The Pay Model Can Work … If You Are The New York Times

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Just like Bluto stated in in this famous scene (1:24) from “Animal House,”When the going get tough, the tough get going.” This is exactly what The New York Times is about to do.

In order to combat the downturn in circulation over the past several years, newspapers are doing everything they can to stay afloat. Reporters are being laid off and sections of the paper have been eliminated in efforts to save money, but yet publications are still shutting down. However, the world’s most respected daily isn’t giving up just yet in its effort to generate new revenue streams.

With more than 17 million visitors per month, is taking a major risk in January 2011 when it starts charging flat fees for full access to its site. Since this news came out last week, PR pros have passionately weighed in on whether or not this strategy can be a successful one. I think it can, but it’s not for everyone.

What happens when a country, business, or any other entity needs help? More times than not, the big boys come in and try to rescue them out of crisis, right? Or at the very least they will lead the discussion on how to reverse the situation. This is what I believe The New York Times (NYT) is doing, and rightly so. You can’t expect a smaller newspaper to go out on a limb and take this sort of measure. This isn’t to say that smaller outlets don’t have the creativity to come up with a solution such as this. The fact of the matter is that NYT has many elements already in place that can make this change in philosophy a success:

  • A worldwide audience
  • It is largely considered the best source for news
  • Some of the most talented reporters in the world call it home
  • Steps have been taken towards integrating with social media networks (2.3 million subscribers on Twitter)
  • And most importantly to PR pros, NYT is still the no. 1 newspaper outlet that clients want to be in.

While it may be more challenging to attract the average person to subscribe, NYT has a lot going in its favor – mainly that it provides content that you can’t find anywhere else. And if subscribing to the site helps publicists share content and new pitch angles, then don’t you think clients will be willing to spend a few extra bucks for that type of insight? I do. And there is certainly no shortage of clients.

As I discussed a few paragraphs back, there are smaller newspapers that have tried similar approaches and have failed. Take Newsday for example. With a circulation greater than 400,000, this Long Island (NY) newspaper began a pay model in October 2009 with similar hopes as NYT. But after just three months, only 35 subscribers have signed-up to pay $5 per week for, which averages 2 million visitors per month. Is this because they are charging too much? Did they not put together a campaign to build enthusiasm internally and externally for this? Did they launch this prematurely? Many questions are left to be answered, and both Newsday and NYT’s approach will make for interesting case studies.

So what do you think? Will newspapers like The New York Times succeed with this pay model? Do regional and local outlets have the same opportunities? Please vote in the poll below and lets find out!



10 comments on “The Pay Model Can Work … If You Are The New York Times

  1. Andrew,
    “When the going gets tough… the tough get going. LET’S GO…OOOOHHHH!”
    I really like the way you’ve framed this, even though I don’t think this will ultimately work for the NY Times. My feeling is that while I enjoy reading the NYT, I’ll buy it at the newsstand before I pay for it online.
    I’m glad you brought up Newsday, a paper I love, but no longer read online because of the payscale. It’s been a failure, much like Newday-owned Cablevision’s NY Knicks.
    I am still a person that actually picks up the paper, but since I live outside Buffalo I can’t get to my favorite papers. I can still read the NY Daily News, LA Times, and Washington Post for free online. NYT should re-think this strategy.

    • Thanks for the comments, Jason!

      It’s not so surprising that Newsday’s efforts have seemingly failed when you consider this is the same company that has run the New York Knicks franchise into the ground.

      I’m excited to see how this works for the NYT, and I love that they have 11 months to plan everything out before launching this next year.

  2. I think the newspaper pay model can be successful only if all major news outlets employ it. NYT is a great news source and it does amazing work in engaging with Gen Y (not only Twitter; their Facebook fan page is simply amazing). However, with so many other great news outlets, people are more likely to change their preferred news source than pay for content.
    We live in an age when everyone is used to getting news for free. We live in an age when people are more willing than ever before to share their knowledge. This is especially true for my generation (Gen Y). If the NYT loses us as readers now, we will never read this newspaper in the future – online or offline. Or at least as long as it is paid for. There are so many other great news outlets that we already love and they are free: BBC, CNN, The Guardian. We will probably read only them.

    • Good thoughts here. I think broadcast has a small advantage though in that it can reach more households worldwide, but certainly there is much we can learn from them.

  3. This is a big step for newspapers and if anyone is going to make the change, it needs to be one of the top players. If the NYT succeeds then it will lead the way to saving smaller outlets. One reason I believe this could work out for the NYT is that people are always in a hurry, they want their news on demand. This elminates the hassel of going and buying paper. People love to buy things online these days, why not their newspaper? The fact that it is free now and won’t be then might stir up a few mixed emotions, but if paying is the only way to get the news you want, then people will pay.

  4. Yes, it can work.

    And the thing that will allow it to work is the general constriction of news outlets.

    How many major newspapers are there in:

    Los Angeles
    San Francisco

    There is one dominant newspaper in these markets that 95% of the population reads. If that dominant newspaper who completely dominates the market says they are going to charge, where are people going to get their local news?

    In fact, I’d argue that the more localized the outlet, the better chance they have to get people to pay for news.

    People can find NATIONAL news a variety of places, but local news is a different thing altogether.

    Your view is New York-centric, New York has a variety of options for people to get their news about New York–that’s why the Daily News failed online–people just went to NYT.

    The REAL key to getting paid content to work is that EVERY media outlet has to be on board in a given market.

    Sort of like the record industry did. People were downloading songs left and right for free. The record industry stuck together and sued the shit (and still do and publicize it) people who try to download major label music.

    Unfortunately, the newspaper industry has their head up their asses as pretty much has for decades.

    • Really appreciate your take on this.

      Having worked at a local/regional newspaper before (The Journal News – White Plains, NY), I can tell you that a few years ago they made it more of a priority to focus on local news vs. NYC and national news. Totally agreed with them there. However, I’m not sure that making local folks pay for local news is going to result in profitable. IMO, there’s not enough people that will subscribe in order to make this a new revenue stream.

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