Friday, October 31, 2014

Is the New York Times model working?

The 3rd quarter results of the NY Times are mixed. Print advertising keeps going down, by 5.3% so is the print circulation. The new digital applications are not very successful and the Gray lady has dropped its Opinion app. which did not attract enough subscribers. So the diversification of the great daily digital services is disappointing to say the least.
However, subscriptions to the digital edition keep growing to 875000 customers And digital advertising is up by16.5%. The current loss is due mainly to the cost of buying out 100 journalists from the newsroom.

The conclusion is that the global trend of the digital policy of the NYT is fairly successful. More and more people read the digital edition and pay for it between 15 and 20 dollars a month. Advertisers are also coming and financing a growing part of the very large and expensive newsroom.

And yet, there are two limits to this growth. First, the fact that people rely more and more on new circuits, unforeseen 5 years ago: the social networks and specially Facebook which works more and more like a media and then the  internaut uses more and more the smartphone, notably the enlarged one which means a different access to the news and to the ads.

All that means that the NYT like the Guardian or the FT must think very hard about a non so distant future. 5 years are a very long time in the digital age.

Thursday, October 16, 2014

The digital challenge of the regional newspapers

French regional newspapers are in bad shape. The figures are well known: a regular fall of circulation, at about 2% per year. A faster decrease of classified and advertising at a rate of 8% per year. The result is the obligation to raise the price of the newspapers which is punishing for the subscribers that make a huge majority of the readership.

It is hard to see the future of Nice Matin. The once prosperous daily of the French Riviera loses 12 millions euros a year and its circulation is in free fall. It is obvious that the proposal of the employees who wish to buy their newspaper is not realistic. Their financing is not properly fixed and they intend to keep working the printing unit which is losing a lot of money. Rossel proposal is more to the point but it is painful: It intends to reduce drastically the staff and close the printing unit. However, even if Rossel prevails it remains to be seen whether Nice Matin can survive more than a few years.

The digital challenge is not easy to face either. Regional dailies are desperately looking for devices with a very limited success. Ouest France and Sud Ouest are trying an evening edition, mostly devoted to national and world news. For the moment, it doesn't work. Subscribers are scarce as they can get for free the news offered by these dailies. There are so many websites in French or in English that provide that kind of information. Look at Huffington Post, Slate and the websites of the free sheets.

However, the big question is the financing of the very costly collection of local news. In the US, the local newspapers have been trying for years to build up paywalls and attract local advertisers. By now the figures are very disappointing. Local pure players are not successful either. For the moment, at least, the public is not willing to pay.

And yet, people want to know what's happening in their city, the place where they live. There is a solution but it has not been found yet.

Wednesday, October 1, 2014

The Guardian goes European

The Guardian has great ambitions and important financial means thanks to the sale of its classified ads website.

Its main objective is to become a global world media. It has developed a strong position in the English speaking community. It has launched a digital edition for the US and for Australia. Now it is working on a new initiative, the launch of an European edition on the Web.  Now most executives of the main European countries speak English and could be potential readers of a good digital publication staffed with high level journalists hired from Germany, France, Italy or Poland and doing in depth investigations.

Still the competition is tough. The International New York Times and the Financial Times offer a comprehensive coverage of European news. However, the main threat comes from the new European edition of Politico, based in Brussels and supported by Springer.

For national media from Germany, France or Italy, it is also a challenge. It is obvious that the language barrier doesn't work any more. Only quality counts which costs money but he Guardian and Politico have deep pockets.