I've no idea if the Seattle Times' decision to hide behind a paywall will grow or shrink their revenues in the long run. I assume they've studied the numbers, so if this is an act of desperation, it's at least a calculated one.
But I do know that a paywall will almost immediately shrink the newspaper's relevance. That is inevitable.
With the paywall in place, fewer people will read the Seattle Times. Oh, the number of paid subscriptions will bump up at first, but there will be fewer actual readers. And not only will the paper's audience be smaller, it will be more homogenous: Older, wealthier, older. With each successive generation, fewer young people are getting into the habit of reading daily newspapers, especially in print. That's why the Seattle Times is charging more for a digital only subscription ($3.99/week) than it is for Sunday-only delivery ($3.15/week), a subscription that includes digital access for free.
That's right: The Seattle Times will charge digital subscribers an additional $43.68 a year for the privilege of not having a newspaper dumped off on your doorstep. That's a business model the phonebook companies might want to look into.
And in addition to suppressing direct readership, depending on the porosity of the paywall it will also serve to exclude the paper's reporting and opinion from much of the larger conversation that occurs outside its gated community. Why should I Tweet a Seattle Times headline if the bulk of my followers can't load the page from the embedded link? Why link to the paper's website at all, except for entirely exclusive content? Judging from my comment threads, it's clear that many readers already neglect to click through the links provided—the last thing they need is further disincentive.
Publishers may see paywalls as an effective means of seizing back control from news aggregators, but paywalls only empower news curators like me. As a blogger, I built an audience that trusted me to read the papers, pick out a handful of the most important stories, block quote the key passages, and tie it all together in some sort of meaningful and entertaining context. Erect artificial barriers to reading my source material, and fewer people will. That only enhances my ability to frame the message.
As Dom says, the Seattle Times is not the New York Times. It's not nearly as essential. It's also not the Bellingham Herald, a paper that faces much less competition from TV, radio, and other media outlets for local news coverage within its local market. So I'm just not convinced that paywalls can ultimately save newspapers from further decline in Seattle-sized media markets.
Not that I've got a better idea. In fact, I strongly suspect that barring a total re-imagining of what it means to be a "newspaper," the industry's business model crisis is intractable. So I suppose the Seattle Times might as well give a paywall a try, as self-defeating as I expect the experiment to ultimately be.
But as much as I might disparage paywalls in practice, I think they're even worse in theory, for they threaten to destroy what in a weird way has been a sorta golden age of journalism, at least from the perspective of avid news consumers. No, really.
When I first moved to Seattle in 1992, I used to occasionally pick up a copy of the Sunday edition of the Philadelphia Inquirer at the news stand in the Pike Place Market. It was expensive and a day or two late, but it was the only way to keep up with the news in my old home town. (Okay, it was the only way to keep up with the news on my beloved Philadelphia Eagles.) At that time there were still a handful of news stands in Seattle that catered to expats like me, shipping in newspapers from major cities around the world. But not for long.
The Internet changed everything.
Within a few years nearly every newspaper anywhere was on the web offering a free online edition, and ushering in an unprecedented new era of information accessibility. Where once it was a labor to keep up with current events even in nearby Tacoma or Everett, one could now feast off a smorgasbord of local content from the far reaches of the world. I no longer needed to satisfy myself with days-old coverage of an Eagles game: I could read the sports sections of Philadelphia papers same day, as well as articles in the papers covering the opposing team. And oh yeah—if something important was happening in Olympia or Spokane or the Tri-Cities, I could read those "papers" too. Amazing.
All news is local, in that it happens locally somewhere. And anybody who argues that this revolutionary explosion in access to local news wasn't a tremendous boon to our democracy is either crazy, stupid, or lying. Probably lying.
But paywalls destroy this. They are anti-revolutionary. By design. They set up artificial barriers to the diffusion of information, and to the healthy dialectic such accessibility fosters. They reject and suppress the productivity gains offered by new media technologies. Whatever additional revenue some newspapers might individually realize, at the macro level paywalls destroy value.
I'm willing to entertain the notion that paywalls are necessary to the survival of newspapers (although I doubt it). And perhaps faced with the necessity of justifying the cost of a digital subscription, the Seattle Times will reinvest this new revenue in improving its product (although again, I doubt it). And of course, as much as I loathe the Seattle Times' editorial page, I don't really want to see Seattle become a no-newspaper town, so if a paywall is crucial to the paper's survival, then I guess so be it.
But in the long run, I don't see this as either a desirable or viable solution. Like the defensive walls the Romans erected around their cities in the dying years of the Empire, these paywalls cannot forever keep the barbarians at the gates. An industry built for print, with all the infrastructure and overhead print demands, is simply not well suited to exploiting the efficiencies of the digital realm. And if newspapers cannot give news consumers what they demand, somebody else will.