The Long Island daily newspaper called Newsday, was one of the first newspapers to try using a paywall. A paywall is where you must subscribe and pay a fee to access news online. But what could turn out to be a preview for others is that people are not going to pay. Newsday setup their pay for service last October and has attracted a whopping 35 subscibers at $5 a week.

That is sad when one thinks that the newspaper was originally purchased for $650 million. According to a recent article it also states that:

That astoundingly low figure was revealed in a newsroom-wide meeting last week by publisher Terry Jimenez when a reporter asked how many people had signed up for the site.

The web site redesign and relaunch cost the Dolans $4 million, according to Mr. Jimenez. With those 35 people, they’ve grossed about $9,000.

In that time, without question, web traffic has begun to plummet, and, certainly, advertising will follow as well.

Of course, there are a few caveats. Anyone who has a newspaper subscription is allowed free access; anyone who has Optimum Cable, which is owned by the Dolans and Cablevision, also gets it free. Newsday representatives claim that 75 percent of Long Island either has a subscription or Optimum Cable.

Mr. Jimenez was in no mood to apologize. “That’s 35 more than I would have thought it would have been,” said Mr. Jimenez to the assembled staff, according to five interviews with Newsday staffers.

He argued that the web was not intended to be a revenue generator, but rather to provide extra benefit to loyal subscribers.

Not to be a revenue generator? You spend $4 million to setup a web site and expect what, to lose money? I would bet that as this paper continues to lose money, Jimenez will continue to collect a bonus. After all, isn’t that the American way?

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