Willing to pay

nytlogo153x23There’s some chatter about the New York Times survey to their customers on whether they’d be willing to pay $5 per month to access the content. They also asked if $2.50 would be acceptable. I didn’t get the survey, but as a long-time NYT reader, my answer would be an unequivocal “Yes, absolutely”.

What’s interesting is that this debate comes on the back of the larger debate around Wired editor Chris Anderson’s book, Free. I haven’t read his book (although I have read reviews) and I also read Malcolm Gladwell’s retort. When Chris Anderson says “free”, he means free to the consumer – but the reality is that nothing that takes time or effort to produce is ever free – someone is paying. Either the producer is paying for her own costs and giving away the end product or advertisers are supporting the product.

And that’s what is important to realize. The cost to produce something is not free (even if the cost to transmit and disseminate it may be close to free). So what happens when the producer has to get paid?

Let’s come back to the NY Times. Everyone is jumping up and down saying newspapers are dead. Agreed – I haven’t bought a printed paper in over 8 years. But journalism is not dead. Not even close. Today, I cannot go to one place and get the incredible breath and depth that the Times offers me. I can’t find exceptional political insight and funny technological coverage in a blog. If you point me to the Huffington Post (a site I was addicted to during the elections), I’d say, yep, great example of online journalism.

The journalists at the Times are fabulous at what they do. And they have to get paid to be able to continue to do what they are good at. So what’s the solution? It appears that advertising revenues online cannot cover those costs. It comes down to having the consumer pay something.

My recommendation is to allow consumers to get a certain number of articles free each month – say 10 articles. After that they get charged the $5 fee and they can read anything they want, including all the archives, for the rest of the month. For a frequent reader, like myself, I’d rather just have them autobill me. Forget the 10 free articles a month. I’ll blow through that on day 1 or 2 at the latest.

For the customer who comes to the NY Times site very rarely, their experience doesn’t change either – they can read their one or two articles and leave without feeling any pain.

The middle section – the group that reads maybe 20 articles will dither. But, $5 is about 1.25 Starbucks coffees. At $2.50 it is less than a Starbucks. Quality content written by journalists who are the best in their fields, edited by a top team of editors, across an incredibly wide range of topics for an entire month on one hand. One cup of coffee on the other. Seems like a no-brainer to me.

The issue is that we’ve been trained to expect content on the internet to be free. Retraining ourselves will be hard, but not impossible. If it is a question of not reading the NY Times or paying $5, I’d gladly pay the $5. I think they should offer a family rate too – so for something like $10, up to 5 people can read the Times.

Now for some caveats: I’m willing to pay to sustain the journalists and editors that bring me the content. I am not, however, willing to pay to sustain high-cost printing technology and all the infrastructural and organizational fat that is needed to support the print side of the business. As a consumer, I can’t really make that allocation, but I hope the Times will do the math and when paying print consumers stop supporting the cost of print, the print section gets shut down. Please do not make the eco-friendly online users support the dinosaurs’ tree-killing addiction. Oh, and while I’m at it – if I do pay, I really want the ability to embed the NY Times’ photos and videos. They are awesome and by allowing bloggers to embed them (with links back of course), the Times will actually get more traffic, not less.

Finally, the Times has to consider if someone else will fill the gap they leave with a great product that is free. The asset is the journalists. Unique individuals with unique voices. Not so easily done. And even if someone could do it free for a while, they’ll hit the same economic issues as the Times.

The Times seems to have explored a number of options – a couple of years ago, they had people pay for Times Select (and yes, I paid). I’m sure they’ve come to this after a lot of thought (I hope they have, although their decision to disable embeds gives me pause). To term paying for things online as old-school and therefore unacceptable is silly. And I, for one, am willing to pay.

  • Shri – i totally agree with you on this. but the details are in the implementation. i do not think a pay wall across the entire site is the way to go. i like what the FT has been doing for a few years now, which is you get cookied when you visit their domain. if you visit 10x per month or more, you are asked to pay.

    this is a very elegant execution of the freemium model, where you use free access to your content to bring readers who aren't regulars, but you use a subscription model to generate revenues from your most loyal readers.

  • Agreed, Fred. I've never used FT, but the model I suggested in the post was exactly the same – first 10 articles are free and then the $5 monthly fee kicks in.

    I thought about whether this fell into the “freemium” bucket – I always understood freemium to mean that the core service was free and that additional features are paid and so I didn't feel this qualified. Interesting to hear you define it differently – learned something new today.

  • The model get the first x hits free only works as long as your competitiors can't reproduce similar content that's always free. I your site has unique value, then this goes a long way to sving the dilemma Steve Rubel brought up recently, how best to monetize the stream.

  • I'd note, though, that the FT model has not won them a lot of fans. They started with 30 monthly articles for free, then dropped it to 20; now it's down to 3.
    I think this approach can work but there's always going to be pressure to reduce the value of what's available for free.
    At some point (and I think the FT is at that point), the light user will just avoid ft.com content, instead using the Guardian or Telegraph. The balance between what to give away and what to charge for is probably the most important decision in a freemium product.
    The FT tends to be shielded somewhat, because for so many of their users, it's a corporate expense, not an individual purchase. For typical consumer content products, that's a much harder sell.
    That said, I would gladly pay a monthly fee of $10-20 for full access to the NYT, but that should include access online, on the iPhone, on the Kindle, etc.

