Posted by: Jon Fine on January 24, 2008
A colleague and I had caught wind earlier this week that News Corp. would not make the Wall Street Journal online free, after all, and while we heard that the wind appeared to be blowing against the notion of a free wsj.com, we couldn’t get anyone to confirm the chatter to our satisfaction. (This is my way of saying “we couldn’t nail the story before Rupert Murdoch broke the news at Davos,” although I now see the New York Observer had a pretty good bead on this a little while back.)
Ah well. Quick thoughts:
If Rupert is indeed outlining the strategy here, as per the Journal:
"We are going to greatly expand and improve the free part of the Wall Street Journal online, but there will still be a strong offering" for subscribers, Mr. Murdoch said. "The really special things will still be a subscription service, and, sorry to tell you, probably more expensive."
. . . well, then, this is sort of a best-of-both-worlds scenario, innit? “Greatly expanded” free stuff wins them more traffic and thus more online ad dollars; keeping the tariff in place also keeps subscription revenue in place. I'm not fully sure if I should read "variable pricing" into his remarks, but if so, well, so much the better.
But one other thing occurs to me. Let’s assume the wsj.com gets a high CPM for its ad inventory on the pages locked up behind the firewall. This is entirely possible, because right now the ad sales side can make this argument to its advertisers: "Our readers are rich, rarefied, and uniquely engaged with the product, since they’re paying fairly serious dough to be there. And we mentioned they’re rich, right? This is a scarcity play, for both inventory and the kind of reader you can't get elsewhere. You wanna be here, you pay up.”
Why give that CPM premium up? Especially if you’re expecting to build out other parts of the site to give you more inventory on it elsewhere.
(In other words: Like Rupert, I’ve totally changed my mind on this!)