All the news thats fit to retweet

The New York Times today came out with its long awaited digital subscription pricing. Beginning immediately in Canada and March 28 in the United States and the rest of the world, heavy users of the New York Times will be asked to pay between $15 and $35 every four weeks for continued access.

Most people aren’t likely to hit the paywall. I consider myself a heavy news consumer and I value the NYT brand. But I had no idea how many stories I read a month. I checked my own usage and found that I read 18 stories in the last month.

The reality is that most traffic to news sites is already driven through search and social media. Those will remain free in the new model. Four years ago, only 20% of NYT visitors who viewed the front page. It’s likely a lot lower now. Bizarrely, the new model actually discourages people from going to the NYT home page directly.

For those who do hit the limit, there are numerous options aside from paying:

  • Stop reading.
  • Tweet “Psstt… buddy, can you tweet me a link?” If someone responds, you get free access to the story.
  • Follow @nytimes on Twitter and click on the links from there.
  • Go into your browser’s porn mode.
  • Clear out cookies.
  • Go to Google and search for keywords related to the story.
  • Find a summary of the story on Huffingtonpost.com and click through from there.

Print subscribers continue to have free access to NYTimes.com, mobile applications and iPad apps.

Some commentators have pointed out that the pricing is out of line with the print edition. For $15 a month, you can get home delivery of the Sunday New York Times which includes all access to the online, mobile and tablet editions of the Times. To get the same access without the print paper costs $35 a month.

So the times is charging an extra $20 not to deliver the paper. In one case, you’ve got nearly zero incremental cost. In the other, you’ve got several dollars in hard costs of paper, printing and delivery.

What gives?

The point of the digital pricing is exactly to drive people to print subscriptions — even if they never read them and the papers pile up.

The ad rates the NYT can charge in print are much higher. On average, the NYT generates $600 in advertising per year per print subscriber and less than $10 per online user per year. If someone looks at the digital pricing and decides to get a paper subscription, that’s a huge win for the NYT because it gets to up its more valuable print subscription base. Of course, at some point advertisers will catch on that no one is reading that circulation.

As someone who cares about the environment, this saddens me. Chopping down trees, sending them across the country and then having diesel-guzzling trucks roaming around town all morning is just wasteful. (Not to mention the process of disposing of all this.) The Yellow Pages people, with once a year deliveries,  have nothing on newspapers.

I doubt that this new model will be an abject failure like TimesSelect. But it’s also unlikely to generate significant revenue for the NYT.

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About Rakesh Agrawal

Rakesh Agrawal is CEO of redesign | mobile. Previously, he launched local and mobile products for Microsoft and AOL. His personal blog is at http://blog.agrawals.org and tweets at @rakeshlobster.
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