Wired has a good take on that:
We’ll see if the almost certain bad will of a giveth and taketh away revenue model is worth trying to put the content genie back in the bottle.
Also, you know what happens when your customers find out they’ve been paying good money for something other people are getting for free? It doesn’t make them happy customers, let’s put it that way.
In effect, what newspapers (and magazines) are doing is incentivizing their customers to go for their money-losing products. You know those Chinese food places, (on Fulton Street in Manhattan and in mall food courts across the land) that hand out sesame chicken samples on a toothpick outside the store? If newspapers ran Chinese restaurants they’d be handing out full meals out front for free while trying to get you inside to pay big bucks for the chicken-on-a-toothpick.
Newspaper websites are the worst kind of loss leaders in that they only—thus far at least, and as far out as any of us can see—lead to losses. The Journal’s been different in that it rakes in tens of millions of dollars in subscription fees every year on top of the advertising it gets (notably, Journal print circulation has been steadier than most papers that don’t charge).
In March, WSJ.com unique visitors were almost half that of The New York Times’s site because it’s figured out how to charge many while letting many more have relatively easy access to the site. It’s pretty brilliant, actually.
WSJ.com’s great advantage was that it charged from the very beginning—something other papers can only dream they had done. Its readers are acclimated to paying for Journal content.
That content is valuable. Hold the line, WSJ.
Interesting take. Although it seems to me that the WSJ iphone/blackberry app example indicates that the WSJ may be exploring the value of free content, without actually saying so. I doubt their paid model will last, personally.
- Amy Gahran
#1 Posted by Amy Gahran, CJR on Thu 23 Apr 2009 at 12:56 AM
Why won't their paid model last? You might want to see a downtick in online subscriptions first and as far as I can tell there haven't been. They have 1.1 million paying subscribers. Free content doesn't make sense for them, but I like I said toward the bottom, they've figured out a way to have their cake and eat it too. Most everything on the site is free if you come from an inbound link, but to stay on the site and click stories costs money.
That's smart.
#2 Posted by Ryan Chittum, CJR on Thu 23 Apr 2009 at 05:22 PM
I think they ought to give away the print version for free and charge for the online access.
Think about it: the print edition is less convenient, not searchable, less up-to-the minute, less interactive, and now that everyone's got BlackBerrys and iPhones, less portable. On the other hand, it's more of a "push" medium, since they deliver it to you rather than needing you to visit the site every day. That makes it more effective as a marketing tool. It would also make sense, if they used this strategy, to make the printed versions of their stories shorter, "encapsulated" versions, with the full details available online behind the pay wall. That would cut printing costs as well as reinforcing their revenue model.
#3 Posted by D. B., CJR on Fri 24 Apr 2009 at 12:07 PM