New York Times post loss Q1 2016. How soon before it goes Digital only?

The very excellent New York Times (if you see it on a Saturday, just get it) reports a loss of 14 million usd in Q1 2016.

It's about the decline in print advertising but digital is up, although as usual, does not compensate for the print decline, just yet.

It added 67,000 digital subscribers in the quarter - huge - bringing it to 1.4 million overall. 

Total revenue in the quarter was 380 million usd and it's hard to understand (very very hard) with revenues like that, you can make a loss at all! 

Here's the point....Revenue from digital subs was 54 million. Revenue from print and digital advertising was less, at 42 million. 

There comes a time when the cost of printing the paper becomes so loss making because of the massive cost of production (paper, printing), whereas the cost of producing the digital edition is massively lower and profitable.

And with their growth in digital subscriptions, there has to come a point where it makes more sense for The New York Times to become digital only. 

It has to be an outcome. 

You heard it here first!

Facebook's biggest shares in October 2014

Newswhip have published the top Facebook shares for October (which they developed via Spike).

The Huff Post leads the way with 67 Million interactions in the month. PlayBuzz and BuzzFeed come in ahead of the likes of Fox News and NBC - never mind The New York Times.

So it again points to the rise in online sites developing "news" over traditional sites. And frankly, the sites doing well are more "entertainment" driven rather than hard news reflecting too, the desires of a Facebook audience.

But still, the numbers are pretty stunning....

NY Times loses 80m homepage views in 2 years. Shock? Not at all but very interesting as to why.

Interesting piece on The New York Times online.

Seemingly, according to BuzzFeed who've sight of internal documents, they've lost 50% of their homepage views - 80 million in two years.

Crisis? No....rather than a loss of readers, perhaps what we're seeing is the move away from homepages and possibly, here is a reason why.

News is no longer the destination read and what's delivering news readers is referral traffic - from Twitter, Facebook, Blogs, Reddit and so on. So people are getting their news when it's sent to them - they're not going looking for it.

So when they see something of interest say on Twitter, they click that link and it brings them to the specific page and NOT via the homepage. The readers are only looking at stories that interest them - snacking - rather than the "news in full". So the notional idea that I read a paper online from front to back, might be changing.

Homepages are institutional, whereby Social Media reflects the readers interests.

So readers are looking to be entertained as we know and so only read the stuff they find interesting. Audience analysis by publishers as to what's being read, might confirm this trend and they may find that their homepage traffic is in demise whereas overall, their numbers are still holding up.

Interesting for advertisers too who are paying premiums to be on the homepages....

But perhaps important to publishers too, to drive their stories by links on Social Media, although they do that, but this may need more focus to deliver views. 

So the Social Media aspect of publishing is becoming more important.

They might, for example, keep tweeting the popular stuff. And the headline on the Social Media link to the story, will be key.

Perhaps the way we're reading news is changing and perhaps an interest in "general news" is declining as such. It's not a commentary but just an interesting development to note.

I don't believe the NY Times have lost readers - they've just lost readers on their homepage landing page. So news needs to adapt to that.


One day too, we'll get the point where we send relevant news to the relevant people rather than to everyone en masse. 

The Internet is a one-to-one medium, not one-to-many.

Amazon is making lots of money and losing lots of money.

Amazon is making lots of money and losing lots of money.

The darling of Wall Street (what the New York Times calls the company as "the teacher's pet") recent data on Q3, showed more of the same.

Great sales with continued great losses.

Revenue was up a staggering +24%, beyond expectations, to just over 17 billion usd. But it lost, 41 million usd in this quarter. They lost 274 million last year although some of that attributable to poor investment in the deals site, Living Social.

But how do you generate 17 billion of turnover and still lose, 41 million? Beats me.

Investors see it all as ramping up for the future, with the Amazon Share price now 10 times what it was in 2008. In particular, they see Amazon's investment in string after string of Warehouses (100+), as enabling it to become the biggest retailer in the country. Hmmmm.

Amazon is still warning of a further loss in Q4 and investors are still smiling.

I do think Amazon is a great company and I do think The Kindle will bring it places. 

