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NYT Paywall Cost $40 Million: How? 305

An anonymous reader submits this musing from Philip Greenspun's blog: "Aside from wondering who will pay more than the cost of a Wall Street Journal subscription in order to subscribe to the New York Times, my biggest question right now is how the NY Times spent a reported $40-50 million writing the code (Bloomberg; other sources are consistent). Google was financed with $25 million. The New York Times already had a credit card processing system for selling home delivery. It already had a database management system for keeping track of Web site registrants. What did they spend the $40-50 million on?" Maybe the folks behind CityTime were free on weekends.
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NYT Paywall Cost $40 Million: How?

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  • by Anrego ( 830717 ) * on Monday April 04, 2011 @08:14AM (#35706440)

    I can actually see how this happens. Large organizations spending millions and taking years to do something a small team could whip up (and probably do a better job of) in a few months.

    Different team sizes are required for different tasks. Some companies get this and put small teams together and have flexible processes that can scale to project size. Other companies can only do things one way, and that’s where you end up with insanity such as this.

    You end up with layers and layers of process controlling huge unwieldy teams. You spend months just drafting the process by which you’ll operate under, and then it needs to be reviewed and this is before development even begins! You end up with 5 layers of management, each providing no real value to anything... but adding lots of time and cost.

    You’ll need to gather metrics of course, so you need to figure out what metrics you need, and how you will analyse them, and how they will feed back into the dev process. And of course you’ll need someone to actually facilitate all this with some kind of metric crunching tool (which has to be bought and admined as well).

    • A simpler way. (Score:5, Insightful)

      by khasim ( 1285 ) <> on Monday April 04, 2011 @08:22AM (#35706500)

      Follow the money.

      Someone is getting paid. Find out who and what that person's connection to the person signing off on that expense is.

      • Re:A simpler way. (Score:5, Informative)

        by _Sprocket_ ( 42527 ) on Monday April 04, 2011 @11:28AM (#35708522)

        Follow the money.

        Someone is getting paid. Find out who and what that person's connection to the person signing off on that expense is.

        Sure. But don't expect to always find some nefarious link. The world of bureaucracy is bigger than just corruption. Although bureaucracies do make a breeding ground for corruption and they become more unwieldy the more the system is adapted to eliminate corruption.

        I've had a lot of direct experience dealing with government bureaucracy at various levels and organizations (and some experience with corporate bureaucracy). I've seen relatively simple tasks turned in to months-long projects and couple months worth of thorough effort turned in to a multi-year outsourced contract. This isn't because someone was getting a pay-off. This is because The System, of which every good Bureaucrat serves and follows, demands levels of effort far beyond anything anyone not serving The System would think sane. So while the tasks themselves can be simple, performing the tasks within the bureaucracy requires many more additional steps that require many more man-hours to accomplish.

        I should stress that corruption can still rear its ugly head. I haven't viewed it very often myself. But I've dealt with rules that have come in to place to close a loophole exposed by someone who had figured out how to game the system and got caught doing so. There will be people that are gaming the system according to these new rules and the process will repeat itself (as well as the occasional case of someone who thinks they won't get caught doing something others got caught doing).

    • by headhot ( 137860 ) on Monday April 04, 2011 @08:22AM (#35706504) Homepage

      I'm a consultant in telecom. I see this every day. I'm convinced that any project, no matter how big can be done by 6 people.

      • by rwven ( 663186 ) on Monday April 04, 2011 @08:34AM (#35706568)

        I'm a consultant in telecom. I see this every day. I'm convinced that any project, no matter how big can be done by 6 people.

        QFT. In my experience it seems like, for the most part, a small, highly skilled, highly focused team can accomplish at least as much (or in some cases far more) than any large team of developers/architects. Decisions are easier, faster, and cheaper to make when you have a group of people with industry experience and know-how. The amount of code needing to be laid down for most web projects really isn't THAT large....especially when it comes to a project like this NYT example.

