Time magazine tests pay-what-you-want sub offer

"Real Insight is in short supply? How much is it worth?"

The question can be answered, apparently, by "Whatever you want!" because that is the sell line is at the top of a direct mail piece from Time magazine reported by Media Bistro's Fishbowl NY blog.

The offer is 56 issues of the struggling newsweekly for whatever the reader chooses to pay. Will this Radiohead model catch on,or will other publishers conclude that it makes no economic sense at all?

Time is not a pioneer, mind you; that distinction probably goes to the music magazine Paste, which first tried this in late October last year. The result was that the month-long online offer saw over 31,000 people take advantage of the pay-what-you-want offer, according to an article in Folio: They paid an average of $4.00 for a year-long subscription to the magazine. The promotion ran online for a month.

The success, however, does not appear to be a financial one, at least, not yet. Though new subscriptions generated about $125,000 in revenue, fulfilling those subscriptions will cost more than the $4.00 per subscriber the magazine took in. "We lost money," says [Paste president Tim] Regan-Porter. The experiment will eventually pay off, he says, when these subscribers renew, and from additional advertising revenue the magazine can generate from an increased circulation. Paste had about 120,000 paid subscribers before the Radiohead promotion was launched.

[Thanks, Peter, for the tip]