News Corp. Claims 79,000 Subscribers To Its Paywall For The Times
from the details-please? dept
Back in November when News Corp. released some subscription info for its paywall for The Times/Sunday Times (publications which it walled off behind a complete paywall), the details were really lacking. They claimed 105,000 "paid" digital users, but that mixed up a bunch of different kinds of users, including one-off "daily" purchases and subscribers. They did say about 50% of those were "monthly" subscribers, but there was an introductory £1 per month rate, as compared to the full £8.67 per month rate that would go into effect after the first month. So, now, with News Corp. claiming 79,000 monthly subscribers, I'm wondering how those "intro" plan subscribers are being counted. Did all of them convert to full priced? How many dropped off? Are they still counting those who dropped off in that subscriber count?Either way, while 79,000 subscribers may sound like an impressive number, I'm still not convinced the economics works out. Assuming that they're all paying the full price, subscribers are paying almost exactly $1 million per month. That's not bad, but it's not a really huge number for an operation like News Corp. either. And if it's true that traffic to the websites dropped about 90% from about 21 million unique visitors down to less than 3 million unique visitors, ad revenue from the site really isn't bringing in that much (no matter how many times they try to spin the audience as being "more valuable.") It still seems like they almost certainly gave up significantly more in ad revenue than they're making via the paywall, and while there are still new signups, over time it's going to be tougher and tougher to sign up new users. Clearly, the paywall is not a complete disaster, like some others, but it still doesn't seem like the economics add up here.
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Filed Under: paywall, the times
Companies: news corp.
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Subscriber numbers
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So how long is it before we start hearing the word pirate and numbers start getting into the recognizable range?
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(Yes I know, they don't do that any more, just roll with it k?)
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I claim to be a reader of the NYT.
As for actually visiting the site? I would never pay to have my intelligence insulted in the manner the NYT delivers it to their readers, subscribers or not.
Opinion is one thing. Shilling it as fact is quite another.
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Re: I claim to be a reader of the NYT.
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Your estimate of 1m/month revenue is interesting - that's what the Daily Mail say is their display ad revenue from 50m uniques/month. If the money is the same, I'd far rather have 79k customers than 50m drivebys.
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So much for 10% will pay
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Mike, you really need to work on wrapping your head around some concepts:
First off, if the average user sees less than 20 pages, they see stuff for free. There is no loss of ad revenue on average users. They aren't losing the single page shots, they aren't losing the search engine traffic, they aren't losing the drive bys.
Basically, they make everything they made before, and add another 1 million a month on top.
Actually, they probably make more at this point because angry bloggers like you have been promoting them like crazy the last couple of months getting your manties in a bunch over the paywall.
I know that blending business models are sometimes hard to understand, I cannot understand though why you cannot grasp this one.
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$$$
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Re: $$$
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some math
http://publishing2.com/2007/07/17/newspaper-online-vs-print-ad-revenue-the-10-problem/
ahe m. so. that means....
pre-paywall monthly ad revenue:
ads: $3.50 arpu x 21,000,000 users = $73,500,000
total: $73,500,000 revenue per month.
post-paywall monthly ad revenue:
ads: $7.00 arpu (more valuable!) x 3,000,000 = $21,000,000
subs: $1,000,000
total: $22,000,000 revenue per month.
genius move!
m3mnoch.
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Re: Re: I claim to be a reader of the NYT.
I'll allow this moment to provide me the shame I deserve.
My apologies to the NYT for my blunder.
As for Murdoch's rag... the comment still applies.
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AC, you really need to read before spewing.
First off, if the average user sees less than 20 pages, they see stuff for free. There is no loss of ad revenue on average users. They aren't losing the single page shots, they aren't losing the search engine traffic, they aren't losing the drive bys.
That's the *NEW YORK TIMES* paywall. We're talking about The Times from News Corp. Reading helps.
Basically, they make everything they made before, and add another 1 million a month on top.
Except they don't. There are no drivebys for The Times.
I know that blending business models are sometimes hard to understand, I cannot understand though why you cannot grasp this one
Kinda funny to see you complain about comprehension when you failed so badly.
