NYTimes.com Pay Scheme Has A Great Big Hole

Bill Grueskin is following The New York Times digital pay plans as the former managing editor of the subscription-based Wall Street Journal Online, where the huge (and mostly free) NTYimes.com was a constant nemesis. He is now academic dean at Columbia University’s Graduate School of Journalism. He got his first taste of paid content as the founding editor of The Dakota Sun, a 10-cent weekly paper on the Standing Rock Sioux Indian Reservation in North and South Dakota.

Some thoughts about the new digital pay scheme announced Thursday by the New York Times:

»  Expect a big number of early subscribers. This happened with TimesSelect, the two-year-and-out effort to get people to pay to read opinion columns. It launched in September 2005, and within less than two months the company had signed up around 120,000 newly paying subscribers.

That growth flattened quickly, though; by May 2006, it had only 170,000 subscribers (plus about 280,000 print subscribers who registered for free access to the service). The Times ended the project in September 2007 with 227,000 digital-only users, discerning that there was far more to gain from ad revenue than subscriptions. In other words, TimesSelect garnered more than half of its paying users in the first two months of its existence.

»  Some have called this a porous wall. Indeed it is — and it’s actually far more porous than most people realize. Yes, access is free for print subscribers, and for others, it costs from $15 every four weeks for just the website, to $35 for all digital platforms. The wall is supposed to kick in when a reader clicks on more than 20 stories a month (with some exceptions, detailed here).

But there’s a great big hole in that wall that the Times doesn’t mention in its FAQ or press release. According to sources close to the situation, the 20-story limit can be breached if you access the site from multiple devices, and/or if you delete your cookies. In other words, suppose you hit the wall on your PC. Then move to your laptop, where you’ll get another 20 stories. Delete your cookies on any computer, and the clock goes back to zero.

This is a lot less trouble than some of the schemes being touted on how to get around the new paywall at the Times or the one that’s been at the Wall Street Journal for 15 years. Indeed, many people routinely delete the cookies on their browser, or they have software that does it for them.

Keep in mind the Times isn’t locked into the current scheme. It could dial up or down the 20-story limit. And at some point it could fill in some holes in the wall — by tying usage to a visitor’s registration rather than device, for example.

»  Everyone is focused on the digital implications, but few note the real business proposition. If you’re a print subscriber, the value of that subscription just rose by more than $450 a year. That is, you now get full access to the Times on every digital device — your computer, phone and tablet — at no charge, while other shmoes are paying nearly $38 a month. Why would the Times not charge print subscribers something more for digital access, as the Journal has done for years? Perhaps it’s to bolster the value and loyalty of that audience, some of whom pay more than $700 a year for daily home delivery.

The Times has a huge digital footprint, according to *comScore*, of more than 31 million unique users. And the paper has fewer than 850,000 print subscribers. Yet, digital advertising contributes only about one-fourth of the company’s ad totals, and (until now) there has been little or no circulation revenue from any of its online properties. But with this plan in place, and the NYTCo’s Boston Globe about to start charging for digital access later this year, we’ll soon find out.

»  All those who say the paywall won’t work, or that it will, don’t know. They’re making it up. Some of these are the same people who moaned a few years ago about how WSJ.com was cutting itself off from the Internet. And so far, we haven’t seen any signs that WSJ‘s current owner is less enamored of pay walls than its former one.

Finally, Thursday’s announcement provides a news peg for those with a grievance against the Times to complain about its news coverage. It seems untoward, especially at a time when four Times journalists are missing in Libya, and other are putting their health at risk to cover the disaster in Japan. A particularly execrable example appeared from Cory Doctorow on Boing Boing. He starts with a string of suppositions about the wall, and then in the middle he opines, “I’m all for finding a business-model for investigative journalism — and yes, I know how silly it is to talk about journalistic skepticism in the same breath as the NYT, who can’t even bring themselves to call torture ‘torture’.”

Doctorow, who then goes on to grudgingly acknowledge that the Times “covers itself with both glory and shame,” has a bio (on www.craphound.com) in which he notes his career as a “science fiction author, activist and blogger.” He does not say he has gone missing while covering a war or exposed himself to radiation in the wake of a tsunami, but yet there is bravery on his page. His latest novel is, he says, “an audacious experiment in print-on-demand publishing.”

This photo, taken last week as two of the Times‘ journalists were running from Libyan bombs, sums it up. Or as my 10th-grade geometry teacher used to say, QED — quod erat demonstradum.