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The Internet Businesses The Almighty Buck The Media News

WSJ's Online Subscriptions Outperform Print 223

Posted by Zonk from the numbers-add-up dept.
ScentCone writes "The New York Post is reporting that the Wall Street Journal's parent company, Dow Jones, is doing much better with its online publication than with print. Online subscribers pay $84/year, whereas print subscribers are still paying $356... and the profit on the online business is 20 times that of the paper flavor." From the article: "'They're simply losing market share to other media. Print publishing is not a profitable business for Dow Jones anymore,' said Feinseth. Kann is hoping that the company's long-range growth also comes in online publishing, which has profit margins at least 20-fold higher than print. The Wall Street Journal Online is signing up thousands of new subscribers, up 5.2 percent for the quarter, to a total of 731,000."
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WSJ's Online Subscriptions Outperform Print More

WSJ's Online Subscriptions Outperform Print

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  • The real news (Score:5, Insightful)

    by stecoop ( 759508 ) * on Friday April 15, 2005 @09:28AM (#12244040) Journal
    The real information gathered from the story is that consumers buying Wall Street Journal online are paying 20 times too much. They should be paying $4.20 a year.

    At least competition will help as if there is so much money in something then everyone will be doing it.

    • From a WSJ reader. (Score:4, Interesting)

      by MisanthropicProgram ( 763655 ) on Friday April 15, 2005 @09:36AM (#12244113)
      ... consumers buying Wall Street Journal online are paying 20 times too much.

      It would seem that way, wouldn't it? But the reporting and writing that paper does is superior to just about everyone else. I'm willing to pay the amount they're demanding. Am I stupid? Maybe. But I think the other alternatives are definately not worth their price.
      And I'd lik to add that I pay the newstand price ($1) because the WSJ is a data whore. When I did subscribe to them, my junk mail increased about three fold.

    • Re:The real news (Score:3, Insightful)

      by OECD ( 639690 )

      Online subscribers pay $84/year, whereas print subscribers are still paying $356...

      So why the hell don't they throw in online access when you pay for the dead tree version? They'd be more likely to pick up some of the online subscribers as print customers, and it would make the current print subscribers feel like they're getting more value for their bucks.

      • Re:The real news (Score:3, Insightful)

        by CastrTroy ( 595695 )
        I'm not sure how much the WSJ costs on the newsstand, but it doesn't seem like they are giving avid readers much of a break. assuming it's a daily, that's about $1 an issue, which is the same price most large newspapers cost on the newsstand. I would assume you'd get some kind of deal.

        I get MacLean's, a weekely Canadian news magazine. It costs $58 a year for a subscription. News stand price is about $99. They give subscribers better rates because they know they will buy every issue, they already hav

      • They charge you $350 for the print version, and don't give you free access to the online version???

        (eyes goggle)

        That's the dumbest thing I've ever heard. No wonder their print subscribers are switching to online.

    • Re:The real news (Score:4, Insightful)

      by Karma Farmer ( 595141 ) on Friday April 15, 2005 @09:41AM (#12244161)
      They should be paying $4.20 a year.

      Could you tell me how you got that out of the article?

      A buck a day for the WSJ sounds pretty damned cheap to me -- have you ever read it?

      • Re:The real news (Score:2, Interesting)

        by stecoop ( 759508 ) *
        Could you tell me how you got that (sic 4.20 per year) out of the article?

        Come-on now I don't have an MBA it is simple math though....

        All right I'll explain, just from the article text:
        Wall Street Journal is in the news reporting business; therefore, can be used as a simple benchmark for profitability in the line of business.

        The comparison between print and online is that the print is making a given profit and the online is making a given profit. They are in the same business yet the online is making 2

        • Re:The real news (Score:5, Informative)

          by Ingolfke ( 515826 ) on Friday April 15, 2005 @10:13AM (#12244492) Journal
          For all of those of you out there who missed the satire here (oh gosh I hope it's satire) please read.

          They are in the same business yet the online is making 20 times the profit of print. Take the online subscription fee of $84 per year / 20 times the profit = $4.20 per year is the expected price for subscriptions.

