Thursday, October 31, 2013

More subscribers to the digital N Y Times

The 3rd quarter results of the New York Times Company show how a good strategy pays in this troubled period and teaches a lesson to some other actors of the media world.

The operating profit is up by 44% at 12.8 millions dollars, not because of advertising which keeps sliding down, minus 1.6% for print advertising and minus 3% for digital advertising.

However, the number of subscribers to the digital only service has grown by 28% in one year, reaching the stunning figure of 727000.

What does it mean? First, advertising has a very limited future in the digital economy. It is co-opted by a small number of very big operators such as Google, Facebook or Twitter who invest now in the mobile services and leave a very small space to the news providers. This situation is not about to change in spite of the relative success of video. Millions of news users don't compare to hundred of millions of Facebook clients.

Then, the only hope for news services is paid subscription but to succeed, you have to offer a real service at a correct price. If I may use my own experience, I can state that I consider my subscription to the digital NYT ,which I can use on my computer and my smartphone, is rather cheap, 12 euros per month. For that price, I have access to the gigantic data bank of a world newspaper and the 1000 journalists of its newsroom.

What about France? The subscription to dailies is rather expensive, 14 euros per month with a very limited offer of national and world news. The only newspaper which can develop a notable audience in the francophone world is le Monde but its rates are probably too high and its access to free news is too generous. Why would you spend 170 euros a year if you get for free the main pieces of information?