        I also think (and this probably goes without saying around here) that a top-heavy management structure is an instant doubling (or probably worse) of time and budget for any project. I was on a development team once that had twice as many people-management and project-management positions as there were developers, and it was an absolute nightmare. Developers ended up sitting around twiddling their thumbs waiting for someone to actually make a decision and call down the order to act.

        • by jimbrooking ( 1909170 ) on Monday April 04, 2011 @09:00AM (#35706782)
          Agreed. Long before most of you were born, i.e., in the 1960s-70s, it was a given that if IBM told you (a customer) that they were putting another 100 people to work on a piece of late software, they were really telling you the project had been killed. And of course there's the classic Mythical Man Month ( which, of course, no one reads any more.
        • Re: (Score:2, Interesting)

          by Anonymous Coward

          I agree. We're a 2 person company that's bid on projects against larger competitors. We've had customers call us in after going months or over a year with the larger companies and not having any deliverables.

          We've turned around the project in a fraction of the time it took a larger team to even start. It's absolutely insane.

          The common reason that we're not taken seriously is that we don't have a big enough team to deliver on time, and if these larger companies can't stay on schedule then we have no hope

          • by TheRaven64 ( 641858 ) on Monday April 04, 2011 @12:32PM (#35709334) Journal

            The common reason that we're not taken seriously is that we don't have a big enough team to deliver on time, and if these larger companies can't stay on schedule then we have no hope in hell.

            Next time you have a project, you can hire me as a consultant. You won't have to manage me, and I won't do any work, and will only require a token salary, but I'll increase the size of your team by 50% and therefore make you seem 50% more credible!

        • I don't mean to tickle fanboi/flamewar neurons here, but I think a comparison of Apple and Microsoft is germane here, especially since many posts are commenting on the use of small teams of programmers..

          Apple develops new products like the iPhone/iPad using small teams of excellent designers and programers. Only once the basic product is designed, once the base OS patterns are set are the products released, and a broader range of programming staff allowed to mess with it. This allows them to design the ba

          • What did you do this morning? Spill some Reality Distortion Shield in your coffee? Apple (which may or may not use 'small teams of excellent designers and programmers) pushes out stuff that is buggy as hell. Anybody with half a brain and a reasonable grip on reality doesn't buy any Apple product until version 2 or, better yet 3. What Apple does it that it concentrates it's folks on just a few items compared with the thousands of SKUs that Microsoft has to deal with. They don't have to cover the breadth
      • by fruey ( 563914 )

        "any project, no matter how big" can be split into sub-lots which can be done by 6 people... but may take a lot of time if the same six people have to install in several different countries, or install hundreds of machines for infrastructure :)

      • by Chrisq ( 894406 )

        I'm a consultant in telecom. I see this every day. I'm convinced that any project, no matter how big can be done by 6 people.

        There are probably a few exception, but add two or three good testers (who should not be the implementers) and I think that would cover 99% of projects

      • by dlingman ( 1757250 ) on Monday April 04, 2011 @08:47AM (#35706672)

        I'm a consultant in telecom. I see this every day. I'm convinced that any project, no matter how big can be done by 6 people.

        I guess you don't have any kids then. (What am I saying. This is slashdot.)

      • I'm convinced that any project, no matter how big can be done by 6 people.


      • by SharpFang ( 651121 ) on Monday April 04, 2011 @09:09AM (#35706866) Homepage Journal

        Prerequisite: the team must be equipped with powertools to cut through the red tape.

        Say, open line to the CEO who just says "yes" to anything they say and authority to fire whoever stops them from performing their task.

        Depending on company structure, 10-60% of the time of any "revolutionary" change is spent actually developing the change, the remainder is asking, waiting, begging, urging, pressing, explaining, escalating and generally overcoming people who while aware of the necessity of the change and futility of their resistance, will resist the change as much as they can (or see it as the opportunity to exercise their decision-making power, which is totally unneeded and unwelcome there but by no means anyone could ever notice that.)

      • by vlm ( 69642 )

        I'm a consultant in telecom. I see this every day.

