"If everything goes well", the NY Times will drop its paper business in 10 years — their words
It was February 2010 when journalist Jeff Kaye and professor Stephen Quinn encapsulated, in a pretty compact volume, the pains and pleasures of chasing money to defray good journalism in these unquiet days. Funding Journalism in the Digital Age arose as some kind of missing manual that every publisher in the world should read but that a few had. There are loads of good things throughout the book, but don’t blink because they fly by — it has less than 200 pages, which means the first lesson is self-explanatory: stop wasting paper.
At some point Kaye and Quinn retrieve a playful Silicon Alley Insider survey about the New York Times’ pains and pleasures. It says that the Times’ “annual print cost would be about $644 million”, therefore it would come cheaper (and smarter) “(to) give a $359 Kindle to all the 830,000 Times subscribers”. This is a 2009 study, I’m aware. After eight years, Kindles got much more affordable, but they’re miles away from embracing the role of “new” platform for newspapers. And frankly that doesn’t matter, since the NY Times never considered this Kindle giveaway festival anyway.
One thing the New York Times has always considered, though, was to get rid of the paper business. And if you wish to know why, Kaye and Quinn’s book, unsurprisingly, may offer the answer: “Ward Bushee, editor of the San Francisco Chronicle, revealed in 2009 that it cost $10 to produce and deliver each copy of the paper’s Sunday edition. The cover price was $2”. It’s simple maths: if SF Chronicle loses $8 for each copy, and in 2017 they’re still selling 227,000 copies every Sunday, the weekly debt hits the $1.8 million mark — and the San Francisco Chronicle is ten times smaller than the NY Times.
Ken Doctor is another author who tried to underline, back in 2010, how much trouble newspapers would have to handle (all the cool kids were writing a book about it). Most of his recent work can be found on this website, where he published, last Friday, a curiously lengthy interview with New York Times CEO Mark Thompson. I’m not sure if Doctor saved the best for last on purpose but the finest piece of that Q&A was exactly Thompson’s final answer: “Even if everything goes well, if you’re talking about transitioning over to a fully digital NY Times, I expect we’ll be printing The New York Times for at least another 10 years.”
It is such a pity Doctor didn’t ask anything else. I would have a lot of questions after this spontaneous combustion. When Thompson says “if everything goes well” it clearly means the NY Times is actually aiming to drop the paper in the near future. And since he established this 10-year period himself, it looks like they already have a deadline. Don’t get fooled by that “at least”, it’s just a pain reliever.
In May, the Times reported that “print advertising revenue fell 18 percent, driving a 7 percent decline in total advertising revenue for the quarter”. The company even tried to boost some enthusiasm by celebrating “308,000 net digital-only news subscriptions”, but ended up admitting the obvious: it’s the end of the world-sized newsroom as we know it. And apparently they feel fine. “We’re in rapid transition from a celebrated past as a great American newspaper to a future of even greater potential as a subscription-first, mobile-first news provider”, hedged Mark Thompson. At least, now we all know how “rapid” is “rapid transition”.
So what’s the future of this all-digital-slash-subscription-first company in the next ten years? Today, digital ad revenue represents almost 40 percent of the NY Times’ total advertising revenue. They’re still serving a blend of some “old” online behavioural ads alongside with proprietary banners to advertisers (Macy’s and FX were in the loop last time I checked) — yes, banners, like it’s 1999. Obviously, there are other hidden money-maker gems spread on their boundless digital pages and the proclaimed redesign may encourage the despondent ones — that’s why the new motto is “subscription first” and not “subscription only”.
In the (not so) long run, digital ad revenue will surpass the print one, although there are more print subscribers today than three years ago (but that’s a story for another day). Truth be told, in less than ten years, print ad revenue will become merely residual even to the NY Times, as it has already happened to a lot — and by that I mean a hell lot — of minor newspapers across the globe.
To the Times, after all, it could be the safest crusade. And it can work — if the stars align. To everybody else, however, a plausible follow-the-leader movement may do little to solve the issue. Indeed, contrarily to popular belief, the New York Times can not be a role model for its peers. Simply because it manages much higher amounts — of revenue, subscriptions, pretty much everything — than the rest of them.
Speaking of the rest, for those who are not the NY Times, it would be advisable to consider another course of action. Especially now that Thompson so kindly sent us all an assertive save-the-date card.