By Dan Kennedy • The press, politics, technology, culture and other passions

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A rocky launch for the Times’ paywall

The New York Times has had months to test its online paid-content system. And, as of this morning, it’s a mess.

Last night I tried logging on to the Times’ iPhone app, which, as a subscriber to the Sunday print edition, I am supposed to get for no additional charge. I entered my username and password and got a message telling me to look for a confirmation email. I did. It wasn’t there — not in my inbox and not in my spam folder. I did it again. And again this morning. No dice.

I tweeted, and Greg Reibman, publisher of GateHouse Media’s Metro Boston papers, tweeted back: “Exact same thing happened to me. @nytimes promised email confirmation that never came.”

I also got this, from @NYTdigitalsubs: “Sorry to hear you’re experiencing login issues w/ iPhone. We’re investigating. Stay tuned. Thanks for patience.”

Perfection may be unattainable, but given the resistance to paying for Internet content, the Times needed as smooth a launch as possible. So far, not so good.

On the bright side, I did have a chance to play with the Times’ new iPhone app for a few days before the paywall went up, and it is spectacular. And since the “Top News” section is free to everyone, I was able to read that this morning.

Tuesday afternoon update: @NYTdigitalsubs came up with a workaround — log in as a digital subscriber rather than as a print subscriber. That did the trick. A more complete solution is supposed to be available later today.

New York Times: Pay us less and we’ll give you more

As best as I can figure out, it will soon be cheaper to get access to all of the New York Times’ digital products and the Sunday print edition too than it will to go paperless. Let’s run down the math.

Every three months, Media Nation Central pays $97.50 for home delivery of the Sunday Times. Under the new pay scheme announced last week, that entitles us to free access to most of the Times’ electronic delivery options: NYTimes.com, Times Reader, and apps for smartphones and tablets. (Kindle and Nook editions aren’t included in any of the just-announced options.)

On the other hand, if we don’t get the print edition at all, it will cost us $35 every four weeks for the same electronic package. That’s $113.75 every three months, or $16.25 more than getting the identical range of products plus the Sunday paper. That’s a markup of nearly 17 percent.

Now, Times executives have every incentive in the world to push the Sunday paper: it’s where most of the advertising revenue comes from. I’ve been told that the Boston Globe makes as much as two-thirds of its money from the Sunday paper. It’s probably about the same at the Times.

Still, it seems odd that the Times has deliberately set up a system under which you get more if you pay less — although, granted, I’m not factoring in the cost of tips, which should bring the price of paper-plus-electronic to somewhat more than electronic-only.

Thoughts on the N.Y. Times’ modified limited paywall

Earlier today, Lois Beckett of the Nieman Journalism Lab asked me and a number of other media observers to write brief commentaries on the New York Times’ modified limited paywall, which was announced this morning. She got some interesting responses, ranging from Steve Buttry (“ridiculous”) to Amy Webb (“a wise move”). Here’s what I wrote:

The New York Times is taking a smart and nuanced approach. Times executives have struck an interesting balance between charging heavy users for access while remaining part of the free online conversation that’s become such an important part of the media ecosystem. I have no idea whether a limit of 20 free articles a month is too little, too much or just right, but I assume they’ll adjust in response to what the market tells them.

I was also pleased to see that print subscribers, including Sunday-only customers (like our family), will have free access to most of the Times’ online platforms. The Sunday paper remains a vital source of revenue for the Times, and it makes sense for Arthur Sulzberger, Janet Robinson and company to do whatever they can to preserve that money machine.

That said, the Times will no longer be able to make excuses for glitchy software and access problems. I’m reasonably happy with the Times iPhone app, but my wife reads the Times on her iPad, and it’s buggy. You can get away with that when it’s free. But once you put a price tag on your product, you’ve got to guarantee that it works — and be responsive to consumer complaints when it doesn’t. That’s especially true given that the Times is charging more for electronic access than many had predicted.

The news business may be watching this very closely to see what lessons can be drawn, but I’m not sure that there will be many, because the Times is such a unique product. For many people, the Times may be the one “newspaper” for which they’re willing to pay to read online. Rather than paving the way for other newspapers, the Times’ paywall may instead lead to a further stratification of the news business, as executives at other papers find themselves unable to emulate the Times’ success in persuading customers to pay for electronic access.

The announcement was pretty much along the lines of what the Times said was coming months ago, though the fees for non-print subscribers ($15 to $35 every four weeks depending on your platforms) are higher than some had expected. There are also all kinds of exceptions regarding Twitter and Facebook access, top news on smartphones and the like.