        Look at the spectacular cost of billing systems in the old-world voice telecom... You need 24x7 monitoring NOC and NOC tools and troubleshooting tools for the multiple geographically separate multiple synchronized billing database servers. And, being telecom, you need at least eight layers of management, minimum, each of which needs different reporting systems and dashboards. Finally there's the intermittent / process oriented / batch oriented monitoring tools required. And probably some queuing softwar

        • I have no citation for this ( but I remember reading in a reputable .au newspaper that the administration of the Melbourne [Australia] tram ticketing network cost almost exactly the same as the ticketing revenue - in other words, they could have just fired all the ticket inspectors, torn out the ticket vending machines, and made the tram network free!

          Many large organisations seem to make their priority to simply give their staff work to do. The value of the tasks assigned is less important than

      • Interesting assertion. I wonder what the Ancient Egyptians building the pyramids would have thought if you had suggested that to them.
      • I agree. Well. mostly.

        I've had a few opportunities at jobs, where they had "years of manhours" and a small fortune put into a project that barely worked. They've needed significant changes made, and neither I nor the original coding team could see it modified in the ways the bosses wanted quickly.

        Instead, I've taken the existing project, reproduced the list of requirements, and added the new list of requirements, to give a full scope for a new project. Then I

    • by fruey ( 563914 ) on Monday April 04, 2011 @08:29AM (#35706532) Homepage Journal

      Two well identified principles at work here (and the bigger an organisation, the more likely they are to happen, especially without strong leadership)

      1. Parkinson's law : basically, work spreads out to fill the time that was earmarked to complete a project
      2. Brooks' law : Adding people to a project increases lateness, because the number of communication channels to manage increases as a square of the number of people on a project

      Only very sound management and trusting delegation - along with having a reasonably competent project team in the first place - can make things happen quickly.

      • This is the truth. Mod parent up. IT Project Managers all need to read Steve McConnell's "Rapid Application Development". It is literally The Holy Bible of IT Proj Mgmt.
    • by PsyciatricHelp ( 951182 ) on Monday April 04, 2011 @08:44AM (#35706644)
      I actually use to work for the Times as a tech and all I can say is, man you nailed it.
    • by dkleinsc ( 563838 ) on Monday April 04, 2011 @09:07AM (#35706844) Homepage

      I should point out that the NYT Paywall is apparently a much more complex beast than a simple "pay up to see the articles". What they're trying to do is allow search engines, Twitter, and other social media to drive traffic to them, but at the same time not allow people to regularly read their content for free.

      My guess as to the approximate cost breakdown:
      - consulting fees to convince the top brass to go along with this plan even though the last attempt failed miserably: $20 million
      - project management and business analysis: $10 million
      - profits for the purchase manager's brother-in-law's IT contracting firm: $9 million
      - 8 developers and 2 testers to do the actual work: $1 million
      - Watching online readership plummet again: Priceless.

      • What they're trying to do is allow search engines, Twitter, and other social media to drive traffic to them, but at the same time not allow people to regularly read their content for free.

        Here you go:

        if request['referer'] in (twitter, facebook) or 'Googlebot' in request['agent']: allow_access()

        Since I only spent 3 weeks writing that, I'll just charge $25 million for it. Such a deal!

        • by ildon ( 413912 )

          My (possibly incorrect) understanding is that if a site treats the google bot differently than a regular user, then google will blacklist them.

          • Fixed in commit #3:

            if request['referer'] in (twitter, facebook): allow_access() # or 'Googlebot' in request['agent']: allow_access()

            That'll be $3.7 million, please.

        • Three weeks of development and $25 million for one line of code that will be broken with a simple Firefox extension! Priceless! =)
      • You forgot one thing: the lawyers. The lawyers need to be paid somewhere, for everything from "reviewing" the plans and the policies to dealing with potential lawsuits from people suing you later on (you know that will happen, right?). Maybe this is part of the "consulting fees" at $20 million; they probably also had to reduce the $1 million for the development & testing down to $250,000 and offshore the work to India or Singapore, just so that the lawyers can take some more,. . . Who cares if the code
    • by Anonymous Coward on Monday April 04, 2011 @09:12AM (#35706916)

      The depressing thing about the "big budget" development efforts is that the bigger the budget, the bigger the likelihood that it will fail.

