The Financial Times moved to see off the impending threat of Rupert Murdoch in the online business content sector yesterday by ditching its site's existing subscription model in favour of offering more free content.
The plan has been interpreted as a pre-emptive strike against rumours that Rupert Murdoch plans to make content on The Wall Street Journal's website free following his acquisition of the newspaper's owner, Dow Jones, earlier this year. The FT's decision also reflects the rising significance of online advertising, which is a potentially more lucrative source of revenue than subscription sales.
From mid-October, users of the FT.com website will be able to view 30 articles a month for free, a shift away from its previous policy of only allowing subscribers who paid either £100 or £200 a year access to most of the site's content. The unique model hopes to tempt more users into subscribing once they have used up their 30 free views a month.
The FT.com site has more than 100,000 subscribers, which adds up to £9m a year to the FT's revenue base, according to analysts. Usage of the site has grown substantially this year with unique users up more than 70 per cent. In contrast, the WSJ.com has nearly 1 million subscribers.
Yet with the WSJ.com rumoured to be ready to ditch its subscription-based model and The New York Times abandoning its paid-for content model last month, there was a certain amount of inevitability about the FT's move. One analyst, speaking off the record, said that once Mr Murdoch "lets the cat out of the bag, it will be difficult for anybody to put it back in there again".
He added that Pearson, the owner of the FT, will look to make a virtue out of necessity by capitalising on soaring internet advertising demand, but said it is difficult to judge how much extra traffic the FT.com site will need to offset the impact of the lower subscription revenue.
John Ridding, chief executive of the FT, said that the company's content is worth something to its subscribers and that the changes to its pricing model could stimulate more usage of the site and hence more subscriptions. The company will also invest in improving the site with a redesign, new columns and faster speeds. It will also offer more blogs and video content, reflecting The Daily Telegraph's investment in multimedia.