The plan is very different from one that will be unveiled later this year by a sister Times Co. property, the Boston Globe, which announced last fall that it would divide its Web offerings into a free Boston.com (filled mostly with content that doesn’t appear in the Globe) and a paid BostonGlobe.com.

Last October, I interviewed Globe publisher Chris Mayer about his paywall plans.

Reflecting on the latest circulation figures

In Japan, advertising accounts for just 35 percent of newspaper revenue. In Britain, it’s 50 percent. And in the United States, ads have traditionally amounted to a whopping 87 percent of newspaper income. That’s why it can truly be said that, in the U.S., newspapers have always given away the news, charging only for paper and delivery.

These days we pay for computers and broadband access while getting the news for free — same as it ever was. That is among the most important explanations for why news organizations are going to have a difficult time persuading more than a handful of readers to pay for online access. I wish them well. But the challenge is enormous.

One thing some readers will continue to pay for is the convenience of print. (Spare me your nostalgia for the romance of print. Print persists for one reason: it’s still more ergonomically friendly than any electronic version. Someday that will change.)

After yesterday’s newspaper circulation figures were released, showing a continued but slowing decline in print sales industry-wide, Boston Globe publisher Chris Mayer issued a memo — a copy of which was obtained by Media Nation — attributing the Globe’s continued slide to last year’s decision to raise the price to as much as the market would bear. (Here is the Boston Herald’s take.)

The idea is that there’s a sweet spot. Up to a point, you can raise prices and make more money, even if the total number of print readers declines. Somewhere, though, there’s a top to the curve, and the challenge is to find the top and not raise prices so much that revenues start to fall. The result, unfortunately, is that you end up with a niche product for an elite readership. But it’s either that or die.

And here’s a good piece of news. There’s also a sizable subset of readers who will pay for electronic editions like Times Reader and GlobeReader, which are cheaper than print but more convenient than newspaper websites that keep you chained to your desk. Given that iPad editions have barely kicked into gear, that’s a promising sign.

The full text of Mayer’s memo follows.

Dear Colleagues,

Earlier today the Audit Bureau of Circulations issued their Fas-Fax report for the six months ending September 30th. The Globe has shown year-over-year declines in line with our expectations, as a result of our circulation and pricing strategy instituted last summer.

The good news is the rate of circulation decline has slowed as we cycle through the impact of the price increases. One indicator is the comparison between September’s report and March’s report. Viewed this way, the declines are 2.8% for Sunday and 4.2% for daily. These are encouraging trends for our business and in line with others in our industry.

The past few months has also seen continued excellence in our reporting and positive contributions to the community. Our Spotlight Team investigation of patronage in the state’s probation department; our sensitive series of stories on bullying; the amazing coverage of the Amy Bishop case; coverage of the earthquake and aftermath in Haiti and its impact in Boston; and our current coverage of the political races are just a few examples of the important journalism we’re delivering.

The Globe’s circulation, now at 368,000 on Sunday and 223,000 daily, still makes us the largest newspaper in New England by a wide margin. The year-over-year decreases of about 15.7% on Sunday and 12.0% daily were expected and budgeted.  To offer some context, we raised prices last summer in most areas by 30% to 50% to grow circulation revenue and stabilize the business.

Of course, circulation numbers are not the end of the story. Print and online media work in concert with one another to build audience. It should be noted then that in terms of readership, during an average week, the Sunday Globe, the daily Globe and Boston.com together will reach 51% of all adults in the metro Boston area.  It will also be reported in Monday’s Fas-Fax that Boston.com’s local audience grew by 2.9 %.

The recently announced two-brand digital strategy is now officially under way and we are developing launch plans for our new subscription-based Web site BostonGlobe.com, and the next generation Boston.com. And, watch forperiodic launches of digital products in the upcoming months.

So, as we look ahead we will continue to execute on our strategy, building on the strong foundation of quality journalism, original content, broad audience reach, higher reader engagement, advertising effectiveness, and strong connection with the community that is reflected by, and results in, our more than 50% of the market.

We can all share a sense of optimism and purpose as we focus on our future success.

— Chris

Photo via Wikimedia Commons.

Publisher Chris Mayer on the Globe’s new pay model

Christopher Mayer

(Note: If the top of Media Nation looks mangled, please hit reload.)

I’m skeptical, but I’m impressed. Yesterday’s announcement that the Boston Globe will move most of its content to a subscription-based website sometime in the second half of 2011 shows that Globe executives know where their strengths are and that they’re prepared to think innovatively to protect those strengths.