  • we made up the word so we can make up what it means!

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  • I agree that you can't move the # of articles down. So pick carefully.

    I didn't break it out, but you're totally right – if you are paying anything, it would have to be universal access, including the Kindle etc. Nickel and diming the user would be terrible.

  • Totally agree w/you Shri – I love NYT online – have been reading it for as long as it's been online. $5 is incredibly reasonable and basically the cost of a monthly magazine at a newsstand. I do, however, like to hold the NYT magazine section in my hands to read, tho I rarely do these days. b/t/w, love the FB Connect addition – 🙂

  • Weird – I hadn't enabled Facebook connect – maybe that's why your name doesn't show up Eileen. I've now enabled it. Can you come back and reply and see if it is better?

  • tgfi

    True, many would be willing to pay, but I guess this would truly work only if ALL newspapers across the board switched to a pay model of some kind- because so long as someone is giving reasonably quality news free, it becomes harder to convince one to pay for it..like you said, the attitude of expecting it to be free, esp. online, is going to take a lot of work to remove.

  • I don't think it needs every paper to charge. I only read the Times and the WaPo to a lesser extent. Rarely the WSJ which is already behind a subscription wall. If the Times charged, I would pay. I wold not switch to the LA Times or the Chicago Sun Times. I just don't think the quality is the same. And I am used to the writers on the Times. I read some of them every week.

    I think your point of “if anyone gives away decent content, no one can charge” is true in an undifferentiated market. To me, the news market is highly differentiated especially when it is other than breaking news. To you, though, it is probably undifferentiated. The question for the NY Times is are there more of me or more of you?

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  • I agree…I read NYT Online most every day, and I'd absolutely pay a small fee to continue. It just makes more sense to me than wasting paper (and it's so much more convenient online!).

    Interestingly, my parents – both in their mid-Sixties – prefer reading from an actual Newspaper and not the Internet, which may show a preference based on what they've grown up with.

  • This is great for those like you who do visit and read the Times each day. But, for people like me, I only visit when doing research and I do not want to pay $5 or $2.50 every month just to do research. If I use something from the Times, I will cite them and drive traffic back.

    Also, if a vast majority of new agencies begin to charge subscriptions for their services – I think this would entice our government to tax it. If they tax this, they will start taxing everything on the web (just my paranoid opinion).

  • Not sure I agree with your logic. If you research less than 10 articles a month, it is free. After that, it is $5/month. Is that too much? Less than 50cents an article? The value of your research has to be more than that, right?

  • Yes, you are right. However, when researching, I just don't know – walking in the door – my level of usage. There is so much information out there – that when I see a pay site (much like the WSJ that only provides a snippet then asks you to subscribe) I just move on. It means a little more work on my part – but right now I am OK with that.

    I completely agree with you that writers need to be paid for their work and if I was a regular reader of some of these news sites – then I would be glad to pay. But, unfortunately, I am not.

    I get requests to reprint my articles all the time. I just ask for credit as I am flattered that they find value in my words and thoughts – but I don't write for a living either.

    Lastly, my research is not that valuable. Most of it is for my own edification. I do like to read other's work for inspiration when I am blocked for articles on my own site – but, this usually comes from something small they may say in their work (not based on the entire piece). For example in your piece above – I was particularly interested in why one cannot also utilize photos and videos – especially after paying for the content. This has prompted me to look into other site (online media or social media) that will or try to find out why not.

    Side note: I really like your blog – especially the interaction.

  • Not sure I agree with your logic. If you research less than 10 articles a month, it is free. After that, it is $5/month. Is that too much? Less than 50cents an article? The value of your research has to be more than that, right?

  • Yes, you are right. However, when researching, I just don't know – walking in the door – my level of usage. There is so much information out there – that when I see a pay site (much like the WSJ that only provides a snippet then asks you to subscribe) I just move on. It means a little more work on my part – but right now I am OK with that.

    I completely agree with you that writers need to be paid for their work and if I was a regular reader of some of these news sites – then I would be glad to pay. But, unfortunately, I am not.

    I get requests to reprint my articles all the time. I just ask for credit as I am flattered that they find value in my words and thoughts – but I don't write for a living either.

    Lastly, my research is not that valuable. Most of it is for my own edification. I do like to read other's work for inspiration when I am blocked for articles on my own site – but, this usually comes from something small they may say in their work (not based on the entire piece). For example in your piece above – I was particularly interested in why one cannot also utilize photos and videos – especially after paying for the content. This has prompted me to look into other site (online media or social media) that will or try to find out why not.

    Side note: I really like your blog – especially the interaction.

  • Thanks for that. Chocolate is the best

  • I think it's extremely difficult for a company to really charge for “content” that is online. Not sure if there is anyone out there who has tried it successfully – love to see what happens when NYTimes goes for the bucks from readers.

    As far as I can see…it's going to get a lot of traffic down, but as long as they can supplement that by their subscription revenue, things should be fine.

    Cheers!