New York Magazine has some sterling advice for the New York Times’ paywall. The whole thing is like a step-by-step guide to seppuku, but this gem stands out:
Make the price surprisingly low. This, no doubt, the Times has already thought of. One of the main selling points of the new thetimes.co.uk is that it only costs £2 a week (about $2.89), which is much less than the cover price — and considering that all the costs of printing and distribution are eliminated, it should be.
Yeah, almost 3 bucks a week is like nothing! It’s only $150/year! I’ll gladly pay that for a couple of pieces of exclusive content every day, because, like everyone else, my budget for news is thousands of dollars a year.
Back in the day, people paid decent money for a paper newspaper because it was the only way to get timely, relatively in-depth news delivered to the home. But things have changed, to put it mildly. The subscription price for a newspaper might be a valid comparison for a paywall price in Rupert Murdoch’s Viagra-fueled jack-off sessions. Out here in the real world, even a news junky like me won’t pry $150/year out of my wallet to read a couple of things I can’t get anywhere else on this new-fangled Internet thingy.
MattF
The unsolvable problem for newspapers is that the one thing that people are not going to pay for is ‘news’. So, newspapers that put their news behind a paywall are slamming the barn door after the barn’s inhabitants have not just gone– they’ve vanished forever.
SGEW
Honestly, I’ll wind up paying whatever for the NYT ’cause it’s my hometown paper and I grew up with it. Other people, I don’t see why they would.
Zifnab
Ok. So this news model is going to sound a bit crazy at first, but bare with me.
We get middle-aged businessmen and former beauty queens to sit behind a desk, and read the news in front of a camera. Then we broadcast that news over “air” “waves”, so that anyone with a pair of rabbit ears on his TV can watch it. If you want to get really fancy, you can have your businessmen and news models ON SITE delivering the news, perhaps while interviewing an uninformed bystander for an outside opinion.
Now, this is where it gets truly crazy. Guess what you charge? NOTHING! You don’t charge a dime. Not to the viewers. Instead, you break your broadcast into segments and splice in advertisements for goods and services that the viewers might be interested in purchasing.
And behold your news model. Crazy? Perhaps. Entirely untested? I’ll admit that. But I think this “free news” business model might really have legs sometime in the near future.
jrg
Why would I pay for a NYT subscription when I can watch a White House press conference for free?
Just like waterboarding! Yay!
Ginger Yellow
To be fair, UK readers of the Times are indeed used to paying a lot more than $150 a year for a few pieces of exclusive content a day. And there’s 600,000 of them, plus over a million for the Sunday Times. That’s even with the wide availability of free news sources (including newspapers). I’d agree it may not travel well across the Atlantic.
As for news budgets, if you add together my various subscriptions and regular reads, it probably comes to about a thousand dollars.
Brien Jackson
I don’t get this. The easiest solution to getting people to pay for your work is to make your work worth paying for! I make fun of newspaper paywall ideas all the time, but I gladly pay for a subscription to Baseball Prospectus and Baseball Reference’s play index. To say nothing of the $20/month I pay for MLBTV. Why? Because it’s worth it. This isn’t rocket science.
The Moar You Know
Lord, I make up crazy shit in my head every day. Why would I pay the New York Times for essentially the same service?
jwb
I think they will be hard-pressed to get more than $60 a year ($5/month). If I was running the show, I’d start with something more or less meaningless (maybe a dollar a month), sit on that for a year while people get used to the idea of paying for it, and then start ratcheting up the price to find the price point at which revenue is maximized.
I’m almost certain that the Times will make the same mistakes they did with Times Select of both charging too much initially (and so losing more in ad revenues than they make in subscriptions) and making the wrong things premium content. I’ve been participating in the Times Insight Lab, and they certainly seem to be using it to probe for how they can charge, but the direction of their questioning does not make me optimistic that they have any better handle on it this time as last time.
