I think you hit the nail on the head about what constitutes content that people are willing to pay for. If something is merely entertaining or interesting in a trivia building sense, free is probably the way to go online. If it’s something that actually makes you smarter, healthier, or wealthier, you can probably charge for it.

That being said, the traffic spikes are nice, but it rarely translates into stickiness. I hope to compile some data and have some results, but as with any online study, there is a high probability of not having any statistically significant conclusion.

“The whole idea that blog links can blow up traffic is nice, but it doesn’t really translate in the real world.” Hm, what do you mean by that? I’ll follow your attitude and remain anonymous, but I’ve seen on smaller “real world” news sites that blogging can cause 10-25% in traffic at different points. I’m not sure how that scales to an already huge organization like NYT, though to be honest, I think it might increase rather than decrease. That’s just a guess, but it’s based on the fact that the NYT isn’t some tech echo chamber. There are a lot of blogs out there on a lot of topics, and the NYT produces great content a lot of them want to talk about and are more likely to now.

“That being said, WSJ has done very well being a paid service online.” I agree, and I think they could have remained one. But then they wouldn’t be the New York Times, they would morph into a different sort of new company, more like the WSJ or The Economist. Both of those are fine media organizations, and successful models. But the NYT wants to be the paper of note, isn’t their (unofficial) slogan something like “a first draft of history, as it happens.” To do that, they need to hit the biggest (educated) audience possible, not a select paying elite. And the best way to monetize a huge audience right now is advertising.

Also, I think the thing with pay content is, it has to help you make money. The 37 Signals products aren’t paid for by people because they like to be in the know, it’s because they’re productivity tools that have a ROI. Same with the WSJ. It has distinct financial implications. NYT does for some users, but for others its more intangible, and thus you’re less likely to want to pay for it.

All of which is to say, for many other products, I would agree with you. I hate the idea of “just slap some ads on it, and you have a business model.” Especially when the ad revenue is based on a CPA. I just think the NYT is a special case in the opposite direction. Cheers!

I think you make some valid points. That being said, WSJ has done very well being a paid service online. The real question is “What value does the information you have provide?”

I think with people like Thomas Friedman, there are enough hardcore readers who will pay to read his stories.

The whole idea that blog links can blow up traffic is nice, but it doesn’t really translate in the real world. That being said, we’ll be installing an analytics package on TechDumpster to get a better read on reader stickiness.

First, you ask “Can the NYT really generate 3 MM new visitors per month to its site with this move?”. Though they might not hit that exactly, I think they’ll get close. The times really has a lot of gravity in the media world, and the locked door of TimesSelect negated a portion of that.

More importantly though, I think this is part of the larger strategy towards moving away from print. Right now, when you buy the print product of the NYT, what you pay doesn’t even pay for the paper it’s printed on. The entire paper is supported by advertising. The circulation is constantly decreasing. Despite the fact that you pay for the Times, their business model is built on print advertising, and that revenue source will continue to decrease.

They essentially have a castle built on a swamp. In the short term, it is very expensive to move the castle, but in the long term, waiting until it sinks is going to cost more. I think the Times Select wall coming down is them starting to move the castle. In the short term, would it be cheaper to stay put? Fuck yes! But it would be worse for them in the long term.

That move is rare in current media business in that they are hurting an existing revenue stream to invest in a future one. It’s painful to do, but the lack of balls to do it is what is killing other major media companies right now.

You could pose an argument that the NYT should exist purely as a pay paper online. If anyone could pull it off - in general world news, not financial news - it might be the NYT. They’re going to lose stature no matter what, but I would guess that they’d lose more stature and revenue by following that sort of path. Cheers.