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Under 1% conversion rate, that's fine
A sub 1% conversion rate to paid subscribers isn't unique. It's rather typical web bulk business as usual. What's the typical Google Adsense or AdWords click rate? It's lingering in the same neighborhood and that's a much easier action to get someone to take --- getting them to buy is much harder.
If the Times went from 21 million viewers a month to 3 million viewers then good for them. Roughly an 86% loss of people. Along with the comes a reduction in servers, bandwidth, IT resources, headaches with 24/7 operation reduced, all sorts of stuff. Probably cuts down on the comments they need to moderate also.
Most businesses operate on a 90/10 rule. Like, 90% of my income comes from 10% of my audience.
Dropping the other 90% of freeloading web visitors should be a step more established brands take. Destroying your brand and giving your content away for free like it has been for over a decade strong has to stop. Web viewers can't expect quality content unless there are quality folks with the time and resources to produce such. The legions of bloggers aren't going to replace traditional media, they have their place though.
Last time I checked I can't find any company in any other industry than media giving their hard work away for free in hopes of somehow later recouping something. If McDonald's did this they'd be out of business, if Porsche did this, gone in one quarter.
So, why do we expect a free newspaper when you can't get a free lunch anywhere?
As for the economics of search and related traffic. It's very lucrative. One industry insider has said up to $50 CPMs, far above those nice to to see $3 CPM lowly bloggers might hope for.
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Please help.
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Re: some math
Daily Mail - similar UK based newspaper with gobal reach gets 2p (£0.02) per month per unique.
Did you notice that link is from 2007, the middle of the last advertising boom?
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Re: Re: some math
you should have a dedicated "free faq" page linked from the navigation. it could talk about infinite goods and definitions of monopolies and all kinds of core knowledge a lot of these commenters are missing.
you could even use it as a link-to jump-point sort of thing that points to your past posts on the topics.
m3mnoch.
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Re: Re: some math
two things:
1) you must be thinking per unique page view or something. that's a super tiny, completely unsustainable number. that's closer to arpdau vs arpu.
2) your comment doesn't even make sense. so ad rates 4 years ago were 100x more than today? wow. no wonder newspapers are going to hell. ad inventory is selling for a penny on the dollar today compared to 4 years ago!
m3mnoch.
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Re: Re: Re: some math
http://socialtimes.com/online-overtakes-newspaper-ad-revenue-so-does-google_b32140
m3mn och.
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Re: Subscriber numbers
oh wait...
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Re: Under 1% conversion rate, that's fine
Making "free" part of your overall business model does NOT mean giving everything you produce away for nothing and ever has. How many times does this super simple fact need to be repeated? I swear the instant some people see the word "free", their brain immediately shuts off. Societally speaking, I fall under the category of lowest common denominator. I didn't finish high school and don't have a job, yet I'm able to understand the whole free concept without any difficulty at all. What does that say about you and your ilk?
PS: McDonalds gives stuff away for free all the time, usually as part of some promotion (Monopoly for example) and is a perfect example of how free can help you make more money.
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Don't believe the numbers
The offers are ridiculous. For example, they may include a separate Sunday edition for free with a regular subscription or they may include a regular subscription along with a Sunday edition. They claim these as separate numbers when they're really the same. 79,000? More likely to be 39,000 or less. My bet is way less for the online edition.
You'd be surprised at how many people subscribe to newspapers for the "coupon incentive". That really doesn't exist the same way online.
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Paid subscriptions are really the only thing that matters...
What I meant by using them is show me how any traditional real product business can exist by "giving away their 'product' for free". I meant permanently giving everything (the Google model) not free as in a promotional.
McDonald's does not nor will it ever give away anything for free - only will in limited form to promote one off freebies out of their advertising budget.
By all means, if you can figure out how Porsche can give away free automobiles, every one they make and still have a business, well sign me up at the start of the line for that handout.
As for publishing, the only thing that matters with traditional print is paid subscriptions. It's what gets audited and what contributes most to advertising rates.