The Globe’s dilemma is that it has an enormously successful free website, Boston.com, that is quite different from the paper itself. Start charging for access to Boston.com, and many of those 5 million unique visitors a month would vanish.

The solution: keep Boston.com free, but split off the Globe’s content into a separate, paid site called BostonGlobe.com, currently a free subsite. The decision raises lots of questions. Perhaps the biggest is how much free Globe content will be posted on Boston.com, and whether Boston.com will remain as popular once it has to stand on its own.

Still, it’s a far more interesting idea than the metered model embraced by the Globe’s parent company, the New York Times Co., which rolled it out at the Telegram & Gazette of Worcester recently and which will give it a go at the flagship paper sometime next year. Under the metered model, readers can access so many articles for free each month, after which they have to pay. It might work for the T&G and the Times, but it would have been deadly for Boston.com.

Yesterday I conducted an e-mail interview with Globe publisher Christopher Mayer, which he graciously agreed to do because I still can’t take notes. (Although it’s getting better. I’ve got a pillow propped up and am typing two-handed now for the first time since my accident.) Our unedited conversation follows. I’ve got a few closing thoughts after the jump.

Q: The metered model seemed to be the way the New York Times Co. was going. Why did you choose something different?

A: We’ve said all along that each organization would need to come up with a custom-made approach that takes into account unique market factors. We felt this was the best course for us, given the fact that we have two strong brands and essentially two different types of users of our Boston.com site. We have the opportunity to build a free site and a subscription-based site, and based upon extensive research, that emerged as the best option for us.

Q: The advantage of the metered model is that you’re not entirely cut off from the great conversation that’s taking place on blogs and in social media. Are you concerned about breaking a big story and not having as much impact as you should because people can’t link to you? Please address what Clay Shirky said about the importance of online sharing with respect to the Globe’s reporting on the pedophile-priest story.

A: We don’t intend to be cut off from the conversation. We haven’t announced, or even worked out, all the details of what will be on which site. But we can envision that some full-text Globe stories will be available on the free site. I suspect we would have put many of the initial priest sex-abuse stories on the free site because that Spotlight Team investigation was viewed as clear public service reporting. In the future, we’ll make those judgments as appropriate.

For the Globe, a hybrid paid-content model

As you may have heard, the Boston Globe today finally made its long-anticipated announcement on placing some of its online content behind a paywall. I think publisher Chris Mayer’s decision to offer a free Boston.com site and a paid BostonGlobe.com is interesting. I’ve got some questions. I’ve got concerns.

I’ll have more to say tomorrow. Meanwhile, Ralph Ranalli at Beatthepress.org and Boston Phoenix editor Carly Carioli have some worthwhile thoughts.

Boston Globe edges closer to paywall

The Boston Globe will soon start charging for online content, Eric Convey reports in the Boston Business Journal. As with plans being developed by its corporate cousin the New York Times, the Globe’s paywall will be deliberately porous so that bloggers and their readers can share a certain number of stories each month. Heavy users, though, will be expected to cough up.

I predict, at best, very limited success — so limited that it may prove not worth doing. The Times Co. reported today that its revenue from print advertising and circulation continues to fall, but that online ad revenues are up by 14 percent compared to a year ago. Yes, the overall volume is lower, but online is where the growth is.

Rupert Murdoch’s Times of London lost between two-thirds and 90 percent of its online readers when it erected an admittedly more rigid paywall earlier this year. The Globe’s website, Boston.com, draws about 5 million unique visitors each month. The paywall could wind up alienating readers and advertisers alike.

I’d keep Boston.com free but get rid of the “Today’s Globe” section, which is a perfect replica of the print edition. Post most Globe stories to Boston.com, but maybe not all of them. Make sure readers get the message that the Globe and Boston.com are not the same. And reserve the full contents of the Globe itself for paid platforms — not just print, but mobile, iPad, Reader, Kindle and the like.

The Boston Herald already does a good job of differentiating its print and online editions. And the Globe has a greater opportunity, because the Herald is lagging in alternative electronic platforms.

More from Ralph Ranalli at BeatthePress.org, whose post alerted me to this story. Also, another Times Co. property, the Telegram & Gazette of Worcester, started charging for online content last month.

Telegram.com takes the paid-content plunge

The Telegram & Gazette of Worcester began charging for online content today. It’s a move widely seen as a test run for the New York Times, which plans to start charging for Web access next year, and whose parent company also owns the T&G (as well as the Boston Globe).

