Rupert Murdoch's Paper-Centric Digital Strategy
News Corp. (NWS), Murdoch's global media conglomerate, this week revealed two key elements of its strategy to get consumers to begin paying for digital news content. The first is the price for an iPad subscription to The Wall Street Journal. A subscription delivered to Apple's (AAPL) new e-reader will cost $17.99 a month -- $17.99 a month -- more than it now costs to get a home-delivered paper and access to wsj.com.
At the same time, News Corp.'s European division announced plans to begin charging for online access in June to the Times of London and the Sunday Times. While not quite as pricey as a WSJ iPad subscription, it'll still cost readers real money: £1 ($1.50) for a day pass -- i.e., the same price as the print edition's cover price -- and £2 ($3) for a week pass. The plan appears to be a straightforward pay wall, not a metered system like the one The New York Times will adopt next year, which lets casual readers browse a number of articles for free.
The weekly subscription does represent a significant discount, with a week's print subscription going for £6 ($9). Still, it's a surprisingly aggressive price point -- particularly in the U.K., where an abundance of dailies, and Murdoch's own price-slashing tactics, have held down subscription rates.
Why, you might wonder, would anyone pay so much for a digital newspaper when just a few dollars more -- or less, in the case of the Journal -- buys both paper and online editions? Exactly. Attacking the problem in this way suggests that Murdoch is motivated as much by a desire to drive readers to buy or renew print subscriptions as he is by the question for digital revenues.
There's nothing especially novel about that. Shoring up print is a commonly-offered rationale for adopting an online pay plan. When I interviewed Steve Brill from Journalism Online, one paid-content startup, he predicted that papers selling bundled print-and-web subscriptions will see their circulations increase.
For Murdoch, the ultimate print nostalgic, there could be no worthier goal. The danger is that, in trying to herd web users back into print, he ends up instead pushing them to competing newspapers whose digital offerings are more modest.