The New York Times Digital Subscription Plan is Leaving Money on the Table

I have been trying to wrap my head around the New York Times new digital subscriber plans. I have been happily paying for the NYT on my Kindle as well as reading it for free from time to time on my iPad(s) and mobile phones. I just don’t get their new pricing scheme. It’s not my place to say what the New York Times should charge – they should figure out what the market will bear. And I am already perfectly willing to pay for their content as I enjoy reading it. The thing I don’t understand is why they want to charge such an aggressive price for me to add a third screen. A few observations and questions:

1. What percentage of people who have iPads / tablets and want to read the New York Times on those devices also own smartphones? My guess is that there is significant overlap between iPad / tablet owners and smartphone owners. Why penalize that audience to the tune of $180 per year for the right to consume the content on two additional devices? It basically doubles the price of the annual subscription on a single device.

2. While I’m willing to pay a bit extra to be able to read the NYT on the tablet and a second device, I’m not willing to pay over $400 a year to read it on my tablet and my iPhone / Android device. That just seems outrageous. If the price increment were on the order of $5 per month, I’d probably opt for the full plan that includes tablet and smartphone access. Paying a small amount for an incremental device makes sense. Paying almost double does not.

The thing is, I don’t actually object to being charged more to read the NYT on multiple screens. But I think of the world in a really simple way – there’s my computer (my Macbook Air) and then there are my smart mobile devices (iPad, Android phone, and iPhone). It feels to me like splitting the tablet and smartphone experiences into two different plans doesn’t match my usage patters. I’m either on my computer or I’m on the go – I’m happy to pay for convenience, but this plan doesn’t nail it for me.

I hope the New York Times reconsiders and drops the price on the “all-in” plan – I’d happily pay for the peace of mind knowing that I can consume everything across all the devices I use for a price I can swallow. Until then, I’m sticking with the iPad plan and I’ll have to just make do on my smartphones.

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  • Wen-Wen

    Coming from a first hand experience at Newscorp working on this, I’m relatively sure that the folks over there (NYT, WSJ) have a very old school mentality when approaching this and so to them, another device is like buying another copy of the paper. Personally, I think the best approach is to charge for specific types of content (classifieds a la craigslist) or doing a rev-share deal with some lesser hardware players that are willing to pony up a more significant chunk of their revenue.

  • The really really dumb thing about their plans? Subscribe to the daily print edition of the NY TImes (M-F) for $3.70/week and you get access to all digital editions (smartphone, tablet, nyt.com etc) for free. Save yourself $20.20. I’m guessing no one did the math…

  • Doug

    I thought this move was insane. The math works out such that buying a print subscription is cheaper than the other options individually. That tells me that they’re willing to charge a lower price for a higher cost product. That’s nuts – it’s the antithesis of good management practices (ie canibalize high cost products with lower-cost products). nnThe NYTimes spends $1 Billion in operating costs for producting the print version every year. They could give 1.4 Million (their sunday edition circulation) wi-fi Kindle’s away for free EVERY YEAR and that would only cost nominally $200 Million. What do they want to hold onto those costs?

  • Melinda

    I’m guessing that they worry that any devices after the first two will have a large chance of secretly being a cheap way to let additional people parasitize their content stream. They don’t want to completely say no to additional devices but they don’t think you really need them either, so they are charging you for the cost of their estimated losses, take it or leave it. Just a guess.

  • I really enjoy this post! and did follow your Twitter too! Nice post