I wish the Chronicle luck at its experiment with a “paywall.”  Once upon a time, we used to call that a “subscription” -- that is, you pay money and someone delivers to you something worthwhile to read. Since nobody much likes to pay to read anything any more, it’s considered risky and a bit radical for a newspaper to charge money for access to the work that it pays a staff a fair amount of money to produce.
Let’s do the nice thing here, shall we, and set aside the question of whether the journalism the Chron produces is of such high quality that people ought to pay a premium for it. I have my gripes with the Chron, and always have, but seriously: Having a local newspaper that tells you what’s going on in town -- even if it doesn’t always do it well -- is worth a dollar a day. Which is what the print version costs.
Writers need to get paid . Reporters are necessary to the function of democracy, and if they can’t make a living doing the job, it’s not going to get done. Since most young people aren't used to paying to read anything these days, the only option has been selling (more and more) ads.
That’s actually a model the alternative press has followed for decades, and it’s worked fine. In the days before cable, that’s how TV worked, too -- it comes in free, and you pay for it by watching (annoying) ads.
But it’s a problem on the web, where ads don’t bring in the revenue they once did in print, so everyone’s scrambling to find a way to pay the bills. If you’re Markos over at Daily Kos , you build a huge, huge community that loves what you’re doing, and keep the staff fairly modest, and sell enough ads and bring in enough donations to pay for it all. If you’re Nick Denton’s Gawker Media Empire , you keep costs very low by hiring very limited staff (certainly not a lot of reporters) and sell ads ads ads everywhere, including “sponored posts.”
But if you’re the San Francisco Chronicle, with 280-plus reporters who need health care,  and lots of editors and executives, and the Hearst Corp. demanding impossible profits, you’re kind of SOL.
These things don’t tend to work very well. Sfgate had a paywall for “premium content” years ago, and it just sort of faded away. The Wall Street Journal and the Business Times pubs get away with it, because people who read biz pubs are used to paying for information. I’m not sure how many truly loyal Chron readers there are who are willing to pay to read Matier and Ross and Chuck Nevius on the web. Most of those people already pay for a print subscription.
The other problem is that it’s really unclear what the identities of the two sites, sfgate and sfchronicle, will be. They look different (sfgate looks like a newsy website, sfchronicle looks like a print newspaper), but where do you go every day for news? If you read sfgate, you’re missing stuff that only appears on sfchronicle, but if you read sfchronicle, you’re missing stuff that appears on sfgate. It’s not like you get a “premium” edition of the paper in one place; you have to check two sites to get your local news, not one.
For example, today you can get The Chron’s own Carolyn Lochhead on the same-sex marriage case at sfgate. If you pay extra, you can go to sfchronicle and get an AP story that’s not exclusive  and will run in lots of papers.
Why does this make me want to pay?
So I don’t know; it’s going to take a lot of evolving to make this work. Again, I wish them luck; anyone who’s trying to find a way to keep paying a news staff deserves credit. But at this point, it seems like a pretty dubious plan.