Opinion Blog: New York Times Paywall-innovation or blunder?

April 20, 2011 by · Comments Off 

Posted by Erin Goldsmith
egoldsmith@mail.smu.edu

It’s official: The New York Times online content is now blocked by a paywall.

According to MSNBC, the paper is charging $15 every four weeks, or $195 a year, to read more than 20 articles a month on its site. Apple users, including iPhone and iPad junkies, can access the third-largest U.S. newspaper for only $20 every four weeks, or $260 annually. A digital subscription covering the website and both mobile options costs $35 every four weeks, or $455 annually.

Despite these daunting numbers, the math makes sense. When you break it down, a digital subscription costs roughly $1.25 a day. When compared to the nearly $2 the paper costs at Starbucks you actually save money.

The idea may be intuitive but the Times’ follow-through is lacking. The numerous subscription plans can be confusing to the consumer.

Say you are a multi-platform user—Smart phone in hand, iPad tucked under your arm, and laptop bound in your briefcase, you are the quintessential 21st Century media user. Sadly, this type of user, which is rapidly becoming the norm, is overlooked by The New York Times’ subscription plans.

If you want to read the paper on both your Smartphone and iPad, you’ll have to buy two separate subscriptions. Don’t worry though, The New York Times will gladly charge you $35 every four weeks for your double subscriptions.

As if the subscription costs aren’t confusing enough, it get’s worse. Readers coming from a search engine, such as Google or Yahoo, get five free articles per search service per day. There are no limits on the amount of traffic coming from Facebook and Twitter, however. Basically, you can access the NYT as much as you’d like if you access the site from Facebook and Twitter.

Considering this, why charge in the first place?

In the weeks after adding a paywall the site has been the brunt jokes and scrutiny. The Huffington Post went so far to announce a payment plan just for New York Times’ employees who wished to gain access to the site. The announcement, which was later confirmed as an April Fool’s joke, poked fun at The Times for its crazy payment plan.

Payment plans are understandable. In today’s news market, everything seems to be going digital. Why not capitalize on this? The Times is only receiving scrutiny because it is on the forefront of this idea.

Will The New York Times paywall be a success? Will people pay for the site’s content or will readers go to free sites like The Huffington Post instead? With so many different options, including free access through social media sites, it doesn’t seem like a subscription is necessary.

Personal Finance: When Daddy’s Credit Card Expires

November 8, 2010 by · Comments Off 

By Liz Collinsworth
lcollinswo@smu.edu

There comes a day when the bird has to leave the nest and is forced to fend for itself. So what happens when students are cut off and parental funding reaches an end? How can students graduating from college learn to manage their own funds and begin to plan for the future at a young age? There is no textbook for life and no syllabus to guide fresh graduates step-by-step through life after college. Luckily, there are experts, tools and tricks to aid in post-graduation financial decisions.

Money management can sound intimidating, but can be tackled with the right plan in play. Post-college life can unveil hidden expenses and bills that many students don’t even realize exist. A basic understanding of costs such as insurance, rent and utilities, car payments and taxes is crucial to developing a financial plan.

Amanda Klassen, an 18-year-old student at Collin College says that while she is aware of taxes, she is unfamiliar with how they work.

“Right now my employer takes taxes out of my paycheck and my parents file them for me,” Klassen said. “I admit that I am completely clueless as to how the whole process takes place.”

(GRAPHIC COURTESY LIZ COLLINSWORTH)

Developing familiarity with finances early on is crucial to managing money

The key to financial success in the future is to develop and maintain a plan, and it is never too early to begin saving, says B.J. Collinsworth, chief financial officer of The Pinnacle Fund and an experienced certified public accountant.

“Start thinking about retirement the day you start working,” Collinsworth said. “Put together a financial plan and stick to it. Live within your means and start saving something beginning with your very first paycheck.”

While it may sound ridiculous to begin thinking about retirement upon graduation from college, Social Security and Medicare are reaching their expiration date.

According to an article on Youngmoney.com, an online portal to aid young adults in money management skills, Social Security will “be entirely depleted by 2037.” Yet young adults are still not saving. Some 40 percent of all young adults don’t have a savings account and 55 percent are not partaking in retirement savings such as 401(k) accounts, the article says.

Freedom is a potent responsibility that can bear evil upon those who abuse its sweet power. Students graduating from college and stepping foot into the real world for the first time are often compelled to spend the money that they never had and tend to neglect saving in the rush of financial freedom and salaries. While it may be exhilarating to be set free into the business world, blind spending is potentially threatening to monetary stability.

This generation is fortunate to live in a technology era when smartphone applications and computer programs can help manage money. Apps such as DebtTracker Pro and Flixoft’s Grocery Gadget, as noted on youngmoney.com, are examples of personal finance tools that allow users to hold a financial planner in the palm of their hand. Various technological apps and programs can help young adults keep track of payments and bills, bank balances and transactions, and even calculate progress toward getting out of debt. Smartphone users can now “hire” their own financial planner to teach them how to manage finances without paying someone the big bucks to do it for them.

