25 Percent Off?

Inside.com Says Pretty Please

When media-dish site Inside.com began offering free trial subscriptions in May, the idea was for people to get hooked on its gossip within 30 days and begin paying $19.95 a month for the service. Skeptics wondered whether Inside would be able to sell its content—a business model that has often failed—and they're still wondering.

Because depending on how you count, the first wave of freebies could have ended in mid June—yet Inside failed to cut people off. Last week, Inside finally began sending suspension notices and offers to subscribe, but with a 25 percent discount and a soft touch. The letters all but said, "Well, pay soon, OK?"

Inside is traveling a road paved with the corpses of paid-subscription models. Both The Street and Slate had to abandon attempts to get customers to pay. Are Inside founders Kurt Andersen and Michael Hirschorn losing confidence?

No way, says Hirschorn. Business is great, great, he crows. Both traffic and advertising are "better than expected." And paid subscriptions? "Doing well," he reports, "but not off the charts."


Last week, Inside finally began sending suspension notices and offers to subscribe, but with a big discount and a soft touch.


Hirschorn and crew have been explosively hyped and bankrolled to the tune of $28 million. There's no question people like the site. The news about the movie, music, and other media biznesses is fresh and juicy, and Inside writers have scored their share of scoops. Traffic is reported to be high. Some of what gets the most hits, though, like the Inside Dope column, will always be free. It's the data in the site's five industry segments—reports on book sales, box office takes, job-hoppers—that will require your credit card number . . . please.

A scattershot sampling of likely media customers contacted after the extended 30-day trial—a media-beat editor, a literary agent, a book editor, a few publishing execs, a film producer—turned up not a soul who had actually coughed up money. And none of them knew anybody who had.

Told that an informal survey turned up nary a buyer in sight, Hirschorn sounds beleaguered, confessing he has just talked to a Brill's Content reporter asking some of the same questions. "Look, it's a hard sell to folks," he says. "Some will do it; some won't. We've given ourselves roughly two years to prove out this business plan."

Besides, he adds, the site didn't have its official rollout until June 12. "The 30-day trials are running out," he says. "Now we're seriously dunning people. In a few weeks we'll know."

Some potential customers do say they're giving serious consideration to signing on. Todd Shuster of the Zachary Shuster literary and entertainment agency says he'll "probably" subscribe. "It's worth it for the Barnes & Noble sales figure," he explains. Likewise, Sally Richardson, president of St. Martin's Press, is leaning toward it. "If we were ever tempted [to subscribe to an online site]," she says, "it would be with them. . . . [They're] very provocative."

In fact, the publishing industry has been the big surprise, Hirschorn notes, with the "response to book coverage significantly better than expected."

But it's unclear how Inside will make money if an editor in a publishing house, say, buys a subscription and e-mails all the latest dope to a phalanx of colleagues—a strategy already being bandied about by some New York office mates.

Not a problem, says Hirschorn. They want to share, great. "It's free advertising for us. Besides," he adds, "as we introduce really cool personalization, it will become not feasible."

He repeats his mantra: Inside is a "work in progress."

Some media types say the fervent buzz about Inside has diminished to a low hum. They say people still log on for the freebies, but don't talk much about the site anymore. As for paid subscriptions, the wheel's still in spin. But you get the feeling Hirschorn et al. have their shoulders to that wheel, grunting it uphill the hard way.

 
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