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Charles Warner

Charles Warner

Posted March 12, 2009 | 01:28 PM (EST)

NY Times Charges for Web Content


Once upon a time in the future, on January 1, 2010, The New York Times announced that it would charge $149 yearly for access to its online content. The company's CEO, Arthur Sulzberger, Jr., also announced that the venerable "newspaper of record" would cease printing the paper and "from now on it will be available only on the Internet."

"We did not make this decision lightly," Sulzberger said in a press conference, choking back tears, "because, I, like my close friend Rupert Murdoch, was born with ink in my veins. But we could no longer ignore the economic realities. We are bleeding money as well as ink, Carlos Slim won't lend us any more money, no one is dumb enough to do a sale-lease-back agreement on our printing presses, and Canada is running out of trees to cut down."

"For our loyal, aging readers who don't have computers or for those who just like the sensation of holding paper and getting their fingers dirty, we have a program we've developed jointly with HP to give them color printers so they can print out a specially formatted version of The Times." In a typically lame attempt at humor, Sulzberger added, "we've transferred the addiction to and cost of paper and ink to our readers, should they chose to accept it"

A task force led by Sulzberger and Martin Neisenholz, senior vice president, digital operations, considered whether or not to charge for online content, how much to charge, and whether or not to continue printing the paper The task force sought the advice of leading newspaper, journalism, academic, and Internet experts before making a decision. Among those consulted was blogger Jeff Jarvis, the author of What Would Google Do? Jarvis has pontificated for years that content on the Internet should be free and that when companies contemplate an Internet strategy, they should ask "What Would Google Do?"

Apparently, Sulzberger did just that and called Google's CEO, Eric Schmidt, who had gone on record in 2008 as indicating that it was important for The Times to survive. Sulzberger asked Schmidt that if Google owned The Times, what would it do. He asked this question after he asked Schmidt if Google would be interested in buying The Times and turning it into a non-profit organization.

Schmidt's answer to the first question was, "Are you kidding," and to the second question was, "Charge for your valuable content. Google would have gone out of business if we hadn't figured out how to charge for our valuable search results." Sulzberger was concerned that they would lose a lot of traffic and could therefore charge less for online advertising. However, Schmidt said that they would save enough by discontinuing the incredibly wasteful printing and distribution process to be able to survive.

Schmidt's most persuasive comment was, "Look, you have no choice. Your content is valuable and by charging for it you will lose casual, free-loading readers who don't really value your content. These readers are more than likely of less value to advertisers, so you can charge a higher rate for lower but more desirable ad impressions online. You will force people to make a choice between The Times and other publications that charge for subscriptions. Others will be hurt, not you."

Sulzberger said that The Times had a bad experience charging for content with Times Select, which charged readers to access The Times' columnists such as Maureen Dowd, Frank Rich, Paul Krugman, Gail Collins, David Brooks, Bob Herbert, Thomas Friedman, and Nicholas Kristof. Schmidt replied with uncharacteristic sarcasm, "Why are you surprised that few people were thrilled about paying to read Maureen Dowd? They might read her if it didn't cost anything, but weren't willing to pay for the privilege. That might be more of a comment on the quality of your columnists than on the willingness of people to pay for content. Lots of people who hate its editorial policy pay for the Wall Street Journal's online content because overall they find it valuable."

"It's time to realize that the newspaper business is not in the manufacturing business. The Times has been run like General Motors too long, allowing the unions too much power. Get out of the printing business. Get into the news business - online."

And so The New York Times stopped printing a paper, charged for its online content, and everyone expect those who liked dirty fingers lived happily ever after.