It just doesn't add up
I went by my favourite newsstand on Saturday to pick up the weekend papers and had a chat with the nice lady who is always there. She told me that my weekend FT had gone up in price to £2.50. Then, she tells me that the weekday issue was going to £2.00 as of Monday. Sensing my obvious sense of disapproval, the sweet newsstand lady shakes her head in commiseration and tells me that she thinks the FT is trying to simply shift sales from the newstand to subscriptions and online…
If only it was that logical.
Even though I live and breath internet media, until less than a year ago, I used to buy the FT at newsstands 3-4 days per week. But as the price went from £1 to £1.80 in just a three years I found it completely unjustifiable. At £2.00 it’s robbery and certainly bears no relationship with financial climate or the prevailing rate of inflation.
So, perhaps I am one of those quaint newsstand customers who is being intentionally squeezed into a subscription… buy a subscription, you say. Well that is where the problem really begins. The price of an FT home subscription in central london is £416. That’s a lot of money but its a complete farce when you realise that the EXACT SAME service would only cost me $348 in New York — that’s £234! In fact I can get two years of FT subscription in the US for the price of one year subscription here in London and still have enough change left over to subscribe to a bunch of magazines. There is no justification for that especially as so much of the cost of producing that particular newspaper is in the UK.
It gets worse. The website only subscription with all the same content as the paper cost £207.48 which is more or less the same price as the US home delivery option. Think about that: no paper, no delivery, no fancy plastic wrapping and the FT wants me to pay the same amount for a web subscription as I would get for the paper delivery in NYC? If the guys at the FT are listening, I have some news for you: your online product isn’t worth what you think it is.
I am sure someone out there will argue that it costs a lot to produce this content and that its worthwhile paying for it. That’s true, but its important to remember that media is a competitive industry. I have a choice of where I can get my news and information and as Fred Wilson pointed out, there is someone else out there willing to fill the space and I don’t mean just the internet.
My friend Toby Constantine at the media advisory group Market Evolution recently pointed out that the FT’s pricing model makes it more expensive than SKY. Think about that for a second. A subscription to the FT costs more than a subscription to Sky which includes hundreds of channels, movies and throws in internet access and VOIP calling as well! It makes no sense. The newspaper industry is completely out of touch with reality.
I often hear people hold up the FT as one of the success stories in the newspaper industry — they have great content, a loyal customer base and will survive the transition to digital. If that is the case, I think the newspaper industry is in more trouble than they know.