Michael
I think they should add a lot more commentary. Doing that so far has been working out very well for media conglomerates, as it saves lots o’ budget on newsrooms, reporters and editors.
beltane
It’s not the dollar amount of a subscription that matters, it’s the fact that you will be required to hand over your credit card number and complete a transaction that will deter people from reading. They will learn this simple truth the hard way.
russell
McClatchey is free, and they’ve never published Judith Miller, had Bill Keller as an editor, or Daniel freaking Okrent as public ombudsman.
So the NYT will not be seeing any of my money.
What kind of crazy talk is that?!? You sure as hell never went to any B-school I ever heard of.
Dude, I hardly know you….
beltane
@Michael: Yes, we absolutely need more Douthat, Brooks, and MoDo. There is a real untapped market out there of people willing to pay money to read the opinions of idiots. While most of us can just go down to our local bar or diner to hear stupid opinions, not everyone is blessed with this luxury, and for these people, NYT Select will be a real godsend.
Captain Haddock
I will pay. But only because I am waiting for Judy Miller’s triumphant return with those WMD’s.
daveNYC
Maybe they could finagle an agreement to hook it in to Amazon’s ‘Buy It Now’ system? A single click instant transaction would at least have a chance.
mr. whipple
And coupons!
Dave
@Brien Jackson:
And here is the difference…what you are mentioning here is not only news worth paying for, but news/content you really cannot get elsewhere. I can’t watch a Pittsburgh/Houston game in New England unless I either pay for MLB or get some convoluted package of Fox Sports channels that include one of those cities. I can’t get the stats from Prospectus elsewhere without paying for it. I could try calculating them myself, but I don’t have the time and I suck at math.
The NYT could write great news stories….but I can read the same (if written differently) stories at McClatchy.
ellaesther
Well, and aside from anything else, the Internet is over. Prince said so.
eemom
I received an e-mail the other day from the WaPo, to which I’ve been a hapless subscriber for more than 20 years (because it’s the only friggin paper we have here except the Moonie Times) to sign up for some e-mail news alert thingie they are launching.
Know what it’s called? “The Most”! Most Post — get it? Haw haw haw. Danged if that ain’t a brilliant marketing ploy.
So, you know, not so fast there with the RIP’s, mistermix. These guys got lotsa aces left in their holes.
Poopyman
Wouldn’t pay for the NYT, never for the WaPo, but I might if they ran stories like this.
russell
Speaking of McClatchey:
Palin speech draws fewer than Nickelback concert in Wichita
See, that’s the kind of news I’d pay to read. Except it’s free.
Jay in Oregon
This was very timely, then:
twitter.com/FakeAPStylebook/status/17946751220
amorphous
@russell: So is ProPublica.
Edit: And as I go check McClatchy I am greeted by “Palin speech draws fewer than Nickelback concert in Wichita.” I have never been more conflicted about a headline in so many different ways.
EditX2: Mivehind.
jwb
@beltane: I’m not convinced. People give their credit cards all the time. The real question is how much traffic they would lose in the initial phase. I believe the model they are developing will allow a limited number of page views free (like 10 articles a month), and you’ll need to pay if you want to see more. So the basic issues are: for the sub-group that currently visits the Times for more than 10 articles a month, what percentage will simply not pay a subscription fee and no longer visit regularly (impacting ad revenues), and for the remainder what is the optimal price point that maximizes revenues (subscriptions and ads)? Obviously, the first thing they need to do is try to make the percentage who will pay the subscription fee as high as possible. It’s incredibly important that they get people to put the credit card into the system, which is why I think they need to start with a very low fee, and maybe a good perk like access to the archives or something. Once credit cards are in the system, assuming there are a sufficient number of subscribers, they can then work on finding the best price point.
But I’m betting they set the subscription price way too high and that they won’t offer any real perks, which will mean that relatively few people will choose to become subscribers and we’ll have the Times Select problem all over again. Except the Times will then be on the verge bankruptcy, leaving it no choice but to be acquired by Murdoch or perhaps Google.
