Times Paywall 353q2l

The New York Times Paywall

Introduction – New York Times Founded on Sept 18’1851 By Henry J. Raymond & George Jones Led by Arthur Sulzberger Jr. – Chairman in

2011 By 2011 had won 106 Pulitzer Prices In year 2011 had Revenues of $ 2.3 Bn. Operating profit $ 57 Mn. Digital subscriber base of NYT was 3,90,000

New York Times Company New York Times Media Group

New England Media Group

Regional Media Group

About Group

Other t Ventures

NYT Business Units  NYT Media  NY Times  International Herald Tribune  New England Media Group  Boston Globe  Worcester Telegram & Gazette  Regional Media Group  15 Newspapers in S.E. & California – Sold in 2012/ $143 Mn.  About Group  about.com  caloriecount.com  t Ventures

U.S. News Paper Industry & Trends In 2009, Industry size $ 35 Bn. Overall 5000 Players Top 50 Players ed for 75% of Business Advertising contributed to 75% of total

revenues Production & distribution were the major costs Journalism Industry was getting disrupted (Internet) Moving from Offline to Online Content Evolution of Digital disruption

BUSINESS CRISIS – NEWSPAPER INDUSTRY Overall paper circulation was declining YOY ment revenues were declining Detroit Free Press went weekly from daily Ann Arbor News went totally online Wall street journal introduced paywall successfully On contrary Times of London lost visitor traffic

from 2.79 Mn to 1.61 Mn. Other media sectors suffered revenue loses due to digital disruption iPad was another new medium of consuming news

NY TIMES - CHALLENGES Print Subscriber base went down by 8% from 2007 to

2011 Advertising revenues went further down by 6% in 2011 on YOY basis Operating profit dropped by 76% on YOY basis Had to sell Regional Media Group Business for $ 143 Mn Online subscription model TimesSelect Online Subscriber experiment introduced in 2005 was not a real success Uncertainty about new Online Subscription Paywall platform

NYT FINANCIALS – 2008 TO 2011 Financials of the NYT Company ( $ millions)     2011 2010 2009 Revenues           Advertising 1221 1300 1336   Circulation 941 931 936   Other 160 162 167   Total Revenues 2323 2393 2440           Operating Cost           Production Costs 957 962 1021   SG &A 1020 1054 1153 Depreciation and   Amortization 116 121 134 Total Operating Cost   2094 2137 2308             Operating Profit/Loss 57 234 74   Net Income/Loss -40 108 20

2008   1771 910 258 2940     1310 1328 144 2783   -41 -58

Online Subscription – THE PAYWALL First attempted by NY Times in 1996 Was priced @ $35 per month Was dropped to not disturb the increasing internet

traffic Second attempt in 2005 TIMES SELECT priced @ $49.95/Yr. Touched 227 thousand paid subscriber base by 2007 Closed on Sept 2007 due to criticism of pay wall approach  base had access to similar content through social media & blogs

Deg New Paywall NYT Types of Platforms available: All OR Nothing Exclusive Content Metered System Device Specific Offers

NYT OPTED for: Metered System – Allowed 20 Articles per month, extra on paid basis Device Specific Offers – Different schemes for devices  Partnered with Auto Manufacturer Lincoln for free subscription

Leaky wall Concept  Those who directed through Search Engine – limited

articles  Those through Social media – unlimited access Digital Pricing: • NYT + Smartphone  $3.75 • NYT + Tablet  $5.0 • NYT + Smartphone + Tablet  $8.75 Print Home Delivery Pricing: • 7 Days  $15.40 • Friday - Sunday $10.80 • Only Sunday  $7.80 • Monday- Friday  $7.7

Results February 2012 NYT Reported 3,90,000 paid

subscriber 70% of paid subscriber ed for digital access However, Potential drop in Website traffic & online advertising revenue. Concern in Online adv. Revenue For 2011, digital advertising revenue for the company was about 28% of the total ad revenue. Overall business sentiment was not positive

Conclusion & Recommendations Positive Growth in subscriber base In short Term pay wall was success Uncertain about long term strategy  Recommendation They should continue with pay wall until they have

enough online adv. revenue. However do away slowly and steadily with pay wall. Initially can offer longer subscription periods to loyal customers at the same charges. Discount on subscription to new customers

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