The New York Times today announced that it will drop its paid online subscription program, TimesSelect, effectively admitting its two-year attempt to charge its Web site users to access premium content and archives had failed.
TimesSelect, which charged $49.95 per year ($7.95 a month) for access to its columnists and the newspaper’s archives, drew an estimated 227,000 paid subscribers and $10 million in annual revenue. Beginning at midnight, the newspaper will open up access to its entire site to readers. So what
changed?Many more readers started coming to the site from search engines and links on other sites instead of coming directly to NYTimes.com. These indirect readers, unable to get access to articles behind the pay wall and less likely to pay subscription fees than the more loyal direct users, were seen as opportunities for more page views and increased advertising revenue.
According to Nielsen/NetRatings, NYTimes.com traffic sees roughly 13 million unique visitors each month, and could explode without a wall, according to industry observers. The crumbling of the Times subscription modelleaves the Wall Street Journal as only major newspaper in the country to charge for access to most of its Web site, generating $65 million in revenue, according to the Times.
So what does this mean for magazine publishers? Consumer Reports, one of the few remaining magazines to charge for access to its site, is nearing three million paid subscribers to its Web site. (Most subscriptions cost $26/year.)
But for most consumer magazines, the free model dominates the industry. Why? Because it comes down to readers – which is why magazine industry consultant Bob Sacks likes the Times move.
"They are thinking long term and this move will continue to protect and promote the Times brand, and at the same time cultivate new readership," Sacks wrote in an e-mail. "After all sustained loyal readership is the bedrock of any publishing empire, be it large or small. If you don’t have readers, exactly what do you have?"