Perfect Tommy
I have no problem paying for content:
$140 Estuaries and Coasts ( w/ CERF membership )
$149 Science ( w/ AAAS membership )
$199 Nature
.
.
.
$150 a year for the NYT – I’ll pass.
themann1086
I pay that much for my WoW subscription, and I get a hell of a lot more than a few pieces of exclusive news!
The Moar You Know
@ellaesther: Prince has not been wrong about a lot, over the long haul. Especially with regards to music, and I have a feeling that he may be soon be proven right about the “internet being over” as a method of music distribution.
Frankly, I hope he’s right, period. I love Balloon Juice, and have found it one of the few spots on the intertubes that actually provides timely, useful, and witty commentary, but there’s not much else out there that isn’t either flat-out wrong or directly harmful to society. The end of the internet isn’t going to be too upsetting to me, when it eventually comes – and it will.
jwb
@russell: McClatchy forgot to apply the wingnut multiplier, which would tell us that the Palin crowd actually totaled eleventy billion. See, McClatchy can’t be trusted, because they don’t go beyond the facts to show us the Truth(r).
Belafon (formerly anonevent)
Most people would have decided that it’s not worth the subscription price to know what is happening in the rest of the country/world.
booger
Booger’s Law: If I have to pay for it, it isn’t news.
Also, too.
Tony Alva
I see dark days ahead for news services of all varieties. CNN online makes no money. There rev’s come from broadcast and their ratings are sliding hard. NYT’s is on the cliff’s ledge. Who’s going to pay all these reporters? Who is going to pay for the local beat reporter? Ad supported on line news has yet to provide enough $$$ to support the kind of operation that we take for granted. Forget which papers/agencies you like or dislike, the internet freemium fallacy is going to cause a crisis at some point in the not so distant future and the only one who will be able to offer ‘Free’ online news will be your friends at Fox since they’re the only ones whose ratings and ad rev’s can support it. Can’t wait…
Persia
@mr. whipple: And comics. Don’t forget the comics.
marianne19
It’s a lot cheaper than subscribing to the national edition of the newspaper which is about $100/quarter for home delivery.
James Hare
The Moar You Know:
Yes, because everyone is just dying to go back to using CDs or other physical media to distribute music. Prince is either insane or ignorant beyond belief. The idea that a major communications media would “end” is just delusional nonsense.
Just because you don’t approve of the content says nothing about the medium. When you create a truly democratic medium, people will say dumb things. The cure for speech you don’t like is not trying to suppress it — it is more speech.
But hey if you wanna pine for the “end” of one of the most productive and useful inventions the human race has ever seen, that’s your choice. I’d rather work to make it more useful.
Brett
To be honest, I’m not entirely sure what Rupert Murdoch was aiming for when he put the entire Times UK behind a paywall, so that you can’t even look at the article titles without paying. It pretty much kills the online presence of the newspaper, not to mention any third-party links and references to it.
Was that his point? Was he basically saying, “Well, we’re not making any money off of online news, so we’ll just keep it on as a tab for our print subscribers as an accessory?” It makes you wonder why he didn’t just take the whole paper off-line.
Zifnab
@russell: Man. Palin or Nickleback? That’s the sort of competition where all I can do is root for injuries.
James Hare
@marianne19:
I think one of the reasons paywalls look attractive to newspapers is because they can offer the same product at a much lower price, thus capturing consumers who still want their news product but can’t justify the expense of a subscription.
The problem is that getting the news on the Internet is NOT free, unless you’re doing it from a public library or the like (many of which still get the dead-tree edition). My Internet connections costs about $50 a month. My computer was a little over $1,000. When I add in those costs (and the readily-available news producing alternatives) any paywall seems ridiculously expensive.
zeph
The WSJ online subscription was only a viable proposition for the same reason as mediocre corporate steakhouses and golf clubs — it’s all charged to corporate expense accounts. The NYT needs to tap into that market.
