News Corp’s Times Hikes Digital Fee To Milk iPad Riches

With Rupert Murdoch in London to launch the Sunday Sun whilst grasping News International’s crisis for a second time, News Corp is doubling its digital subscription fees for The Times and Sunday Times, to take more money from wealthy iPad owners.

From March 1, The Times and Sunday Times’ Digital Pack (for web, mobile and tablet) will hike from £2 a week (billed as £8.88 per month) to £4 per week. The web-only fee of £2 per week will remain unchanged.

A Times spokesperson tells paidContent: “We’re not ‘doubling’ our price. We’re introducing a new pack that includes all digital products. Previously, we were offering iPad access as complementary offer.” The difference may effectively be semantic.

Existing digital subscribers, of whom there are 119,255 for the Times, will stay on the previous rate until 2013. After that time, if the current subscriber count held steady, we could speculate that the rate increase would double the publisher’s theoretical maximum monthly digital income to £1.9 million, before stripping out commission to distributors like Apple (NSDQ: AAPL), a few corporate licenses etc. Doubtless, The Times would also like to add new subscribers by that time.

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Some would be forgiven for thinking higher fees may make new customer acquisition more difficult. But the average salary of the (Times’) iPad reader is £109,000 and over 15 percent of the its daily iPad audience earns over £200,000 a year, the publisher told paidContent last month. That’s ample room to bump the price.

Times editorial director Tom Whitwell ttells paidContent: “The iPad edition is a super-premium product with huge take-up. Pricing now reflects that.”

Why would Times Newspapers, which pioneered paid consumer news content’s second wave when it introduced the fees to much scepticism in summer 2010, do this now? Here is some speculation…

  • The publisher considers 119,255 a success and reckons it can confidently ratchet up prices without impacting the adoption future adoption base.
  • Because it can. It seems like The Times can milk its wealthy iPad base for more.
  • It’s decided adoption may be have a ceiling at around the current rate and wants to wring more money from existing subscribers, albeit after 2013.
  • The publisher wants to reclaim some of the 30 percent Apple is taking for those new iPad subscriptions.
  • Times Newspapers losses remain heavy and News International wants to get Times Newspapers ship-shape with bankable extra income ahead of a divestment amid News International’s turmoil.

The Times 2010 fees introduction polarised many in the industry, with some more recent fee adopters like The New York Times (NYSE: NYT) opting for a softer, metered model. Now News Corp.’s (NSDQ: NWS) The Times is preparing to give some free stories to friends of customers who share article links in social media, the publisher revealed to paidContent in January.