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Fox News Corp: Free Wall Street Journal Online
An article in USA Today indicated, amongst other things, that the Wall Street Journal is considering making it’s site a free site. From a quantitative standpoint, I would probably analyze it from the following context on a static one year time frame:
1. Current Expected Revenue = Annual Paid Subscriptions * Number of Subscribers * Number of Page Views * Avg Advertising CPM.
2. Expected Revenue = Annual Number of Unique Users * Annual Number of Unique Page Views * Avg Advertising CPM - Loss of revenue from existing digital subscriptions - Expected loss of physical advertising and subscription revenue from print subscribers that migrate from the print version * the ‘X’ Factor.
The ‘X’ factor is how much of a lift does the digital version get due to the fact that all news releases will draw additional attention, how much brand recognition grows, and how much additional natural traffic and page views occur due to readers being able to access more information in natural SERPs, news, and RSS feeds. In addition to that, they probably could derive some interesting market research products with regard to how the dissemination and reading of news on the Internet affects the markets.
Now I don’t subscribe to the digital version of the WSJ, but my understanding is that they have advertising and sponsorships of some sort. From experience, I can tell you it is a FACT that business rich content sites can generate materially higher CPM rates for standard IAB ad units by using contextual, personalization, and behavioral targeting.
If Rupert Murdoch is as savvy as I think he is, we will probably be seeing a free digital version of the WSJ.
What are your thoughts? What other factors do you think News Corp should consider?
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WSJ only has 250,000 or so digital subscriptions (they say 750K but that includes people who get it free with the home delivery) so isn’t the issue that they really can make more money with subscriptions, they just haven’t figured out how to get mass subscriptions. Let’s say they could have 3M subscribers at a slightly lower rate … would that work? Then they get ad revenue plus subscriptions.
The issue isn’t that the subscription model doesn’t work the issue is that WSJ hasn’t figured out how to make it work.
I remember in a class on online marketing I took long ago that the WSJ was regarded as a case study in success for starting out with a subscription model. It seems to have worked well for them over the years.
Beyond the complex business decision of what will make more money is Murdoch’s reported desire to supplant the New Yorks Times as the premier (is that the right word?) paper in the United States. This is part of the “X” factor equation.
I think there are half measures that can be taken as well. For example, the WSJ’s opinionjournal.com is free. The WSJ could also make any articles linked from a referrer like DrudgeReport and perhaps other newspapers free. This would give them a great many more pageviews while protecting the subscription segment.
Take note, Arthur, that the people who get the journal by subscription do NOT get the digital version free. (At least, I know I don’t.) So those 500K other digital subscriptions are paid, but at a lower rate. I’d also not that the straight digital is now being offered for $20 off the regular fee. A test?
Phineas –
FYI, you’re being ripped off, and you should call the Journal to complain.
Dow Jones is in fact giving away the wsj.con online subscription for free to print subscribers (or you can look at it from the vice versa way, that online subscribers get the print version of Wall Street Journal free delivered).
[link: http://www.getwallstreetjournal.com ]
The test is that they are giving away wsj.com as low as $9.99 for 30 days without committment too.