In the future, premium content will be shielded behind a pay wall. Readers will have to pay for the privilege of accessing content in The Report on Business and The Globe and Mail.
Digital subscriptions have become the new reality as the traditional business models for generating revenue have experienced incredible changes, particularly over the past five years. The analog versions of magazines and newspapers are no longer producing the returns needed to keep stockholders happy.
Many of these media organizations began offering some free-online content to generate on-line readership stats that were used to sell on-line advertising. This created a much needed revenue base but revenue from traditional sources has plunged.
The Globe and Mail is requesting that employees take unpaid temporary leave over the slow summer months, to assist the bottom line. They are hoping that at least 10% of the workforce will avail to avoid temporary lay-offs.
Pricing structures, for future content is yet to be worked out. London's Financial Times has been corralling readers towards less free content. Lowering expectations as customers are prepared for the pay wall. Access to the papers internet offerings have gone from lots of free content to 30 free articles per month in 2007 to the current maximum of 8 articles. They have also made registration mandatory in order to access a single story.
I have had mixed views about digital newspaper and magazine subscriptions. I certainly have no qualms at all about paying for premium content. Bills have to be paid and shareholders require return on their investments. What bugs me is that my digital copy of The Telegram (which I really like) costs just as much as having it delivered to my door. Sure, the costs of staff remain the same, but I believe that the cost savings associated with not having to print and distribute my paper warrants a reduced price.
The plethora of national and international news aggregators has changed peoples reading habits At P&P, I comment on articles and direct readers to unique content. Most of the time, I offer an opinion on something that I have read or heard. I see no reason that readers should not have to pay for access to unique news at the source. That source has to pay staff, produce websites and has generated value.
Too much free content has certainly cut into the value of brands. If you give it away, people are going to expect to receive it for free and experience sticker shock when you introduce the pay wall. There are also lots of competitors out there like the Huffington Post that started as a digital provider. They have never been incumbered by the costs of printing, distribution and traditional staffing models. Another issue, in attempting to increase hits to websites to increase the value of banner ads, traditional ads have become less attractive. Combined, traditional media companies have either not responded in a strategic way to the accelerated change by embracing new opportunities.
There is no magic formula for price structures. What is a fair price? Perhaps, publishers should hike the their newsstand prices and reward digital subscribers. A 25% discount for digital editions seems reasonable enough. This is the model that the The New York Times and the Financial Times have adopted.
The Globe and Mail have yet to release what it's new pay wall price structures will be.