Business Models

by Marcus Carab

Filed Under:
business models, paywall, print

ny times

Is The NYT Paywall Just A Ploy To Sell More Print Subscriptions?

from the or-are-they-just-crazy dept

There are so many strange and problematic aspects of the New York Times' ersatz paywall plan that sometimes the big and obvious one doesn't get discussed enough: it's really really expensive. A year of full access on all devices comes out to $455 (or $421 if you count their paltry four-week introductory discount). That's more than the Wall Street Journal - way more. In fact it's more than a lot of things, as this chart by Michael DeGusta illustrates nicely:

But it gets even crazier when you compare that price tag to a New York Times print subscription. A year of weekday home delivery only costs $285 the first year, and $322 after that (with some variation by location). That's right: over $100 cheaper than a digital subscription - and a print subscription includes full digital access. Perhaps one of the economists who writes for the New York Times can correct me on this, but that doesn't make any goddamn sense. If you're going to charge $455 a year for a website, you better not tell me I can get the same thing plus a few hundred pounds of free kindling for two-thirds that. If I pay you $150, will you also mow my lawn?

I can think of only two explanations for this. One is that I am severely misinformed about the nature of the internet, and websites are in fact delivered to my computer by truck while system administrators dump barrels of ink in the sewer. The other is that, in the long run, the paywall is just a giant ploy to get their print subscriber numbers up. Some believe that the print prices are purposely obfuscated, but I think this is a temporary situation. I predict two things will happen before the year is out: readers who hit the paywall will start being greeted with home delivery offers alongside the digital packages, and digital subscribers will begin to receive offers to "add on" a print subscription at no "extra" charge.

If I'm right about the New York Times' motives, I'll be pretty disappointed. Their strategy is so confusing that everyone is having a hard time figuring out exactly what they hope to accomplish, but at least it seemed to be an acknowledgement that the economics of news distribution have changed (even if they reacted in an entirely backwards fashion). Now it is beginning to seem like nothing more than an attempt to prop up the same legacy model that has been holding them back this entire time.

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  1. identicon
    Michael, 31 Mar 2011 @ 9:06am


    The problem with that theory is that they seem to hide all of this.

    You are going to get a lot of people that buy the paper version because they want the paper version - and they will accidentally become digital subscribers (many who will not use it).

    You are going to get a lot of people that didn't read all of this confusing stuff about the pricing and subscribe to the digital subscription because they are digital people and want it (and will probably pay again in ink and paper because lots of these twits will probably print the articles they want to read).

    Then you will find the small number of people that want just the digital version, were not dissuaded by the cost, saw the cost of the paper version, saw that the paper version came with a digital subscription, and went "hmmm...since I already have a trash bin, that's the way to go". I don't think this will be a very big group. Who price shops their newspaper? If you are frugal enough to, and you want digital news, you probably get your news for free already.

    This all stinks of a series of bad corporate decisions by people that do not understand technology - and have a very poor grasp on economics.

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