FT.com Still Doesn't Get It

| About: Pearson plc (PSO)

What on earth are the executives at FT.com thinking? Instead of boldly following the lead of the NYT and making the site free, they've arrived at a weird compromise: articles and data will be free to users up to a total of 30 views a month. They will then be asked to subscribe for access to more material. This is a silly decision, and I'm quite sure that eventually the whole site will go free. Let's count the reasons why this move makes very little sense.

  1. It's a disincentive to read the site. The FT claims that the new model will "allow bloggers and news aggregators to link to material previously available only to subscribers" – but anybody seeing such a link will think twice before clicking on it, since doing so will cut into their precious allocation. At the margin, potential readers will probably make do with the summaries provided on the blogs and new-aggregation sites, and not visit FT.com at all.
  2. It's a disincentive to link to the site. Let's say a blogger links to one in ten articles that he reads. Then if the blogger isn't an FT.com subscriber, he'll basically be limited to three links to FT.com per month. Why minimize the link-love in this way?
  3. It's a disincentive to use FT.com as an authoritative resource. Let's say you're interested in researching the story of how Paul Wolfowitz was ousted as the president of the World Bank. The FT covered that story very well, in dozens of articles. But you can't read them all, and it's not obvious which are the "best" ones, so you end up using some other, free source of information instead.
  4. It's a disincentive to use FT.com as your home page, or as a go-to site to find out what's going on in the world of business and finance.
  5. It maintains the existing confusion between free content and subscription content. Apparently "new blogs" will be part of the new FT.com, and presumably those will be free and will not count towards the 30-articles-per-month quota. FT.com publisher Ien Cheng says that “people find it much harder to get to know your content because they see a hard barrier at first, without even having a chance to get to know your best content”. But all he's doing is replacing the hard barrier with a soft barrier: it's still a barrier, and it will still have the same effect.
  6. No mention has been made on the subject of whether the blogs' RSS feeds will remain truncated: back in May, the FT suddenly and idiotically decided that it would give its most loyal blog readers only a few words of each blog entry. If this protocol remains, they're still not going to get much in the way of links.
  7. The NYT has demonstrated that it's relatively easy for an authoritative newspaper to get its readers to register in return for free content. But FT.com is going to put up a registration firewall after just 5 pageviews per month: yet another obstacle to people reading its content. Given that FT.com will remain a subscription site, and that FT.com retains the right to lower the 30 views per month hurdle at any time it likes and to alter it from market to market, it's easy to see why people won't even want to bother registering if they have no intention of subscribing.
  8. Cheng hasn't read up on his Hume: you can't get an "ought" from an "is". He says that "We have always believed that the journalism we produce is worth something to our core users," and that "this new model allows us to keep to that principle." But just because FT.com readers will pay does not mean that they should pay. Why charge for something, if you can get more readers and build a more valuable website by giving the same thing away for free?
  9. The new model doesn't even make internal sense. "You’ve got to be able to target and registration is going to help us do that," says Cheng, right before he says that "any publication that goes completely free significantly risks ending up with an undifferentiated volume". If he's targeting, then by definition he's differentiating, and can still sell high-value readers to advertisers. Does he think that Vogue's page-rates are adversely affected by the fact that it sells hundreds of thousands of copies in Wal-Mart?

This whole announcement smells of caution and weakness. As Henry Bloget says, if Pearson can't make bold decisions at the FT, maybe it shouldn't own the FT at all.

As with TimesSelect (gone), the paid Wall Street Journal Online (soon to be gone), and other paid newspaper sites, we think that the FT's half-measure is not long for this world. Meanwhile, the Financial Times proper is likely to be increasingly isolated and threatened in a world dominated by Murdoch/Dow Jones, Thomson/Reuters, and other massive global financial brands. Owner Pearson (NYSE:PSO) should sell it to someone that can do more with it.

The pairing of the WSJ newspaper with the Dow Jones newswire worked out quite well: I'm sure that Thomson/Reuters would be interested in what they could do with the FT.