          Notice that what is being done is that the total revenue per subscriber is being divided by the profit ratio. This makes no sense. That $84 per customer per year is used to pay for the infrastructure, staff, etc. to provide the service. Let's say that $80 per customer per subscriber. That leaves $4 in profit. Which would mean that the paper version makes $.20 per subscriber per year. My point is not the exact numbers, but that the basic mathematics used is WRONG! You cannot divide revenue by a profit comparison ratio and come up with a meaningful subscriber cost.
          • Notice that what is being done is that the total revenue per subscriber is being divided by the profit ratio. This makes no sense.

            Why would a wookie, an eight foot tall wookie, want to live on Endor with a bunch of two foot tall ewoks? That does not make sense!

        • Re:The real news (Score:3, Interesting)

          by HMA2000 ( 728266 )
          We don't know what the cost of either the print or the web editions are. We do know the price.

          If the cost of the print edition is $355 and the cost of the web edition is $64 (both cost figures amortized over the size of the subscriber base) then the profit is 20 times. (profit of $1 and $20 respectively)

          Another solution could be the print edition costs $354 and the web edition cost $44 ($2 and $40)

          In other words, we don't have enough information to determine where a parity will be reached.
          • And we could add in the fact that we don't know how much revenue either edition gets from advertising. I do know that most print papers make almost all of their money from advertising; the actual subscription price is usually negligible in terms of revenue. The fact that people pay for a paper is mostly useful in convincing advertisers that people actually read it. All of which is probably less true of the WSJ than others; it's expensive as papers go, and advertisers probably don't need as much convincin
        • This should be modded +5 funny, not +4 informative.

        • Re:The real news (Score:5, Insightful)

          by wfberg ( 24378 ) on Friday April 15, 2005 @10:20AM (#12244562)
          Come-on now I don't have an MBA it is simple math though....

          Apparently there still is a need for business school..

          Just because the profit is 20x the profit of the offline version, that doesn't mean their costs are 1/20th. Assuming the profit on the offline version is 4%, the profit on the online version would be 80%, so the cost would be $16.80 -- a lot more than $4.20!

          Of course, this doesn't necessarily reflect the true cost of the online version too well - I doubt that they're expensing the costs of articles that are written for the paper version and republished online at reasonable prices; i.e. if the paper WSJ wouldn't exist, the online version couldn't copy their articles.

          So, yes, it would appear that the online version is doing well, though you'd have to look into what they're paying for their shared content to know just exactly how well.

          But if they were selling the same amount of subscriptions at $4.20 a year they'd be making huge losses.

          Of course at $4.20 a year they'd sell more subscriptions, but whether that would still make a profit remains to be seen.

          So I'm afraid your simple math didn't quite cut it..
        • So, you expect to be able to pay for a year's worth of paper and delivery costs for $4.20?
        • We're talking here about profitibility of distribution here. The business of newspapers has traditionally been 2 things: selling paper with stuff printed on it, and selling advertising. The business of newspapers is not, unfortunately journalism. (I freelance for magazines, and they want quality material, but they want it cheap.)

          So what does this tell us about the future of journalism? More celebrities. More syndicated stories from the wires that everyone else is running. Blogs reproduced without payment

    • Re:The real news (Score:5, Insightful)

      by ScentCone ( 795499 ) on Friday April 15, 2005 @09:50AM (#12244245)
      The real information gathered from the story is that consumers buying Wall Street Journal online are paying 20 times too much.

      Never mind that the paper version is losing them money, so making more profit than the losing part of the operation isn't, by itself, necessarily all that fabuluous.

      But the real news in your comment is that you don't think someone should make any more profit than you think they should. What is the correct profit margin for each type of business, taking into account seasonal variability, changing competition, evolving technology, company reputation, and all of the other variables that impact each business model? Do you have a table, or set of guidelines? How often do you update it, and based on what criteria?

      I have an idea. How about: the WSJ has competition, and if any of it is as good or better, and charges less, then people will spend their money there, instead. Or, regardless of what the WSJ costs, if people don't think it's worth it, they can just stop subscribing. It's almost like the market adjusts the price! *sigh*
      • The author of the article is incorrect, WSJ.com is not the primary generator of revenue or income of electronic publishing, they don't make money on the electronic version of their newspaper. They make tons of money on their DJ newswire services and index services (which have effectivly zero current costs). Newswire services are news terminals similar to Reuters or Bloomberg terminals that probably rent for several thousand dollars annually. You can dig up the numbers in their quarterly releases.
        • OK. Doesn't change the tone of my response to the prior post. The implication was that because online operations (whether simple subscriptions to their site, or the other services you subscribe - doesn't matter) are 20 times more profitable than some other business unit, that it means that DJ is charging too much. My point is that they charge exactly what they can, and if their services stop being more useful to some people than Bloomberg, Reuters, or others, then the market will impact the price appropria

