Could Freemium Models Work for Legacy Newspapers?

In 2015, the Danish newspaper industry continued its decade-long decline of the printed newspaper circulation. The main cause of the decline is the change in preferences of readers, who prefer online news sources. This change in preferences and the resulting decline in circulation have created economic uncertainty for the legacy newspaper firms: while the business model of printed media provided healthy revenues from both subscribers and advertisers for many Danish titles, the Internet-based revenue models have not yet succeeded in ensuring sustainability of their business.1 It appears that leading Danish newspapers cannot generate enough revenues from online activities to compensate the costs of producing and distributing their content online2 despite increasing the Internet traffic to their websites. As a consequence, many legacy newspaper organisations adopted mixed-revenue models based on advertising and subscription for their online content, but continued to exploit their printed titles for the necessary revenues. Much of the digital content is, however, still free of charge. This supports the constant traffic to newspapers’ news sites, but implies a difThe newspaper industry has long been looking for sustainable business models for their digital editions. One of their popular choices is the freemium business model based on free and premium content with a paywall. However, freemium has not yet lived up to the expectation of the industry and has not secured the revenues that industry players hoped for. This article discusses a number of the main principles of the freemium strategy and tactics, and highlights the critical points for legacy newspaper organisations.