on discovery path

WSJ the “Drug Dealer”

I’ve mentioned before that I’m quite addicted to WSJ Mobile Reader - I read their articles on my BB incessantly.

Recently, WSJ Mobile Reader started charging subscription fee for access to most of its articles.

To my surprise, I am actually considering to subscribe.

As I look back, I realized what a smooth calculated process WSJ has driven to get me to this point.  About one year ago, WSJ started distributing the Mobile Reader for free.  I wasn’t the first to sign up, I downloaded it sometime in the spring after a prominent VC raved about it on his blog.  A couple of months ago, the Reader began showing a splash screen informing that I have until such and such date before I need to make a choice: register for WSJ and get access to the free content, or subscribe to either the print or Web version and get full access to the mobile free.

By this time of course I’ve been a user for about 1/2 year… reading WSJ on my BB has become an ingrained daily habit.  WSJ’s “drug dealer” strategy here has worked.

My case also seems to validate the news publishers’ business strategy: make up for the loss in print subscribers by going online, but not solely on an advertising business model - instead, offer online and hybrid subscriptions at higher price points to offset decline in revenue… while transforming the company cost structure.

Per Dan Gross over at Moneybox:

“So in the past six months, according to ABC, the New York Times’ daily circulation fell 7.3 percent, while Sunday circulation was down 2.7 percent. Horreur! And yet, the New York Times Co. reported that in the third quarter, “circulation revenues rose 6.7 percent, mainly because of higher subscription and newsstand prices at The New York Times and The Boston Globe.” In the quarter, circulation revenues were larger than advertising revenues for the first time—$175.25 million, compared with $164.5 million.”

Now if only I could wean off the drug…