NEW YORK (AdAge.com) -- Rupert Murdoch's new weekly pricing plan for The Wall Street Journal's mobile app looks steep, but it should help reinforce the value of subscribing to the mothership.
When Mr. Murdoch gave the first details of the Journal's plan to start charging for its app on iPhones and BlackBerrys (as the paper had already suggested it eventually would), the real surprise was the price.
If you're not a subscriber to the Journal in print or on the web, prepare to pay $2 every week for the privilege of using the mobile app -- $104 every year. If you subscribe to either the print or online edition, you can pay just $1 extra dollar every week. If you subscribe to both, you can have the app for free.
Previous experiments with charging haven't come close to those levels. The Associated Press experimented this year with selling its BlackBerry app, for example, for $2.99 -- one time only. Many app developers talk about getting 10 people downloading the free version for every one person willing to pay, but the AP found a much bigger difference.
"Most folks talk about a 10 to 1 ratio," said Jeff Litvack, general manager for mobile and emerging products at The Association Press. "We saw a significantly higher ratio." The reason? So much similar content was already widely available.
So how many people will pay $104 every year to use the Journal's app? How many Journal Online subscribers will fork over another $52?
The Journal declined to elaborate on Mr. Murdoch's comments, which he delivered at a Goldman Sachs conference in New York. But with all the free financial and business news and information out there, it looks difficult for even the Journal to attract a ton of high-paying, app-only readers. It seems more likely, given the new details, that the paid app will noticeably reinforce the value of subscribing to the mothership.
In a similar vein, The Financial Times introduced an app this summer that is free so far -- but not without limits. The FT uses a metered approach online, providing free content at first then requiring heavy readers to sign up and pay. The app is part of that. "It's integrated with the access model," a spokeswoman said. "Your article count is carried across the web and the app, driving subscriptions."
Other publishers will probably appreciate the strategy. "My reaction to the pricing is that anything that supports our efforts to confirm the value of news, we're supportive of," Mr. Litvack said.
"We're keenly interested to see how the consumer responds," he added. We are too.
UPDATE: On the morning of Sept. 17, The Journal announced details of its plan, which include some remaining free content on the app, which will remain free to download, in addition to the new fees that will be required for full access to Journal subscription content and new tools including "advanced save and share functions, enhanced market data, stock tracking and personalization capabilities."