Newsday to charge readers for access to its website

by Staff, Brand Republic 27-Feb-09, 08:50

NEW YORK - New York tabloid Newsday is to begin charging for access its website, which makes it one of the first US newspapers to reverse away from free content.

Read Gordon's Republic blog post - Newsday - beginning of the end for free content?

Cablevision Systems Corp, which bought Newsday in May 2008 from Tribune Corp for $650m, said it planned to charge online readers of Newsday as part of a move to transform the newspaper's website into a locally focused cable service.

The decision to charge comes after Cablevision had to write down Newsday's value by $402m putting the decision to buy the paper and move into the suffering US newspaper market under further spotlight.

Tom Rutledge, chief operating officer of Cablevision, said: "Our goal was and is to use our electronic network assets and subscriber relationships to transform the way news is distributed.

"We plan to end the distribution of free web content and make our news gathering capabilities a service for our customers."

Cablevision has announced no cuts to its print operations, but these are expected.

Timothy Knight, Newsday's publisher said: "We are in the process of transforming Newsday's website into an enhanced, locally focused cable service that we believe will become an important benefit for Newsday and Cablevision customers.

"More particulars will be forthcoming over the next few months."

The decision to charge comes in a terrible week for the US newspaper business and on the same day that EW Scripps announced it is to close the Rocky Mountain News.

The paper the Pulitzer Prize-winning paper will close on Friday after failing to find a suitable buyer. Scripps said only one buyer came forward and they later pulled out.

Rich Boehne, Scripps chief executive, said at a Denver news conference following the announcement: "It was not an industry player nor one who has been involved in the newspaper industry in the past."

The closure leaves Denver with one major daily, the Denver Post, which is owned by the MediaNews Group.

The closure follows news earlier this week that Hearst Corp was considering shutting the San Francisco Chronicle as USA Today publisher Gannett said it would cut its dividend by 90%.

That news sits alongside a growing number of newspapers that have filed for Chapter 11 bankruptcy protection including Los Angeles Times and Chicago Tribune owner Tribune and Philadelphia Newspapers, which publishes The Philadelphia Inquirer and Daily News.