Paywall intercept rates on “closed” and “open” news sites yield revenue optimisation insights

By: Matt Lindsay, CEO and Joel Medford, Data Analyst and Team Lead at Mather Economics

In a recent study, Mather Economics analyzed the performance of 118 websites for one year after they changed their paywall strategies in March 2023. One group of news sites, the “closed” group, allowed fewer free articles, so more visitors hit a paywall. The other group, the “open” group, allowed more free content, so fewer visitors reached a paywall.

This was not a randomized test. There were 91 sites that tightened their paywall (closed group) and 27 that loosened their paywalls (open group). While this isn’t a statistically valid market comparison, it offers valuable insights into how different paywall strategies affect news media sites.

To be included in the study, publishers had to meet these criteria:

– The market must offer a paid subscription.

– The market must have at least one form of standard content restriction (registration wall, premium paywall, metered paywall).

– The market must pass all data quality checks and validation for March 2023-March 2024, accurately differentiating between the three types of restrictions.

We compared several performance metrics for each group one year after they changed their settings, including monthly users, monthly page views, conversions per million users, and the paywall conversion rate. We then used these metrics in an economic model to see how their paywall strategies affected subscription volumes, retention rates, and revenue. We also looked at how these strategies impacted advertising revenue through changes in page views.

As shown in the chart of paywall hit rates, the closed paywall markets saw a significant increase in paywall hits, more than doubling. The more open markets experienced about a 30% decrease in paywall hits. This result aligns with our expectations, given how users view articles. Most website visitors read only one story per month, with a small share, typically about 5%, reading more than three articles. Therefore, lowering the paywall limit from three to two articles per month affects more visitors than increasing the number of free articles from three to four.

The charts below show the changes in monthly users and page views over the year following the paywall changes. Each market’s metric is indexed to March 2023, with data points reflecting the median indexed value within each group.

Observations regarding these charts of monthly users and page views:

– Traffic declined for both groups year-over-year due to overall news industry trends during this period.

– The Closed group saw larger declines in users and page views compared to the Open Cohort.

– The difference in page views starts in August 2023, and the difference in users starts in October 2023.


The following charts show the changes in the paywall conversion rate and the conversions per one million monthly users.

Note: The closed group is represented by the blue line in these charts. They experienced lower conversion rates but higher conversions per million users.


The trends in conversion rates and conversions per million users between the two groups followed expected patterns. The more open paywall group had a higher conversion rate, as these users were more engaged after consuming more free content. In contrast, the tighter paywall group saw a decrease in conversion rates since it intercepted fewer engaged users on average.


The net effect of changes in the intercept rate and conversion rate is reflected in the conversions per million users for each group. The tighter paywall group had a greater increase in conversions per million users than the open paywall group because the number of sales attempts (+100%) outweighed the reduction in conversion rate (-20%).

Both groups experienced higher conversions per million users over the year due to several factors, including improving conversion rates and changes in audience levels.


Some observations regarding the change in paywall settings on audience behavior:

– Tighter content restrictions result in fewer articles read but no net decrease in daily users or page views in the short term (about six months).

– Users don’t immediately notice a change and continue to visit the site.

– Users refresh pages or try multiple articles when encountering a paywall.

– Tighter content restrictions begin to affect page views and monthly users several months after the paywall changes are implemented.

Applying metrics in an economic model

Websites employing a stricter paywall strategy observed a 46% increase in average sign-ups compared to those with a more open approach. However, a drawback of stricter paywalls is higher subscriber churn rates, as more subscribers may cancel their subscriptions over time. In this context, “quality” refers to the likelihood of new subscribers to maintain their subscriptions. The critical question is: at what retention level does the paywall strategy reach a balance? Additionally, this analysis examines the impact on advertising revenue stemming from changes in page views.

Here are the indexed performance metrics comparing March 2024 to March 2023 for the two groups:

If we take the closed paywall as the standard, which most sites adopted during this period, we can calculate the retention rate needed for open paywall sites to achieve an equivalent level of subscriber-months from new subscriptions (the number of months of active individual subscriptions). This breakeven rate varies depending on the time frame. In this example, we’ve used one and two years, with an index of 100 starts for the open sites and 146 starts for the closed sites.

For instance, if the closed paywall retention is 40% in the first year, open paywall customers would require an 85% annual retention to compensate for the lower start volume in the initial year. A two-year breakeven annualized retention rate would be 63%.

The revenue generated from these new subscribers will depend on the offers and pricing tactics implemented by news media companies. For this analysis, we focus on volume as the breakeven metric due to space limitations. Pricing tests that alter new offer promotion prices, promotional terms, and renewal rates show significant benefits from strategic pricing tactics.

Chart: Subscriber months from the two cohorts illustrating “breakeven” subscriber volumes and retention over a two-year breakeven time horizon.

Key Insights from this Analysis and Model:

– The increase in new subscriptions outweighs the decrease in retention resulting from stricter paywall strategies when viewed from a subscription volume perspective.

– The decline in page views and visitors due to a tighter paywall typically occurs several months after the change is implemented.

– Achieving the necessary increase in retention to “break even” from the lower number of starts generated by an open paywall is often challenging.

– Implementing more open paywall or registration wall policies should be accompanied by new offer characteristics aimed at improving retention, such as longer terms.

– Initial effects on advertising revenue are minimal in the first few months due to the lag in customer response to paywall changes.

– A “pulsed” paywall strategy, alternating between open and closed phases, may help mitigate long-term traffic losses, underscoring the need for active management of paywall strategies to maintain an optimal revenue mix.



This analysis of 118 paywalled news media sites offers valuable insights into the dynamic factors influencing optimal revenue strategies across subscriptions and advertising. The time delay in customer response to new paywall behaviors is a crucial consideration. Additionally, achieving the necessary retention increase to offset lower starts from a more open paywall presents a challenging threshold. This analysis points to areas for future research, including designing new subscription offers tailored to customer segments reaching paywall intercepts under alternative paywall strategies and subscriber-only content.

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