Articulo (Juan Vila Y Elliot)
Business and Management
Submitted By JUANVILA
The New York Times Paywall: Executive Summary
This report examines the rise of digital journalism and the willingness of online readers to follow this trend. The study provides an analysis and evaluation of the current and prospective profitability and financial stability of the newspaper industry and more specifically of “The New York Times.” Companies in this industry have been selling printed newspapers since the XVIII century. While newspapers continue to print and circulate news, the industry has changed as revenues in advertisement—the main source of revenue for the times—and news circulation have declined due to the digital era. Well-known newspapers are failing to monetize on the new opportunity to become the best digital newspapers. A clear example of why they are losing advertising revenues are companies like monsters.com who started to supply job offers online—removing the jobs portion away—and GM who made their own website to take automotive advertising away.
Analytical Problems: To keep pace with the digital trend and analyze the best ways to monetize online, the New York Times has developed a paywall, were subscribers pay a monthly fee for the opportunity to get access to all the information provided by the New York Times. Paid digital subscribers in the year 2011, after launching paywall, increased by 390% in less than a year. Also, online newspaper traffic from 2004 to 2009 increased by 75%. The New York Times is making the transition from physical to digital, however, the annual price of a subscription for the New York Times is more than 100% higher than the price of any of its competitors.
The report finds the possible streams of revenue for The New York times for its four different departments—since the regional media group business unit was sold for $143 million last year—and uses methods of analysis including trends in the market, horizontal...