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New York Times paywall coming March 28

By Julianne Pepitone, staff reporter


NEW YORK (CNNMoney) -- The New York Times announced "digital subscriptions" on Thursday, revealing the long-awaited details of its paywall plan. Starting March 28, non-subscribers will be able to read only 20 online articles for free each month.

Home delivery subscribers can continue to access online and app content for free. Non-subscribers can choose from three packages: $15 every four weeks for Web access and smartphone content; $20 for Web plus access to the Times iPad app; and $35 for Web, tablet and smartphone access.

There's still some room for free, though: Readers who reach online Times articles through links from search engines, blogs and social media will be able to access those individual articles, even if they have reached the 20-article monthly limit.

But for some search engines, users will have a daily limit of free links. The New York Times' press release on its plan did not specify which search engines will be affected, but a Times article on the plan said there will be a five-link limit through Google (GOOG, Fortune 500).

The homepage at NYTimes.com and all section fronts will remain free to browse at all times. The "Top News" section will remain free on the Times' smartphone and tablet applications.

"Free links from social and search is a key point," said Sree Sreenivasan, the dean of students at Columbia Journalism School. "This will keep the visitor numbers from falling too much. And their core paying audience is not going to change."

The Times says its homepage receives 30 million unique readers per month. Figures from The Nielsen Company, however, said NYTimes.com had 15.5 million unique visitors in January. ComScore data said New York Times Digital, which includes properties like About.com, overall had 71.9 million unique visitors in January.

Sreenivasan said he considered the plan pricing to be fair, though the company should "make payments as easy as iTunes" to increase readers' willingness to fork over cash.

The Times' digital subscription plan is rolling out in Canada starting Thursday, "in order to fine-tune the customer experience" before the service rolls out to the rest of the world.

New York Times Co. (NYT) stock ended 0.3% higher at $8.89 a share, though it had risen as high as $9.35 earlier in the session following the announcement.

In a prepared statement, Times publisher and chairman Arthur Sulzberger, Jr., said the move "will result in another source of revenue, strengthening our ability to continue to invest in ... journalism and digital innovation."

The cost of free: Determining the paid vs. free balance has been difficult for media companies, and they've been making big bets on digital publications as print sales dwindle. Most employ a "freemium" model -- some content free, some paid -- in an effort to keep as many readers as possible.

News Corp. (NWS, Fortune 500) has been at the forefront of charging for content. While some of its The Wall Street Journal content can be accessed for free, a sizable portion is behind a paywall.

And last month, News Corp. unveiled an iPad-only publication called The Daily. CEO Rupert Murdoch committed around 100 staffers and an investment of $30 million to get it launched, and will spend $26 million a year to keep it running. The Daily costs 99 cents a week, or $40 for a yearly subscription -- though News Corp. has extended a free trial for several weeks.

The price point for digital content is a sticky decision for media companies, as the proliferation of blogs often means readers can get similar content for free elsewhere.

And going digital can be expensive. To take The Daily as an example: To break even on its operating costs from subscriber revenue alone, The Daily would have to sell more than 650,000 subscriptions -- and that's without accounting for the cut Apple (AAPL, Fortune 500) takes for selling The Daily through its App Store.

Apple unveiled a new subscriptions model last month, in which the company will take 30% of all sales generated through its platform -- and publishers cannot include links in their apps to let customers buy content outside of the app.

The Times said its apps will be in compliance with the Apple subscription model by June 30. To top of page

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