As a dude with an MA in Journalism and close to 20 years experience in advertising, I got a lot of thoughts here. The first is are they crazy! Not that many years ago they put their op-ed pages (called TimesSelect) behind a subscription firewall, and later had to reverse course and make access free.
Now they are thinking about not only putting their op-eds behind a subscription firewall, but almost all of their content, much like the Wall Street Journal or the Financial Times. I assume they think this is logical, makes good business sense, but below the fold I will outline why this is so mistaken.
Before I start to rip apart the business concept of the New York Times, let me stress I understand "good" content isn't cheap to produce. It costs a lot of money to hire the "best" writers and editors. Even more to have a foreign bureau in major nations/regions of the world (which they are closing at an alarming rate).
I get that, and they are at their core a business and they have shareholders. Losing money isn't really an option. Maybe short term, but of course not long term. But they just don't get it.
The NYT Isn't A Core Business Publication
First and foremost they look to the success of the Wall Street Journal and the Financial Times and their pay-for-access-model, which is their first logical flaw. Those are core business publications. I am willing to bet the vast majority of their paid subscribers pay for their subscriptions via their company. Not out of their "personal" funds.
When I worked at my last ad agency we got more than 300 trade pubs and multiple newspapers each day (including the Wall Street Journal, Financial Times, Barrons, et al). We also got the New York Times and the Washington Post (among others), but that was cause we were based in DC. Otherwise those two publications, if I was say based in Atlanta would have been almost meaningless. In fact the admin people would pull sections like "Style" and "Sports." We were being paid to read about our clients and the industries they operate in, not if the Redskins won or what dress this women wore to the Oscars.
When you are not a "core" business publication and only really serve one market/region, it is tough for me to pass off the expense of your subscription to my boss and that is a huge market share.
Page Views, Page Views, Page Views
To keep it stupid simple online advertising is sold two ways. First page views or impressions. Lets say my client is selling cookware. I want to advertise in the Food section of the New York Times. I buy a million page views and that means my ad is "served" up on a million pages.
BTW: This is why on many sites you click through to an article and read a few paragraphs and then have to click next page, read a few more, then click next page again. They got three page views in one article.
This is how the NYT and most sites sell advertising. Sheer numbers. So when there are a lot of posts here and elsewhere linked to a NYT article, Google News picks the story, well that is good for the NYT cause they have more page views. More page views, more ad dollars.
Of course I don't have access to internal NYT site stats, but it is safe to say if they offer up a subscription model, their page views are going to drop through the floor. They stand to lose tens and ten of millions. Which leads us to the next point.
PPC Is The Reality Now & The Future Of Online Advertising
This is the second online ad revenue model called PPC, or pay-per-click. This model has been around for a long time, but Google is the master at it. It means your ad is displayed on a site, but the media outlet only gets paid when somebody clicks on it. For example, do a search for "Music" on Google. The results to the right, "Sponsored Links," are PPC ads. It is free to place those ads, you only pay Google if somebody clicks on them. You bid in an "auction" like format for the highest position, hoping for a higher click-through rate (again, the only time Google gets paid).
This is the current model that is working. About 85% of Google revenues are from PPC ads (their AdWord and AdSense services). Tens of billions, cause as an advertiser I want to get the person from the NYT to my site.
But here is the problem. Sure it is nice for the NYT to be able to claim, "hey everybody pays to view our content, their incomes are higher, more education," you name it. Demographics that are "sexy" to an advertiser.
But that falls on its face when they have a much smaller audience. If I am an advertiser I run a commercial on NBC during prime time, even thought I have a lot of waste, cause the sheer size of the audience is huge. I will pay a "premium" price for that audience.
I won't do the same to reach a small number of subscribers to the NYT when I might only be bidding against one or two other companies, cause their audience has moved from a "mass" audience to a more business specific audience. If the market is PeopleSoft, Oracle, and SAP are they really going to bid each other up for an PPC ad? Nope.
It just makes no sense, none.
Content Wants To Be Free
If I wanted I could download any movie I wanted for free. Get any program I wanted. Any video game. It would take no money using free software. And that is something like Windows 7 or Sherlock Holmes. The ability for anybody to subscribe and then just cut and paste the content, well that takes an IQ of like a five year old.
It happened when they put their op-eds behind the TimesSelect firewall. It will happen here.
Conclusion
When I lived in DC for 15+ years I got into the habit of reading the Washington Post and the NYT daily. There was no joy more then both newspapers in hand, Sunday morning, pot of coffee, and hours of reading.
I paid to get those print editions, then eventually reading them for free online (I do miss the newsprint stained hands BTW). As blogs came about and the Times put their op-eds behind a firewall I found myself moving away from having their pages anywhere near my start-up tabs. Now I almost never visit their sites, unless linked from something else.
I am a "brand" loyal guy, but they changed their business model which in turn changed my behavior, and changing a behavior back is not an easy thing. I can just read the "Your Abbreviated Pundit Round-up" here daily and get most of what I need.
The Times, which is called the "Newspaper of Record" is about to make them a small niche publication.