The Financial Times (FT) is exploring ways it can drive subscription revenues with added-value tools and services, licensing its digital content to an increasing number of third-party channels while developing offerings of its own that are unavailable elsewhere.
There are no plans to charge for these services however, seen as a way to make FT content more useful, and therefore more valuable, to readers.
“The value we deliver is based on the journalism, and the contract is based on the number of people reading,” says Caspar de Bono, MD of the business paper’s B2B division, in an interview with Media Business Asia.
“The more people read, the more familiar they become with the value of what we do; the more likely they are to become a subscriber, the more likely they are to stay a subscriber.”
Provided the FT retains direct subscriber access, a way to monitor content consumption and ultimately gauge its value, the preferred option is for other companies to provide workflow services that leverage FT content.
Similarities with software
In some ways, digital publishing resembles the software business, explains de Bono, who manages relations with corporate subscribers, news aggregators and syndication customers.
Multiple players can monetize a fluid and developing ecosystem, even though the FT provides a core element - its content - that nurtures it.
“As long as you’re a subscriber to the FT, we’re quite happy for you to read our journalism on somebody else’s app, on somebody else’s solution, but crucially we know who you are," he says. "You’ve paid us and we’ve given you credentials that work on multiple devices.
“You’re not stuck with one solution, which is quite a subtle but very important change from the old business model, particularly for large multinationals, who were probably paying many times over through a variety of different aggregators,” he adds.
“Now they pay once, because their license is platform neutral.”
It’s been four years since the FT renegotiated terms with content aggregators such as Factiva and LexisNexis which used to pay a royalty in return for wholesale content rights.
The shift proved unpopular at first, but has helped the FT significantly expand its reach, working with 37 third-party channels today, compared with seven under the old model. FT subscribers are free to switch aggregators or add new ones, without any change to the FT’s licensing terms.
What’s more, readers now have more aggregation services to choose from, with increasing consumption on tablets and smartphones, as well as proliferation of social media, driving experimentation with new models.
“As aggregators get more innovative and there’s choice through that market, our solution anticipates that and is very flexible from a customer’s point of view,” de Bono says.
The FT has around 2,300 corporate customers, representing around 45% of the subscriber base. This is up from zero four years ago when de Bono’s division was created to develop B2B subscriptions.
So far, just under 100 of these contracts are from Asia, though until recently no one had been developing this side of the business full-time.
“I’m excited about the Asian opportunity,” de Bono says. “We’ve gone from half a person last year to seven this year, focusing on direct licence sales, with representatives in Singapore, Hong Kong, Korea and Japan.”
Consumption data from FT.com reveals a tangible demand for FT content from Asian readers, de Bono adds. At the same time, a broader subs base in Asia also helps shore up the value of a recently introduced annotation service called MBA Newslines, part of a wider move to help the reader base connect with each other.
This new tool, initially targeted at business schools, is geared towards named experts linked to a company or institution, offering an alternative to the existing comments system, which allow anonymous contributions.
Over time however, the functionality could be opened up to other constituents, fostering the development of an expert network around FT content.
The FT’s focus should make it easier for like-minded commentators to find each other, de Bono says, though the model is designed to plug into other social networks, rather than act as a substitute.
Productivity-lifting tools and services help create advocates for the FT, de Bono summarizes, ultimately making it easier to persuade prospective subscribers to sign up.
The FT has already developed a credible digital business model. The task in hand now is to scale it.
“Our USP is journalism, so how do we leverage other solutions that are out there, or make it easy for our users to use solutions that are out there?” de Bono ponders.
“What’s special about the FT is our international perspective, and our focus on those issues that are relevant to international decision makers.”