nytimes paidcontent header New York Times Offering Paid Content in 2011

By Tara Lane, Staff Writer

Only three years ago, The New York Times scrapped its paid digital content service TimesSelect, after it failed to bring in significant revenue. With rumors swirling since last summer about a similar move happening again, the news giant finally confirmed that it would implement a paid content model — set to roll out in 2011.

The New York Times Company has tried nearly everything to keep the historical publication afloat: reducing the size of the paper and the number of sections printed, cutting back on employee benefits and offering buyouts to employees in an effort to trim newsroom staff. Still, the newspaper industry as a whole is struggling, and not even the Times is immune. Though online reactions were anything but positive – a Mashable poll found that the majority of respondents would not pay for the paper’s online content – moving to a paid model seems like a natural move for this industry leader.

Since Wednesday’s announcement, NYTimes has been assuring customers that the decision to institute a paid model was well thought out, and that it won’t be as drastic as people think. Visitors will be allowed to view a certain number of articles each month, with the option to pay once the limit is reached. This has the potential to get messy — referring back to the Wall Street Journal’s fight with Google just a few months ago to block search engine crawlers — as users could find ways around these pay walls. Additionally, The New York Times site also hosts a number of blogs that deliver quality content in a more casual setting. It would be wise for the Times to keep these blogs free of charge, especially for casual readers who look to NYTimes for up-to-the-minute news and opinions.

In 2009, Sparxoo ranked The New York Times 2nd on our list of the top 25 digital influencers in news and politics due to their firm grasp on social media and skilled execution of dispensing news using these new digital mediums. When The New York Times content is hidden behind a pay wall in 2011, the newspaper and digital influencer’s buzzworthiness might fade — as less people have access to the content.

Will paid content kill online readership for the New York Times? Not likely. A comparison search on Compete.com finds that The Wall Street Journal, which is known for having a similar paid content model, is not that far behind the NYTimes in terms of web hits and unique visitors – good news for NYTimes. Still, NYTimes must think about the big picture: will paid access be profitable in the long run? If the Times loses readership, they’ll also lose advertisers, which will bring them back to square one. It’s a delicate balance, one that must be carefully instituted if there are any hopes for long-term profits.

The Times isn’t the only industry jumping on the paid content bandwagon – YouTube is beginning to offer paid movie rentals through the site (first up are selections from the Sundance Film Festival), and popular music streaming site Pandora has recently started charging users who wish to use the site for more than 40 hours each month. There are also talks that Hulu may also charge for content in the future, in response to pressure from major networks who have seen viewership dwindling in the past few years.

Customers have become accustomed to getting so many things for free that the thought of having to suddenly pay for something isn’t exactly a welcome change. From a business perspective, we must assume that the NYTimes has done its research and feels confident that avid readers will pay an access charge.

Looking at the success of Apple and iTunes, we can see that customers are willing to pay for these digital goods. iTunes’ business model has made it easy for users to access and download the product on a variety of devices, and offers the product at an affordable cost. In addition, they’ll need to make sure their content is on par with the price their asking customers to pay, and that it’s accessible through other means that just their Web site (new rumors suggest they are looking to find success with the Apple tablet). Will they be successful the second time around? Chances are that many people will change their minds and attitudes between now and then. We’ll have to wait a year to see what the final outcome will be.

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