I recently found out that the NY Times plans to charge in early 2011 a fee for frequent users to its website. I do not think that this strategy will work for the following reasons:
1. I think that the potential revenue is not going to be enough.
2. There are too many other alternative quality sources of news with virtually the same headlines.
3. The public is accustomed to free information online and according to my research users are not willing to pay for news. If other online papers don't do the same then it will not work for them because readers will simply find the news for free elsewhere.
4. NY Times.com, being the most popular newspaper site in the country with highest advertising revenue has a lot to lose if the move backfires.
5. In the past other newspapers like Los Angeles Times have experimented with online pay structures and then abandoned them.
6. This move will mean less people on their site which means less advertising revenue.
On the flip side I understand that it takes a lot of money to create quality news. It costs money to pay writers to come up with interesting stories, pay photographers and editors to make sure that the reporting is accurate. What I think they should do is sell more ad space, get better writers to bring in more people making it possible to charge more for ad space.
Nowadays we pay more for information than we ever did before, because we place a high value on the content we receive. People are already paying for information, a lot of money a month, but they are choosing to pay for these content providers such as cable/satellite. For further detail on that check out the great synopsis by Nicholas Carr on how "Information wants to be free" - http://www.roughtype.com/archives/2010/01/information_wan.php
On a final note I think that as consumers we are all lucky to read as many online newspapers for free as we do.
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3 years ago
It seems to me that The New York Times is desperate to create revenue. Good quality news is readily available for free from many sources and I believe that the N.Y.T. is doomed to fail.
ReplyDeleteInstead of charging the readers for reading the news, they should restructure the way they pay their writers. Pay the writers a base salary per article and pay them additional money depending on how many hits their articles get. This seems fair for both The N. Y. T. and for the writers.
I am sure that their decision was the result of some serious research. They will probably lose some advertising revenues due to a substantial decrease in traffic. Now, the question is whether that would be offset by an adequate increase in paid subscriptions.
ReplyDeleteThe worst case scenario for them is that the model will fail and they will have to go back to free content.