The New York Times Reveals Paywall Plan

The New York Times rolled out a plan on Thursday to begin charging the most frequent users of its Web site $15 a month in a bet that readers will pay for news they have grown accustomed to getting free.

The new plan launches today in Canada for testing ahead of a Mar. 28 global launch, but might it actually scare away the readers that stand to benefit the paper the most?Photo: Wally Gobetz/Flickr

Finally, The New York Times announced “digital subscriptions” on Thursday, revealing the long-awaited details of its paywall plan. Starting March 28, non-subscribers will be able to read only 20 online articles for free each month.

Home delivery subscribers can continue to access online and app content for free. Non-subscribers can choose from three packages: $15 per month for Web access and smartphone content; $20 for Web plus access to the Times iPad app; and $35 for Web, tablet and smartphone access.

There’s still some room for free, though: Readers who reach online Times articles through links from search engines, blogs and social media will be able to access those individual articles, even if they have reached the 20-article monthly limit.

But for some search engines, users will have a daily limit of free links. The New York Times’ press release on its plan did not specify which search engines will be affected, but a Times article on the plan said there will be a five-link limit through Google .

The homepage at and all section fronts will remain free to browse at all times. The “Top News” section will remain free on the Times’ smartphone and tablet applications.

“Free links from social and search is a key point,” said Sree Sreenivasan, the dean of students at Columbia Journalism School. “This will keep the visitor numbers from falling too much. And their core paying audience is not going to change.”

The Times says its homepage receives 30 million unique readers per month. Figures from The Nielsen Company, however, said had 15.5 million unique visitors in January. ComScore data said New York Times Digital, which includes properties like, overall had 71.9 million unique visitors in January.

Sreenivasan said he considered the plan pricing to be fair, though the company should “make payments as easy as iTunes” to increase readers’ willingness to fork over cash.

The Times’ digital subscription plan is rolling out in Canada starting Thursday, “in order to fine-tune the customer experience” before the service rolls out to the rest of the world.

In a prepared statement, Times publisher and chairman Arthur Sulzberger, Jr., said the move “will result in another source of revenue, strengthening our ability to continue to invest in … journalism and digital innovation.”

According to the Times, its iPhone app has been downloaded 6.2 million times since its 2008 launch, and the iPad app has been downloaded over 1.6 million times since October.

NYT officials say that the iPad app has generated strong interest from advertisers, especially luxury, technology and entertainment companies. Studies have shown that iPad readers are more susceptible to advertising than those using other mobile platforms.

The Times is also planning to offer users the ability to subscribe digitally from within the app, which will work with Apple’s in-app subscription system beginning Jun. 30, so it’s clear that iOS readership continues to be an audience that’s important to the company.

News Corp. has been at the forefront of charging for content. While some of its The Wall Street Journal content can be accessed for free, a sizable portion is behind a paywall.

And last month, News Corp. unveiled an iPad-only publication called The Daily. CEO Rupert Murdoch committed around 100 staffers and an investment of $30 million to get it launched, and will spend $26 million a year to keep it running. The Daily costs 99 cents a week, or $40 for a yearly subscription — though News Corp. has extended a free trial for several weeks.

The price point for digital content is a sticky decision for media companies, as the proliferation of blogs often means readers can get similar content for free elsewhere.

And going digital can be expensive. To take The Daily as an example: To break even on its operating costs from subscriber revenue alone, The Daily would have to sell more than 650,000 subscriptions — and that’s without accounting for the cut Apple (AAPL, Fortune 500) takes for selling The Daily through its App Store.

Apple unveiled a new subscriptions model last month, in which the company will take 30% of all sales generated through its platform — and publishers cannot include links in their apps to let customers buy content outside of the app.

What’s your take? Will you pay for the privilege of using an app, or just go back to reading on the web? Tell us your thoughts in the comments. [NY Times via CNN, GigaOm and NY Times]

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