      Some of the most successful software I've ever seen was fairly ugly stuff that was knocked out in short order by less than 5 people. Years later, as it finally begins to seriously creak at the seams, the corporation puts together a massive team to bring it up to date. They spend massive amounts of time and money on consultants, fad "silver bullet" development tools and fad "silver bullet" project management techniques. 18 months into the 2-year schedule, they realize they've spent a year and a half generation UML Actor diagrams, panic, and immediately set everyone to work coding, without any coherent blueprint at all. The whole thing falls apart, lots of people get laid off, and maybe 2-3 people go in and hack the original warty system to keep it going. With luck, one can repeat this cycle several times.

      • by steelfood ( 895457 ) on Monday April 04, 2011 @11:10AM (#35708314)

        What they lack is vision.

        You can pull off a big project with a large group of people. Countless people in the past have shown us you can do it, Steve Jobs being the most visible currently. But you need to have vision. You need to have somebody at the top going, "This is what it needs to look like in the end. This is the part you need to work on. Now go do it."

        Most management meetings are more about answering the question that a single, lone visionary would've answered in two minutes, than about actually getting there. Rule by committee isn't only inefficient, it's the perfect way to get nothing done (which is why there are heads of state even in democracies). Management meetings are a form of rule by committee. Is it no wonder then that everything crawls?

    • by Bengie ( 1121981 )

      They're probably double counting.

      Their logic:
      We spent $40mil, as a company, over x months. This project took x months, therefore, the project cost us $40mil.

      That's how you get this logic: [] (Safe for Work)

  • Its easy (Score:5, Interesting)

    by MichaelSmith ( 789609 ) on Monday April 04, 2011 @08:18AM (#35706472) Homepage Journal

    A lot of it will have gone into executive information components of the system. Ways of showing the guys in charge exactly how much money they are making from the paywall this minute. Then you have the configuration interfaces and the teams to design datasets to control how the paywall works. Then you have the engineering which actually implements the paywall. They probably wrote a proxy from scratch to do that. Then they put it through validation. This created 10000 bug reports. Thats a lot of bugs so they outsourced the bug fixing to four companies in India who approached the solutions in 223 different ways. Then the resulting code changes were merged back into the mainline with bugs closed. Nobody wanted to do the tests again which was probably a good idea for the sanity of the people involved. Then they went live.

    Well, thats my guess, anyway.

    • Re:Its easy (Score:5, Funny)

      by gl4ss ( 559668 ) on Monday April 04, 2011 @08:37AM (#35706590) Homepage Journal

      you actually forgot one bit.

      hiring 'shadow developers' (also known as retards) and inflating the team size from the 10 needed to the unnecessary 100+ with testers. the times still receives just the output from 5 good guys but gets a bill for 100+. and every new person introduced to the team is more profit, as the there's more hours and persons to bill for(so they hire an unnecessary new guy/gal to inflate the team, the new person costs say 5000$ a month, the client is billed for 6000$, the company ruining executives keeping the difference . and universities have been just inventing new professions so it's pretty easy to inflate the team with sheep experts, marketing advisors, accessibility destroyers etc. and every single one of them will try to come up with output that would change the end product somehow, to justify their job).

      • > the new person costs say 5000$ a month, the client is billed for 6000$

        ROFL! Where do you work? If the new person costs $5000/month then they most likely get billed at $275/hour.

        • by gl4ss ( 559668 )

          I'm in Finland, nobodys got money to pay 275/hour now, even if it got results. maybe in 1999, but not now, so the name of the game has been what I just said, I wasn't trying to be funny :.

          the point of this small bleeding - which is scaled up, so it's small only per person - is just that, it's easier to justify new help than paying the old guys what they should be paid. it unfortunately makes things happen a lot slower, not faster. also it dilutes responsibility so you can't even point out anyone doing anyt

      • Testers (good ones, anyway) are vital. A good tester will find the edge cases that the developer never thought of, or the holes in the requirements that the designer never thought of, but that end users will inevitably find.

