Bundling / Newspaper / Transaction Costs / Unbundling

Times Reconsidering Fee To Read Plan

The New York Times still offers a completely free to read online version. A few years back Times unbundled their online offering and tried to charge $50 for access to their Op-Ed columns. Times branded the offering as Times Select. Even though the Op-Ed columns were unbundled from the rest of the newspaper, all of the Times Select are offered in bundled form for an annual subscription fee. Readers who subscribed to Times Select gained access to all articles for the whole year. There was no article level or Op-Ed columnist level unbundling. For example if you only wanted to read Paul Krugman’s articles and did not want to pay for opinions of other columnists you had no option. You received all of them, from Bill Kristol (who is no longer with Times) to Maureen Dowd.

There were not many takers to this pricing scheme, Times ultimately decided to cancel this programHuffington post reported that Times is reconsidering fee to read model for parts of its website.

“TimesSelect generated something like $10 million a year, which was real money, but in the end the company calculated that we’d be better off taking down the wall and letting the flood of additional visitors to the Web site attract advertising dollars,” Keller said. “The lesson of that experiment, however, was not that readers won’t pay for content.”

With down economy Times lost more  advertising revenues than ever before and is trying to compensate with revenue from for-fee content. Times is considering multiple options, that range from bundled pricing (subscription) to completely unbundled offering (per article fee)

  1. Charging for full-access subscription (Bundling)
  2. Developing a micro-payment model in which readers pay a few pennies each time they click on a page  (Full unbundling) . The challenge here is how to defray the high transactional costs.
  3. Selling news to be distributed on reading devices, as the Times already does with Amazon.com Inc.’s Kindle.

Other options include but not stated by Times are

  1. Charging for archives with variable pricing for articles
  2. Getting advertisers to sponsor access to certain articles
  3. Separate general news articles that can be found in any news media from differentiated Times only articles. Give news articles for free and charge for the Times only articles.
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