Charging for Online Content: Is the NYT punishing its most loyal supporters?

With the transition to the web almost two decades ago, the newspaper industry made one glaring mistake: it succumbed to the free content hype that was all the rage in the 1990s and decided not to charge for good, quality journalism online. Flash forward to 2010 and you find the industry in decline, unable to reconcile the old business model with new technology and struggling to compensate for lackluster advertising revenue and declining readership.

Media analysts have long debated the merits of micropayments similar to iTunes (buy one song for $.99—well, more like $1.29 now) and walled subscription services but so far, the Wall Street Journal has been the only newspaper to succeed in implementing such a program. Yet after much speculation, the New York Times has indeed announced that effective 2011, it will begin charging for a subscription to the website after a certain number of “free” articles (though home delivery subscribers will be spared additional fees).

In a question and answer article, senior executives at the NYT said the newspaper has learned its lessons from Timeselect, a previous walled subscription service that was limited to the columns and archives but boasted 227,000 paying subscribers. By this number alone, executives have concluded that people will pay for high quality online content and that users recognize that the New York Times differs from other outlets, “the depth and breadth of (its) reporting and analysis,” said one executive.

The new metered model (which applies to the whole site) would be a monthly flat fee and executives assert it will give flexibility when it comes to digital advertising while not hindering searches or links coming in from other sites. In other words, if a friend sends you a link in an email, on social media platforms or you click on one within a blog (for instance the one above!) you can view the article WITHOUT adding to the allotment of free articles.

To the query of whether this plan” punishes” the paper’s most devoted readers, executives coolly responded that although they cherish their readers, a sustainable business model is an absolute necessity. Based on research, they say they are confident their loyal readers will pay, “because they know The Times brings them authoritative, intelligent and well-written news and opinion.”

I’m pleased the plan will not be enacted until next year, it will give the paper ample time to iron out the wrinkles. With the WSJ’s foray into paid online content, the NYT is making the right decision and based on the limited details available at this time, it seems flexible enough to succeed. I’m looking forward to how this experiment will turn out! Maybe, just maybe, it will be the answer to some of the industry’s woes.

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