18 March 2011

NYT Paygo No Go

Today I received an e-mail from  an Old Grey Lady, otherwise known as The New York Times, proclaiming an important announcement.  It was just the 42nd Street fixture again implementing some form of Paywall.  I trust that the Old Grey Lady’s attempts to raise revenue  will be as effective as the paygo promises made during the era of former House Speaker Nancy Pelosi (D-CA 8th).

Since the advent of the internet, there have been few media outlets that have implemented successful subscription models.  The Wall Street Journal charges to see their online news content, and the WSJ has over 400,000 subscribers.  Rupert Murdoch’s Times of London implemented a paywall last July which reduced web from 21 million hits to 2 million but managed to retain 100,000 web subscribers along with 100,000 who have access due to their regular subscriptions.

Amongst new media, Rush Limbaugh was amongst the first broadcasters to offer a premium service Rush 24/7 which offers podcasts, watching the radio show on a “Ditto cast”, a “stack of stuff” and a newsletter.  It is estimated that Rush 24/7 may be a $5 Million a year revenue stream.  Many other conservative broadcasters have followed suit.  So much so, Glenn Beck’s Extreme Insider is a nascent network, having a “4th Hour” after-the-show show, specials, Glenn Beck University and another one hour show hosted by S.E. Cupp.  This cyber success and the death of the dead tree addition are major motivators for the New York Times to again try a digital subscription effort.

In 2005, the New York Times put up a paywall for their esteemed Columnists like Maureen Dowd.  Well, that did not work out so well and the subscription model for the Pinch Sulzberger’s bottom line was dropped in 2007.   The Times also has charged for their digital archives. Now the New York Times will try a metered model, which will allow for a score free of articles a month, and five Google references a day before being prompted for a $15 a month subscription.  This seems targeted for I-Pad and smart phone readers.  It is unclear how Kindle subscriptions will be effected, but Kindle readers have carped that their edition does not include all of the articles.

The reticence from e-book readers suggests the problem that news consumers want to feel like they are getting something for their money.   The Wall Street Journal offers outstanding financial news that is not readily replicated elsewhere and appeals to a niche national audience.  But the WSJ also operates a free Opinionjournal.com website which shares the editorial page opinions.  The Rush 24/7 and Glenn Beck Extreme Insider gains allegiance not only from consumer identification with the broadcaster but because the subscriptions offer material not available elsewhere and consumption on the consumers own terms (e.g. podcasts, archives).

The New York Times has several challenges in charging for their subscriptions.  Ironically, the ubiquity of the NYT as a news source in the Lamestream Broadcast newsrooms makes it less likely that casual new consumers will subscribe to delve into the details.  Is this digital subscription offering something new or extra?
While the Old Grey Lady’s liberal news sensibility may appeal to Manhattanites and the Eastern Seaboard Elites, will this be enough to build a digital subscription base?  After the 2002 campaign by the New York Times to admit women into Augusta National with a steady stream of articles, the NYT’s started to resemble the caricature of just being a liberal organ grinder.  The NYT lost further credibility after the Jayson Blair plagiarism scandal.  This perception of partisanship and fecklessness was reinforced with their scant and skewed coverage of the Tea Party and Restoring Honor rallies.

The New York Times cultivated an image of through their motto of containing “All the News that Fit to Print.”  A quarter century ago, I remember regularly going to my Journalism School’s reading room to thoroughly read one of the few newpapers of record. Now, the proliferation of news sources, the unmasking of liberal Lamestream Media news bias and the advent of alternative media no longer makes the New York Times required reading.

Maybe I can not appreciate the perceived value of a NYT digital subscription as it reporting is on the other side of the ideological aisle.  But I still do not think that there are sufficient subscribers at the Alphabet News Networks, Tweed types trapped in ivory towers and Manhattanites to make this metered model be a steady income stream.

New source subscription schemes only seem to work if they offer added value for money and/or subscribers identify with their news source.  The WSJ offers information which is unique amongst publications.  Rush 24/7 and Beck’s Extreme Insider offer significant extra content and services and subscribers are validated by their membership.  I am dubious that the NYT’s digital subscription will give that much more or have the cache that the aforementioned memberships have.  It strikes me that a NYT digital subscription will be a convenience tax for loyal readers.

While I think that it is unlikely that the CPB governmental largess will actually be liquidated by Congress in this fiscal year, I think that NPR has more of a potential revenue stream from a subscription model than does the NYT.

The success of the NYT’s subscription model will become apparent after it is implemented on March 28th.

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