National Geographic has a 12 month subscription plan for 15$. Isn't that a deal or what? Why are they doing it? Lets see. We all know that newspaper circulation is on an inexorable ride down, except if you are a gossip mag like US Weekly or People. Anyway, as a magazine is confronted with declining circulation, it is going to see lower sales revenues as well as less advertising revenue as advertisers have more incentive to leave. One way to stem the circulation decline is to cut prices. Even if you keep circulation up by selling at cost, it has a nett positive benefit because you have higher advertising revenue. One could actually sell extra copies at a loss, if that additional circulation leads to sufficiently higher advertising revenue. Which is the business model for your commuter free papers like Red Eye (Chicago) or Metro (London). The online model is essentially the same thing, where content is free in order to attract viewership, and then advertising is where you try to make some money.
Coming back to my original point, 15$ sounds like a steal. $ 1.25 for an issue filled with gorgeous photos and beautiful essays on the wonders of this world. I can live with that. Hail Economics! Those who are about to get a deal salute thee! Ha ha.
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