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August 07, 2009

Could Subscriptions Save the Online Publishing Industry?

Tien Tzuoby Tien Tzuo


There's some irony to the fact that the publishers of the Wall Street Journal made waves this week by announcing they will soon charge for all content. On a conference call held after the company’s earnings announcement, News Corp Chairman Rupert Murdoch said that he plans to roll out paid content on all of their news websites as early as this financial year. Aren't newspapers one of the originators of the paid subscription model?


Earlier this year, we blogged about how subscription revenue models are taking center stage, and noted that Murdoch hinted at a move towards paid content saying "the challenge for media organizations was finding a balance between advertising and subscription revenues and figuring out how to charge for content without alienating existing users -- which could lead to Web sites offering tiered levels of free and paid-for material."


Staci Kramer, co-editor of PaidContent.org, really hit the nail on the head. Interviewed on Marketplace yesterday, she said:


"There's a lot of different ways that people are trying to do this. You know, what I think what we're going to enter here is a very big experimental phase with News Corp, and how they will handle this. And if you look at, whatever they do at the beginning shouldn't be viewed as something that even they expect to be in place a year from now."

News Corp is not alone - the online publishing industry as a whole is starting to come full circle on the topic of paid content. Wired Magazine is talking about "raising the price or straying from the traditional magazine business model with ideas like tiered pricing with different benefits."


Zuora customer GigaOM Network understands the power of subscriptions and recently launched a premium content service for its annual subscribers.


We’re watching this space with great interest. Subscription business models are - at the very least - part of the answer to helping struggling online publishers. But, does anyone believe that free news sites will cease to exist? The paid content providers will have to find a way to differentiate themselves in order to justify the premium.



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