However, I do not like a strategy of owning warehousing (although I understand why) because it's old economy. These services could be supplied by someone elsewhere - they are massively eating into potential profits.

They require significant investment in perishing stock (which books for example, are) as well as high levels of investment in property that can quickly devalue. Maintenance is high and consistently rises. Staff are required 247. It's a little bit mad.

The consistent growth in Amazon is undoubtedly superb and a real indicator that what they're doing is right. However, the losses cannot go on forever like this - it is truly laughable not to be able to generate a profit on these turnovers. Something is endemically wrong with cash management and that's not good long term.

Investors are smiling.
But for how long?

I've seen it so many times before - investors will get tired of this and then things could go South. Amazon needs to make money early in 2014. Must.

Publishers, Music Companies, Mobile Companies and more are being rescued by internet companies they tried to stop.

All the talk of the Internet wreaking havoc on traditional media companies is changing. In fact, it's helping them!!

I've stolen this from a great Article in the current August 17th edition of  The Economist (cover above) which is well worth the read, called "digital pennies pile up at last".

The reputable PWC reckons revenue for online media and entertainment will rise by 13% each year for the next 5. So the web is growing the entertainment business.

Music, which record companies legally, stupidly, fought internet pioneers for years, is actually showing +.2% growth - the first time it's growing in a decade. Which means the internet increases royalty payments to....the very same record companies! 

And that's their IFPI trade group numbers. So the web is coming to their rescue as their CD and DVD sales collapse.

Online radio and music streaming (Spotify etc) brought in a billion dollars in 2012. 

Mobile phone companies are benefitting too, by selling data to access these services whilst their call rates are going into a death spiral. 

YouTube are now paying small copyright fees too on music downloads.

Netflix, Hulu and Amazon are of course buying rights to stream content online from traditional broadcasters. That's about 3 billion Dollars a year and rising. Online licensing accounts now for a third of the revenue growth at traditional CBS.

Book sales are growing again by about 14% per year on Ebooks means bigger profits for publishers and for authors. Yes, it has meant the death of bookshops but in return, accessibility to books is far greater especially amongst the young and far more of us are reading.

Digital newspapers subscriptions are working to a point too. The New York Times has nearly 700,000 (!) online subscribers. 

The surge in smartphones, in tablets, in ipads coupled with the extension of broadband speeds are driving this growth. EMarketer, a US research firm, thinks Americans will spend more time online this year than on TV. And because people want content, 'on the go', they're becoming more prepared to pay for it.

It's a fairly extraordinary turnaround that Internet companies are now becoming the saviour of traditional media companies such as publishers, record labels and TV broadcasters who tried so desperately to stop it. Instead of embracing it, encouraging it, because better access means higher sales, they were afraid of something they didn't understand.

They'd have sold more far sooner, if they had.

Ad revenue is bypassing Ad Agencies as it goes online. Like the book publishers, the record companies of old, Agencies are pooh-poohing it instead of selling it, embracing it. There's lessons here.

Like the peasant's in Lamb's essay, we know not how to roast pork, other than to burn the house down.

Interesting isn't it? 
You have to laugh though. Irony of ironies.

Bezo's buys The Washington Post. Why?

Jeff Bezo's purchase of The Washington Post (and it seems to be him personally rather than his company Amazon) still flummoxes me.

He paid a big price - 250 million usd in cash, about 17 times the ebitda profit which is a high multiple - it would for example, give The New York Times a valuation of about 4 billion usd (way ahead of its current market cap).

Such a high price that it's hard to see it as being a straightforward financial play. He's not in it to get his money back running The Post as normal. Especially when you consider further falls in circulation and advertising.

So why?

Clearly he's bought a big brand. The Washington Post is considered erstwhile and authoritative but that being said, one wonders what does he see in newspaper publishing that justifies the price? And what does he see that the current Graham family owners couldn't?

It has been suggested that he just wanted to save an American institution - perhaps, because billionaires like to own newspapers and restaurants (vanity purchasing). The Post of course, was famed for the Woodward/Bernstein Watergate reporting and 250m is pocket money for a man worth possibly, 28 billion usd. Add to that, Bezo's comments that he won't be involved "day-to-day" would seem to indicate that vanity is not the driver.

