Real test of Times' paywall will be on revenues

BBC technology correspondent Rory Cellan-Jones says the real test of The Times and Sunday Times paywall experiement is whether it will deliver more revenue than was available to the papers when their content was freely available online.

Writing on his BBC blog, Cellan-Jones says: "There are still some imponderables. We know that the 105,000 includes those who have paid for the more expensive iPad app, or to read the papers on Amazon's Kindle but we don't know the split. We are also unclear just how"sticky" these paying customers are - in other words, whether or not they renew their subscriptions at the end of each week or month.

"We do know that around half are paying monthly - that's £8 for the website or £10 for the iPad app - and the rest are paying £1 for a day's access. By my very rough back-of-the envelope calculations that adds up to annual revenue of around £7m. On top of that there will still be some advertising revenue, and with 100,000 paper subscribers having activated their digital editions, the newspapers have a total online audience of 200,000."

He adds: "With a paper like the Guardian now earning around £40 million a year in online revenues, I think it's safe to assume that Times Newspapers has yet to achieve the same revenues from its paywall experiment that were available when its website was free. That's not to say this adventure has failed. The Times has shown that there is an audience, albeit small, willing to pay for digital content, and other newspaper groups are rushing to imitate parts of the experiment, notably the use of tablet computers as a paid platform."

Cellan-Jones disagrees with a claim by Times editor James Harding on the Today programme this morning that his journalists' fears that they might be cut off from the online conversation have proved groundless. He writes: "Really? That's not what I've heard from at least one reporter, frustrated to see rivals enjoy all the online buzz around their stories now denied to a journalist hidden behind the paywall."