Murdoch plans online revolution

LONDON: Rupert Murdoch will use the London Sunday Times as a testbed for a radical new strategy designed to transform the finances

of his British newspaper business by charging for online content.

The newspaper’s website, currently combined with that of its daily sister title Times, will be launched as a standalone site, Sundaytimes.co.uk, at the end of November, according to senior industry sources.

It is unclear whether News International, the subsidiary that controls Murdoch’s stable of British papers, will introduce a subscription model or charge for each visit.

The plans form part of a wide-ranging overhaul of Murdoch’s titles, which also include the tabloids the Sun and the News of the World, after he said they would stop making content available free of charge.

The News Corp chairman said on Wednesday that all his websites would introduce charges by June 2010. He claimed consumers were willing to pay for celebrity scoops and exclusive stories. The Sunday Times advertised for web staff earlier this week and a team of executives have been working on plans to charge for content for nearly a year. The posts include several “communities editors”, designers and dedicated news journalists.

The Sunday Times is the dominant player in the

UK weekend newspaper market, selling more than one million copies a

week, and has subsidised losses at the Times for many years.

It is now thought

to be losing money, however.

Internal documents are believed to show it made a loss of £16 million in 2008-09, the first time it has gone into the red since Murdoch acquired it, and is expected to lose a further £12 million this year. It made a profit of £53.4 million in 2007 and £42.8 million last year.

In a separate move, executives at News International also plan to double the marketing spend used to encourage readers to subscribe to their titles from £7 million last year to £13.5 million this year.

The fact that Murdoch is flagging up one of the biggest strategic shifts in the history of News International so publicly suggests he is eager to encourage competitors to follow his lead, according to senior industry executives.

Andrew Neil, a former editor of the Sunday Times and one of Murdoch’s key lieutenants for over a decade said: “It is a very good idea. I think he’s right and it would help if everybody did it. He knows that this will work better if all the main competitors do it.” Neil said the initiative should be welcomed by an industry that has seen advertising revenues fall dramatically in the face of one of the deepest economic downturns for decades.

Neil pointed out Murdoch’s websites will have to change dramatically if the initiative is to succeed. “If you are going to charge you must build a site that is different and has distinct character. You have to recreate the paper online.”