Wednesday, 15 July 2009

Businessweek and the online subscription model

(By Richard Holway 9.00am 15th July 09) Being a market analyst can sometimes be as easy as just keeping your eyes open and observing your own behaviour. Smartphones, Apple, netbooks are all recent examples where you didn’t really need an expensive research report to tell you what was and would happen – you were your own market research.

Another case in point is the demise of the paid for magazine. For about a decade I paid an annual sub to Businessweek; one of my ‘must read’ publications. Then they wrote to say they were discontinuing the European edition but I could still have the US one. I declined. Since then I have consumed Businessweek for free on the internet. (They do have a $30 subscription offer but the only advantage is that it gives access a few days earlier than the free one – hardly a problem as I had that delay with the print version anyway!)

So the news yesterday that McGraw-Hill were to sell Businessweek for $1 was not a huge surprise (The FT – See Businessweek - joked that you could now buy the whole outfit for less than the cover price of the print edition!) Other news about the major slump advertising revenues – including online advertising – illustrated the cause of the problem.

I have severe doubts that online advertising can ever compensate. Here at TechMarketView, our model (and future) is based on subscriptions (banner ads are ‘icing on the cake’). It’s tried and tested. Newspapers (like the FT) and top quality magazines (like Businessweek and the Economist) have got to develop effective online subscription models if we are to continue to enjoy the high quality reporting they offer.

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