“My iPhone is officially my business partner,” said Stephen Terry, a 22-year-old Collin College student. “I can find any information I need, check my online bank account and even track my stocks.”

Technology has even transformed what may have been your grandmother’s favorite pastime, coupon-clipping. Shopper’s cards, frequent buyers cards and coupons are easy ways to cut back on expenses. Conveniently, a majority of these things are now available electronically on smartphones to better cope with today’s technology.

The New York Times recently reported on the soon-to-be “InControl” MasterCard from Citigroup that declines charges when users disregard their monthly budget. If a credit card is in your future, youngmoney.com enforces the importance of always paying, at least the minimum payment each month to avoid getting into debt. This will enable users to establish good credit.

Part of the reason graduates are falling into debt at an early age is due to financial illiteracy. According to networksfinancialinstitue.org, only 26 percent of parents with children the age of five or older feel qualified to educate their children financially.

The year 2004 turned out more individual bankruptcy filings than college graduates. Network Financial Institute says that adults between the ages of 20 and 24 “represent the fastest growing segment of bankruptcy filings.”

Advice For College Students

Let’s admit it…yes it’s great to have that gym membership and Netflix is convenient entertainment, but there are cheap alternatives. Hulu.com allows viewers to watch missed TV episodes and even select movies online for free, and running outside is just as effective as running indoors on the treadmill. Furthermore, free Internet is available via Wi-Fi at various locations, and while coffee at home may not be served in a cute little cup, it’s cheaper and requires no transportation. Try to limit eating out and impulse purchases to increase potential savings. Limiting excess, materialistic spending is an easy way to save.

If you feel uneducated and inadequate to fend for yourself, outsource. College finance expert J.L. Thompson discusses tips from his book, “My College Finance.” Youngmoney.com offers an entire library of online calculators and tools to help young adults manage their finances. Research financial advice online and utilize the tools that you have in your cell phones, public libraries and online.

NYT Reporter Says Media Predicted Financial Crisis

October 23, 2008 by · 1 Comment 

By Chris Dell
cdell@mail.smu.edu

Who’s to blame for the disastrous collapse of America’s financial system?

It certainly isn’t The New York Times, according to Diana Henriques, financial reporter for the newspaper. Henriques spoke Tuesday at the William J. O’Neil Lecture Series in Business Journalism, which took place at SMU’s Crum Auditorium.

“Throughout 2007 we ran a drum beat of warning stories about these accelerating risks,” Henriques said. “We were clanging the fire bell right through 2008. I make no apologies for how my paper covered this financial hurricane.”

Henriques cited a handful of articles which forecasted the impending mortgage crisis as many as five years ahead of the collapse, including a Sept. 17, 2006, editorial by The New York Times.

“The housing boom would never have lasted as long as it did if mortgage lenders had to worry about being paid back in full,” the article stated. “In a market so vast and dynamic, everyone knows that if mortgage defaults should rise, damage could reverberate throughout the financial system.”

Since 2006, mortgage defaults have gone through the roof and the economy has been rocky. The problem originated when mortgage lenders bought home loans and sold them to private investment banks, which packaged them together and sold them to investors.?

When homeowners made their regular payments and home prices rose, everyone in the chain profited. But grim reality struck when defaults began piling up and the loan packages — called mortgage-backed securities — were realized as practically worthless. Many banks have shut their doors, and the economy, as a whole, has been greatly impacted.

So, who was to blame for the crisis? Henriques said the media wasn’t totally blameless. News programs made the mistake of placing too much importance on the stock market, suggesting “it is the only market that matters.”

Henriques said if the bond market had been a fixture on the nightly news, perhaps the impending crisis would have been recognized sooner. She stated by the time the financial turmoil affected the stock market, it was too late for regulators to react.

She also said there was a conflict between what the press felt obligated to tell the public and what the public wanted to hear. People who were benefitting from the housing bubble certainly didn’t want to hear that the day of reckoning would come.

“There really are times when people don’t want to hear what the press says,” said Mark Vamos, the William J. O’Neil Chair of Business Journalism, who attended the speech. “In the bubble, there were a lot of people getting rich … They were using their [home equity] like ATMs.”

Henriques argued business leaders need to be trained on how to talk to the media. She said Treasury Secretary Henry Paulson and other figureheads in American economics weren’t able to clearly explain the crisis to the public. That has led to misunderstanding between the people making financial decisions and those that are affected by them.

“In general, business people aren’t prepared to interact with the media,” said Frank Roby, CEO of insurance brokerage Holmes Murphy Texas. Roby attended the lecture and said leaders of individual businesses, not just leaders of the financial system, should be trained to interact with the media.

Finally, Henriques argued, “The public is trained by its leaders not to listen to mainstream media. They say it’s just another special interest group, which is trying to push its own agenda … The public did not believe the messenger telling them about the massive financial crisis.”

Henriques was the latest speaker in the O’Neil Lecture Series, which invites a distinguished business journalist to the SMU campus each semester. William J. O’Neil studied business at SMU and went on to a successful career as the founder of Investor’s Business Daily. Vamos, who coordinates the lecture each semester, was hired as the program’s first chairperson in May 2007.