Online newspapers can earn revenue from subscriptions and from advertisements. The more readers…

Online newspapers can earn revenue from subscriptions and from advertisements. The more readers who access the paper’s site, the higher the advertising revenue the paper earns. To increase revenue, in 2011 the New York Times began offering online subscriptions for $180 per year. Anyone purchasing the subscription has unlimited access to any content on the paper’s site. Other online readers are allowed to read only the front page of the newspaper and 20 stories monthly for free. Business writer Trish Gorman explained that the Times “had no way to know who would embrace the price increase. So the paper allowed readers to segment themselves.” Briefly explain how the paper’s strategy allows “readers to segment themselves.” How does the strategy increase the paper’s revenue?

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