However, he is known too as a soft hearted, decent guy and without any vanity.

Of course there's the potential for an e-paper play with great distribution potential through his Kindle business. A great newspaper delivered in a great new way. Possibly.

But fundamentally this buys him influence. Although clearly as the Amazon founder he had some of that too, but a newspaper owner gets you into the corridors of power. Papers like The Washington Post, make and break politicians. Make and break Presidents.

So I think that he doesn't have a plan just yet.... but he knows that it will bring kudos and influence - good enough for now. Then he can spend time thinking about how to change online publishing with a world class brand. At 250 million, that might be justification in itself.

Bezo's has gone from techy to establishment. With a 28 billion fortune, 250 million might represent a good investment in just that. Political influence.

Apple to launch SmartWatch. A Smartphone you wear on your wrist.

Rumours abound, very strong rumours, that Apple are to launch a smartwatch. Which is basically a smartphone you wear on your wrist.

Pebble are already in the market and Google have just applied for a patent.

Although it's been talked about for a while, The New York Times have confirmed it's in play and being developed with "curved" glass so it wraps around your wrist.

Wearable computing has an inevitability about it. We know of Interactive Glasses but wrist wearing is somewhat easier. The key to this too, is Siri, the voice recognition Apple software that allows a voice to read back, or dictate, email for example. So the need for a touchscreen is reduced.

Straight out of James Bond, you'll talk into your watch and ask it to things like directions or information or email. It will tell you global time, set alarms, act as a GPS tracker, and possibly, connect calls over Wfi (which the ipad mini already does without having a Sim card). 

And general cloud connectivity means all your devices are connected so the watch can act as a conduit for that. If you've a number stored on your Ipad or Phone, the watch can get it for example.

Interestingly too, the use of body heat to create energy through your wrist, is I know, already underway as too the movement of your hand which currently drives some watches anyway. Hence the archaic need to "charge your phone" in the wall socket, must soon go. It's very old fashioned (!).

Another innovation from Apple. 

Who else.

New York Times. Subscriber paywall working but Ad revenues are down. This is the line quality publishers need to walk.

The New York Times is growing its digital subscriber base although its advertising revenue is declining.

668,000 thousand digital subscribers for the group is up from 566,000 in September. Advertising revenue though is down by -8%, largely due to declines in the print versions (down -10%) whilst digital revenue is down just under -2%. But they're down.

The problem here is a trade-off between a model that makes money from a subscriber paywall versus a model that makes money from advertising. If you have paid subscribers (paywall) then you've less readers compared to when it's free. As some of the content is closed off for subscribers only, free readers move away elsewhere. Therefore the page impressions decline and consequently too, the ad revenue will fall. Charge for content and you'll have less readers and therefore, less advertising.

However, the NYT overall revenue is up +5% so the growth in subscribers revenue is more than offsetting the consequential loss in ad revenue. For now.

In return too, its shares are up +15% bringing more capital value - so people like what they're seeing.

If a paywall subscriber model is adopted by publishers like the NYT, it actually puts pressure on content. Paying readers want more up-to-date content, more services, more video, more coverage because they're now paying for it. They'll want detailed business analysis for one. Quality journalism.

So a paywall will work best in a quality title where affluent readers will be more able and more willing, to pay. It's a risk for sure but that depends too on where the paywall is placed - a combination of good free content (on the homepage for example) with subscribers getting detailed content, might be a good balance between maintaining digital Ad revenue and generating subscriptions.

If you can walk that line, it's an opportunity that The NYT is proving.

Techcrunch blogger has the extra bottle of wine at The Flipboard launch and starts to write....yep, another one. Oh dear.

You know the way it is.


You've gone to lunch, had that bottle of wine too many and now you're going to tell everyone what you really think. So you draft that email but most of us never send it until the next day at best, because we're old hands.


Or that text you send and the next morning you look at the phone, arm extended, with one eye, going "no, please, I didn't, did I?".


