Paywalls restrict users from accessing premium content on websites unless the user is a subscriber or has paid a fee to access the content. There are two main categories of paywall,  offering alternative ways of accessing content. Those based on a soft paywall design offer limited access to premium content on the website and the rest remains behind a paywall, which can only be accessed if the user pays a fee. The second most common type of paywall is a hard paywall, which restricts almost all the web content behind it, and this can be accessed only through subscription or other payment models.

While searching on the internet, a user stumbles upon various results in the form of websites and links for similar information. All these results might provide different answers to the same query, albeit in different manner and quality. This can lead the user on an endless search for unlocked information. This, as you can imagine, can become frustrating to a reader who is short on time and energy.

Enter paywall labels. These are, effectively, filters that accompany every link on the results page indicating whether the link will direct you towards paid content or unrestricted content. Surely, this tool is very useful for users who are sick and tired of using tricks and loopholes of different paywall designs to access restricted content. However, these tricks are time-consuming and technical. For the average user, having clearly labeled paywalled content should be a priority, and this was reflected in a recent poll by Deyan Darketing. While it is of great benefit to the user, for those websites that provide premium content there could be a negative effect.

It is generally considered that paywall labels will impact site visits by users. It can contribute to the downgrading of quality services because of the tendency of the masses to overlook and skip paid content according to their convenience. It can make business for these websites difficult and make them lose revenue generated from advertisements.

Following are some of the challenges faced by websites:

  1. Decreased traffic

Paywall labels will modify a user’s preference by providing the choice of accessing similar content elsewhere, which will drive away traffic from the premium website. Traffic to websites brings in revenue and impressions on which these websites bank, but such a tool will negatively affect their website and reduce traffic.

  1. Visibility

The search engine algorithm prioritizes content based on ads and popularity, decreased traffic will contribute to a decrease in visibility, and gradually, the search results will stop displaying the links on the main page, which will further damage the business.

  1. Lost revenue

Low traffic and visibility will then make way for lost revenue. Although a premium website has a subscription model, studies reveal that subscribers only make one-tenth of the total visitors on the website, with the remaining ninety percent access the information that is available freely. If they lose ninety percent of impressions, then they will lose other sources of revenue that help them sustain the business.

As it stands, for those in the business of offering up information, paywall labels can negatively impact site visits and force a website to change its revenue model. And in a worst-case scenario, it might even force them to shut down. Greater consideration should be taken going forward if an acceptable outcome should be reached with all parties involved.