Omnes Omnibus
@James Hare: I am sure that Prince is preparing technology that will beam his music directly into your brain.
mclaren
People also paid decent money for a dead-tree newspaper once upon a time because it came chock full of hard-hitting info written by real reporters like Ernie Pyle and Jimmy Reston and breaking stories from news desks all over the world.
Today, the New York Times and the Washington Post come chock full of asswipe by suck-ass hacks like Judith Miller and William Kristol, and “breaking news” now involves Paris Hilton’s latest sex tape.
ktward
Historically, my annual ‘news’ budget consisted of daily Chicago Trib delivery and Vanity Fair every month. I’m still old school with VF–does double-duty as a cultural touchstone–and so it will remain unless/until I get on board with digital readers. (Not likely. I’m old, with a fond appreciation for tactile familiarity– quality of life issue.)
That said, I traded my daily Trib subscription several+ years ago for solely the Sunday paper. (It’s all about the coupons, and with good promo timing I pay only $26/year.)
I read NYT online. IMHO, it seems to me that it thinks way too highly of itself.
Indeed, I can’t think of a single Op-Ed for which I’d pay that kind of money, and the news itself is ubiquitous as has already been pointed out.
Conversely, I gladly contribute to cutting edge journos the likes of TPM, MoJo, and The Nation among others. (Quick reality check: an e-subscription to The Nation only costs $18/yr.)
We DO need to support responsible, responsive, ethical journalists. (C’mon, they need to be well fed & relatively happy to do their best work under sometimes intolerable conditions and cringe-worthy deadlines.) But more and more, particularly during and post-Bush, I’m finding the mega-media corporate journos perform as partisan shills for a reliable paycheck. I don’t blanketly blame them nor judge their work, necessarily, but I’m certainly not going to pay money for it when I have better quality news/opinion i-options.
Paris
I’m not sure that its relevant but I pay about that per year for my local paper. Are we going to continue to bitch that journalism can’t make money but refuse to pay for it? That seems childish to me. I wouldn’t pay for the NYTimes but I don’t read it anyway. Its useful as an example of how not to produce honest reporting but that’s about it.
And tip the delivery person generously you cheap skates.
Comrade Sock Puppet of the Great Satan
“It’s only $150/year!”
I pay $99/year for dead-tree and internets access to the Financial Times, whose coverage beats the shit out of the Gray Lady’s. Plus I don’t have to read the NYT’s concern trolls in the Op-Eds.
RAM
I retired three years ago after about 32 years in the weekly newspaper biz. Our cover price and our subscription price didn’t cover news content at all. The per-issue price folks paid at the newsstand and the price subscribers paid covered the cost of the paper and ink at the newsstand plus postage for subscription copies. Ad revenue paid everything else including the salaries for reporters, editors, the press guys, and the stuffing crew on press day (three sections a week plus advertising inserts) as well as all the other overhead from the press and ink to our computers to heating the building.
I was led to believe that was similarly the case with the daily folks and weekly news magazines.
So, without any paper or printing costs, no postage or other significant delivery costs, and no need to kick back a few cents to the newsstand folks I fail to see why advertising shouldn’t pay for on-line content the way it does with print content.
ktward
@James Hare:
“My Internet connections costs about $50 a month. My computer was a little over $1,000. When I add in those costs (and the readily-available news producing alternatives) any paywall seems ridiculously expensive.”
Most (all?) internet users–including yourself, I’ll wager–have already absorbed the costs of hardware/ISP for reasons that have nothing to do with e-news subscriptions. This has zero to do with paywall considerations, nor should it.
Joey Maloney
@ktward:
One of these days VF will figure out how to remotely drench your iPad in perfume.
ktward
@Joey Maloney:
Go ahead and take cheap shots, I’m used to it.
But I’ll point you to the same thing I tell a few select real live friends who take similar cheap shots:
The Great Hangover: 21 Tales of the New Recession from the Pages of Vanity Fair
amazon.com/Great-Hangover-Tales-Recession-Vanity/dp/0061964425/ref=sr_1_9?ie=UTF8&s=books&…
The book is largely a compilation of VF pieces written by the likes of Stiglitz et al. Altogether excellent stuff. (Needless to say, I didn’t have to buy the book.)
