When it comes to paywalls around news websites, I sometimes wonder if we are becoming an international fraternity of cargo cultists. The voodoo economics which accompanies the release of digital sales figures for The Times and Sunday Times is developing into its own art. What could this 105,000 digital sales, ‘around half’ of which are subscribers actually MEAN?Well, you can read some pretty interesting analysis here, or here, or here or here (FT paywall warning), or indeed in hundreds of other places. And then just to make your cerebral cortex hum, add into it the 30,000 daily sales lost at The Times between June and September this year. We know from all of this accumulated analysis one thing for sure; that the numbers we are talking about in terms of paid digital subscriptions are tiny. The analysis also carries very little or no substantive information about the opportunity cost of investment in the paywall, the additional costs of marketing and supporting the live product, the actual margin that this investment represents. These 105,000 incidents of some digital payment activity are subdivided into anything from a pound paid for Caitlin Moran’s interview with Keith Richards (I know that is one transaction they have banked, for sure), to a Times fetishist who has iPad, Kindle, paper and web subscriptions .
But take two steps back, and just think about what we are discussing here. These are tiny numbers, and we are discussing them in relation to The Times, or The London Times as it is known on this side of the Atlantic. The Thunderer, the standard bearer for the British press, its best known export and most resonant brand. So what we must know on a macro level is that the influence game for The Times is up.
Even running a loss of £80 million a year, Times Newspapers is worth it for a business the size and scale of News International in the UK, if it is an effective tool of influence. That loss is less than 10 per cent of the profits of BSkyB, and in the past it has represented an investment in lobbying, public relations and marketing for Rupert Murdoch’s group. The moment the numbers mattered enough for News International to erect a paywall around its digital reach was, in many ways, the moment The Times officially lost its key purpose for the company. In previous battles with regulators, the amassed influence of the Wapping editors and their titles has proved crucial. Margaret Thatcher cleared the decks for the merger between Sky and BSB as both companies faced bankruptcy twenty years ago, largely because of the relationship Rupert Murdoch had built with her government and the perceived influence of its papers in delivering the electorate.
The Times is arguably no longer that key driver of influence. It is supplanted by the Financial Times and maybe even the Wall Street Journal (Murdoch’s new favourite influencer) within the UK. Internationally it has no voice, or none to speak of, post the paywall. Its pale editorial performance in under-reporting the recent phone hacking scandal involving former News International employees, has meant that it cannot even be used as an example of how independently minded Murdoch’s print titles are, and this too might prove a crucial failing.
News Corporation is setting out on its most important play of the decade as it seeks to take BSkyB under its own full control . The British government and the EU will have to approve the bid, which raises considerable concerns about the market share and influence News International will have in the domestic market. It could be that the accumulated courtship of power results in a wave through. But if News is deemed to have too great a share of the UK market for the bid to be allowed to go ahead, then what? Well, News Corp can either give up on the idea, or it can shed its less important assets.
The Times and Sunday Times would now have to fall into this category. What more significant gesture could the company make in its pursuit of the BSkyB deal? The Times is a financial headache for the company, and conceivably has outlived its editorial purpose as a lever of influence. Having made such a fuss about the power News has in the market, those who lobby against its reach could hardly protest that shedding The Times was not a significant move. In the long-term strategy of the world’s most intriguing media conglomerate, this newsprint product looks increasingly dispensable, and 100,000 digital customers make very little difference to this underlying truth. And of course, the ultimate irony, is that should The Times reach the auction block, there would be plenty of buyers.
Very interesting take on this whole situation. Id breath alot more easily if News Corp offloaded the Times in order to complete it’s BskyB sale.
I particularly enjoyed the irony that your google adsales had put an advert for the Times-online at the bottom of your blog.
The case for selling the Times rests with whether it is seen by Rupert Murdoch as just an influencing tool. I suspect that, rather, he sees it as a way to make money from a high-end audience.
There are two key factors that weigh against NewsInt disposing of the Times.
First, a readership (not circulation) approaching a million in a demographic highly desired by advertisers will be key to selling access to audiences across multiple platforms. While traditional newspaper groups talk about cross-platform ad sales, NewsInt and BSkyB would really be able to do it.
Second, the demographic of Times readers tells us that they will be early adopters of devices such as the iPad which make non-paper reading of content much easier than previously. I reckon that a big chunk (if not all) of that £80m loss could be recouped by shifting readers away from paper to digital formats. With BSkyB’s delivery capabilities (a subscriptions service and broadband) and it’s 10m customers (of whom around a third are broadband customers) it would be reasonably straightforward to add the Times to a lot of people’s monthly bills. Presto! – the Times is profitable.
[…] Einst galt das “Handelsblatt” als Hort der Zahlenfrickler. Dort saßen Menschen, die genau hinschauten. Das scheint jetzt nicht mehr der Fall zu sein. Denn allen Ernstes die “Times” als Vorbild für Pay-Erfolge heranzuziehen darf man als, nun ja, Minderheitmeinung ansehen. Tatsächlich löste die Veröffentlichung der Zahlen seit Beginn der Bezahlzeit unter angelsächsischen Medienjournalisten zwei Reaktionen aus. Die einen wüteten gegen die wachsweiche Intransparenz der Veröffentlichung. So bloggt Emily Bell (Ex-Guardian-Online-Chefin, jetzt Professorin in den USA): […]
So this has been Murdoch’s game all along: The Times is on the block as a possible divested interest to negate competition claims to push through the BSkyB deal. Meanwhile, he can use the Times to test paywall strategies for his other print brands.
You’ve gotta admit, love him or hate him, he plays a bloody good game. (Hate btw)
[…] from NY on News International’s recent data on how The Times is faring behind its paywall: W(h)ither the Times?. There’s been quite a lot of comment about the numbers released by News International, but […]
[…] W(h)ither the Times? « Emily Bell(wether)Emily has some(t)hing to say on the T(i)mes paywall other than just look at the num(bers): "But take two steps back, and just think about what we are discussing here. These are tiny numbers, and we are discussing them in relation to The Times, or The London Times as it is known on this side of the Atlantic. The Thunderer, the standard bearer for the British press, its best known export and most resonant brand. So what we must know on a macro level is that the influence game for The Times is up." (times newspapers paywalls news_international ) […]
[…] Emily Bell: on the waning influence of The Times Think about what we are discussing here. These are tiny numbers, and we are discussing them in relation to The Times, or The London Times as it is known on this side of the Atlantic. The Thunderer, the standard bearer for the British press, its best known export and most resonant brand. So what we must know on a macro level is that the influence game for The Times is up. […]
[…] W(h)ither the Times? […]
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[…] that it’s time to officially deem the plans a bust. Former Guardian editor Emily Bell had the most insightful take on the situation, explaining that it indicates that The Times has become a mere pawn in […]
http://virtualeconomics.typepad.com/virtualeconomics/2010/11/news-corps-paywall-is-about-news-corp-not-the-times.html
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