    • Re:The real news (Score:4, Insightful)

      by Ingolfke ( 515826 ) on Friday April 15, 2005 @09:51AM (#12244255) Journal
      the profit on the online business is 20 times that of the paper flavor

      You should try reading the WSJ sometime you might learn something about business fundamentals and economics. The PROFIT is NOT equal to the cost to the subscriber. All that is being said is that the online version makes 20x more profit than the paper version. So if the paper version makes $.10 per year of profit per customer, the online version is making $2.00 of profit per customer.
      • mod this up, grandparent misread the summary
      • So if they're not making much profit from the readers buying the paper than they are making profit from people reading the paper - IE advertisers. Then it would still benefit them to reduce the price to almost cost or even below to get more advertisers. Actually it sounds like the Google model where they don't charge but make a little income from the advertisers.

  • Paper is archaic... (Score:4, Funny)

    by tquinlan ( 868483 ) <.tom. .at. .thomasquinlan.com.> on Friday April 15, 2005 @09:30AM (#12244054) Homepage
    ...and I would much rather read things online. Hell, I'd even pay for a well formatted paper to read on my Treo. But it just seems so archaic to watch all the people on the train in the morning attempt to fold their papers and still read while not disturbing the people they're crammed up against.

    • Re:Paper is archaic... (Score:4, Insightful)

      by Guardian Hacker ( 644242 ) on Friday April 15, 2005 @09:41AM (#12244163)
      Paper may be archaic, but I already spend enough of my day in front of a computer. I personally like to be able to read the hard copy.

      Beyond less strain on the ol' peepers, it's nice to be able to get away from the computer. With the online version, it might not be DRMed, but I certainly can't easily take it with me wherever I go (sure, I can print things out, but that format is still less than ideal for me).

      I agree that the online version might be great for some, but I'm not one of those people. And I've tried NewsStand [newsstand.com] and Zinio [zinio.com] as well as the online versions of many papers.

      Beyond what I've mentioned already... For my taste, the screen is too small a device for the display of articles. With a paper, I might have to turn a page once or twice.... with NewsStand and Zinio I found myself doing a constant 'pan and scan'. Online articles required too much scrolling and clicking of 'next'.

      I'll stick with the dead tree format (I recycle, mind you), but agree that a paper specifically formatted for display on-screen might be a good thing.
    • Online newspapers aren't that portable. I can take a print paper and read it at breakfast, at lunch at the mall, at dinner, I can read it in the bathroom, I can even read it in the car while sitting in traffic, or while waiting for a doctor/dentist, while waiting to get my car inspected, etc.

      I can't do that with an online paper. My only options are reading it during the day at work (subsidized by my employer) or reading it at home on my PC in that room (subsidized by less time with my family).

      Until electr
    • Sure, you can browse the internet while eating breakfast, but that's a good way to get your keyboard and/or computer ruined.

  • First of Many... (Score:2, Insightful)

    by Rick Zeman ( 15628 )
    It's only a short while til the NY Times, The Washington Post and other first-tier newspapers start charging for content. The only issue is which one will be first....
    • The reason the WSJ can charge so much for their paper and charge people for online content is because the vast majority of the subscribers are able to deduct the price from their taxes as a business expense.
      • subscribers are able to deduct the price from their taxes as a business expense

        So? That doesn't make it free. It just offsets their income by a little bit, and they pay just a little bit less in taxes. It's still a net cost to the subscriber.

        The reason people pay for it is because they find it directly (and often immediately - that day) useful to their business and investment decision making, and that pays back hugely in excess of the cost.

    • Re:First of Many... (Score:5, Insightful)

      by jbolden ( 176878 ) on Friday April 15, 2005 @10:08AM (#12244436) Homepage
      Almost all the "first-tier" papers tried charging for content. The WSJ was the only one that was succesful. The reason is that WSJ has original content that no one else has while the other papers are all getting their news from wire services and government briefings so they all had the same stuff. The NYTimes of the 1950s which has a large international staff (and thus plenty of original international content) probably could have had a pay website. The NYTimes today doesn't have anything all that important to say.

