Look, NYT, Online Subscriptions Can Work! (NYT)

Asked to weigh in on the whole debate over whether newspapers should charge readers for access to their content or remain entirely advertising supported, FT.com managing director Rob Grimshaw told us:

For an entire industry to decide they're just going to give away their product for free, may prove, at some point, to be a mistake.

And so, unlike say, the New York Times, which does give away its product for free -- at its peril, we agree -- the Finanical Times instead employs what it calls a "frequency-based" subscription model.

Here's how it works: Everyone gets access to 3 articles a month. Register with the site for free and you can read 10 articles a month. Pay $3.44 a week and you get access to everything online -- except for the FT's famed LEX column. For that, and access to the FT from your mobile, you have to pay $5.75 a week.

Pearson (PSO), the FT's parent-company, doesn't break out the paper's earnings seperately, but Rob did share with us some numbers:

In the last 18 months, 1 million readers registered with FT.com.
Because registering requires readers share lots of personal information, Rob says the FT.com can charge advertisers $40 to $60 CPMs.
Rob says 20,000 new users register with the site each week.
62 million "individuals" visited FT.com last year.
Rob told us FT.com has 100,000 paying subscribers. (Since the FT charges its UK readers more for online subscriptions, this implies that FT.com earns between $18 million and $28 million a year off online subscribtions.)
In October, Pearson reported FT Publishing (which is 85% the paper and and 15% FT.com) saw a 14% y/y revenue increase over the first 9 months of 2008.
Pearson also said FT Publishing profits would grow even if its ad revenues remained flat.

Doesn't a healthy publishing model make you feel young again?

The fact is, publishers like the Financial Times and the New York Times -- the kind that spend any resources at all on raising the quality of their content above any other publisher's in ways that do not necessarily also attract more traffic -- simply have to charge readers subscriptions for access to their product.

They can't rely on selling their audience to advertisers, because more and more, ad-buyers on the Internet are happy to pay $.60 CPMs to show their ads to a certain demographically sliced-up audiences, no matter what Web page those audience members happen to be visiting at the moment.