I haven’t been in the journalism game all that long, but within the first few months I saw the paralysing effect of inertia that’s affected the industry. Innovation is slowed by cries of “we’ve always done it that way”; by too many people at the top trying to ride out decline until they can their retirement bonus; by preciousness about loss-making endeavours. Not many people in the media world are willing to kill their darlings.
By far the worst, though – and my particular bugbear – is the conflation of the medium with the message. Print has never been a perfect means of delivering news. By the time the copy has been set down, it’s almost always out of date. We live in an age in which genuinely up-to-date information can be accessed anywhere on devices owned by billions, but you’d be amazed how many people in the UK news game still think the measure of a story’s success is which page of a print product it appears on.
But the times they are a-changing. Admittedly, they’re changing because the bedrock of media business models is being eroded by the same digital trends that allow much more efficient dissemination of journalism, but they are changing nonetheless. And some media businesses are managing to pivot towards sustainability in that new ecosystem without having to compromise on their central mission.
That’s been most apparent over the past weeks with the latest results from the New York Times, which has been making noise about the success of its ongoing transition from an advertising-based to a subscription-based business. Its latest quarterly report states:
“Digital advertising revenue grew 19 percent year-over-year, a vindication of our decision to pivot towards mobile, branded content and a broader suite of marketing services, and to focus on innovation. Despite continued pressure on print advertising, we were able to grow overall revenues by 5 percent in the quarter.
“On costs, we are investing to support our growing digital businesses, most notably this quarter in brand marketing and consumer acquisition. We continue to keep a close eye on costs across the business and remain committed to aggressively managing profitability.”
Essentially, all told, the NYT was able to grow revenues from digital ads, subscriptions and affiliate revenue by around 30 percent since last year. That means they can legitimately claim to have grown digital revenues more than its print revenues shrank, as its total number of digital subscribers rose 62.2 percent on last year to reach 2.2 million total, of which “the single largest cohort” is the elusive (and meaningless) millennials.
There are some caveats, obviously, and as Mathew Ingram points out in this write-up for Fortune. The most apparent is that the NYT’s print revenue is not what it was even a few years ago, and even given its digital success this year print revenue is still tumbling – and still disproportionately important to the NYT’s business model.
— Sydney Ember (@melbournecoal) May 3, 2017
Despite those caveats – and the acknowledgement that the NYT’s newsroom might need to shrink further (more on which later) – the NYT’s success has been attributed almost solely to its editorial output. In fact, the Times’ CRO Meredith Levien stated in a conference call after the latest results that the Trump bump was far and away the most significant reason for the digital subscriber growth.
There are mid- to long-term worries about the sustainability of that approach (Ingram: “It warned that digital subscription growth in the current quarter will likely be ‘slower than the prior two quarters'”), but that the newspaper has been rewarded for its editorial output is an indication that it’s capitalising on its strengths as its business model shifts.
The same can be said of the Washington Post, to an extent, as Frederic Filloux of the Monday Note points out:
“Jeff Bezos is also able to project an ultra-long term vision with his space exploration project for which he personally invests about a billion dollars per year.
“Closer to our concerns, he has boosted a respected but doomed news institution — The Washington Post — thanks to a combined investment in journalistic excellence and in technology, two areas left fallow by most publishers”.
Newsrooms are likely to need to shrink significantly across the whole industry as the fiscal crunch continues. I’d love to see it otherwise, but giants like the Guardian, NYT and WaPo have all set out plans to reduce the size of their editorial teams in the next few years. That might necessitate a reduction in the number of verticals they can comprehensively cover, but if the news industry is likely to have taken anything away from the NYT’s results it’s that business models will pivot – but the mission will remain.