Australia’s Fairfax Media – publisher of the Sydney Morning Herald and The Age – has come out fighting and super-bullish about its paid business content strategy, in the face of withering criticism…
Its financial media group has issued two press notices declaring “its pioneering paid-for-content digital business model has been a success”, with subscriptions to the daily Australian Financial Review paper’s website up 53 percent over the last year.
In fact, AFR.com claims just 6,711 paid digital subs and many of those are primarily newspaper subscribers. But its story is nevertheless instructive…
AFR.com, which is read by an audience with an average income of AU$229,480 (US$230,000, £143,000), introduced a hefty AU$109-a-month fee (US$109, £68) in 2007.
AFR’s CEO Michael Gill says: “We recognised early that media behaviours were changing and worked hard to define the specific expectations of business and investors. We put in place a business model to support the delivery of high-value, unique content across multiple platforms and provide sustainable returns to the business.
“There remains some uncertainty as to the extent that audiences will migrate from print to digital products. All of our research shows that these platforms serve very different purposes, one around a reference point for the day’s business agenda and the other around highly personalised rich data and searchable, niche content. This is evidenced by the fact that many of our digital subscribers also subscribe to the newspaper.”
Gill’s hubris is a direct response to local criticism – specifically, this column from a commentator who accuses AFR of “absolute neglect, even distrust, of these new electronic innovations” and this column in News Corp.’s The Australian which says Gill “should have his bags packed by now“; the paywall “has been a dismal failure and, by refusing to allow its content to be aggregated on other sites, the once-influential journal has become all but invisible and irrelevant”.
But doth Gill protest too much? On IPSOS data, he says: “The Australian Financial Review has a higher readership among senior executives than does The Wall Street Journal in the USA or The Financial Times in the UK.
“The AFR is the only publication of its kind to have produced profit through all of the last 15 years. It produced record profits in some years that the FT and WSJ reported losses.
“Unlike many others, the AFR did not create a free web site. This is a major reason for its sustained profitability. The paid model for afr.com is no longer controversial. The model is now promoted by people such as Mr Rupert Murdoch who was among its critics.”
Relatively late by international standards, Fairfax in November said it would reform itself as a multi-platform publisher, keeping its consumer news websites free but introducing new smartphone and tablet editions on a charged basis. Group-level Fairfax online revenue grew to US$296.5 (US$296, £184) million in 2010.