Cablevision bought the Long Island newspaper in a $650 million deal last May. It wrote down Newsday's value by $402 million on Thursday, pushing its fourth-quarter results to a loss.
"Our goal was and is to use our electronic network assets and subscriber relationships to transform the way news is distributed," Rutledge said on a conference call with analysts. "We plan to end the distribution of free Web content."
Consultant Ken Doctor says it best:
Want to know how likely it is that Cablevision's new charge-for-Newsday-online will work? A few rational arguments to follow, but consider this number: The average unique visitor on Newsday.com spends four minutes, 25 seconds per month on the site. Ouch. That number can sub for lots of focus groups, price elasticity testing and the like. Newsday's would-be digital audience has voted with its fingertips. That number is up almost one minute from a year earlier, here courtesy of E and P's monthly Nielsen rankings, but still ranks Newsday as having the lowest online engagement of the top 30 newspaper sites..
Confronted with having to pay for a site you may use less than five minutes a month, you think you are going to pay for it? Wrong site. Wrong year. Wrong metro area