ITZ and Belden launch paid-content analysis
The Financial Times has emerged as one of the most successful newspapers to navigate the transition from a traditional, ad-supported business model to a model incorporating paid content and other diverse revenue streams.
"FT.com does not limit access to any particular piece of content, nor does it identify some as free and others as requiring payment. Rather than charging for content, the FT charges based on frequency of use. If you are an infrequent visitor to the site, you may never realize the site is not completely free," ITZBelden reported earlier this week in its new report, "2010 Paid Access Models: Practices and Profiles."
In the past two years, economic turmoil, eroding print circulation and a variety of other factors have prompted newspaper publishers across the industry to look at paid content, including charging for reading newspaper content online.
ITZBelden released the report, which focused primarily on paid online content and replica e-editions, earlier this week. The report was in partnership the American Press Institute, with information and support from Mather Economics and NewMediaHub.com.
ITZBelden estimates that of approximately 1,600 U.S. and Canadian daily newspapers, 60 percent have some paid access to their Web site (including e-edition replicas). The estimate is based on an ITZBelden/API Executive Survey from September 2009.
Some of these newspapers are having more success charging for online content than others. The report looks at more than a dozen newspapers, including Newsday, the Lima (Ohio) News, and The Spokesman-Review in Spokane, Wash. It also analyzes multiple models, including paid online subscriptions and membership programs.
Of course, the model that works for one newspaper won't work for another. The demographics of each market and the audience for each publication's Web site will factor into these decisions. As the Financial Times has figured out, different audiences (fly-by readers versus heavy online users, for example) present different challenges and opportunities.
"It is unlikely that charging for access to news will be a solution for all markets. But charging for news is only one dimension of paid access. Charging for premium content, using paid content as a driver of new product development, partnering with deep niche content suppliers to develop new content channels, charging for services or database access are all emerging as potentially important revenue streams," according to the report.
Among ITZBelden's suggestions:
- Set pricing high to begin and work down, not the other way around.
- Implement approaches based on local market conditions. One-size-fits-all pricing and offerings do not exist.
- Provide for easy, "low-friction" transactions for low-frequency use - story, session, day and week-long access.
- Involve the marketing team in addressing objections to paid access.
Sources for the report included proprietary Belden Interactive local market studies, an executive survey produced by ITZBelden (in partnership with API) last year, executive interviews by ITZBelden and NewMediaHub.com's Alisa Cromer, data analysis by Mather Economics and and client-submitted information.
Clients who purchase the report ($500) will receive both a PowerPoint and narrative including case studies and analysis on payment structures, bundling practices, newspaper reach, paid content competition and more. To purchase the report, download this order form or contact Greg Harmon at harmon@beldeninteractive.com.
For more on paid content, see NAA's reports at www.naa.org/paidcontent.ontact Greg Harmon at itzharmon@gmail, 415.566.4348.
