NYT report show newspaper remaining confident in digital subscription strategy, even as financial results go wanting
In a shorter, more optimistic report, the authors of this 2020 Group report, restate the paper’s marketing position that the NYT is a subscription-first business, while confirming that additional cost cutting measures are coming
There are few journalists I know who are not cheering on The New York Times effort to ween itself off of advertising and move to a purely paid content strategy. The editors themselves believe they are achieving their goals, but the paper’s own financials appear to be telling a different story.
Today, The New York Times published a new report, called Journalism That Stands Apart (PDF) from the paper’s 2020 Group. The report is a far more optimistic look in the mirror than the Innovation Report released in 2014, when the Times was still early on in its quest to move to a subscription revenue model.
The report’s authors are David Leonhardt, Jodi Rudoren, Jon Galinsky, Karron Skog, Marc Lacey, Tom Giratikanon and Tyson Evans, with research and analysis contributed by Samarth Bhaskar and Dan Gendler.
“We are, in the simplest terms, a subscription-first business. Our focus on subscribers sets us apart in crucial ways from many other media organizations,” the report states. “We are not trying to maximize clicks and sell low-margin advertising against them. We are not trying to win a pageviews arms race. We believe that the more sound business strategy for The Times is to provide journalism so strong that several million people around the world are willing to pay for it. Of course, this strategy is also deeply in tune with our longtime values. Our incentives point us toward journalistic excellence.”
The report recounts the paper’s success in driving digital revenue – which it, indeed, has been a leader in doing. But the report’s own chart shows that the decline in ad revenue, which really accelerated following the start of the Great Recession, has exceeded its growth in circulation revenue.
While total revenue stood at around $1.8 billion a decade ago, it now is closer to $1.4 billion. As a result, cost cuts have had to be implemented.
Like the Innovation Report, this one urges change.
“Why must we change? Because our ambitions are grand: to prove that there is a digital model for original, time-consuming, boots-on-the-ground, expert reporting that the world needs. For all the progress we have made, we still have not built a digital business large enough on its own to support a newsroom that can fulfill our ambitions. To secure our future, we need to expand substantially our number of subscribers by 2020,” the report states.
The report is very journalism driven – which, of course, makes sense to journalists, but would have many publishers thinking the report is too narrow in focus.
The authors push the theme that its news needs to continue to become more visual, something readers have appreciated over the past few years. According to the report’s authors, 12.1 percent of all articles now contain visual elements, but the paper needs to do better.
“An example of the problem: When we ran a story in 2016 about the roiling debate over subway routes in New York, a reader mocked us in the comments for not including a simple map of the train line at the heart of the debate.”
“We have dozens of regularly appearing features built for the print edition but not enough for a digital ecosystem. We need more journalistic forms that make The Times a habit by frequently enlightening readers on major running stories, through email newsletters, alerts, FAQs, scoreboards, audio, video and forms yet to be invented,” the report states.
To achieve these, and other goals spelled out in the report, the authors recommend an expansion of its training operation, hiring of “top outside journalists,” making greater diversity a priority for the newsroom, as well as rethinking about how it uses freelancers.
Among its final recommendations is that the paper needs to “reduce the dominant role that the print newspaper still plays in our organization and rhythms” while also “making the print paper even better” – which sounds like a nod to those who continue to be print oriented.
The problem here is that the paper continues to be focused on building one brand, eschewing its many opportunities to build new brands that could be profit centers. With the center of the NYT’s universe solidly placed in the newsroom, this is not a surprise. The NYT has missed countless opportunities to build new products around its talent pool, leading eventually to the loss of some of its talent.
The New York Times continues to be the leading newspaper in the US. But what I found missing in this report is any acknowledgement that the news industry has changed in regards to consumer reading habits, that consumers are migrating to new, and often less reliable, news outlets.
Facebook is mentioned four times in the report, once as one of the places advertising has gone. But one wonders if the NYT realizes that its own relationship with Facebook is why digital advertising has gone to places such as Facebook. Also, with NYT content on Facebook pages, who needs to spend money to subscribe to the NYT (I don’t use Facebook, and am a paid subscriber to the NYT, by the way).
But Breitbart News is not here, as other websites of the so-called alt-right.
When looking at the top news sites as ranked by Alexa, the NYT is right there at the top. But when you look at top sites overall, the NYT does not make the top 25. But several websites that carry news do, such as Facebook, Google, Yahoo and CNN (which ironically, is behind the NYT in News, but ahead overall).
The NYTCo will report its earnings on February 9 and the company has already bragged that the election brought a big jump in digital subscriptions. It will need that that bump as through its third quarter the company was reporting a loss. But the paper will also continue to rely on cost cutting.
“There will be budget cuts this year,” wrote executive editor Dean Baquet, and managing editor Joe Kahn, in a staff memo. “We will lay out the specifics in the coming weeks and months.”
But one area that may face cuts is in, what the editors term “low-value line editing.”
“We must move away from duplicative and often low-value line editing. It slows us down, costs too much and discourages experiments in storytelling. Backfielders, department heads, News Desk editors and, yes, the masthead spend too much time line editing and copy editing, moving around words with little true impact on a story. Copy editors, meanwhile, spend too much time editing and re-editing stories that should be posted quickly.”
Where there will be additional resources is in covering the new administration.
“Covering this story aggressively, fairly and unrelentingly will be the top priority for The New York Times newsroom this year. That’s why we are thrilled to tell you that the company is investing an additional $5 million in our coverage, allowing us to report on the postelection transformation with even more ambition.”