Most print publications have recognized for some time that the handwriting is on the wall and the old business model for newspapers in particular where 80% of the cost of producing a newspaper was covered by advertising and 20% by subscriptions is no longer viable. To a large extent magazine publishers have the same problem.
Now publications realize that in order to survive they must find a way to become less dependent on advertising and somehow charge readers more. They must also deal with the demand for more information online than print publications have traditionally delivered. And the online information needs to be constantly updated rather than once a day or once a week. On top of all this, publications must find a way to deal with the widely held customer expectation that online information should be free.
Around the world, publisher have already tested many strategies and so far nothing has been found totally satisfactory. The A.H. Belo company, publisher of the
Dallas Morning News, has been among the pioneers in trying to find a new model that combines digital and print. Recently they launched another version of their print and digital offering which is being watched closely by many publications around the world. The company’s goal is to eventually reach a 50/50 split between advertising and reader revenue contributions.
Until recently the company give away a most of its content on its web site (
www.dallasnews.com). The new version branded “Subscriber Content” allows readers to still see the local headlines, blogs, classified ads and non-proprietary information such as AP stories online for free. But, if the reader wants to see all that proprietary news and information developed by the newspaper’s news, sports and other journalists, and they don’t have a print subscription, they must pay for that information.
Previously, a seven-day-a-week print subscription to
The Morning News costs $34.62 a month and the eEdition was thrown in for free. Now, print subscribers have full access to all digital and mobile platforms – whatever the newspaper publishes on whatever platforms -- for $33.95 a month. If the customer doesn’t want print, but just the eEdition “Subscriber Content” plus the iPad and iPhone apps the cost is $16.95 a month. Thus, those who think paper is passé can save half of the print subscription cost and just subscribe to the digital services.
Since the introduction of the iPad there has been a new willingness to pay for digital information, and before the end of 2011 there is expected to be over 50 million digital tablets in circulation worldwide. But a number of questions remain.
1 - Will the publication be able to supply updates frequently enough, and enough other features that can’t be found on the print product, to attract users?
2 – How will readership balance out between those who get the paper and those who go full digital?
3 – How much do readers really care about the enterprise content written by the newspaper’s journalists or will many be satisfied with headlines and wire service stories they can still get for free?
4 – Will some readers hang onto the print subscriptions just to receive the weekly advertising supplements?
5 – Will overall circulation finally begin to increase?
6 – If print circulation declines how much will ad rates have to be cut?
This is definitely an experiment worth watching.
John McKeon, the newspaper’s president and general manger said, “We are confident that we are opening a new avenue for growth by providing unique, relevant local content on the platforms readers want, and creating highly targeted opportunities for advertisers to reach consumers.”
The Daily
Another digital strategy that doesn’t include a print option is also worth following closely. Rupert Murdoch’s News Corporation’s launched The Daily in early February. This publication is delivered exclusively on the iPad. Subscriptions costs $0.99 per week or $39.00.