Just like Jerry Comyn did last month http://streamabout.blogspot.ie/2012/05/irishman-jerry-comyn-leaves-us.html and Greg Smyth of Goldman Sachs, before him.


So you're a blogger with Techcrunch. 


Techcrunch was founded by Michael Arrington (yeah, that's him at the top of the blog. Get my drift?) in 2005 who is no longer there but famed for a 2010 a verbal confrontation with CEO of Yahoo!, Carol Bartz. Arrington started the interview by asking Bartz, "So how the fuck are you?" To which she responded, "Is that appropriate?". Later in the interview, Bartz became perturbed with Arrington's criticism of the Yahoo! business model of conglomeration rather than single revenue source producers. Bartz then responded to Arrington saying, "you are involved in a very tiny company" and ended the exchange by telling him to "fuck off." Bartz received some support from bloggers for her response, including Guy Kawasaki who stated, "I respect Carol Bartz even more now." (per Wikipedia).


Techcrunch is one of the top 2 techy blogs along with Mashable, and so as one of their writers/reporters, you're invited by Flipboard (which I love) to a function to tell you about how it's expanding their monetization policies. Not exactly fascinating but still, has to be done. Pays the rent and all that.


But you have had that extra bottle of wine and you've just about had enough. So you start to write your post for Techcrunch. Think of a good headline. Here's the one Alexia Tsotsis went with


Flipboard Expands Its Monetization Options To Paywall. Welcome To The Future, Old Media Assholes.


Old Media Assholes? Hmmmm interesting approach. But having started, let's not stop there. No way, let's go all the fucking way.


Fuckers I am so sick of reporting on incremental tech news for fucking two years now, so sick I’m pretty much considering reverting full-time to fashion coverage. (Don’t believe me? Well, how amazing and beautiful is my“Clothing I Like and Want To Buy” Pinterest board? A.k.a. my greatest accomplishment in my life thus far …).


But yeah, The New York Times took a step towards the future this blasted Sunday night and all of us tech press are expected to cover it like lemmings. Fine. Sure. It’s a big deal, in a business that is slowly dying, to show an understanding of 21st Century distribution mechanisms. Kudos NYT. You’re still worth less than Instagram. Hahahahhaha, lol (drink).


But still you, The New York Times, are way more important than I am, because you convinced Flipboard CEO Mike McCue to work with you early on, which by the timing of this post you could probably figure out that I couldn’t do (in time). Fail. But we’re still covering it because this is the first time Flipboard has offered a paywall option, and it shows a promising alternative revenue stream for both parties involved  … Welcome to the future, old media assholes.


So in between the downing of tonight’s two bottles of wine, I had the good fortune to ask new media visionary McCue the questions y’all are dying to ask, and here they are — Because he was cool enough to answer me  …


And then the questions all seem reasonable - like they're straight from a press release.


But let's not finish there. Let's just roll it all up in a final insult.


So there you have it. If both Flipboard and The New York Times were public companies and you asked me to convert my invaluable Aol stock into either right now, one and a half bottles of wine deep, I’d instinctively go with Flipboard. Suck it, old media. And please die more slowly from now on, because I (clearly) hate you.


Of course, you're all saying this didn't appear on Techcrunch yesterday.
http://techcrunch.com/2012/06/25/die-less-slow/


And you're also saying it wouldn't have got past the editor.
Nope because Alexia is the co-editor.



Alexia Tsotsis
CO-EDITOR
Alexia Tsotsis is the co-editor of TechCrunch. She attended the University of Southern California in Los Angeles, CA, majoring in Writing and Art, and moved to New York City shortly after graduation to work in the Media industry.


She made the Forbes, "30 under 30 rising stars media list". One wonders will she do it again this year?


As for Techcrunch?
Well to be fair, they've left the post up. 
There's a bit of integrity about that somehow.


But a shocking bit of concern that albeit "approved sources" can write anything on Techcrunch without somebody reading it? That is a huge issue.


Techcrunch needs to be seen as impartial and honest.
If no-one is checking the writing, it opens up huge potential pitfalls - paid to blog just being one.