Newsday made the bold (and some, like me, might say, silly choice) to lock its online content up behind a $5 per week paywall. Cablevision, who purchased the newspaper for $650 million in 2008, offers its website to Optimum Cable subscribers and Newsday subscribers for free, but charges anyone else $5 per week, and three months in, the numbers are starting to leak out.

First, how many people have signed up for $175 per month Newsday website? 35. Yes, 35 people. So that extra $9,000 a year must really make up for the estimated 50 percent drop in web traffic. At least they don’t have to pay famous columnists who want people to actually be able to read and share their work.

Now I look at these numbers and see evidence that paywalls might not be a great idea to make money. Even assuming the vast majority of Long Island (which Newsday targets) have free access as Optimum Online users, erecting the paywall means more costs like paying for more customer service and accountants, while even print newspapers find going free both saves tons of money and increases circulation (because they don’t have to pay for as many customer service agents or accountants).

Less traffic, tiny amount of money after spending tons (even to buy the paper). Maybe they’ll eventually learn their lesson that paywalls don’t work and end it like the New York Times did. And then forget and bring it back years after.

On the proverbial eve of the New York Times’ return to paywalldom (has everyone forgotten the Times already dropped its pay wall once because it didn’t work), a research firm posted a study showing 44 percent of Google News visitors scan headlines and don’t click through.

They think this is high. I’m shocked it’s so low.

Analyst Ken Doctor says: “Though Google is driving some traffic to newspapers, it’s also taking a significant share away. A full 44 percent of visitors to Google News scan headlines without accessing newspapers’ individual sites.”

What is Google taking away? If I read all the newspaper and magazine headlines at the newsstand, am I taking something away? No. It’s the newspaper’s job to convince me to “buy” or, in this case, click. Google is providing a huge amount of free advertising for these newspapers and converting 56 percent of that traffic. Any marketer will tell you a 56 percent conversion rate is astronomically high. It is up to those newspapers to turn that traffic into loyal readers.

For Rupert Murdoch and others looking to block Google because it’s taking so much for itself, they are just going to leave that 56 percent for the thousands of other news sources willing share in free advertising. And if they really learn from this study, they’ll figure out how to write better headlines and better stories to convert the other 44 percent.

Rupert Murdoch, after a short time of seemed like he understood the internet was a new and exciting tool, has since changed his medication and now sees it as the evil of all evils. He has been pushing, vocally, not through action, reinstating paywalls on his various media properties. The Wall Street Journal is one of the last major newspapers to have a paywall around most of its content.

Now Murdoch is claiming he will block Google from indexing the WSJ and his other media properties. Murdoch told Sky News Australia “If they’re just search people… They don’t suddenly become loyal readers.” He explained that traffic from search engines involve no loyalty – just view a few headlines and leave.

Removing a site from Google takes just a few lines of code in a robot.txt file, something Google and other search engines make no attempt to hide. So why is Murdoch waiting?

Maybe because even without loyalty, Murdoch knows traffic will drop significantly without search engines bringing tons of free traffic. Even if 99 percent of those people never return, there are 1 percent that stay and might return. It’s up to Murdoch and his websites to give these users a reason to stay and then find ways to monetize that traffic. Murdoch has previously said no news websites or blogs are making serious money, ignoring the massive enterprises behind Gawker, Huffington Post, PerezHilton, TechCrunch and hundreds of others who have embraced the internet to find more cost-effective ways to engage audiences and produce compelling content.

Techdirt points out that for all Murdoch’s grandstanding, his own websites have aggregators that link to other people’s content the same way he claims others are stealing his content. When others aggregate content it’s stealing. When Murdoch does it, its convenient? Maybe this will stop his crusade to overturn fair use in the courts since he’d be culpable too.