  • White and (depends on screen) and read all over? (Score:5, Informative)

    by Leontes ( 653331 ) on Friday April 15, 2005 @09:31AM (#12244069)
    This makes sense to me, especially when you are dealing with the chaotic and capricious world of finance. It's nice to have a paper with you, sure, but with the ever changing world of business, you need to have now headlines now, and yesterday's news may be obsolete by the time it gets to your door.

  • End of Paper Publications? (Score:4, Insightful)

    by Flywheels of Fire ( 836557 ) on Friday April 15, 2005 @09:32AM (#12244077) Homepage
    Long ago, when computers were as big as houses, and magazines were, well, 11x8, people still read magazines on paper.

    But now that your average PDA is small than the magazine, and you can get the latest news online [mithuro.com], not to save the number of trees you save, there's not really a justification for having paper publication of periodicals.

    But I still prefer reading my books on paper. And most people I know feel the same.

    • But now that your average PDA is small than the magazine, and you can get the latest news online, not to save the number of trees you save, there's not really a justification for having paper publication of periodicals. But I still prefer reading my books on paper. And most people I know feel the same.

      There is a perfect justification for reading from dead-tree media: not everybody can afford computers. You know, those poor people who like to read but choose to spend all their money on food (silly them!)..
    • Maybe with some periodicals, but with the WSJ...no thanks. 60+ pages daily, full sheet, financial summaries in agate type--good luck navigating that much content with a PDA, no matter how well it's designed.

    • But I still prefer reading my books on paper. And most people I know feel the same.

      Books are printed at ~15000 dpi. At that resolution density, the pixels from a typical 19" LCD display [viewsonic.com] would give you rather under an eighth of an inch diagonally.

  • I wonder. . . . (Score:5, Interesting)

    by jluebke ( 865638 ) on Friday April 15, 2005 @09:33AM (#12244087)
    How many people (like me) do both. Existing print subscribers can add the online service for $39 per year. I prefer to do most of my reading from the print version, but the interactivity of the online is also frequently useful....
    • but The Economist gives you a free online subscription with a print sub. The only thing the online has over the print is daily updates, which I don't use much. I'm too old to keep reading off of a monitor all day. /. reading does me in - ya know?
    • I'd also wonder how costs are being allocated in this breakdown. If the costs of reporting and editing are included in earnings for the newspaper (which I'd guess is the case, although it certainly might not be), it doesn't surprise me that repackaging that content on a website is a higher-margin business.

  • Fudgy numbers (Score:3, Insightful)

    by stratjakt ( 596332 ) on Friday April 15, 2005 @09:34AM (#12244099) Journal
    Harldly anyone subscribes to print newspapers, the days of the paperboy chucking the sunday edition into your rosebush or onto your roof have been gone for a long while.

    People just pick it up when they stop to get gas/smokes/coffee/whatever, or just read the copy lying there on the subway, etc..

    This doesn't take those kind of numbers into account. That is, this isnt saying more people read WSJ online than they do in print.

    If I were to guess, I'd say most would prefer to read dead-tree material than read a computer or PDA screen. It's just so much more comfortable for the eyes, and easier to take to the john.

    • Re:Fudgy numbers (Score:2, Funny)

      by Anonymous Coward
      Harldly anyone subscribes to print newspapers, the days of the paperboy chucking the sunday edition into your rosebush or onto your roof have been gone for a long while.
      Yeah tell that to the paperboy that delivers to my building. The damn kid is too lazy to walk down the hall of my complex, so he just throws the papers at the doors, at 4 in the morning. Wham, wham, wham. It makes me feel guilty for enjoying the videogame Paperboy so much as a kid.

    • Re:Fudgy numbers (Score:5, Insightful)

      by syphax ( 189065 ) on Friday April 15, 2005 @09:45AM (#12244190) Journal
      It always interests me when folks generalize their personal experiences and observations into "almost everyone/hardly anyone...".

      My experience in suburbia is that plenty of people still get print newspapers delivered. But when I lived in a city, not so much. I'm guessing the parent lives in an urban area...
      • Correct. The WSJ has the second highest print sub in the country, around or over 2 million, IIRC. USA today and its 16 trillion hotel subscriptions is #1.

        ostiguy
        • I recently stayed at the Sheraton Gateway Suites in Chicago, and while it (like many other places) has USA Today delivered to the doorstep each weekday morning, it was the free WSJ in the lobby that caught my attention. My girlfriend was amazed that a simple (and pointlessly dry, in her opinion) newspaper could brighten my day so much.