At the risk of sounding like a dude who defends his Playboy subscription, I largely read VF for the articles. Nevertheless, I do appreciate that it blends cutting edge editorial with, uh, some girlie sensibilities. I naturally lean toward non-girlieness, but my 19yo daughter is, and always has been, the epitome of girlie. VF helps me keep up with her without gagging. (It ain’t Cosmo, is my point.)
Brachiator
@Tony Alva:
You got it. It’s funny. People want to dance on the grave of the NYT because of its past apostasies, and Murdoch probably will kill his various newspapers with his firewalls, but the plain stinking fact is that news reporting ain’t free, and as newspapers die, their online equivalents will die as well.
There seems to be this fantasy that there can be vigorous free “open source” reporting done by amateurs. There are a few, tiny examples of this, but it just is not happening on a large scale.
For a while, you will be left with Fox News, AP wire service reports and maybe something that google or somebody else cobbles together. Oh, yeah, and tv and radio news, which is little more than a headline news service with bits of car chase coverage thrown in.
There will be tons of commentary, but commentary ain’t reportage.
By the way, it’s not just firewalls that are undoing the value of the InterTubes, but also smartphone and iPad news apps that in small but increasing ways, discourage searching and linking.
The end result may be a temporary Dark Ages of free market ignorance until someone finds a truly workable new model.
ThresherK
Haven’t read everything here yet, but I want to know if they making money on the Crossword subscriptions.
Uloborus
@James Hare:
Actually, I read his comments, and I figured that A) he meant that the internet wasn’t ‘cool’ anymore, and B) he’s three fourths joking. Some of his comments were clearly not meant to be taken seriously in any way, like the bit about shoes on your hands.
And I’ll give him A. Cellular phones aren’t cool anymore. They’re ubiquitous. The internet has gone from ‘trendy’ to ‘necessary’.
grumpy realist
Heh, I’m another FT subscriber and am perfectly willing to pay the (comparatively) high subscriber rates because I still haven’t run across anything in the FT that doesn’t contain a) info, b) humor, or c) good analysis. The reason I don’t want to pay $150/year for the NYTimes is because it isn’t worth that much.
Idea for new US newspaper/news service: nothing but in-depth, good quality muckraking. Hire real reporters, do real analysis, and charge what’s necessary. It will be a niche market, but there should be enough news junkies out there willing to pay.
eeewwfactor
@Zifnab: “Bear with me,” the standard expression, is a request for forbearance or patience. “Bare with me” would be an invitation to undress.
Maybe if the NYT video news features attractive ex-models (of both genders) that bare the news to us, your idea will work!
mnpundit
Drum had a good post on this.
He has a good point. The criticism is all well and good, but doing it all online means they can’t afford to operate. NPR is the sole exception, but NPR is not print media.
D0n Camillo
Great. Now I’m imagining Modo and Bobo sitting nude at a desk discussing their opinions. I hope they keep that way behind a pay wall.
mnpundit
You know, all that except the last paragraph was Drum’s quote.
I stuck it in blockquotes.
Is the Balloon Juice comment system simply too STUPID to realize that [blockquote] and [/blockquote] are the beginning and end of something even if there are BLANK LINES in between?
Brachiator
@grumpy realist:
The problem is that with his paywall, Murdoch is not trying to protect news stories, he is trying to protect the value of the product so that he can keep ad revenues up (although this is still a losing proposition).
Subscriptions have never maintained any newspaper or newsmagazine (or even tv or radio news for that matter). The bulk of the revenues have come from display and classified advertising. Even Financial Times, which some applaud here or The Economist, thrive because they can deliver “premium consumers” to advertisers. For example, the 2009 FT rate card promises that advertisers can reach 10 million “influencers” worldwide (half of whom are in the US), and so charges $35,475 for a weekday black and white display ad targeted to the US, and $147,000 for a worldwide ad. By comparison, the subscription is gravy, but it ain’t the full course.
