Monday, May 14, 2012

The Globe and Mail Will Soon Be Pay-Per-View

During my last year of university, I studied quite a bit of research about the declining newspaper industry, newspapers shutting down their print facilities, companies unsuccessfully trying to charge readers for their news articles. Today I learned that The Globe and Mail will soon follow suite with their online pay-per-view news articles.

Last week it was also reported that The Globe and Mail asked their employees to take unpaid leave while the company worded to move their newspaper online, a financial decision that the company hopes will help their bottom line. Could this mean financial trouble for the company, and large amounts of layoffs within the company? If they follow suite with many other newspaper companies who have shifted their focus online, there very well could be.

Phillip Crawley of The Globe and Mail said this week that their company has decided to charge a premium for high demand articles. “I think there is a broader general move towards charging for content,” says Crawley. “It doesn’t mean that everything is sealed off because it’s a metered paywell, it means that if you go beyond a certain number of stories you want to access you end up paying something for the privilege of doing that.”

“Clearly the traditional revenue model is changing. Over the last 10 years we’ve seen a lot more digital revenue from ad sales but we haven’t done a great deal on the subscription side, so this is an area that is still relatively untapped for us. At the same time, we’ve got to look at the existing costs of the business. As some of the traditional sources of revenue decline we need to look at where our resources are and make some shifts.”

Over the past year, The Globe and Mail has studied similar newspaper strategies as London’s Financial Times, The New York Times, and The Wall Street Journal. In my previous research, many studies with large groups of people showed negative results for newspapers offering a subscription fee for their news. Many consumers feel they can get their news elsewhere for free. The Globe and

Mail is still working out the details of their paywall model, and no further details are available at this time.

Crawley noted that the company hopes to operate with about 80 employees in their new paywall model, estimated to be about 10% of their current workforce. “We’re not talking about permanent layoffs,” he said.

What do you think of The Globe and Mails decision to move online? Would you pay a subscription fee for your news?

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