That same gauge or indicator should apply online as well. Who really cares if a site has a gazillion page requests a month by 10 billion 'viewers'. That model is ripe with fraud, numbers inflation, scams and many other issues. If you haven't provided a way to tie the real users in and can't gauge more traditional signals and data (geographic, postal code, gender, age and income) then your viewers go from value to in my opinion costing you money.
Shame that the anti-paywall folks are mostly the same people who support piracy, love Google enabling such and generally are consumers, not producers of content.
Amazing how much traffic breaking this paywall and getting around it have generated on Twitter and elsewhere. At some point it goes from game playing mischief to criminal theft.
Free is not sustainable at scale and for long duration. It's a scam of extremes like $2 million for a 30 second commercial is on television.
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Re: Paid subscriptions are really the only thing that matters...
But, um, that's the whole point. You don't give away things that have a marginal cost to give away. You give away the stuff that doesn't have a marginal cost to give away.
That same gauge or indicator should apply online as well. Who really cares if a site has a gazillion page requests a month by 10 billion 'viewers'. That model is ripe with fraud, numbers inflation, scams and many other issues.
Oh come on. You know damn well that newspaper subscriptions are even more rife with fraud, number inflation and scams. Page views are much easier to audit and confirm.
Shame that the anti-paywall folks are mostly the same people who support piracy, love Google enabling such and generally are consumers, not producers of content.
Almost nothing stated here applies to me. I produce content. I make my living producing content. I do not support piracy. And I think paywalls are monumentally stupid from a business perspective.
Free is not sustainable at scale and for long duration.
Bullshit. TV and radio have shown that it's incredibly sustainable. And so have plenty of free newspapers
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Re: Re: Paid subscriptions are really the only thing that matters...
Marginal needs to include all costs. If a publication only has to export a print production piece to the web and no other cost, then sure, per se, why not try that experiment in a limited fashion.
Problem is giving away content online for many is a cost center --- significant additional cost.
Thinking eyeballs = viewers = revenue isn't going to cut it dollar wise compared to traditional publishing.
Oh come on. You know damn well that newspaper subscriptions are even more rife with fraud, number inflation and scams. Page views are much easier to audit and confirm.
Print subscriptions are actually audited and certified. While there might be some distortion, it's nowhere near what 75% of all websites misreport as their traffic. As bad as traditional media is, I can guarantee numbers nationwide without much effort or trickery. With the web, well good luck, in theory the numbers should be easier to gauge, but nearly everyone fails to standardize and audit, so it's the wild west of fraud.
Click fraud for online advertisements 'officially' as of last quarter was something like 30%. That's 1/3 of spend rate down the toilet per se.
I think paywalls are monumentally stupid from a business perspective.
Hey, we're all entitled to opinions and I value your opinion even if mine differs.
I see no reason why a newspaper or traditional media should bow to new media distribution models and destroy their brand. Giving some free content away can be lead generation certainly, but giving it all away is simply a very bad idea.
When paywalls go up people starting howling at the moon. I think the limits with many of the paywalls is more than generous, yet many continue to bemoan this reality and hack the system to extract more free content. It's shameful that we have such a prevalent culture of content pirates.
Bullshit. TV and radio have shown that it's incredibly sustainable. And so have plenty of free newspapers
TV and radio give their content away for free, but guess what most of it is purchased from third party producers. Even say the local talk radio show, while free to listen isn't free volunteer labor of love for the hosts, the stations pay them a living wage or better. Their ad rates are rather high and typically very worth it. Not like your are going to get bogus ad clicks from a radio campaign. Your ad either brings people in or it doesn't. It's fairly easy to optimize and the ads are in the geographically correct market targeting the intended demographic. Good luck with that on the web, it can be done, but it's a splattered mess all over and ROI is really sketchy still. Hard to convey many messages in limited form factors and in 140 characters of web ads - like AdWords.
With all you have provided, the only viable model you have inferred is for traditional media to perhaps upcharge their print advertisers to advertise on the electronic version or go after the online only dollars to subsidize their web content. If they go at it dumping all print content online, inevitably subscriptions dry up and people expect everything for free. That drives down the print ad dollars. No way today that online dollars will come anywhere near print ad dollars. Actually, online ad dollars for next decade will continue to be coins on dollar comparatively.