The T&G model, explained in a memo from publisher Bruce Gaultney and editor Leah Lamson, is fairly complex, as the Times model reportedly will be. Here are the basics:

  • Print subscribers will have full access to Telegram.com for no additional charge.
  • Non-subscribers will be able to access up to 10 local stories per month without paying. But they will have to register.
  • Non-subscribers who wish to access more than 10 local stories will have to pay $14.95 per month or $1 for a day pass.
  • Some Web content will remain free, including breaking-news stories.

Will the plan succeed? It depends on your definition of success. It may bolster print circulation, or at least slow its decline. The tiered pricing system is clearly aimed at non-subscribers who make heavy use of the website. Anyone who’s thinking about dropping his print subscription will now have a good reason not to do so.

According to the Audit Bureau of Circulations, the T&G’s Monday-through-Friday circulation is about 70,000, and 81,000 buy the Sunday paper. Among other things, charging for Web access will allow management to count paying online readers in those numbers.

On the other hand, I doubt many people are going to fork over $14.95 a month to read Telegram.com without getting the paper. Even if the move bolsters the Telegram’s bottom line, the danger is that the website will wither. (According to Compete.com, the T&G’s website draws about 275,000 unique visitors each month. The T&G claims about 800,000. Measuring online traffic is notoriously difficult.)

I also don’t see how this amounts to a test run for the Times — the papers are too different. The T&G’s readership is almost entirely local, and I can’t imagine its website has ever been a major priority. The Times is a national paper whose website, NYTimes.com, with nearly 20 million unique vistors per month, is the most widely read newspaper.com in the country.

Yet the T&G may be better positioned to get away with this than the Times, which has any number of competitors for national and international news. There is little competition for news in Worcester and the surrounding area — although this does present an opportunity for an existing news organization to beef up its own free website.

Based on a sampling of the more than 300 comments to Gaultney and Lamson’s memo, it doesn’t seem that the T&G’s announcement has been well-received. Yet that’s a self-selecting group. I did like the comment from the reader who buys a copy on his way to work every morning and thus won’t get free Web access. Management needs to think about how to take care of good customers like him.

My prediction is that the move will be of limited benefit, but that it won’t look that way. Very few people will sign up for Web access, and print circulation will continue to decline — but the drop in print would be worse if the T&G hadn’t made this move.

Note: I spoke with WBUR Radio (90.9 FM) this morning about the T&G’s move. I’m not sure whether it made it on to the newscast, and it doesn’t seem to have been posted online yet.

Talk is cheap

In my latest for the Guardian, I take a look at the latest talk about how subscription apps and microtransactions will usher in a new era of paid content. And I conclude that it is just that: talk.

Roger Ebert, Esquire and the paid-versus-free debate

Here’s something I don’t think I would have said five, three or even one year ago: the editors at Esquire made a mistake when they posted Chris Jones’ and Ethan Hill’s wonderful profile of movie critic Roger Ebert on their Web site last week. Ebert, as you may know, is slowly dying of cancer* and is writing, literally, like there’s no tomorrow.

We are in the midst of an endless debate over free versus paid content. I generally come down on the side of free Web access. Most news is a commodity, and if you can’t get it from one place, you’ll get it from another.

But the flip side is that when you’ve got something that isn’t a mere commodity, you shouldn’t just give it away. Jones’ story about Ebert, and Hill’s photography, comprise anything but a commodity. This is exclusive, important, heart-breaking, inspirational journalism. And it’s something that Esquire should have used to drive sales of the magazine.

Increasingly I’m coming around to the idea that a newspaper or magazine’s Web site should be different from its print edition. The Web should be about blogs, community, interaction and extra features that aren’t available in print. The print edition should drive traffic to the Web site, and the Web site ought to drive sales of the print edition.

Esquire does offer some online extras with its Ebert story, but it could have offered more (a slide show, a video, a podcast of Jones and Hill talking about the piece) — and less (not the entire story, at least not for a few weeks).

As I look at the Ebert story online, I see just one non-house ad — a banner at the top of the page, currently selling Dockers pants. I’ve read the story, looked at the pictures and have no particular incentive now to buy the magazine. The idea, I think, should be print and online working together. What Esquire has given us is a Web-first approach with the hope that, someday, someone may figure out a business model. How 2005 is that?

*Further thoughts: A Media Nation reader has asked me to rethink my “dying of cancer” construction. I didn’t write it carelessly. The story is replete with references to the limited time Ebert has left (“Ebert is dying in increments, and he is aware of it”), and his health is precarious because of repeated bouts of cancer. Nevertheless, the story also makes it clear that Ebert is, at the moment, cancer-free. Perhaps Ebert will be with us for many years to come. I hope he is.

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