Tapsearch Com EditorWhat do you do for money honey
September 18th 2007 23:50
A lot of Internet folks are hailing The New York Times's decision to tear down its subscriber wall. Now readers won't have to pay for online content. The Times rationalizes that it can make more money from online ads than from Web subscriber fees.
I'm not really convinced they made the right decision, though. The beauty of charging for online content isn't so much that a lot of people pay for it, but that it reduces the incentive for print subscribers to cancel. Why buy a newspaper -- and, in doing so, view far-more-profitable print advertising -- when the articles are online for free?
Ad revenue-wise, in the course of a year, one typically has to add about 100 unique visitors to a Web site to make up for a single lost print subscriber.
Hit & Run cites a TechBlorge post that crunches the numbers:
Shouldn't preserving 90 percent of one's money overshadow a modest increase in the remaining income?
Of course, the obvious counterargument is that the Times spends a lot of time and money making these decisions, whereas I read a few articles and pontificated. Very few major newspapers charge for online content anymore, so it seems the market has decided that free is the most profitable way to go.
I'm not really convinced they made the right decision, though. The beauty of charging for online content isn't so much that a lot of people pay for it, but that it reduces the incentive for print subscribers to cancel. Why buy a newspaper -- and, in doing so, view far-more-profitable print advertising -- when the articles are online for free?
Ad revenue-wise, in the course of a year, one typically has to add about 100 unique visitors to a Web site to make up for a single lost print subscriber.
Hit & Run cites a TechBlorge post that crunches the numbers:
[T]he two-year experiment was earning the Times about $833,000 each month - or $10 million a year - but that's about a third of the $80.9 million earned by all digital businesses at the Times. And even then, almost 90% of the company's money was coming from its non-digital offerings.
Shouldn't preserving 90 percent of one's money overshadow a modest increase in the remaining income?
Of course, the obvious counterargument is that the Times spends a lot of time and money making these decisions, whereas I read a few articles and pontificated. Very few major newspapers charge for online content anymore, so it seems the market has decided that free is the most profitable way to go.
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