FT, others float Web subscriptions
FT, others float Web subscriptions
Newspapers, buffeted by this year's downturn in print advertising revenue, are increasingly looking to new online revenue strategies. The Financial Times (FT) is the latest example of this push for online cash, with its announcement that it is considering a "pay-as-you-read" model for its content on the Web.
The news and business daily already offers a part-paid model, where users can access a certain amount of content per month before being asked to register and then, with more stories accessed, to pay for a subscription. Under the new system, which is expected to be in place within the next 12 months, readers may be asked to pay per article or for the amount of time they spend on the site. The actual price of each article or minute under the new plan has yet to be determined, and the paper will probably test a few different price points before settling on a pricing system.
"The reasoning behind this new offering is to give our customers flexible opportunities in how they consume the FT," said Greg Zorthian, president of the Americas and global circulation director for the FT. "We want it to be available in any format in any different medium, any way they can get it, and as you know we have been very adamant about charging for media across all platforms. This is just another way to give the customer the opportunity to get it."
FT.com's frequency access model has more than 1.4 million registered users and 117,000 paying digital subscribers. Revenues from these subscribers are up 30% since this time last year. The paper also sells individual issues through the Amazon Kindle. Zorthian said that the pay-per-view program would complement these other offerings, not replace them.
The newspaper has had discussions with its auditors, such as ABC UK, over how to measure audience for the individual articles that may be purchased. Zorthian said the paper considers itself "platform-agnostic" and is focused on growing total paying subscribers across all media.
Zorthian added that he didn't know of any other companies that were offering content on a pay-per-view model at the moment, but that he expected others would explore similar plans in the near future.
"I suspect many people are looking at it as they look at different ways to charge for content, but it's very early in the game for media outlets to charge for content at all," he said. "We applaud anyone who wants to charge for content because the more publishers that do, the more it becomes an accepted form of access."
News Corp., whose The Wall Street Journal (WSJ) already operates an effective partial paywall, also plans to seek more revenue through paid online content. According to reports, all of the company's newspaper sites are expected to have paywalls in place by next summer. The model for the sites is expected to resemble that of the WSJ, leaving some content free and saving select stories and tools for paying customers only.
"The digital revolution has opened many new and inexpensive methods of distribution," said News Corp.'s chairman and CEO, Rupert Murdoch, on a call with investors last week. "But it has not made content free. Accordingly, we intend to charge for all our news Web sites."
Some analysts doubt that extra revenue from paywalls will be enough to remedy newspapers' downward revenue slide. However, new data from the Newspaper Association of America shows some hope for online content providers, indicating that traffic to newspaper Web sites is growing in the US. More than 70 million people — 35.9% of US Internet users — visited a newspaper Web site in June, marking a 7% increase over June 2008. Page views and number of sessions also increased, by about 11.5% a piece.
Meanwhile, The Economist is turning to a piecemeal payment plan for its weekly print edition, allowing readers to place single-copy orders for next-day delivery. Orders can be made online or by text message. Like the FT's online scheme, the pay-per-copy idea is focused on providing convenience for readers.