  • CAL's (Score:2, Interesting)

    by Anonymous Coward

    Microsoft client access licences for all subscrbers?
    Paywall is implemented in sharepoint

  • by Anne_Nonymous ( 313852 ) on Monday April 04, 2011 @08:19AM (#35706484) Homepage Journal


    What else offers so little for so much?

    • by Blymie ( 231220 )

      The sad part is that there *are* good consultants out there. I'm one of them. I'm extremely skilled, knowledgeable, and I bring a lot to the table.

      Frankly, there are a *lot* of firms out there that have unskilled admins, that only need help during certain projects, or during time of distress. As well, as long as the person doing the audit is acceptable, external security audits are a GOOD thing. If one truly cares about security (and not ego), external audits are great. Lastly, there are firms that are

      • by SharpFang ( 651121 ) on Monday April 04, 2011 @09:14AM (#35706928) Homepage Journal

        The sad part is that there *are* good consultants out there. I'm one of them. I'm extremely skilled, knowledgeable, and I bring a lot to the table.

        ...but that's what they all say.

        • by Blymie ( 231220 )

          The sad part is that there *are* good consultants out there. I'm one of them. I'm extremely skilled, knowledgeable, and I bring a lot to the table.

          ...but that's what they all say.

          Perhaps, but now you're slinging mud.

          The truth is, as with any profession, there are a lot of incompetent people out there. Frankly, I've seen a lot of incompetence in the IT world, including full time employees.

          I find it astounding that some consultants charge for lunch, and even charge for taking a crap. If I stop and have a 10 minute discussion, non-work related, with someone at a firm I'm working for... I *take that time off the bill*. I don't charge for research, unless the topic is utterly obscure.

    • Serves them right I say. If executives do not want to hire the right people and have internal staff, and want to vendor everything out to get raped by consultants it serves them right. Maybe eventually they will learn that this is a very stupid business model, at least to the extreme that it is taken. The best part is now if they need additional work, or if something breaks, guess what, more consultants. Not to mention in 10 years no one will have the documentation or know how anything works, and the actual

  • 1. Stupidity
    2. Ignorance
    3. Stupidity + Ignorance
    Fomr the highest company levels (C*O) down to the managers.
  • They hired the same guys the government uses to create $10mil Drupal websites.

  • Corporation (Score:5, Funny)

    by moberry ( 756963 ) on Monday April 04, 2011 @08:23AM (#35706508)
    $45,000 for the implementation, and $39,955,000 in management bonuses.
    • by JamesP ( 688957 )

      More like

      45,000 for the developers
      10,423,243.54 in legal fees
      14,251,136.87 in management bonuses
      7,472,223.45 for (self-)financing interest and opportunity costs

      The numbers don't add up, of course

    • by jovius ( 974690 )

      The reasoning: $40 million is only $0.005 per every human being, so if each potential future customer paid even one dollar once a year for the content we'd make $7 BILLION profit. It's a perpetual money making machine! Some even pay twice!

  • []

    An investment firm is hiring mathematicians. After the first round of interviews, three hopeful recent graduates - a pure mathematician, an applied mathematician, and a graduate in mathematical finance - are asked what starting salary they are expecting. The pure mathematician: "Would $30,000 be too much?" The applied mathematician: "I think $60,000 would be OK." The math finance person: "What about $300,000?" The personnel officer is flabberghasted: "Do you know that we have a graduate in pure mathematics who is willing to do the same work for a tenth of what you are demanding!?" "Well, I thought of $135,000 for me, $135,000 for you - and $30,000 for the pure mathematician who will do the work."

    thank you, SilverHatHacker (1381259) for the joke

  • Stupid comparison (Score:5, Interesting)

    by Anonymous Coward on Monday April 04, 2011 @08:27AM (#35706524)

    Apples: Creating a search engine from scratch. The main hook is that it is simpler than existing products. User workflow involves typing in a term and clicking a link, and users are interested in it because it's different than competing products. No money (remember, this is before Google Ads) is changing hands.

