Tuesday, September 18, 2007

The New York Times Sets It Free

The New York Times' decision to stop charging for content that had been behind the "TimesSelect" firewall is good news for fans of Maureen Dowd, Frank Rich and 21 of their columnist colleagues. And it is more compelling evidence that charging the customer directly for online content is not a winning strategy.

TimesSelect was generating about $10 million a year, the newspaper reports, “But our projections for growth on that paid subscriber base were low, compared to the growth of online advertising,” said Vivian L. Schiller, senior vice president and general manager of the site, NYTimes.com.
Even television, the epitome of an ad-supported medium, found ways to charge for some content, even things that had once been free. But TV spread like kudzu only because it was all free all the time

Couple that with the announcement yesterday that AOL was moving its senior managers from Dulles, VA to New York to be closer to the ad industry -- to say nothing of its new strategy of tearing down the garden wall and putting all their content online -- and it is pretty clear where the trend lines are.

You need a very good reason to expect your readers to pay you anything. There really aren't many, and none which seem to apply neatly in consumer context.
Many readers lamented their loss of access to the work of the 23 news and opinion columnists of The Times — as did some of the columnists themselves. Some of those writers have such ardent followings that even with access restricted, their work often appeared on the lists of the most e-mailed articles.

Should Everything Be Free Always And Forever?

Can you ever charge the end-user for anything online? Sure. Even the NYT will continue to charge for some archive material. The Wall Street Journal, the first and most successful publication to create a fee-based service, does it to the tune of $65 million a year. That may be re-evaluated when News Corp. takes over and new synergies and dynamics are evaluated and, arguably, it is really a B2B service anyway.

Some services use the Web as an additional delivery system for content that is highly valued by a relatively small group of well-paying customers. And television, the medium which is the epitome of an advertiser-supported mass medium, has many pay services -- even of things that were originally free, like boxing and movies. PBS is member and sponsor supported. But it took decades to redefine and refine a market that took root only because it was all free, all the time.

B2B vs. B2C

It seems clear that while charging a niche clientele cane make sense in a B2B model it makes no sense when trying to serendipitously capture as many general readers as possible. And serendipity is the controlling force these days since most pages are accessed as the result of searches -- and to a lesser but growing extent RSS subscriptions -- not bookmarked brand loyalty.

To exploit this opportunity your content has to be available, by definition; one of the reasons cited by the NYT for their change in strategy was the frustration of readers directed by search engines to one of their TimesSelect columnists -- only to find that it was not available. It has become common to see bloggers indicate when registration is required in links to outside sites. I know I am not alone in routinely not bothering to go to such destinations.

It may not be the case that as the New York Times goes so goes the world. But I always have a hard time not slowing down when I drive past a table on the road with a sign that says "Free Stuff." The demand for free is pretty much always going to be greater than the demand for not free. The arithmetic seems pretty simple.

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