Even assuming a 5% conversion rate, that would mean 60,000 from a daily online readership of around 1.2 million (according to the ABCe figures). Factor in that around two-thirds of the readership are outside the UK, and advertisers locally will be left with a readership of around 20,000. Advertisers may say they value engagement over scale, but will they actually come on board? Even if current revenues are disappointing, they are going to be hit hard by such a diminution of scale. And the costs of delivering a high-quality web site will still need to be met.

It’s easy to criticize. After all, what are publishers to do if users won’t pay for their expensively acquired content. But it remains to be seen if this model can effectively generate more revenue than other models, whether they offer tiered access, or additional exclusive content, or try and build additional new revenue streams (such as ecommerce) around the core news brand.

It’s a bold move, of the type we’ve seen before from Murdoch. But does that guarantee it will work? It depends partly on how his competitors respond. In the UK, The Guardian, The Telegraph and the Mail may benefit initially from those unwilling to pay for The Times online. But also on the horizon, and also announced today, is the prospect of the polar opposite of the News Corp (NYSE: NWS) model, from The Independent, under its new Russian owner Alexander Lebedev.

The Indy, with a loyal but small readership, has struggled to make an impact either in print or online, lacking the resources of its rivals. But Lebedev has already revitalized London’s daily paper, the Evening Standard, through a commitment to both decent journalism and the ultimate disruptive model – he scrapped the cover price. With The Times putting up a paywall, will Lebedev be tempted to outflank them and offer The Independent – in print and online – for free? We’ll be returning to the topic of how publishers can monetize their content in a number of reports later this year.

Nick Thomas is an analyst at Forrester Research, where he serves Consumer Product Strategy professionals and blogs. Reprinted with permission of Forrester Research Inc.