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NYTIMES.COM FEE DECISION COMING SOON.

It seems more and more likely that the New York Times will move forward with a plan to start charging some sort of access or membership fee for its web site, NYTimes.com. It was just but a mere two years ago that the site did away with its TimesSelect system, which held opinion columnists behind a pay wall.

"The reason we discontinued TimesSelect is that we came to the conclusion that search engine optimization had changed and it would give us the ability to generate more advertising revenue if we did not charge for content," Scott Heekin-Canedy, president and general manager of The New York Times Group -- which includes not only the iconic newspaper and its web site, but also its sibling, the International Herald Tribune of Paris -- told a reporter from The Telegraph of London in a story printed on Saturday.

"The climate seems to have changed," Heekin-Canedy told The Telegraph. "There seems to be more of a willingness to pay. We charged roughly $50 a year for TimesSelect and we had about 200,000 paying subscribers."

Heekin-Canedy said the paper is considering two models: a "metered model," where users have free access for a limited number of page views and must pay beyond that and a "membership model," where all users continue to have free access but "members" get special services and privileges that non-members do not.

The Timesman said the paper expects to make its decision in August -- "by the end of the summer." The implementation would follow only when the web site had the technology to support the decision.

On Friday, the Poynter Institute of St. Petersburg, Fla., reported that the paper had sent subscribers to its print edition a link to an on-line survey regarding web-site charges.

"When answering the following questions, please think about whether you would be willing to pay for continued unlimited access to NYTimes.com," Poynter.org reported the survey said. "How likely would you be to pay a $2.50 monthly fee -- which would be a 50 percent discount for home delivery subscribers -- for continued, unlimited access to NYTimes.com?"

Poynter.org also spoke with Catherine Mathis, vice president of communications at The Times Co., who confirmed the survey but who said that no decisions about a pricing model have been made.

"The one thing I advise people on this is that we've got a very large [on-line] revenue stream," Poynter quoted Mathis as saying. "We looked at 30 different companies -- Weight Watchers, ESPN, Consumer Reports -- to see how much money is being generated from web sites. What we saw is that we're doing a pretty good job monetizing content with advertising."

In other Times Co. news, the company said on Wednesday that it had postponed its deadline for accepting initial bids to purchase its New England operations, which include the Boston Globe, the Worcester Telegram & Gazette and their web sites. The company retained Goldman Sachs in the late spring to organize the sale and at that time a July 8 initial bid deadline was set.

The Times and the Globe both reported that potential bidders had asked for more time to develop bids for the paper. Additionally, two bidding groups -- one led by Stephen Pagliuca of Bain Capital Partners and the other led by former ad agency chief Jack Connors -- had asked for and received permission to merge their efforts late last month.

Lastly in Times Co. news, in light of the bidding postponement, a credit analyst advised clients last week to sell Times Co. bonds that mature in 2015.

"Declining revenue and margins, weak cash flow, and escalating leverage lead us to a sell recommendation on the 2015 issue at a price of 70," wrote David Novosel of GimmeCredit, in a research note.

The trick is going to be how to keep those page views -- which drive ad income -- up while getting any sort of access fee. Either of the models discussed by Heekin-Canedy would keep the page views thriving while bringing in secondary income. Unfortunately, though, what works for NYTimes.com probably won't work for the rest of the newspaper business.
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Title Annotation:New York Times Co.
Publication:NewsInc
Date:Jul 13, 2009
Words:685
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