New business model? Sunday newspaper/tablet subscription.

NiemanLabs, Ken Doctor 25.3.2011

...This week, The New York Times is scattering balls all over the news publishing table, introducing its pay system in the United States on March 28. The potential unexpected dramatic impact: the makings of a new business model. It’s a simple idea really, and one that hatches both out of the Times’ pricing models and the emergence of the tablet as the first real replacement-for-print reading device.
The idea: a Sunday newspaper/tablet subscription. And it’s an idea that over the next three to five years could prove a real transition strategy for metro dailies as well, as well as community ones.
...Let’s take a quick swipe at the newsonomics of the idea, following up on last week’s broader look (“The Newsonomics of the New York Times Pay Fence“) at the plan. In the New York market (where it has something less than half of its circulation), the Times charges $4.90 a week, or $252 a year, for its Sunday subscription. Outside the metro area, the rack rate is $7.50 per week, or $390 per year.
...Now, let’s do the new digital-only pricing plan math. The Times gives me tablet and online (desktop, laptop, but not smartphone) access for $20 every four weeks, or $260 a year. Why not pay $68 less, and get the Sunday paper in addition to the tablet access? How many print subscribers have decried the daily papers piling up, an eco-unfriendly lifestyle, and wondered what to do, especially as they find more of their time going to digital reading, of the Times and other news? In fact, with the savings, by dropping seven-day print, at $600 or $700 a year, you could pay for a shiny new tablet within two years!
...We’re focusing, in this moment, on reader revenue, but it’s still ad revenue for the Times and nearly all dailies that represent their biggest income. Here, too, the Sunday print/daily digital access plan holds a lot of promise. Sunday has always been a big day for daily publishers, but through the last decade, it’s become a bigger day. In fact, Sunday isn’t just the biggest day; it’s fast becoming the pivotal day. In fact, current profitability can often rest on Sunday.
...Remember how the Detroit papers cut back to three and four days of print publication, in the dark days of the deep recession, two years ago? They are still on that publishing schedule, and here’s the key reason why: They retained 93 percent of seven-day ad revenue when they went to new model, says Dave Hunke, now publisher of USA Today, and the guy who, as Gannett’s lead in Detroit, led those changes.

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