To recover lost sub revenue, WSJ site would have had to increase traffic 12x : analyst

Further to pay walls or not pay walls: The recent decision of the Wall Street Journal to continue restricting its website to paying customers (at least for now) may have had something to do with the math of replacing those subscription fees with paid advertising. According to a story in paidContent.org, an analysis by Bear Stearns shows the popular site would have required 12x the traffic it now has to replace the revenue from subscriptions. Analyst Spencer Wang calculated thus:

• WSJ.com revenue is currently pegged at $78 million annually, based on an estimated 989,000 subscribers paying $79/year.
  
• Including non-subscriber traffic, the company claims 122.4 million monthly page views.
• Based on an estimated CPM of $6 and a few other assumptions about sell-through rate and ad impressions per page, Wang arrives at the 12x conclusion.

Wang also notes that $78 million in revenue only accounts for an estimated 4 percent of Dow Jones (NYSE: NWS) revenue,

so from a strictly financial stance, it doesn’t much matter either way to News Corp. If Murdoch does set WSJ.com free, as is widely presumed, there will likely be a broader strategic rationale than simply wanting more ad revenue in the short term.