You can’t maintain good reporters or domestic and foreign bureaus if news is a niche market pitched to the cognoscenti.
grandpajohn
I don’t read them for free so there is no way I would pay to read them even though 538 will be moving to NYT
Brachiator
@grandpajohn:
I’m curious. What do you read? What news sources do you pay for? (and this is also a general question for everyone else as well).
The Raven
One of the problems we’ve seen in eBook pricing is that the common intuitions about the cost of publishing are wrong. In book production, half the cover price is spent before any ink hits paper. Many people simply don’t understand, or believe, that writing is work, it takes time, and the work isn’t over once the first draft is done.
Now…I don’t know about costs in newspaper and magazine production. But, let’s assume they’re the same as book production costs. The NYT weekday newstand price is $2.00. Under that assumption, $150/year, for everything the NYT currently provides is reasonable–in fact, it’s a good deal.
News has always been a loss leader. Headlines may get the public to buy newspapers, but so do various sorts of services: regional advertising, classified advertising, financial reports, weather reports, and so on. Advertising itself is a revenue producer. We no longer need daily newspapers for any of these services.
So…? Good question.
eeewwfactor
@D0n Camillo:
Modo and Bobo used to be models? Maybe for Sears underwear.
jwb
@D0n Camillo: I would pay not to be exposed to that.
jwb
@mnpundit: “Is the Balloon Juice comment system simply too STUPID to realize that [blockquote] and [/blockquote] are the beginning and end of something even if there are BLANK LINES in between?” What part of FYWP don’t you understand?
jwb
@The Raven: Production and distribution costs for newspapers are considerable. I read somewhere awhile back that the NY Times could give away Kindle readers to every one of their dead-tree subscribers, change over to all electronic publication, and come out ahead within a year.
On the other hand, as products converge to the status of commodities, price converges to marginal cost of a unit over time. The marginal cost of a digital copy is exceptionally low, so your only hope is really product differentiation, which would allow you to distinguish in a meaningful way your widget of news from everyone else’s.
Brachiator
@jwb:
I don’t see how this could possibly be entirely right. How would the Times pay reporters and editors, etc? It also costs something to distribute electronically.
Steeplejack
@mnpundit:
Put two underscores on each blank line between paragraphs, and the blockquote will stay together.
I know it sucks, but that’s the reality of WordPress on Balloon Juice right now.
jwb
@Brachiator: The assumptions (not entirely realistic) were that the dead-tree subscribers would continue paying current rates and the ad revenue would remain the same. As I recall, the Kindle ($200) costs less than a year of printing, paper and distribution for one subscription. I have no idea whether that is realistic—though I’ve heard that a rough equation for papers and magazines is that the subscription basically covers paper, ink and distribution, with ads covering content and layout.
Brachiator
@jwb:
I’ve never seen anything that suggests that subscriptions make up a significant portion of a newspaper’s revenues or profits. Balance sheets and financial statements do not separate paper, ink and distribution into one category and content and layout into another, nor do they allocate income against categories of expenses.
Ad revenues have always been the lifeblood of newspapers. Here’s a number from a 2009 Moody’s Investment service article.
You can look at online articles from the Columbia Journalism Review (CJR) wwebsite to follow the precipitous decline of the newspaper industry. A good recent blog discussion on why online subscriptions probably won’t rescue the industry can be found here. Key quote:
Rupert Murdoch’s paywall won’t work, but unfortunately nobody yet has a good alternative model.
JR in WV
Dude,
The New York Times isn’t involved in any way with Rupert Murdoch, the London Times is. In NYC Rupert owns the Wall Street Journal and NY Daily News, and maybe the Post IIRC.
The NY Times is owned (mostly) by the Sulzberger family.
So your article is based upon false assumptions.
JR