A Long Island newspaper invested €4 million to redesign its online website with content behind a paywall. They got 35 subscribers in 3 months.
The web site redesign and relaunch cost the Dolans $4 million, according to Mr. Jimenez. With those 35 people, they’ve grossed about $9,000.
Second tier newspapers’ only chance to get some subscription revenue from paying online customers could be taking a share of offers bundling together access to several sources of premium content. The role of aggregator may be taken on by Apple iTunes or Amazon Kindle.
As with print-based media, Internet-based distribution generates only a tiny fraction of the revenue and profit that today’s incumbent cable, broadcast, and satellite distribution models do. As Internet-based distribution gains steam, therefore, most TV industry incumbents will no longer be able to support their existing cost structures.