February 18, 1998 5:05 AM PST

Slate to begin charging fees

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After more than a year of anticipation, Microsoft's Slate today finally will start taking subscription sign-ups, charging $19.95 per year for charter members.

In the plan, reported yesterday by CNET's NEWS.COM, charter members, who must sign up by March 9, will be guaranteed the $19.95 rate for as long as their subscriptions stay current. They also are being offered offline incentives--a Slate umbrella and Microsoft software--in an attempt to entice people into plunking down some cash for reading material they have gotten for free for 20 months.

Slate will leave some of its content in front of the subscription wall, mostly to give surfers a sampling of content that Slate is hoping will whet their appetites for more.

Slate originally had planned to charge for content much earlier but held off while waiting for the market to mature.

When Slate launched in June 1996, the plan was to charge subscribers $19.95 per year for the weekly magazine. But in January 1997, Slate put those plans on hold. A year later, it is finally reviving them and it appears to be at a similar price point.

Print publications, ranging from the Wall Street Journal to Playboy magazine have started charging subscription fees for their publications on the Web. But this appears to mark the first time a magazine that originated online has migrated from the free to the subscription model.

It will not be the last, however. Other online publications are considering charging subscription fees as well. Salon, for example, has said it is planning to add a premium service to its free literary Web magazine. In that case, however, the original magazine will remain free and the magazine will charge for additional content. Salon executives said earlier this year that service would launch within six months.

Others are slowly adding charges for bits and pieces of content as well, such as search services or financial information. While many old-time Netizens have vowed they will never pay a cent for online content, others apparently are willing to pay.

The big-bucks question, however, is how much they are willing to pay and for what. Slate is about to find out.

"I do think there are a lot of people watching us closely," Slate publisher Rogers Weed said. "It's sort of a leadership move. There are a lot of publishers out there who would like to see us succeed."

Weed said Slate will start off modestly, hoping for about 20,000 subscribers within the first few months. While that may seem small to some, he'll be happy if Slate continues to grow.

Although Microsoft has probably the deepest pockets in the industry and can afford a loss on some of its products, the company is as bottom-line-oriented about Slate as it is about all its other products.

Eventually, Slate is expected to turn a profit, Weed said, noting that there is no deadline it must meet and no magic numbers to reach.

Today's move will delineate the "dividing line between the period we were getting out on the Web and the period where we were trying to build a business around the site," Weed said. "We've always felt that we've needed this revenue stream to have a viable business. It's kind of marking a second phase for Slate."

 

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