Monday, March 15, 2010

How many web subscribers will support a newspaper?

The consumption of contents of payment is low in Spain. Also, the public spends more in the systems and platforms of access, as the wide band, the mobiles or the television of payment. The expense means of the citizens in cultural consumption was 372,2 euros in 2007 according to the last available fact, which it can have increased up to approximately 410 euros in 2009.
According to the Survey of Cultural Habits, the Spanish spend an average for 44 euros in periodicals a year, 12 % of the entire expense. The revenue for user in the payment television is about 40 euros a month, just as the expense in mobile telephony. In access to Internet every person spends 47,5 euros a year.
Different studies of consumption of the newspapers indicate that the reader only appreciates about 20 % of the content. A relation value / price of 20 daily cents, six monthly euros that about 7,6 euros might come even if we count every Sunday.
Sufficient for a big national newspaper?
Let's take a big national newspaper as a hypothesis with a few income for 240 million euros per year. Let's calculate that it already achieves 10 % of Internet: 24 millions. The role income splits into 60 % for the publicity and 40 % of the sale of copies: 129,6 millions of publicity and 86,4 of the sale of copies.
If the benefits are eight per cent (in crisis times), the cost of the newspaper would be about 220 millions.
A big newspaper might convert 20 % of his buyers to the payment ideally, what would reduce the role income to 69 million euros.
If it can support the publicity in role with this copies fall, the income would be 198,6 millions. To close Internet to the payment would transport a descent of the digital advertizing invoicing of at least other 30 %, from 24 millions to 16,8. A few entire income of 215,4 millions.
The cost reduction with the decrease of the throw might be of approximately 10 million euros between role, impression and distribution, a cost of 210 millions that would grow at least up to 212 with the need for implementation, management and promotion of the model of payment.
To support the profitability it would be necessary to invoice 229 millions, 4,5 % less than with the previous business model. It would be necessary to achieve 13,6 million annual income of payment. A whole of 30,4 million income in Internet and an increase of almost 27 % of the digital income.
It would transport a strong fall of the only users, but it would demand a growth of the quota of income for Internet up to 13,3 % of the invoicing, half a point over the proportion of the Internet market in the advertizing, but enough whole more than the newspapers usually obtain in Internet.
At a price for ten monthly euros 114.000 users would be needed. If it is exempted up to 12 % of the annual expense with contents, the income for user should be 50 euros per year and 272.00 users would be needed. With an intermediate price for 7,90 euros a month 144.000 users would be necessary.
Is it possible to come to this quantity? The answer that many persons in charge are valuing only has for the time being a handlebar: Financial Times, a newspaper that it has obtained 121.000 payment subscribers with a diffusion in role of 400.000 copies.
A target that seems difficult to manage with the competition and the current market, but that is in the table of many and that explains the option for payment models only in platforms of access like the mobiles or the digital readership.

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