How Much Revenue Can The New York Times Paywall Generate?

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So how much money will the New York Times generate with its new digital subscriptions? The company has said that about 15 percent of monthly visitors to its website are heavy users who access more than 20 pages a month — and therefore will soon be prompted to pay up. Some of those heavy users are already print subscribers who will be able to continue to access the site for free, but how many of the others the NYT is able to get to subscribe will determine just how much new revenue the company will be able to bring in. If you use TimesSelect, the paper’s last paywall initiative, as a basis for projecting revenue, the Times is looking at some very significant potential sales from its new plan.

*ComScore* says that in February, NYTimes.com attracted 31 million unique visitors in the U.S., where presumably the vast majority of these new digital subscribers will come from. Of those, the Times says about 15 percent are heavy users, which comes to 4.65 million people. The print edition has about one million paid subscribers (Circulation on Sunday, its largest day, is 1.35 million, of which 74 percent comes from subscriptions, according to the fall Audit Bureau of Circulation figures). If we assume that more than half of those are also heavy online readers, that leaves at least 4 million users the newspaper could potentially tap to sign up for online subscriptions.

We believe at least 500,000 people (or more than 10 percent of those heavy users) may be willing to pay up — and here’s how we get to that number. TimesSelect, the 2007 initiative that charged online-only readers $7.95 a month to access NYTimes‘ columnists and some original content attracted 227,000 paid subscribers, or about 1.17 percent of the 13 million people who were reading NYTimes.com at the time.

If that same percentage agrees to pay for the new digital subscriptions, that would amount to about 527,000 subscribers in the U.S. alone. The minimum price of $15 for NYTimes.com plus smartphone access would generate about $100 million in additional annual revenue for the newspaper. A blend of subscriptions would push sales higher. And, the number of subscribers could be significantly greater, as well, considering that a higher percentage of people might be willing to pay for all of the Times‘ digital content than for just a piece of it — even though the price is higher too.

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