Almost every major paper in the United States is chasing the paywall success of The New York Times Co. (NYSE: NYT) and News Corp’s (NYSE: NWS) The Wall Street Journal. Both have hundreds of thousands of paid subscribers and get hefty sums for subscriptions. Other large dailies, for the most part, charge less. Here is a look at some of those.
A recent offer from the Washington Post: $19, or 80%, off the one year price (the offer has been extended from some time in the past). The National Edition and DC addition cost $29 a year (also 80% off). For people who live in New York City, the print edition is not available.
The packages show how newspapers attack both print and online markets. Once a digital edition of the paper exists, adding subscribers to the Washington Post online costs the company very little, which makes each one immensely profitable. It is not worth the cost to offer the print paper as far away as New York City. Print advertising has been decimated, so the Washington Post has to weigh how far from the city it is willing to have distribution. Most readers would not pay a huge premium needed to get the paper as far away as New York City.
The Boston Globe charges much less in its recent promotion, but for a much shorter period. Access to Globe.com for 12 weeks is $5. The newspaper gets the chance to renew the reader more quickly than the Washington Post does, which makes many of the customers very valuable over the course of a year. The Globe presents the offer as 90% off. Once again, this supports the premise that once an online edition exists, a newspaper makes money on every new customer.
The Chicago Tribune, owned by Tronc Inc. (NASDAQ: TRNC), offers four weeks for $0.99. Once again, it has a chance to renew and “upsell” subscribers to a more expensive package quickly. (The next tier is $1.99 a week, billed every four weeks.) The margin math for the online edition is likely the same as for the other companies
With digital editions, additional subscribers are a margin blessing.
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