The Paywall
The
Paywall
Agenda• Company Background• Key Issues• Industry and Competition• Earlier Paywall Attempts• Early Results• SWOT and PEST analyses
• Options and Suggestions• Pros and Cons• Future of Newspapers• Fast-forward to 2017:
NYTimes now• Lessons Learned
The New York Times newspaper was founded
The New York Times, the International Herald Tribune, The Boston Globe and About.com
www.nytimes.com
revenues in 2011operating profit in 2011
daily newspaper in the U.S. by circulation
sold Regional Media Group in 2012
1851
Include
$2.3 billion $57 million
TOP 3
$143 million
1996
March 17, 2011 launched in
2 weeks later
March 28, 2011 launched in
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Key issues of the case
Are they
willing
to pay?
How the public
will react?
Is a paywall a good idea for a long term?
- 50%
32 MM Unique VisitorsCPM Social U$ 0,56 X News U$
6,99 “…visitors who are exposed to display ads on news sites are more likely than average to visit the advertiser website, are heavier online buyers and tend to have higher household income.”
Jeff Hackett, comScore senior vice president
Attempt 1 (1996)
Website Launch
$35 per month overseas
Attempt 2 (2005)
TimesSelect
$45.95 per year
4 options came to the fore
All or Nothing
Exclusive Content
Metered System
Device- Specific offer
NYTimes.com + Smartphones $3.75
NYTimes.com + Tablet $5.00
All digital access $8.75
7 days $15.40
Friday-Sunday $10.80
Sunday $7.80
Monday-Friday $7.70
Digital Editions Print Home DeliverySubscriptions PriceSubscriptions Price
• +390,000 paid digital subscribers
• 70% of the print subscribers registered for digital access for free
• The digital ad revenue by 5.3% but the print one by 7.8%
• Digital ad revenue = 28% of total ad revenue
Early Results
Pest analysis
• No governmental regulations• Freedom of expression• No licensing requirements
• Revenues and subscriptions had steadily declined
• The audience is not willing to pay for online subscriptions
• The model of mass communication had changed
• The internet is substituting the prints• Various blogs, social media, web sites
• people’s perception of news has dramatically changed
• prefer to simply browse through the internet
Political
TechnologicalSociocultural
Economical
Five Forces Analysis
Bargaining Power of Suppliers Very Low
Bargaining Power of Consumers
High
Threat of New Entrants• printed newspaper – Low• online newspaper - High
Threat of Substitutes High
Threat of SubstitutesHigh
B. Paywall
C. Pay as you go D. Sell the company and go to Bahamas
A. Ad based model withfree content
What should New York Times
do?
B. Paywall
C. Pay as you go D. Sell the company and go to Bahamas
A. Ad based model with free content
What should New York Times
do?
Paywall with a different approach
Supporting Facts
Iris Chyi (2012) School of Journalism at the University of Texas
Americans are willing to pay
Micropayments are a great success in Germany and Netherland
But North America?
Pros
Legitimize the Content
Generates Revenues
Cons
Competition
Easy to get around
The Future of Newspapers
Paywall
Some experts
considered it a
success
Temporary
measure for
declining industry
The Future of Newspapers
Paywall
Is it working
?
Will subscribers grow?
Digital will
cannibalize print?
Will it sustain in
the future?
Paywall
$3,75 / week
$6,25 / week
$8,75 / week
in 2017
in 2017
Vital moment in the life of The New York Times:
A need for change
New York Times in 2017
Report Staff Way of Working
Vision for the Future:
What needs to be changed
• You cannot stick to the old ways of doing business in the fast pace digital era
• Do not be afraid of radical changes
• Diversify your business
• People are still willing to pay for quality
Key Learnings