          One of these days, I should subscribe. I do enjoy reading the paper.
      • Suburbia is a wasteland where everything is far. You need a pack mule and a sherpa to pick up milk in Colorado. Elsewhere it requires a drivers licence.

        Of course you get it delivered. The alternative is roadside chaos.

        Would the fact that you CAN pickup the paper have something to do with it.

    • Re:Fudgy numbers (Score:3, Funny)

      by Anonymous Coward
      or just read the copy lying there on the subway,

      That's stealing!!!!!!!

      They should be find $150,000, jailed for 15 years, and sacrifice their first born to the JIAA. Lowlife pirates!

      Won't someone think of the typesetters?!?!?!

  • Good for them, good for us (Score:5, Interesting)

    by Rosco P. Coltrane ( 209368 ) on Friday April 15, 2005 @09:35AM (#12244105)
    The more publications go online successfully, the more demand there will be for ebooks and other portable reading devices, the quicker we'll finally get usable cheap ebooks.
    • Project Gutenberg isn't cheap enough for you?

      If you're someone who likes reading, there's so much more good stuff in there than you're likely to find on the bestsellers rack at B&N.

      I'm not necessarily a "newer is better" type of person. I tend to like old movies, classic novels, and NES games. I'd rather read Dickens than Stephen King, and happen to think that Sir Arthur Conan Doyle wrote much better mysteries than Dan Brown (DaVinci code was IMO formulaic drek, why all the hype?)

      YMMV
      • Project Gutenberg isn't cheap enough for you?

        I'm sorry, perhaps I'm old fashioned or something, so you misunderstood me: I meant a real, physical ebook I can read from in the train (like the Franklin ebook, that I think is no more in fact...).

        My point is, there is a sore lack of good such devices, simply because there's not enough demand for them. If publishers put out digital content, then maybe enough people will ask for a portable device to read it and someone will finally manufacture one that's bette

    • Re:Good for them, good for us (Score:4, Insightful)

      by Lumpy ( 12016 ) on Friday April 15, 2005 @09:48AM (#12244225) Homepage
      not a chance in hell.

      until the publishers accept a OPEN ebook format and standard it will never happen.

      if I cant read that ebook I bought 5 years ago on the PDA I will purchase in 6 years it will fail horribly.

      unrealistic you say? i'll remember that the next time I read a book that is over 10 years old.
  • Allow me to invent that aphorism.

    (c) 2005 ites.

    A good lesson for the *AA: cut your prices by 10, sell your stuff online, and you'll make more profit than before
    • A good lesson for them to learn, though I would point out that the WSJ differential is 4, not 10. My guess is they wouldn't sell twice as many subscriptions at half the price. Still, that would put the price of an album on iTunes at $3-$4, not $10.

      Even at that I'm not convinced that it would hold for the *AAs. The WSJ has a targeted, affluent market that would pay for convenience and timeliness. People don't share WSJ articles on P2P networks because not enough people want them, and those who do are mo
    • A good lesson for the *AA: cut your prices by 10, sell your stuff online, and you'll make more profit than before

      Though just like with music, that won't make it any cheaper for the WSJ to actually gather and edit what it is they sell. So the lesson should be the other way around: the WSJ should be watching how quickly a popular bit-based info-product can get turned into a pirated, not-payed-for file that's passed around between thousands or millions of anonymous "friends."

      Obviously people have been e-
    • And getting their heads out of their ass-holes.

      Since they have, unsuccesfullly, fought EVERYTHING to do with data reproduction ever since the invention of the player piano, I expect them to 'see brown' for the foreseeable future.

  • Don't forget medium costs (Score:3, Insightful)

    by aendeuryu ( 844048 ) on Friday April 15, 2005 @09:36AM (#12244112)
    And that's only the subscriptions. Never mind the medium costs. Print costs are really expensive. Maybe some other Slashdotters would have better statistics available at hand, but I remember doing a print run of 1000 copies of a magazine with 32 pages in it for about $1000 (cdn). These days you can get free online webpages that'll handle bandwidth that matches that kind of distribution, whereas paper and ink costs haven't gone down all that much in the past few years.
    • I asked my cousin who works for magazines, and he says for a run that small it would probably cost about $2 USD per magazine. The discounts get better when you start talking more like 20,000 copies.
    • Print costs are really expensive. Maybe some other Slashdotters would have better statistics available at hand

      I would imagine that providing a hard copy of said printed material across the entire country to people's homes or businesses _every morning_ within, I guess, 12 hours of it being printed is not cheap either, if not even more than the raw printing costs.
  • Does the online WSJ sub include access to any sort of backissue archive or anything? Does that have anything to do with their increase in subscribers?

