Long Island-based daily Newsday is to start charging readers for online access starting later this month, the New York Times and others reported. The paper is owned by Cablevision, and subscribers to the pay television provider will get the site free, as will subscribers to the print edition of the paper.
Newsday.com is planning to charge $5 a week, or $260 a year, which is a steep price compared, for example, to the Wall Street Journal, which costs $149 a year for an online-only subscription. And as 75% of Long Island households already are print or Cablevision subscribers, according to Newsday, so the market at which this initiative is targeted is presumably not large. Publisher Terry Jimenez said in a letter to readers that Newsday.com has been undergoing a transformation to become a "more dynamic multimedia resource," and promised to "continue to add features designed to provide you a more useful, personalized experience that makes newsday.com an even greater resource for you to get the information you want and need at anytime."
Some content will remain free, said the letter, including the homepage, classified listings, weather, moves, stocks, obituaries, school closings and community programs. New features for paying customers include a customisable web page that each user can create, content specific newsletters and alerts, and a high definition video player.
The New York Times quoted Debby Krenek, Newsday's managing editor and senior vice president for digital media, who said that "we do expect that our overall traffic is going to decrease, because we'll have far fewer out-of-area visitors accessing the site, but what we're really focused on is our local audience. We're going to be much more locally focused." These local visitors are presumably likely to be significantly more engaged with the site and read more articles than out-of-area readers.
The fact that website will be available free to 75% of local residents combined with this assumption that overall traffic is going to drop, suggests that Newsday does not have high hopes that this move will actually bring in much extra revenue. So why bother? New York Times writer Richard Perez-Pena wrote that "in essence, that makes the site an exclusive service for people who are already the company's customers, and could give Cablevision a competitive advantage over other pay television providers, like Verizon and DirecTV." Silicon Angle contributor Jeff Nolan came to a similar conclusion: "what the online pricing plan is doing is not increasing revenue but defending revenue that is under assault by adding the online service as something extra subscribers get."