The New York Times began charging online readers Monday for full access to its website and offered a heavily discounted introductory offer intended to lure its first digital subscribers. The Times is offering its three digital subscription plans for the same price of 99 cents for the first four weeks. After that, unlimited access to NYTimes.com and the newspaper’s smartphone application will cost $15 for four weeks while full access to the website and a tablet computer application will cost $20 for four weeks. Full access to NYTimes.com and both smartphone and tablet applications will be $35 for four weeks. The Times believes that those who view 20 articles online during a four week period is the current market for this service. The Times began testing its digital subscriptions in Canada on March 17 and extended the system to the rest of the world on March 28.
1.Â How do you think they came up with this number, 20 times in 4 weeks?Â Would this subscription appeal to you?Â Why or why not?
2.Â What is it that the company wants to avoid in electing this new business model? In other words, what are the costs and benefits of this model?
3.Â How do you think the companies expenses and profit margin will differ between the print and online product? Can you think of other accounting elements that are different between the print revenue model and the online revenue model?
CNN (2011). New York Times to start charging online, March 28 (Retrievable online at Â http://www.cnn.com/video)
Lefkow, C. (2011). New York Times Begins Charging Online Readers, Yahoo! News, March 29 (Retrievable online at http://news.yahoo.com/s/afp/20110329/tc_afp/usitmediaindustrynewspapersinternetnytimes)