It was never quite the Berlin Wall of American journalism, but The New York Times' pay wall for full content has officially been reduced to rubble (or, more precisely, will be as of Wednesday). Let us pause for a moment and consider the good the subscriber wall accomplished: By making it just a teeny more difficult to access content by opinion columnists Paul Krugman, Maureen Dowd, and Frank Rich, it freed most of us from having to pay attention to such generally braying jackasses.
Which isn't to say the attempt by the Times to charge for content wasn't an interesting experiment from a business perspective. Over at TechBlorge, David Cassel crunches the numbers for those of us not so good in math:
The Times is strongly repudiating the idea that newspapers can earn big profits by hiding their online content behind a "pay wall" which can only be accessed by web surfers who pay a subscription fee. Crunching the Times' own statistics shows the two-year experiment was earning the Times about $833,000 each month - or $10 million a year - but that's about a third of the $80.9 million earned by all digital businesses at the Times. And even then, almost 90% of the company's money was coming from its non-digital offerings.
The Times' revenue from subscribers broke down to about $27,400 a day -
but given that the newsstand editions cost $1 apiece, that additional money was the equivalent of just a 2.4% rise in their daily circulation of 1,120,420. Yet according to the newspaper, out of the 787,000 subscribers to Times' web site, about 29% were already paying for complete access to the site. "[O]ur projections for growth on that paid subscriber base were low," according to the general manager of NYTimes.com - at least compared to the potential profits from making the content free, and then earning revenue through advertising. In an article which appeared in the New York Times, a media analyst notes that the the ads on the Times' site have been carefully targetted to its readers - which makes their ads even more lucrative….
The Times' move represents a milestone for the internet. According to their own article, the only other major newspaper still charging for online access is the Wall Street Journal. After over ten years, "The Journal has nearly one million paying online readers, generating about $65 million in revenue." And despite that, the Times reports an interesting rumor. The Journal's new owners have been discussing the possibility of discontinuing their paid access as well.
It's not that information wants to be free, but readers sure want it to be.