["Money doesn't always bring happiness. People with ten million dollars are no happier than people with nine million dollars." - Hobart Brown]
The New York Times Is Now Supported by Readers, Not Advertisers
By Joe Coscarelli
Advertising revenue continues to sink at the New York Times Company, which reported a second-quarter net loss of $88.1 million today. But a glimmer of hope can be seen in circulation revenue, which has actually gone up through print subscription price increases and the online paywall. At the company’s big three papers – the Times, International Herald Tribune, and Boston Globe – print and digital ad dollars dipped 6.6 percent to $220 million, while circulation revenue was up 8.3 percent to $233 million. The historical rebalancing, which occurred at the News Media Group for the first time in Q1, may indicate a sea change in an industry that has long relied on advertising to stay afloat. “They’re probably the first major paper that has crossed that line,” media analyst Ken Doctor of Newsonomicstold Daily Intel. “It is an interesting moment.”
The transition was accelerated by the death spiral of print ads, and the stalling of growth for online advertising, but more expensive subscriptions and charging for website access play a role as well. (Note the big ads on the website lately for a summer subscription sale.)
“Getting away from the historic huge reliance on advertising is definitely a plus,” said Poynter media business expert Rick Edmonds. “They’re still trying to stabilize advertising and that hasn’t been wildly successful yet. But the digital subscription effort has been more successful than many people wanted it to be.” The news group now counts 509,000 digital subscribers, up from 454,000 in March.
The morning paper costs more, too, but most people don’t seem to mind. “There’s a large group of people that values what the Times does as a news organization, and that their willingness to pay is greater than we thought it was,” Doctor said. “There’s an alchemy there of aggressive pricing, access to good apps, and the content itself. If that’s in place, it looks like there’s a fairly large number of people who will pay for it.”
News organizations in a similar positions are also seeking alternate revenue sources, including events, education, and other digital businesses. Mixing and matching these money-makers into a sustainable future will fall largely to the Times Company’s next CEO, who chairman Arthur Sulzberger Jr. indicated will be unveiled soon. After pushing out Janet Robinson at the end of last year, the company “could announce a successor as early as September,” the Times itselfreports.
Whoever is chosen will be taking on a new challenge: papers that can no longer depend on ad revenue, but must rely more than ever on the whims of the customer. “We have the pieces of an emerging business, we just have to see how far how far we can go,” said Doctor.
“The future looks like it’s going to be a majority reader revenue. What we don’t know is at what level. And that’s huge, because it tells us how big of a newsroom they can support.”
FT digital subs overtake print circulation
John Reynolds
Digital subscriptions to the Financial Times have exceeded its print circulation for the first time, while mobile now accounts for one quarter of FT.com traffic
Today (27 July) the FT’s parent company Pearson revealed its first-half results for 2012 and highlighted the performance of its digital revenues at the Financial Times.
It said that digital subscriptions to the title – which operates behind a metered paywall – increased in the period by 31% year on year to more than 300,000.
The number of registered users climbed 29% to 4.8 million. Mobile devices now account for 25% of traffic to FT.com, while there are 2.7 million FT web app users.
However, the print circulation of the FT continues to fall. In June, its circulation was 297,225 copies, down more than 50,000 from a year ago, when its circulation was 356,194.
Advertising revenue declined, with growth online and in luxury and personal finance, more than offset by declines in trade and recruitment. Pearson said advertising demand remained volatile.
Overall, the FT Group, which publishes the Financial Times, registered a sales lift of 6% to £216m, while adjusted profits were up 5% to £22m.
Pearson reported a 28% fall in pre-tax profits to £59m.
The group said the fall was the result of three key factors – the sale of FTSE International (which reduced FT Group profits by £10m on the year), structural industry change at Penguin, and a financial hit to its education division.
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What’s there for rivals to fight over?
By Lucia Moses
Renewed questions [1] about Newsweek’s future in the printed form could spell opportunity for other weekly magazines. Then again, what would they be fighting over?
Newsweek had 344 ad pages in the first six months of 2012, up 7.6 percent over the year-ago period. A look at how those pages break down shows a large number of them come from non-lucrative categories, though.
“There’s not much to feast off,” one competitor sniped. “The bones have toothmarks on them already.”