  • sounds like a deal, right? (Score:4, Insightful)

    by Whafro ( 193881 ) on Friday April 15, 2005 @09:37AM (#12244121) Homepage
    All of these publications make their bank by overpricing their products to make even ripoff prices sound like a great deal. After all, why would any magazine give you a year's subscription for eighty or ninety percent below the cover price? Jack up the price on the cover so people think they're getting an amazing deal on a subscription while you still bring in large profits.

    This is just the next extension. You think you're getting a great deal with your print subscription? How about an online subscription for even MORE savings?

    I think that these online publications and their pricing schemes are only as successful as they are because they have such precedent as being a pricey product. It's why CD's are still $15, why purchasing digital music is around a buck a track, and why people buy books on amazon thinking that their 10% discount is amazing.

    • Re:sounds like a deal, right? (Score:4, Interesting)

      by jbolden ( 176878 ) on Friday April 15, 2005 @09:59AM (#12244331) Homepage
      The WSJ unlike most newspapers today still does a lot of its own research in detail. They have a large staff and they give them the time to turn out quality articles. Further the cost of distribution is high. Even in affluent neighborhoods a small percentage of the people want a speciality newspaper.

      The WSJ costs a lot because its much more expensive to produce than your average newspaper. I'm glad they are making money they produce a quality product and they deserve it (with the exception of the editorial page which is junk).

    • Re:sounds like a deal, right? (Score:4, Insightful)

      by Anonymous Coward on Friday April 15, 2005 @09:59AM (#12244339)
      Here's the problem with the argument that "50% off the cover price!" subscriptions means the cover price is a ripoff.

      Printing is expensive. And there's zero resale market--unlike an unsold copy of a book (which you can potentially sell later), magazines and newspapers have a clear expiration date--when the next one comes out. Which means printing exactly the right amount of things is tricky--print too many, and you waste money. Print too few, and you lose sales.

      If I'm running Sports Illustrated, and I am printing a copy for a known and paid subscriber, that very low risk--I know this copy will be sold, I know I can distribute it by mailing it direct from my printing facility (no need to ship it somewhere else first), I know I will be paid, and I know that there's no middle man taking a cut (the price I sell for is the price you pay).

      If I'm printing for retail distribution, things are different. I need to ship the magazines to resellers. I have to sell to those resellers at less than the final "cover" price--otherwise the reseller doesn't make any money (so I make LESS than you pay for the magazine). I also have to price in the risk of the magainzes not selling--I will probably print more than I think "average" sales will be so I'm covered if there's unuaully high demand for this issue, so I'm expecting to take some level of losses for unsold inventory.

      By cutting out the middle man, cutting the distribution costs, and by removing the risk/waste factor from pricing, I don't think it's unreasonable to think that subscription prices reasonably should be fairly substantially below the cover prices.
    • Jack up the price on the cover so people think they're getting an amazing deal on a subscription while you still bring in large profits

      Ever run a retail business? When you buy a copy of Newsweek, etc., from the newstand at the airport, you're dealing with many, many more middlemen. That retailer has to involve another shipping/collections cycle through the publisher, has to deal with issues regarding unsold-copies, and has to pay rent for whatever spot they're doing business (and pay employees, taxes, an

  • Expenses (Score:4, Informative)

    by Stormcrow309 ( 590240 ) on Friday April 15, 2005 @09:37AM (#12244125) Journal

    In relative expenses, print is so much more Capital Intensive [google.com] compared to On-line. Not only that, but the turn-around required to post a story is faster with web-based publishing. Most economic projections show that charging 50% less for a yearly subscription for significantly faster news response is over 200% more profitable when going to a web-based readership.

    They should offer a paid service for stories over 2 months old and delay stories by 15 minutes to an hour for non-subscribers. In addition, have specialized content for subscribers. With no required signup to see the free content, they would encourage people to check out the site. I believe they would end up with a decent return on investment.

    • Most of the WSJ's content is not "up to the minute" financial news but rather well researched articles, and large data tables. A 15 minute delayed version wouldn't be any different from the version online.

