Media commentator Clay Shirky has written an interesting post assessing the Times and Sunday Times paywalls. Shirky argues that the figures released last week on the paywalls erected by owner News International in July aren't ground-breaking news in themselves: the figures are pretty much what one would expect based on the market. But something about this paywall and the reaction to it "feels different," he said.

"It's new because the people paying attention to it are now willing to regard the results as evidence of something. To the newspaper world, TimesSelect [a New York Times paid online content effort] looked like an experiment. The Times and Sunday Times look like a referendum on the future," he said.

The fact that News International has gone for a full paywall and cut the Times, Sunday Times and News of the World off entirely from non-subscribers is the boldest move so far from any major newspapers in terms of paid online content, and therefore seems like the ultimate test.

Shirky suggests that the paywall has had a profound effect on the nature of the newspapers, more than just shifting income from advertisers to users, as "the paywall creates newsletter economics."

He explains, "One way to think of this transition is that online, the Times has stopped being a newspaper, in the sense of a generally available and omnibus account of the news of the day, broadly read in the community. Instead, it is becoming a newsletter, an outlet supported by, and speaking to, a specific and relatively coherent and compact audience." He goes on to suggest that the Times and its Sunday sister are in fact becoming the online newsletter of the UK's Conservative party.

Media strategist Seamus McCauley has another theory about the role of the paywall: he argues on his blog Virtual Economics that the Times paywall is not actually about making money out of the Times, but about using the Times to make money for Sky TV. He anticipates a bundling of Times subscriptions with Sky subscriptions, pointing out that this additional product could put Sky a cut above its satellite rivals.

Source: Clay Shirky, Virtual Economics