The Digital Reader

Pearson (they own the Financial Times) recently released their financial statements and an interesting detail popped up. The Financial Times now have 149k digital subscribers with a registered user base of 2.5m. They also reported that they had doubled their operting profit for the first half of 2010.

The reason I’m bringing this up is so I can contrast their success with the Times of London, who have lost 90% of their web traffic once they required registration. What’s the difference?

The FT succeeded where the The Times failed because one correctly applied the freemium business model and the other didn’t. In this case the FT are giving away some content in order to tempt you into paying for a subscription. The Times of London put all content behind a paywall, and they’ve demonstrated that if people can’t try before they buy, they will not buy.

But that’s not the only difference.  FT are also a niche publication, and they are the best in that niche. The Times of London are a daily newspaper. You can find most of their news stories elsewhere. People are bouncing off the paywall and going elsewhere.

In this digital age, people will only pay for a unique product. If you can’t (or won’t) deliver then get out of the market  before you bankrupt your company.