The New York Times Paywall

MM2 Written Analysis of Cases

April 30, 2016

The New York Times Paywall

Grover, Sargun

LT #6

Current Paywall vs prior attempts

The previous two attempts were significantly different in terms of the time during which they were introduced, the strategy and the marketing mix. The failure of these two attempts should not be a factor in deciding the long-term prospects of the current Paywall.

Standalone analysis of the two attempts is essential to understand the causes of failure and for accurate comparison with the current scenario.

The First Experiment

The first experiment is not comparable to the current one. We justify the same in light of the following themes:

Demographic differences

The first experiment was when the website was launched in the year 1996. This was more than a decade ago when the United States and the World demographics were considerably different from 2011. Internet penetration was not as high, smartphones and other devices such as the I-pad were not as common as they were a decade after. Exhibit 8 suggests that unique monthly visitors were significantly low in the year 2004 (as compared to 2011). This would be even lower in the year 1996. It is hence reasonable to assume that the mass markets had not started to fully appreciate the importance of digital mediums in the newspaper industry.

Place

In addition to demographic differences, the Paywall was targeted only towards overseas customers.

Price

The charge was a flat $35 per month for overseas customers, which translates to an annual charge of $420. If we look at Exhibit 11, in the year 2012, an annual charge of about $450 was way higher than other online content. The price charged was very high given the time (1996) and the target market. There were no customized packages and no free trials hence no option for people to try the new medium.

TimesSelect – The Second Experiment

The second attempt was in the year 2005 and was only directed to people who were followers of noted columnists. All other content was free. Though the columnists criticized the move, there is reasonable evidence to believe that people were willing to pay to get access to noted columnists. According to Exhibit 9, TimesSelect subscriptions almost doubled from November 2005 to September 2007.

The second experiment also did not charge anyone for access to news and other content. The market and the internet usage were again different from the scenario in the year 2011.