New York Times Nuts Not To Charge Subscription Fee (NYT)
On the News Corp conference call last night, Murdoch hammered home our point about why the New York Times (NYT) should charge an online subscription fee. — Murdoch noted that the Wall Street Journal, which charges a subscription fee …
Context & Ripple Effects
The New York Times dropped its paid online product, TimesSelect, back in 2007 when it ended charges on its web site to chase ad-driven scale. By early 2009, with print revenue collapsing and Murdoch pointing to the Wall Street Journal's paying subscribers as proof the model works, that bet was under attack — Silicon Alley Insider itself had already argued the Times should charge, and Murdoch used News Corp's earnings call to hammer the same point. The debate set up the paper's own mulling of an online subscription fee weeks later.
First-order effects
- Murdoch publicly frames the WSJ's subscription model as the template, putting direct pressure on NYT management to justify its free-access strategy to investors at a moment of acute print-ad decline.
- The argument shifts from whether readers will ever pay online to whether the Times is leaving real money on the table versus a rival (WSJ) that has proven willingness-to-pay.
Second-order effects
- If the Times moves toward charging, other ad-dependent papers gain cover to follow, since the industry's most prestigious free site abandoning free would reset the competitive baseline.
- News Corp benefits strategically either way: validating subscriptions raises the value of its own paid properties while weakening the free rivals competing for the same shrinking ad dollars.
Third-order effects
- The episode marks the industry's pivot from traffic-scale economics to reader-revenue economics — the same logic that eventually produced the Times' own pay wall, suggesting the free era of news was always contingent on ad growth that no longer existed.
- A durable split emerges between premium general-interest brands that can charge and commodity aggregators that cannot, forcing publishers to decide which side of that line they are on.
The trend: This is one data point in the broader post-2008 shift from advertising-funded free news to metered subscriptions as the core business model for quality publishers.