    • Re:Expenses (Score:3, Informative)

      by heli0 ( 659560 )
      "They should offer a paid service for stories over 2 months old"

      They already do.

      From WSJ.com
      "Articles dating back up to 30 days are free; older articles are $2.95 each. "

  • Bean counters to the rescue! (Score:4, Funny)

    by Pac ( 9516 ) <paulo...candido@@@gmail...com> on Friday April 15, 2005 @09:49AM (#12244232)
    As soon as the accountants and investment people see this, this wierd situation will be solved by their golden goose killing habits.

    Their first thought will be "Let's raise the online subscription to $356, so our online profit will almost 100 times the paper profit!!".

    Their second thought will be "This online thing was a passing fad anyway".

  • Ad revenue is key (Score:4, Insightful)

    by krygny ( 473134 ) on Friday April 15, 2005 @09:49AM (#12244233)
    Circulation (i.e., dead-tree distribution) is expensive and most pubs do it at a loss, or at best break-even, based on the full cover price. But ad revenue is much higher for print than on line. An ad in the paper is much more likely to reach the target, hence costs more and is more worth it. An on line ad may be exposed to more eyeballs, but they are filtered by the frontal cortex.
  • I gave in this year and bought an online subscription to the WSJ after reading other people's leftover print editions at work for a while and seeing the quality of the reporting. I'm not surprised that their internet division is making money -- it's a great paper, and I am absolutely converted to paying for access online. I believe it's one of the only paid-subscription-required newspapers that is making money.

    Contrary to what you might think, the WSJ is not a stuffy, uptight paper for rich white guys o

  • well (Score:2)

    by egoff ( 636181 )
    I wonder how many are people that converted from print to online access?
  • I worked for a small company, where we were profiled in WSJ. This was quite a big deal since our company consisted only of 5 employees at the time. We wanted to put the article on our website. WSJ informed us, licensing the article was about $500/mo. Seems kind of high since the article was already written, and we weren't reselling the article.

    Nevertheless, we paid it for several months.
  • While WSJ's "online operations" may have earned more money, this doesn't really mean much. It's "print" operations earned very little money. Companies have operations that lose money all the itme, so if the online segment earned a $1, it earned "more."

    Moreover, I suspect the online operation benefits hugely from all the WSJ content generated for the print publication that I suspect is not included in "online operations."

    It's comparably easy to make money when you get 80% of your content for free.
    • They may be looking solely at distribution costs, so the news reporting and basic editing is handled under separate costs. Capital and maintenance costs for even a very large and busy website are far less than those for printing presses, and I suspect the labor costs are also much lower. In that respect, it's much easier to justify the higher profit margins.

  • Subscription price is wrong (Score:4, Informative)

    by kajoob ( 62237 ) on Friday April 15, 2005 @09:57AM (#12244319)
    Online subscribers pay $84/year, whereas print subscribers are still paying $356

    The WSJ only costs you $356 if you buy it from the newstand every day. Don't do that. In fact, you can get a year of the print AND online versions for only slightly more than the online versions. Check here [wsj.com] for a $99/year deal. (referral-free link).

    What I like about the WSJ is that, unlike in most papers where fact and opinion are combined through out all the news articles, the WSJ is pretty much straight facts in the articles and the opinions are relegated to the Opinion section. Don't get me wrong, I like reading the Opinion section but when it comes to news reporting, just the facts ma'am!
  • ...is advertising. Subscriptions for most major print newspapers are usually about 25% of the revenue. 75% comes from the ads. Paper versions have to strike a fine balance: keeping prices at a point where they are maximizing subscribers, the number and demographics of whom their ad rates get set. Production and distribution costs for a print paper take an enormous toll on their profit margins. Market forces will eventually drive large newspapers to non-paper versions. It's just a matter of time.
  • There's talk of how the e-WSJ is much cheaper to produce (no trees killed, no drivers to deliver it, etc.), but go into any bathroom at any brokerage firm and the stalls are littered with copies of it. The hard version makes the copy version cheap to produce because they already have the infrastructure available to easily produce it online. There aren't many web-only publication names that we trust, yet. The old school names legitimize the new school medium (WSJ, NY Times, Wash Post, AP vs. DrudgeReport)
  • Just that "20 times as profitable" figure. All that means is that the amount of the $84 that the WSJ keeps is 20 times as great as the amount of the $356.

