www.atnewyork.com/news/article.php/284421
By Jason Chervokas January 14, 2000 In an effort to expand its brand reach while also increasing its paid-subscription offerings, TheStreet.Com has announced a strategy in which it will split into new free and paid parts. The company will offer much of its main news offerings for free at TheStreet.Com site while moving its best-known columnists and other content into a new paid-subscription site and offering other paid sites to launch in the spring. The moves are the first to be announced by recently-appointed CEO Tom Clarke, who has been charged with the task of refocusing the company and boosting its revenue, user base, and share price. TheStreet.Com shares have lately been trading in the same range as its $19 IPO price. Under the plan TheStreet.com destination site will form the free hub of a network of sites that will include RealMoney.com -- where TheStreet.Com's best-known columnists will be published, as well as TheStreetPros.com, a subscription-based product for financial service professionals; and ipoPros.com, a subscription-based service for the IPO market recently acquired by TheStreet.Com. Also joining TheStreet.Com's free site will be TheStreetTalk.com -- a financial discussion area. "What we're really trying to do is unlock the value of the company," said Clarke in an interview with AtNewYork.Com. With the market valuing free content and high rate audience and revenue growth had to make a change. "Sixty percent of our content is already free but nobody knows it." In fact, Clarke said, consumers were confused and frustrated when they clicked on a story headline on TheStreet.Com's homepage only to be hit with a message saying that the content they were looking for was only available to paying subscribers. In essence the kind of commentary that is now available to paying subscribers will be shifted over to RealMoney.com. And Clarke hope TheStreet.Com's paying subscribers will shift too, even though the new paid site will cost double the current site's $99 a year subscription fee. That's a questionable strategy. Will subscribers want to pay for more for commentary by Jim Cramer and Dave Kansas and conversation with analysts on an up-to-the-minute basis? Clarke thinks so. At $200 a year a subscription to RealMoney.com will still cost less than a subscription to a high end commentary newsletter, he said, and will have the advantage of being up to the minute. But by separating out TheStreet.Com as a free destination, Clarke believes he can increase traffic and ad revenue numbers at the core site. Even though the company will actually have more paid-subscription products in the new configuration, Clarke said he expects advertising will become a bigger part of TheStreet.Com's revenue mix. In the third quarter of 1999 subscription fees, including fees from bulk subscriptions sold at a discount to corporations, accounted for only around one-third of the company's total quarterly revenue of around $4 million. Clarke expects ad revenue to account for something like 75 percent of the revenue in the new structure, and he expects to develop new revenue streams from the company's Fox TV show and other cross media properties in development. |
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