    Oranges: Changing the user experience for a major existing site. Users are already familiar with the existing site and already inclined to react negatively because you're now charging for what was free. Money is changing hands, so a complete system for handling disputes and showing purchase history is required. The whole system has to hook into existing customer service systems. Customer service systems behind the scenes have to be extended. Support personnel have to be trained. Legal considerations for multiple states or possibly nations may be involved. Management needs reporting features.

  • I work for a large, multinational corporation, full of all sorts of layers of management and unpleasantness, and the current rather sizable program I'm working on--months of development and engineering work, lots of hardware, custom-built stuff ordered from all over the place--is still well under $40 million. If this is one of the supposedly greatest newspapers in the world and they manage to spend that much money on so little, no wonder print is fucked. They've done it to themselves.

  • by osgeek ( 239988 ) on Monday April 04, 2011 @08:37AM (#35706596) Homepage Journal

    The Obama administration's web sites for promoting transparency in government were around $34 Million [] just to keep them running.

  • by DrXym ( 126579 ) on Monday April 04, 2011 @08:41AM (#35706618)
    39 million for the oracle license.
  • The complexity of the rules makes it sound like a telco billing system more than anything else - all about rating and charging lots and lots of events in close to real-time based on a hugely complicated rate-card. You'd be amazed how many software companies are sustained by this issue. It's expensive. []

  • or maybe Computer Associates?

    • by Greyfox ( 87712 )
      Definitely not EDS. If it had been EDS, it would have been $120 million, Citrix-based and would have crashed the first time they turned it on.


  • by jayhawk88 ( 160512 ) <> on Monday April 04, 2011 @08:54AM (#35706734)

    Look, we told them we had to program an autonomous artificial intelligence agent to proactively scan cyberspace for hackers looking to bypass the firewall using port cross-scripting. They bought it, don't screw this up for us.

  • I'm sure a pointy haired boss was involved.

  • It's easy (Score:5, Interesting)

    by HangingChad ( 677530 ) on Monday April 04, 2011 @08:57AM (#35706758) Homepage

    I watched the Navy burn $27 million on a glorified CRM that used Siebel and never got any working components. While that clusterfuck was going on a small team of four people built a prototype type system that was eventually rolled out to production because it was the only one that worked.

    The person responsible for the $27 million dollar disaster got promoted and took over management of the working system, which they promptly turned over to EDS to manage.

    When it comes to software development, spending more doesn't necessarily get you more.

  • I was on it all day every day last week, logged in and not, and hadn't. Maybe they're rolling it out slowly. If not I'm fairly certain they didn't get their money's worth.

    "If that's Carlos Slim on the line we're not in!"

    - js.

  • Uhh... (Score:5, Interesting)

    by Panaflex ( 13191 ) <{moc.oohay} {ta} {ognidlaivivnoc}> on Monday April 04, 2011 @09:05AM (#35706834)

    Well it's quite possible to "book" the value of a project much higher than you may actually outlay at any present time. Remember, these costs get deducted, deprecated and ultimately reduce tax burdens.

    Or maybe it was just hookers and blow...

  • . . . because he did not have an installed base.
  • Start with the client's budget for the project, add 10%, and work backwards. The beauty of this system is that it does not depend on a troublesome time estimate.

  • Sort of like:

    Contact a golf buddy who you went to school with and were in the same frat with. Skew bids and and keep out other contractors by disqualifying them with statements like "they don't have the depth", "they don't have the scale we need", "I heard they dropped the ball once or twice", "we should look at company X because they also but our services and/or products", etc.

    Both execs or PMs on both sides trumpet the accomplishment and bail out with in a year. They agree to give each other very

  • Internal company political circle-jerking will quickly drive up the price of anything, regardless of how simple it could be.

If graphics hackers are so smart, why can't they get the bugs out of fresh paint?