The Impact of Chrome 76: Why a Freemium Model Is the Future

It is often said “when one door closes, another opens.” And that is the scenario many subscription-dependent publishers find themselves in today. Publishers have long deployed metered paywalls allowing them to track and cap the number of articles read unless a reader subscribes. Savvy internet users have learned to browse in Incognito or Private mode, which avoids the standard cookie dropping in the name of user privacy, rendering metered paywall less effective at identifying the reader and capping the number of articles read. After considerable investment, publishers were able to identify readers using Incognito and enforce their metered paywall. But the latest releases of Chrome and Safari remove that capability. It has been well documented that the Chrome team enjoys a great deal of autonomy within Google. As user privacy takes on greater importance across the Google ecosystem, the new version of Chrome, known as “Chrome 76,” rightfully reps to this trend. Unfortunately, that same focus to improve user privacy removed the workaround publishers relied on to identify Incognito readers, thus inhibiting their subscription funnel. This is despite Google’s ongoing support for the publishing industry through organizations like The News Media Alliance and the Coalition for Better Ads, which advocate a healthy and sustainable publisher ecosystem. As a consumer, it is encouraging to see the privacy-minded Chrome team at odds with the prevailing business model of their employer. Unfortunately, publisher revenue has become collateral damage. These technical workarounds are more than just some friendly jousting between readers and publishers on the world’s most popular browser. Publishers are under intense pressure to diversify their revenue, as ironically, Google and Facebook disintermediate audiences and scoop up the majority of online ad revenue. Subscriptions are an important part of publishers becoming less reliant on advertising dollars, made all the more difficult if they can’t enforce their metered paywalls. While revenue diversification is priority #1 for publishers, so, too, is ensuring user privacy for the millions of online users. For publishers, this means compliance with GDPR and other data privacy regulations. For browsers and other technology platforms, it means reducing visibility or access to data to protect user privacy. Chrome’s effort to close this privacy loophole falls into the latter category, as does Apple’s Internet Tracking Protocol (“ITP”), which continues to upset the status quo of the web and is pushing the boundaries on how traditional browsers work in the name of user privacy. Which brings me to the question: What impact will Chrome 76 have on publishers? It seems that almost every publisher has currently adopted some form of a membership program or subscription model, capping the number of free articles a visitor can read per month. While in many ways digital subscriptions are the perfect counterpart to a fickle advertising market, publishers will likely see fewer conversions and less subscription growth in the coming months until they can re-institute the reader paywall solutions they had worked so hard to implement. Publisher Recommendations My recommendation for publishers in this environment is to take the following three steps: First, continue to explore and test multiple variables in metered paywalls: number of articles, subscription cost, and types of content. Have good answers to questions like: “does placing more long-form, resource-intensive editorial in front of or behind the paywall help subscriptions?” Many of these answers will be unique to the publisher and only revealed through an always-on test-and-learn strategy. Providing the right balance of free and paid content will resonate with readers who are willing to pay; disregard the readers who will always seek to undermine or avoid the pay model. Second, publishers should continue to work with industry groups like Google News Initiative, and Google’s Subscriptions Lab – as well as companies like Piano with deep expertise in news, media, and digital subscription insights – to help scale and test different strategies. Yes, it feels counter-intuitive to be recommending Google for help, but their efforts have proven helpful for many publishers. Third, realize that consumers are close to peak-subscription – not just across editorial, but across many aspects of the consumer experience including e-commerce, digital media, and other services. Continue to explore and diversify the revenue mix between membership, events, native advertising, subscriptions, and e-commerce in order to grow the 1:1 relationship with readers. This not only nurtures long-term value with readers but also allows your brand to prosper through new product offerings. The new version of Chrome 76 and similar changes from Safari will have a negative short-term impact on publisher subscription revenue. However, publishers have proven resilient, offering new products, diversifying their revenue, and continuing to invest in their core products. Chrome 76 is simply one more event moving us toward improved revenue allocation and a healthier publishing industry.

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The Impact of Chrome 76: Why a Freemium Model Is the Future

Dennis Yuscavitch

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Dennis Yuscavitch