    What I suspect is going on here is that the meat of the WSJ's work, the researching and journalistic legwork, is only being counted as part of the print media division. The online division, with the 20x profit margin, consists entirely of "Take what the print division has already done and put it online". If a share of the actual reporting costs were put
  • I'm not surprised, since the cost of getting that print copy of the Journal to the reader is large and the cost of getting the online version to the reader is negligiable. It's this cost that convinced so many publishers in the 90's, like all the computer magazines, to give all their content away online. Bad decision, if they had had the nerve, like the Journal, to make people pay for access they would have been better off.

  • Good for WSJ! (Score:2, Interesting)

    by scarolan ( 644274 )
    Kudos to WSJ for making it work.

    Many have criticized newspapers who charge for online access, saying it will never work, etc. On the other extreme you have websites that are "supported" by endless annoying popup and flash ads, or by making you look at the ad before getting to the page you wanted.

    Some people don't mind paying for quality content that is useful to them. WSJ has realized this and tapped into a good market.
  • This is great for niche publications like WSJ, who have content you can't find anywhere else (I know, I used to have a student subscription back when I was a sleazy business student). This won't work so well for the more mainstream publications like the New York Times or your local paper. There will always be free places like Yahoo! News that have the same content for free.

    If I were running an online version of a print periodical, I would find the stuff I have that no one else does and charge for that.
  • Many papers are subsidized regionally, in the U.S. this is done through county and state taxes. For city papers, like the NY Times, they get some revenue from the State of NY for operations. I forget what omnibus act or something this falls under.

    The point is... those dollars should be pulled and redirected into wireless infrastructures. Towns like Athens, GA - which tax funded the entire city for complete 802.11b coverage now have a public good - they don't need to fund extra garbage collectors for newsp
  • The Metro, freely available on the subway is trash, absolute junk. Like broadcast television, it's just a medium used to convey advertisements to the public. All of it's articles are bought from AP/Reuters. Despite it's junky content, I often need something to read on the long subway rides. So, I would attempt to find something worthwhile in it. After a short while, I was so sick of the Metro that I wanted to buy a paper in protest--my attention is worth more than that. The problem was, the local paper wa

  • Online newspapers are more convenient (Score:3, Interesting)

    by Flying Purple Wombat ( 787087 ) on Friday April 15, 2005 @10:31AM (#12244703)
    I don't subscribe to WSJ, but I do subscribe to Investors Business Daily [investors.com]. I switched to the online version as soon as it was available. Advantages and disadvantages are probably the same as online WSJ.

    Benefits of online version:
    0. Fewer dead trees.
    1. No stack of old newspapers in my house.
    2. I don't have to haul a stack of paper to the recycling center.
    3. Available shortly after the markets close instead of the next morning.
    4. I can read it with my breakfast without venturing outside in yucky weather.
    5. If I miss a few days, the past week's editions are online.
    6. I can download the PDF version to archive, view on my Palm, or whatever.

    Disadvantages:
    1. Dead tree version makes better kindling for the fireplace.
  • Both have their charm... recently I've been car shopping and find that the things that make online car publications vs offline decent apply in a similar way to magazines.

    Online: Searchable, easy access to older/archive editions, instant-available, less physical item to carry around esp with multiple issues, easy to send to a friend etc in another location

    Offline: Portable, doesn't need a computer, doesn't need power, can take it to the restaurant, bathroom, whatever. I can bring an ad to a car dealer an

  • My twisted logic. (Score:3, Interesting)

    by caluml ( 551744 ) <slashdot AT spam ... OT calum DOT org> on Friday April 15, 2005 @10:37AM (#12244752) Homepage
    Online subscribers pay $84/year, whereas print subscribers are still paying $356...

    So, using the same kind of logic that the movie/record companies employ, each online subscriber is stealing $272 from the Wall Street Journal. They weren't going to pay for it, and yet they still get a copy.

  • Not surprising (Score:2, Informative)

    by jessmeister ( 225593 )
    All the major newspapers (NYTimes, Boston Globe, etc) out here on the east coast have started to see their online revenues outpacing the growth of the offline ones. This is a trend that will only continue as these sites become outlets for information not only via text but also audio and video. This truly is an age where TV stations, Radio Stations and Newspapers (the old media) are going to be going head to head with the Googles and Yahoo's (new media). I bet we'll see some consolidations and maybe even som

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