ITV to drop subscription model for Friends Reunited

LONDON - ITV is set to ditch Friend Reunited's subscription model in response to growing pressure from free social networking sites such as MySpace and Facebook.

It is understood that the commercial broadcaster is planning to drop the £5 annual subscription charge for Friends Reunited.

Earlier this month, ITV appointed Gary Cole as the head of revenues for ITV.com and Friends Reunited, tasking him with building a strong online sales team in order to maximise revenues for the two.

This expected move away from a paid-for model comes as Friends Reunited is increasingly overshadowed by popular social networking sites MySpace and Facebook.

Friends Reunited, which was launched in 2000, boasted 12m users when ITV bought the site for £120m in December 2005 and it enjoyed phenomenal success.

However, the site now has only 9m registered users while MySpace has 100m users and Facebook has accumulated over 50m users.

In August, Michael Grade, ITV executive chairman, already hinted that some areas of the site would be made free for users. When announcing the channel's interim results, Grade said that some elements of Friends Reunited would be opened up.

ITV is looking to make £150m in online revenues and at the recent AOP conference Jeff Henry, director of ITV Consumer, said the broadcaster wanted to be the leading provider of free entertainment in the UK.

When asked how ITV were going to update Friends Reunited in the face of the social media challenge presented by Facebook and MySpace, Henry said traffic was robust and that despite suggestions otherwise the site was "not languishing".

He said he knew the challenge was to take FriendsReunited to the next generation, but at the time he would not say how, only that it was well in hand. Commentators expected this to include making the service free before it lost its audience to rivals.

Friends Reunited will be able to attract more online ad revenue if it drops its charges and boosts user numbers.

ITV is not alone in axing its subscription model in favour of free content. Earlier this month, the Financial Times decided to offer users partly free access, as a pre-emptive strike against The Wall Street Journal's rumoured switch from paid content.

Rupert Murdoch is expected to make The Wall Street Journal's website free, after buying the paper's owner Dow Jones earlier this year.

Since mid-October users of the FT.com website can view 30 articles a month for free. Previously users had to pay up to £200 for the privilege.

The FT was also prompted to cross over to free content by The New York Times' decision to drop its paid-for model last month.

ITV could not confirm plans to drop Friends Reunited's subscription model but said that it was currently looking at making more parts of the site free.

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