A publication can run their business into the ground trying this, many have. What do they get for providing all for free? A winning ticket in the online popularity contest?
For the record, I am a content producer and have my roots in owning a print publication and I've worked in the advertising industry. This isn't my first square dance.
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Re: Re: Re: Paid subscriptions are really the only thing that matters...
Um. The definition of marginal costs is that it *does not* include "all" costs, only the marginal ones. That's the point.
Problem is giving away content online for many is a cost center --- significant additional cost.
You're confusing fixed costs and marginal.
Thinking eyeballs = viewers = revenue isn't going to cut it dollar wise compared to traditional publishing.
If that's all you're thinking, then you're right. But if that's all you're thinking, then of course you're going to fail.
Print subscriptions are actually audited and certified. While there might be some distortion, it's nowhere near what 75% of all websites misreport as their traffic. As bad as traditional media is, I can guarantee numbers nationwide without much effort or trickery. With the web, well good luck, in theory the numbers should be easier to gauge, but nearly everyone fails to standardize and audit, so it's the wild west of fraud.
Yeah. Sure. Trustworthy. http://www.npr.org/templates/story/story.php?storyId=4704566
Try that one again.
As for the web, in my experience people tend to rely on Comscore or Google analytics, so they're at least standardized. But, again, I'm not sure what that has to do with anything.
Click fraud for online advertisements 'officially' as of last quarter was something like 30%. That's 1/3 of spend rate down the toilet per se.
If you're selling ads on a clickthrough basis, then you're going to get clickfraud. The answer is not to rely on PPC ads.
I see no reason why a newspaper or traditional media should bow to new media distribution models and destroy their brand. Giving some free content away can be lead generation certainly, but giving it all away is simply a very bad idea.
How does it "destroy their brand"?
The thing is, I'm talking about this not from a "new media" perspective, but an economics and business perspective. Those things don't change. And economics says that if your product has a marginal cost of zero, and there's competition in the market, you're not going to get away with charging very long.
You can try. But you will fail. That's not some new media speak. It's basic economics. The kind that so many in the newspaper business don't get.
When paywalls go up people starting howling at the moon. I think the limits with many of the paywalls is more than generous, yet many continue to bemoan this reality and hack the system to extract more free content. It's shameful that we have such a prevalent culture of content pirates.
Ah. You think people who want your news are pirates. No wonder you're confused. If you're too stupid to learn how to monetize your audience, please lock up your content. One request, though: send that traffic to me. I'll make money off of them.
TV and radio give their content away for free, but guess what most of it is purchased from third party producers. Even say the local talk radio show, while free to listen isn't free volunteer labor of love for the hosts, the stations pay them a living wage or better.
I'm not sure what that has to do with anything? Why are you assuming that I said anything about free volunteer labor? I did not.
You seem very confused.
Not like your are going to get bogus ad clicks from a radio campaign. Your ad either brings people in or it doesn't. It's fairly easy to optimize and the ads are in the geographically correct market targeting the intended demographic. Good luck with that on the web, it can be done, but it's a splattered mess all over and ROI is really sketchy still. Hard to convey many messages in limited form factors and in 140 characters of web ads - like AdWords.
Again, if you're relying on ads like that, you're doing it wrong.
With all you have provided, the only viable model you have inferred is for traditional media to perhaps upcharge their print advertisers to advertise on the electronic version or go after the online only dollars to subsidize their web content. If they go at it dumping all print content online, inevitably subscriptions dry up and people expect everything for free. That drives down the print ad dollars. No way today that online dollars will come anywhere near print ad dollars. Actually, online ad dollars for next decade will continue to be coins on dollar comparatively.
Yeah, if you're doing it wrong. If you do it right, you make more from your online ads. I know.
A publication can run their business into the ground trying this, many have. What do they get for providing all for free? A winning ticket in the online popularity contest?
Only if they're bad at business.
For the record, I am a content producer and have my roots in owning a print publication and I've worked in the advertising industry. This isn't my first square dance.
Explains your biases. Doesn't explain your weird assumptions.
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Marginal only applies where such costs are NOT any increase in overall production costs. Again, calling the process of bringing content from traditional means to online marginal is simply not true in most publishing companies.
