New York Times Paywall; The Future

New York Times is proof that being a lion for past generations doesn’t equate to being the King of the Jungle in a new generation. The struggles of the NYT are certainly not their own as the newspaper industry has hit hard times in the wired culture. As the article points out, there is very little that has occurred the last half century, from a journalist perspective, that can’t be traced back to the New York Times and its staff of accomplished writers and reporters. But how is it that a company with so much cachet and such a large customer base was not able to launch a successful and profitable campaign online?
Even though the NYT posted $2.4B in revenue in 2011, it had been teetering on breakeven Net Income/Loss. In some respects, at the time of the article, the NYT new online “paywall” subscription program was a success – the recently installed paywall had steadily increased the subscription base since inception, getting 390,000 paid subscribers in a 10 month period. Over the course of the last year and a half they had maintained anywhere from 30M to 35M unique visitors in web traffic. However, there was an introductory price of $.99 for four weeks of access for new subscribers, so there were concerns of those subscribers not renewing. To compound those concerns, in that same time period, the total page views dropped from 700M+ to 600M+.
It’s interesting to note that the NYT net income numbers have been stagnant since 2008, with the costs slightly less in 2011 than 2008 as a percentage of revenue (47% vs 48%). In addition, operating costs have decreased 25%, with revenues decreasing 21%. These figures are important in that the company was able to maintain revenue against cost during a change in the market conditions. Advertising/classified money was moving away from print to other Medias and overall advertising