NY Times Stops Online Charges
Posted by shadmia on September 18, 2007
After a two year experiment the New York Times will stop charging for access to certain parts of its Website. The program known as TimesSelect, which used to charge $49.95 a year, or $7.95 a month for online access to the work of its columnists and to the newspaper’s archives will be discontinued as of Sept 19, 2007. According to the newspaper, revenue from its 227,000 subscribers generated about $10 million a year.
“But our projections for growth on that paid subscriber base were low, compared to the growth of online advertising,” said Vivian L. Schiller, senior vice president and general manager of the site, NYTimes.com.
In addition to opening the entire site to all readers, The Times will also make available its archives from 1987 to the present without charge, as well as those from 1851 to 1922, which are in the public domain. There will be charges for some material from the period 1923 to 1986, and some will be free.
What changed, The Times said, was that many more readers started coming to the site from search engines and links on other sites instead of coming directly to NYtimes.com. These indirect readers, unable to get access to articles behind the pay wall and less likely to pay subscription fees than the more loyal direct users, were seen as opportunities for more page views and increased advertising revenue. The Times’s site has about 13 million unique visitors each month, according to Nielsen/NetRatings, far more than any other newspaper site.
“What wasn’t anticipated was the explosion in how much of our traffic would be generated by Google, by Yahoo and some others,” Ms. Schiller said.
In a letter to current subscribers of TimesSelect the newspaper explained why it was dropping the paid service and promised refunds to those who had paid in advance.
Since we launched TimesSelect in 2005, the online landscape has altered significantly. Readers increasingly find news through search, as well as through social networks, blogs and other online sources. In light of this shift, we believe offering unfettered access to New York Times reporting and analysis best serves the interest of our readers, our brand and the long-term vitality of our journalism. We encourage everyone to read our news and opinion – as well as share it, link to it and comment on it.
Colby Atwood, president of Borrell Associates, a media research firm, said that there have always been reasons to question the pay model for news sites, and that doubts have grown along with Web traffic and online ad revenue.
“The business model for advertising revenue, versus subscriber revenue, is so much more attractive,” he said. “The hybrid model has some potential, but in the long run, the advertising side will dominate.”
In addition, he said, The Times has been especially effective at using information it collects about its online readers to aim ads specifically to them, increasing their value to advertisers.
The Wall Street Journal, published by Dow Jones & Company, is the only major newspaper in the country to charge for access to most of its Web site, which it began doing in 1996. The Journal has nearly one million paying online readers, generating about $65 million in revenue.
Dow Jones and the company that is about to take it over, the News Corporation, are discussing whether to continue that practice, according to people briefed on those talks. Rupert Murdoch, the News Corporation chairman, has talked of the possibility of making access to The Journal free online.