes its $27/month bundle), The Washington Post ($10/month), The Wall Street Journal ($42/month), the L.A. Times ($17/month), The New Yorker ($11/month), Forbes ($13/month), Business Insider ($13/month). CNN’s pricing is more in line with USA Today ($40/year), Reuters ($45/year), The Daily Beast ($50/year) — sites that are more likely to be someone’s second read than their No. 1 news source.1

Presumably, CNN plans to do what the major streaming services have mostly pulled off: enter the market at low price points and then slowly stair-step them up over time. (Or, as Ben Mullin put it, “start with an inexpensive offering to gauge customer demand.”) That might work. But while I am not a price modeler, I can’t imagine that the number of people willing to pay $8/month for CNN.com is less than half the number willing to pay $4/month. And pricing it at $3.99 gives a faint whiff of cheapness that I’m not sure fits with its brand ambitions.

Why not a bundle? CNN is part of the conglomerate Warner Bros. Discovery, where its labelmates include everything from HBO to TNT to DC Comics to Animal Planet. To the degree that there has been an overarching strategy from WBD CEO David Zaslav — other than becoming the “most hated man in Hollywood” and complaining to publications that point that out — it has been to bundle.

Its streaming uber-product, Max, includes content from across all its varied brands, all at a single monthly price. (“Max will stand out amongst streamers by uniquely combining unrivaled breadth and superior quality with iconic franchises and strong product experience, all for great value.”) That mix has, for the past year, included a healthy dose of CNN. (At launch it was a near-mirror of CNN’s TV programming, though it has scaled some of that back.) The reasoning seemed to be that a separate CNN paywall for streaming, à la CNN+, was less likely to succeed than CNN news as a valued part of a much broader package. (This is, of course, how CNN worked in its cable glory days — people paid for it as part of a bundle of channels, not individually.)

Given that strategy, why not bundle the CNN.com paywall in with a Max subscription? Streamers hate churn — might a valuable digital news component give people a reason to maintain their $17/month Max subscription year round, even when “Righteous Gemstones” Season 4 is still months away? Remember: Netflix has invested mightily in casual mobile games, of all things — not the most obvious companion to “Squid Game” — toward the same purpose, an engagement lure that gives subscribers a reason to stick around when their favorite show ends.

I understand why, for intra-corporate reasons, CNN management would rather be seen as generating its own revenue stream than as a loss-leader cog for Max. But if a CNN paywall struggles to find a paying audience, it might make sense to try, er, Maximizing both the value proposition and the price.

They’ve done it before: I won’t pretend any of these thoughts are new ones to CNN executives, who have no doubt done their homework. If there’s a reason to have some hope for the paywall, it’s that the primary people behind it — CEO Mark Thompson and Alex MacCallum, executive VP of digital products and services — have done it before. They were both key parts of The New York Times’ ultra-successful march into digital subscriptions, which remains the envy of the industry. (Thompson was CEO of the Times for eight years, starting shortly after its paywall launched in 2011; MacCallum oversaw the growth of subscription products like Cooking and Games.) The Times has a clear differentiator in the market as the most prestigious organ of American journalism. CNN will have to figure out its own unique selling point, and Thompson and MacCallum have as good a chance as anyone at doing it.

This new offering already has several advantages over CNN+ — the most important being that this paywall will surround work CNN is already doing, not a very expensive and market-untested panoply of new programming. The Times’ original failed paywall, TimesSelect, also tried to carve out a distinct set of content, much of it new, to attract subscribers at a lower price point — and it also flopped.2

Today’s announcement doesn’t say how many articles, exactly, someone will have to read before hitting a paywall. That’s frustrating to people like me who’d like to know, but it’s smart strategy. CNN will be able to flex the paywall’s boundaries however its user data suggests, mixing in story types, time on site, frequency of visits, and anything else that might help optimize conversion rates. (For what it’s worth, I opened up more than 50 CNN stories in an incognito window this morning, hoping to run into the paywall. I never triggered it.)

Still, I wouldn’t be surprised if CNN’s paywall turns out to be a real struggle. Not a flop on the CNN+ scale, to be clear; the lower cost structure ensures management can give this strategy a lot more than 23 days. But can the network convince millions that its digital journalism is valuable enough — and, more importantly, distinctive enough — to justify a monthly charge amid a sea of free content? With its roots in TV news, maybe CNN doesn’t see elite newspapers like Times, Post, or Journal as its true competitive set in digital. But even so, what will keep CNN.com readers from straying to NBCNews.com, CBSNews.com, ABCNews.com, FoxNews.com, or MSNBC.com, all of which remain free? Figuring out that stickiness will be a challenge — and I wish them luck.

Photo of a CNN+ digital sign in New York City’s Times Square, January 22, 2022, by stevosdisposable.

  1. Or, in Reuters’ case, a wire service that doesn’t have a traditional direct-to-user legacy. Oh, yeah, Reuters launched a paywall today too! []
  2. Though, to be fair, it’s not clear the digital news market was ready for any general-interest paywall in 2005. []
Joshua Benton is the senior writer and former director of Nieman Lab. You can reach him via email (joshua_benton@harvard.edu) or Twitter DM (@jbenton).
POSTED     Oct. 1, 2024, 2:35 p.m.
Show tags
 
Join the 60,000 who get the freshest future-of-journalism news in our daily email.
Congress fights to keep AM radio in cars
The AM Radio for Every Vehicle Act is being deliberated in both houses of Congress.
The New York Times redesigns its app to highlight a universe beyond just news
It’s the first major redesign since the app launched in 2008.
You might discover a conspiracy theory on social media — but you’re more likely to believe it if you hear it from a friend
Partisanship, conspiratorial thinking, and IRL connections make for a potent mix — on both the left and the right.