Can Tablets and Paywalls Save the Troubled L.A. Times?

With Russ Stanton out as top editor, the Pulitzer Prize-winning newspaper faces a grim future of dwindling staff, dwindling circulation and dwindling revenue

 

It's another sad day for the L.A. Times, and Lord knows, there have been too many of them.

With Russ Stanton out as top editor, the Pulitzer Prize-winning newspaper faces a grim future of dwindling staff, dwindling circulation and dwindling revenue. The pending layoffs of up to 20 staffers (on top of 350 others over Stanton's four-year tenure) were apparently the last straw for Stanton, who was also said to have clashed with the paper's new digital editor.

Also read: L.A. Times Rocked by More Turmoil: Top Editor Quits With Cuts Looming

So the fifth-largest metropolitan newspaper faces a grim future. Or does it?

Amidst circulation declines, Stanton built the paper's unique online readers to about 17 million a month. If only those readers could be effectively monetized, and the importance of  the paper portion of its business gradually diminished, the Times might mount a turnaround.

The paper is considering two ways to do just that: launching its own tablet and creating its own paywall, as the New York Times and the Wall Street Journal.

Also read: L.A. Times Scuttlebutt: Clash Over No. 2 Editor

For the tablet plan to succeed, L.A. Times newspaper executives need to swallow the unwelcome truth that their customers want the tablet more than they want the newspaper.  Cost and flexibility will be the determining factors: offering a free tablet to anyone who signs up for a one or two year newspaper subscription might well persuade many cost-conscious people to sign up. The tablet — probably some generic knockoff — would also have to offer music, TV watching, movies and other things consumers have come to expect.

For the paywall to succeed, the newspaper would do well to look at the Wall Street Journal, not the New York Times. From the beginning, the Journal has enforced a strict pay wall — only paid paper or online subscribers get access to all content. Free site visitors can access only a very limited amount of material. The cost of all-digital access to the newspaper is a palatable $3.99 a week and the Journal is a joy to read on a tablet.

The New York Times' paywall, by contrast, allows viewers to have roughly 25 free articles per month, before being locked out by the pay wall. The pay wall is easy to circumvent: just start reading the newspaper on your smart phone or tablet when you run out on your laptop. A few simple modifications to your computer, and you can read the newspaper there, anyway.

What incentive does that leave for anyone to sign up for the New York Times? I haven't, and I (guiltily) read around half a dozen stories a day.

The New York Times is also far too pricey. The digital version is $8.75, or more than twice the cost of the Journal's offering. The proof is also in the pudding: the Journal's online edition has been consistently profitable.

Unfortunately, the L.A. Times' success with its tablet or pay wall strategies probably depends upon the newspaper tolerating some short-term cannibalization of  its core newspaper business.

Better now, through a careful strategy, than bleeding out another few hundred thousand subscribers over the next few years in an unforgiving market.