The Times they are a charging

After ploughing millions into their websites, UK newspapers are starting to impose fees for cyber services.

The gunsmoke may have cleared from the newspaper price war but the battle of the newspaper websites has only just begun.

After pouring hundreds of millions into their online versions, and in the face of a debilitating advertising recession, Britain's newspaper proprietors are all urgently reviewing the cost, the revenues and even the purpose of their dot-com operations.

They ultimately want to see a return – or at least a huge reduction in the losses – from their internet adventures.

By this time next year, surfers on the internet, freelancers working from home and researchers trawling the archives may find they are many hundreds of pounds poorer. The age of free content may soon be over and the era of pay-as-you-go upon us. The name of the game now in newspapers is not how many people go to their websites, but how many people will pay for the information there.

On past form, it is perhaps not surprising that The Times fired the first shot. But this time, rather than price cutting, News International has chosen to charge its consumers more than the opposition.

Rivals have been watching the performance of the new subscription-based Times Online website to gauge whether they too should jump into the charging pool – and so risk losing a huge proportion of their internet audience in the process. Some, such as the Finan- cial Times, whose advertising revenues have been badly hit and which has poured a staggering £150m into FT.com, have taken the plunge.

FT.com was left with just 20,000 paying subscribers out of a user base of three million. But it has also started to break even and now hopes that its unique content will entice many more visitors with large wallets to pay for its services soon.

Ironically, some – including FT editor Andrew Gowers – believe that the pink 'un may have left it late to start charging; its chief rival, The Wall Street Journal, has always done so and thus avoided the risk of antagonising some of its supporters by changing policy mid-stream.

The UK, no doubt because of its uniquely competitive newspaper market, has generally been slow to charge compared to other countries (notably Scandinavia, where newspapers have set up a sophisticated combined charging system with banks and mobile phone firms). However, the experiences of some foreign papers have proved cautionary, not least that ofThe Irish Times, which is said to have lost 95 per cent of its website users by introducing a full charging policy over-night. The episode is held up as the seminal lesson in why it is necessary to go "softly, softly" on charging, starting with registration, then premium services and finally archives and sometimes even current news.

After all, internet users aren't used to paying for anything much except porn. "For that reason we may well see the tabloids charging for ladies-in-underwear sites soon," says Tom Ewing of internet analyst Nielsen/NetRatings. "We could see The Sun's pagethree.com site going over to subscription. The Emap lads' mag FHM is already the first major glossy to charge for content, in its case a vaguely cheesecake readers' girlfriends section."

In March, when Times Online started charging overseas subscribers for its rather more sober news content, and everyone else for archives, Law Reports and the crossword club, the general manager of Times Newspapers, Paul Hayes, clearly hoped to signal a shift from the web's entrenched freebie culture. He declared: "The free ride is over and the days of free content have gone.

"The Times was the first UK publisher to recognise the value of online content. The internet offers strong commercial opportunities and we intend to take advantage of them. Charging for content is not a new idea; newspapers have been doing it for 200 years."

Times Online now charges up to £19.99 for its crossword club and £1 an article, with a minimum fee of £10, for its archives. News up to seven days is free in the UK but overseas readers pay £40 a year just to read the online paper, and there are any number of expensive "premium" services for news and sports fans.

While Annelies van den Belt, Times Online's digital director, claims that 30 per cent of the crossword club's original members are now paying subscribers, News International is extremely coy about how the site is faring overall. "That is commercially confidential information," she says. "Some people were annoyed when we started to charge. But lots of papers in Europe and the US are leading this development, so it is becoming more widely accepted."

The Independent, which nine months ago started charging for selected premium services such as crosswords and news updates uploaded on to customers' handheld computers, is gearing up to introduce more subscription packages in the new year. "We're not making a fortune at it at the moment, but our readers are slowly getting used to paying up," says David Felton, the online editor.

But these services are seen as a promising forerunner to a far more extensive charging regime next year, perhaps including pieces by top commentators and access to the archives. "People aren't keen to pay for something that's been free in the past. But we have to drag them along; it's not free to produce and we have to look at the possibility of bringing in long-term revenues."

Guardian Unlimited, the UK's biggest newspaper site, which perhaps uniquely attracts more readers than The Guardian newspaper itself, is also looking at charging soon. "There will be some subscription element to our site soon but I won't be drawn as to what it will be," says Simon Waldman, director of digital publishing.

"While subscriptions will be important for us, they are only a strand of revenue. Advertising has been very healthy, up 30 per cent on last year, so I don't see subscriptions as the holy grail like some do."

The Telegraph, the next- biggest site, is even more wary about moving over to subscriptions after a recent review of the charging option. "We are the best-selling broad- sheet in Britain and our website should reflect that. We're not yet ready to become a niche player, which would be the result of charging overall," says Tim Faircliff, operations director of the site.

"We already charge up to £10 a season for our interactive Fantasy Football game and £25 for our crossword club. We think it better to charge for certain unique areas as it gives us a revenue stream without cutting millions of other people off. That said, of course things may change, and we haven't taken a firm view on what to do in the future."