Online news readers may find emergency money dwindling
Paying for news stories
It’s critical to have emergency money in today’s market, but the New York Times isn’t making it easy. Many avid readers of the New York Times Online are going to be in for a big surprise next year. Mark Zandi, economist for Moody’s Economy.com, said, “The internet is free and more and more people are getting their information directly from it. Gone are the days of paying for a newspaper, except for older generations who don’t have unlimited access to the online news world, or don’t want it.”
The New York Times has long been one of those free news websites, but that is soon to change. Starting next year, the paper is going to be implementing a “metered” system where readers will receive a certain number of news stories for free, but if they want more detailed information they will have to pay. The plan is to draw readers in with interesting articles and then show them the value of learning more about the article’s topic.
Will the plan work?
The big question is whether or not the pay-to-click option will work for The New York Times. They have tried twice before to move to this type of format unsuccessfully. Because of the two failures, executives are taking their time and giving themselves almost a full year to “build the system and figure out the details that are likely to dictate whether the gamble pays off.” The biggest issues are to gauge how much to charge and still keep readers and how many stories consumers will be allowed free access to every month.
Current subscribers to the printed paper don’t have to worry. They will get full-access to the online version with their subscription. The New York Times executives are hoping that this increases the number of print-buyers when they realize that a subscription allows them to read every story online without restriction. Subscribers will also have free access to mobile news, electronic readers and tablet computers for their New York Times content.
Does it make sense for The New York Times?
The question remains if it makes sense for The New York Times to move to this format. It’s still a down economy and most Americans are still prioritizing building their emergency money funds. Will they want to pay for the news when it is so readily available for free elsewhere? The format has worked well for other newspapers like The Financial Times. This is a specialized newspaper that caters to an upper-income set of readers primarily following the stock market, business and the economy while they are on-the-go. Some analysts are questioning whether it makes sense for newspapers that are mainstream to try to follow the same model.
It raises another question on whether or not readers who are turned away by fees will also drive away internet advertisers. Zandi added, “Online newspapers like any other online business get their value by the number of visitors they have… it is possible that The New York Times could lose internet viewers and that would be disastrous for their bottom line in terms of advertising.”
Charging for stories when they are free elsewhere
Finding emergency money in the economy isn’t easy, so charging for stories is an uncertain challenge. According to a study done by ITZ/Belden Interactive, currently about 150 US newspapers charge for internet subscriptions and their fees range from $1 to $35 per month. With a long history of award-winning reliability, The New York Times should be able to gain some online paying customers, but whether or not it will be enough has yet to be seen.