Success of the New York Times Media Group's metered model may spur publishers to reconsider pay walls
By Matthew Schwartz
The recent move by the New York Times Media Group to reduce the number of free articles per month it makes available on NYTimes.com could influence other media companies to adopt some type of metered model for their online content, according to industry observers. Last month, it reduced the number of free articles per month available on NYTimes.com from 20 to 10.
"The conversation is definitely starting to change, and I think we'll probably see a few more publishers attempt this—and there will be varying degrees of success," said Marissa Gluck, managing partner of media research company Radar Research.
Gluck said that constructing a firewall around content online requires capital expenditures upfront as well as on the back end. "It's a question of where [publishers] want to put their resources," she said. "The pressure is on for all content businesses to figure out if subscriptions or a paid model is viable."
Earlier this year, RR Donnelley & Sons Co.'s Press+, which provides publishers with a metered model platform, said it has 285 customers using digital subscription models. Press+ said it has another 200 companies planning to implement the platform.
Dave Marsey, senior VP-media practice leader at ad agency Digitas, said the Times Co.'s decision to cut the number of free articles available to nonsubscribers would spur other media brands to reconsider establishing pay walls.
"You need to have content that can't easily be replicated," he said. "You can't have another guy down the block doing the same thing that you are; a pay wall in front of easily replicable content will likely drive readers to go down the block."
Times Co. said it has about 454,000 paid subscribers to various digital editions of The New York Times and the International Herald Tribune. The Times Co.'s metered model, which it implemented last year, was pioneered by the Financial Times.
The Times' decision to tighten its restrictions is a "testament to the strength of the Times' content and the fact that it's been a pioneer in pushing out its content into new [media] platforms," said Dave Rowe, VP-media director of ad agency Doremus.
Rowe said the breadth of the Times' content should inoculate NYTimes.com from any erosion in its digital audience as a result of tightening its pay wall.
"The Times has such huge traffic that even if they lose 10% or 20% as a result of [restricting the pay gate], they will still have more than enough traffic to meet the needs of advertisers," Rowe said.
In February, the NYTimes.com website garnered 44.8 million unique users worldwide, compared with 43.9 million in the same period in 2011, according to comScore.
The growth in the Times' digital subscriptions helps to compensate for the ongoing stagnation in the Times' print circulation. In 2011, the Times' overall print circulation was 3.3 million, essentially flat compared with both 2010 and 2009, according to the Audit Bureau of Circulations.