Robert Andrews of PaidContent UK interviews Ien Cheng, the talented journalist and publisher of the Financial Times’ web site, FT.com (disclosure: Ien bought me a beer in Hong Kong a few years ago). Cheng (tries to) explain the logic behind FT.com’s move to neither-fish-nor-fowl: a financial news site in which readers get to look at 30 stories a month for free but have to pony up for a subscription if they want to see more.
As with TimesSelect (gone), the paid Wall Street Journal Online (soon to be gone), and other paid newspaper sites, we think that the FT’s half-measure is not long for this world. Meanwhile, the Financial Times proper is likely to be increasingly isolated and threatened in a world dominated by Murdoch/Dow Jones, Thomson/Reuters, and other massive global financial brands. Owner Pearson (PSO) should sell it to someone that can do more with it.
Annotated excerpts from the PC interview:
— FT forced into this move by rivals?: “We came to our own conclusion….This is not at all a response to anything anyone else is doing out there…The model came after traffic analysis, user testing and a beta launch “in secondary markets”.
Amounts to the same thing. Forced to do it because paid-wall model wasn’t working.
— Opening up to win subs? “When we’ve had a barrier against some of our best content, of course we’ve missed out on traffic there and, therefore, advertising – so this model’s going to allow us to get that.”
Translation: Sub growth stunk. The problem with the new strategy: The logic that more folks will now sign up because they see all that great the FT’s content is flawed. The FT’s content is excellent–but so is the content on the Wall Street Journal, Reuters, and a dozen other free or soon to be free financial sites. Those who need to read the FT to sound intelligent (mostly Brit City folk) are already paying for it. Those who don’t will now read exactly as much as the FT gives them for free… (Continued)
— Paying for content: FT.com is far from abandoning the pay-for model that underpins its print, as well as online, offerings.
They’ll be closer to abandoning it online when the “major sub growth” goal of this hybrid model fails.
— Registration and advertising: Advertising growth from casual readers is planned to come from better targeting. Users who read over five stories within 30 days must register for free, at which point they will cough up personal data advertisers can use to enhance profiling.
Registration is annoying, but tolerable. The site will still likely see a major fall-off in click-through when users are presented with the sign-in screen, but perhaps this is a worthwhile tradeoff.
— Advertising and other growth: “Overall online ads are up 40 per cent this year (based on last three months versus same period in 2006), with revenue from the core banner ads stream up 57 per cent. Year-on-year, we’re up more than 70 per cent on unique users, page views are up more than 50 per cent.”
Cool! But not unusual. If memory serves, growth at the WSJ, MarketWatch, etc. is up even more.
— WSJ a looming threat?: Some analysts, expecting Rupert Murdoch to slash WSJ’s cover price and drop online charges, have anticipated agressive competitive against the FT, but Cheng said: “Any publication that goes completely free significantly risks ending up with an undifferentiated volume. That’s not our model.”
It will be, once Murdoch pulls down the wall and WSJ traffic jumps 10X.
Read the full PC interview here.
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