NYTPaywall 15PGPIM45 Shankar Ananth

Write-­‐Up  on  New  York  Times  Paywall    The  paywall,  as  installed  by  the  New  York  Times,  is  serving  its  purpose  of  substantiating  the  online  revenue  stream  that  was  earlier  completely  dependent  on  advertising  revenue.  So,  in  other  words,  this  was  an  essential  step.  Now  from  Exhibit  3,  we  can  gather  that  in  2008,  advertising  contributed  60%  of  the  total  revenue  whereas  in  2011,  the  percentage  reduced  to  52%.  In  the  same  interval,  we  observe  that  the  circulation  is  the  only  component  that  has  increased.  Since  it  is  undeniable  that  news  has  shifted  to  the  online  space,  the  product  strategy  and  channel  interface  should  encompass  the  following  modifications:    

1. Try  to  bring  more  people  online,  increase  number  of  unique  visitors  2. Incentivize  the  user  to  subscribe  by  diversifying  subscription  options,  such  as  

section-­‐wise  subscriptions  and  writer-­‐wise  subscriptions  (De-­‐Bundle)  3. Introduce  customizable  interfaces  on  mobile  apps,  tablet  apps  as  well  as  on  

the  desktop    

The  pricing  can  accordingly  reduce  to  smaller  units  than  the  existential  rates.  The  section-­‐wise  or  the  writer-­‐wise  subscriptions  would  reduce  subscription  rates  and  due  to  lower  threshold,  increase  subscriptions.  This  would  reduce  the  cost  from  the  humongous  $455.  Additionally,  it  will  help  the  advertiser  improve  targeted  marketing,  for  which  a  premium  can  be  charged.    I  believe  the  digital  and  print  price  should  be  segregated  and  the  pricing  should  be  such  that  users  are  encouraged  to  move  online,  rather  than  the  expensive  and  declining  print  medium.    Short-­‐term  plan  would  be  to  stem  to  the  reader  loss  by  making  the  transition  to  the  digital  platform  as  smooth  as  possible.  The  long-­‐term  plan  would  be  to  increase  the  reader  base  and  provide  greater  value,  while  at  the  same  time  maximizing  profit.    The  digital  transition  has  resulted  in  a  faster  than  anticipated  territory  shift  for  NYT.  While  this  has  lead  to  some  obvious  challenges  as  mentioned  in  the  case,  this  also  presents  newer  opportunities  to  innovate  with  revenue  generation,  as  discussed  above.    In  terms  of  journalistic  integrity,  paywall  acts  as  a  denial  of  information.  But  from  the  vantage  point  of  running  a  business,  the  paywall  acts  as  one  of  the  efficient  ways  to  monetize  the  readers  in  general.  Thus,  in  light  of  shift  to  the  online  platforms,  yes  paywall  is  good.      By,  Shankar  Ananth  15PGPIM45