Accuracy in Media



The New York Times’ efforts to focus on digital over print may finally be running out of steam. The company reported that profits in the second quarter slid 52%, as digital subscription growth slowed and advertising revenue continued to sag.

Digital subscriptions, which had grown to 799,000 at the end of the first quarter, from zero in 2011, increased by 32,000 in the second quarter. But that was less than the 39,000 increase in the first quarter.

Any growth would normally be a positive sign in an industry that has been buffeted by readers abandoning print in droves, and a prolonged advertising slump, but in the case of the Times, the growth underscored the longer-term issues the paper is facing.

The growth in the second quarter was largely driven by new subscriptions to the NYT Now option, which costs just $8 a month compared to the $15 plans that most subscribers had been opting for previously. This has resulted in a lower revenue mix and slowed overall circulation revenue to a paltry 1.4% increase in the quarter, down from 2% in the first quarter.

What really killed profits at the Times was the 6.6% drop in advertising revenues, which more than wiped out any circulation revenue increase.

This is not lost on Times president and chief executive officer Mark Thompson, who said the company still has more work to do to deliver long-term sustainable revenue growth.

But how they will do that is a big question mark. The company has done far better than I predicted it would with regard to building a substantial digital subscriber base, but as with all things, the demand is finite. The slowing growth was inevitable as the “low hanging fruit” was picked off, providing much needed financial relief. But now the Times faces a much tougher task of convincing people why they should pay for news that can be obtained elsewhere for free.

With growth slowing and advertising still sliding—the company predicted a decrease in the third quarter in the mid single digits—the Times still needs to figure out how to remain relevant in a fast-changing news landscape, which won’t be easy to do in the face of fierce competition.

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  • Guy

    Although I can’t prove this I doubt if the issue facing the Times is how will they get people to subscribe to their online version of the newspaper when they can get the same news for free elsewhere on the web.

    I think the Times has exhausted its demand base of people who want the NEW YORK TIMES NEWS who are willing to pay for it. After all one does not buy news from the New York Times, one buys the news the New York Times is selling.

  • Richard Hellstrom

    People aren’t going to pay for opinions that they don’t agree with. Were the media is being financed by an atheist based lobby , the American people don’t agree with their opinions. The people support Israel and our media shows a growing support for Palestine. The people that are lobbying for the Muslim community can’t join their churches and would be dragged out of their motel and set on fire if in a Muslim country – So what are they supporting ? It looks like they’ve traded a support for gay marriage for a support of the Muslim Community. Very odd in deed. I guess it based on Satanic principals or the political lobby.

    This isn’t really in support of Israel –