Putting the content online builds an expectation that all content will be provided freely online by said publisher or at least it has to date in most of the online market. Plenty of customers and potential customers will convert to free model. It's the story of the web.
Remember geocoding of data? That was a paid business three years ago, now it's expected to be free.
Here's an idea, if your content is so good and wants to be free, how about dropping the ads and coming up with a real way to make your lunch money?
Yeah. Sure. Trustworthy. http://www.npr.org/templates/story/story.php?storyId=4704566
For every news piece on auditing fraud of print, we can find many online fraud pieces. How many times has Google's AdWords been sued? Many, and claims of fraud persist until today. This applies to all ad networks out there.
It's so bad that the industry is attempting to set it's own standards for federal oversight doesn't come regulate the industry into being honest and thus, less profitable. All a mere decade after they should have instituted auditing and universal standards. Good luck, such an effort will be never be adopted as most ad networks and publishers are too busy distorting their numbers to ever get near such an honesty measure.
If you do it right, you make more from your online ads. I know.
I highly doubt your online ads are making more than print ads in a real publication - when comparing things on a per subscriber basis. The potential for this to become reality is there, but an online publisher needs to collect more data on the user base and operate a very comprehensive advertising program that goes beyond mainstream vanilla features. Read = detailed demographic and personalized product targeting of high net earners with high priced products.
Hey you obviously have a horse in the ad race, but you probably can't convert a soul into a paying customer behind a paywall.
I hope to see more content protected and monetized. Obviously, folks see a value in New Corps and NY Times publications online, as the Twitterverse has been abuzz with folks circumventing the protection methods. Now if we can just explain to the online population that free is a mostly unreasonable expectation we'll accomplish something.
Free content is just a fad.
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You are confusing fixed and marginal costs. It explains a lot. The fact is everyone's putting content online. Once its online, the marginal cost of reproduction is effectively zero. There are fixed costs in putting it online, but those are fixed.
Putting the content online builds an expectation that all content will be provided freely online by said publisher or at least it has to date in most of the online market. Plenty of customers and potential customers will convert to free model. It's the story of the web.
No, it's the story of economics. The economics of marginal costs. People who blame the web for basic economics look silly.
Fact is, the *content* of almost all news publications has always been provided "for free." The cost of a subscription has almost never even covered printing and distribution costs.
Here's an idea, if your content is so good and wants to be free, how about dropping the ads and coming up with a real way to make your lunch money?
I'm really not sure how to respond to a statement as braindead as that one. Why should we take down ads?
For every news piece on auditing fraud of print, we can find many online fraud pieces. How many times has Google's AdWords been sued? Many, and claims of fraud persist until today. This applies to all ad networks out there.
What do AdWords suits have to do with numbers on news websites? And, I already pointed out, if you're relying on CPC, you're doing it wrong. And your response is to focus on CPC?
I highly doubt your online ads are making more than print ads in a real publication - when comparing things on a per subscriber basis. The potential for this to become reality is there, but an online publisher needs to collect more data on the user base and operate a very comprehensive advertising program that goes beyond mainstream vanilla features. Read = detailed demographic and personalized product targeting of high net earners with high priced products.
You shouldn't speak about what you don't know about.
Hey you obviously have a horse in the ad race, but you probably can't convert a soul into a paying customer behind a paywall.
FYI, significantly less than 50% of our revenue comes from "ads." You shouldn't speak about what you don't know about.
As for our ability to convert people into paying customers, again, you shouldn't speak about what you don't know about. We have a fairly high rate of users paying. Not for a paywall, because paywalls are stupid and don't work. But people pay nonetheless. Perhaps, if you took the time to look around, you'd understand why.
I hope to see more content protected and monetized. Obviously, folks see a value in New Corps and NY Times publications online, as the Twitterverse has been abuzz with folks circumventing the protection methods. Now if we can just explain to the online population that free is a mostly unreasonable expectation we'll accomplish something.
Free is the natural state of things when the marginal cost is zero.
Free content is just a fad.
You can't be serious. Honestly, go read an economics text. It'll help you look less clueless.
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