When Tina Brown relaunched the magazine [2] in March 2011, with boldfaced authors and liberal use of photos on thicker, glossier paper, she trumpeted it as ‘Vanity Fair meets The New Yorker.’ One of the goals was to draw in more fashion and luxury ads, an uphill battle, considering newsweeklies are traditionally weak in those categories.
A breakdown from Kantar obtained by Adweek shows just how much of a battle. In the first half of this year, the majority of the ads came from typically low-rate categories.
The biggest single category was media and advertising, with 80 ad pages out of the total 344. More than half the 80 came from outside sales firms that bring in less-productive ads.
Other big contributors from traditionally low-paying categories were government, politics and organizations (49 pages); direct response (32); drugs and remedies
(25). An exception was automotive, which supplied 29 pages.
As for luxury, fewer than 10 ads came from liquor, jewelry and watch, and cosmetics, categories that often lean high-end.
One exception was a cover-to-cover, Mad Men-themed issue that Newsweek produced in March and which drew advertisers like Lincoln, Mercedes-Benz and Benetton. Rob Gregory, president of the Newsweek Daily Beast Co., said that the magazine planned to do more such themed issues in the months ahead, including an “Explorers Issue” and others focused on New York City; women and girls; and military vets.
“Our experience with the Mad Men issue told us, when we do these zeitgeisty cultural issues, we can broaden the base of ad categories and brands very successfully,” he said. “Having learned from this, we’re planning more thematic issues and cultural events and major tentpoles, many of which are helping us connect with advertisers and brands that are out of the traditional mix.”
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Magazines see big rebound in ad pages
Keith J. Kelly
The annual magazine ad-page race just got a little bit tighter last week among the fiercely competitive women’s fashion titles, with Vogue trumpeting a 658 ad-page tally for its September issue (its most watched), up a robust 14 percent from a year ago.
It marks the magazine’s biggest ad-page tally since the telephone book-sized September 2007, which tallied 725 ad pages and was the subject of an award-winning documentary.
Ad pages that year at Condé Nast were juiced because of a multipage Fashion Rocks advertising insert that ran in all the publisher’s magazines that year.
The September 2012 Vogue issue is being billed as the 120th anniversary of the magazine, and Condé Nast publisher Susan Plagemann kept the closing date for advertisers open an extra week, making it one of the latest closings ever for the fashion bible.
As a result, the Condé Nast flagship has pulled into the year-to-date lead in the closely watched titles in the women’s fashion world, with 1,949 ad pages, according to Media Industry Newsletter (MIN).
InStyle, which reported the biggest September in its 18-year history, with 440 ad pages, was up 2.3 percent. Its year-to-date tally is 1,904.6 – about 45 pages behind rival Vogue, with three issues to go.
It should make for a tight race down the homestretch; InStyle Publisher Connie Anne Phillips has won three years in a row by overtaking Vogue at the wire.
The two top magazines are outpacing the two Hearst stablemates, which also performed nicely in September. Elle racked up its second-strongest September ever with a 400-page month – 2007′s 413-page issue was its all-time leader – while in-house rival Harper’s Bazaar also bounced back, with a 16.6 percent ad-page rise to 360.
Elle has 1,749.8 ad pages year to date, according to MIN, good for third. Harper’s Bazaar was hurt because it dropped down to 10 issues this year and has 853.5 ad pages so far, but it is still rebounding.
W, which is a larger-size glossy, was off 3.5 percent for the upcoming September issue, with 246 ad pages and 825.5 year to date, but publisher Nina Lawrence may be forgiven. The magazine is pushing its October issue as its 40th anniversary, and some advertisers may be moving into that issue instead of the traditional big month of September.—Keith J. Kelly
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Meredith reports increase in revenues for fourth quarter
During the fourth quarter of fiscal 2012, which ended June 30, Meredith Corp. saw a 6 percent increase in revenues and a 2 percent increase in earnings per share from the prior year.
The company said in a release that revenues hit $375 million, while earnings per share reached 67 cents. Magazine readership rose to a record 116 million and total traffic to company websites doubled to an average of nearly 40 million unique visitors per month.
Additionally, total company digital advertising revenues increased 95 percent, with its national media group digital advertising revenues doubling and its local media group digital advertising revenues increasing more than 70 percent.
Advertising revenues increased 12 percent overall with the help of its recent acquisitions of the Allrecipes.com, EveryDay with Rachael Ray and FamilyFun brands.
