The Boston Globe is also still bleeding cash. For 2012, it posted a 7.8% decline in ad revenue to $183 million and a 1.7% slide in circulation sales to $155.1 million. However, its paying digital subscribers rose by 8% sequentially to 28,000 – still a meager number that made little impact on the company’s top line.
“All the news that’s fit to recycle.”
The New York Times’ struggle stems from the decline of classic journalism, where highly-paid reporters were required to research, compile and write their own stories. Its threat is the rise of Google Inc (NASDAQ:GOOG) -based journalism, where content mills and blogging sites employ low-paid, anonymous writers to recycle publicly available news from sources – such as the Associated Press – with the sole intention of generating more page views, and thus more ad revenue, for their sites. TheNew York Times attempted to address this demand by buying content mill About.com, which embarrassingly turned into a failed investment that betrayed its core principles.
Internet portal sites such as Google News and Yahoo! Inc. (NASDAQ:YHOO) have also made print newspapers a relic of the past. The New York Times has struggled to successfully monetize its digital format, even though its website was only released two years after Yahoo.com, in 1996.
The New York Times erected a digital paywall in March 2011, in an effort to halt its rapid decline in revenue. Its paywall subscription rates range from $15 to $35, depending on the selected package. Print subscribers get full access to the paid content without any additional fees.
During the fourth quarter, The New York Times reported 668,000 paid digital subscriptions – a 13% increase from the third quarter.
Its website, nytimes.com, is still the most popular newspaper website in America, generating approximately 30 million visits monthly. While that number seems impressive, it pales in comparison to Yahoo, which logged 392 million monthly visitors, and Google and Facebook, which both reported over 1 billion visitors.
In the fourth quarter (excluding the extra fiscal week), The New York Times’ print advertising revenue decreased 10.2%, while digital advertising revenue slid 1.7%. Total advertising revenue dropped 8.3% to $265 million.
The Bottom Line
The New York Times is still stuck where it’s always been – between the past and the future. The problem is that its prospective audience is shrinking. Its remaining two properties – The New York Times and The Herald Tribune – simply cannot compete with Internet giants such as Yahoo or Google, or media conglomerates Time Warner Inc. (NYSE:TWX), The Walt Disney Company (NYSE:DIS) or Viacom, Inc. (NASDAQ:VIAB) – which control large outlets of freely available, often recycled, online news.
All these factors make The Times’ paywall look increasingly stodgy and archaic, and its declining top and bottom lines point to a sad inevitability – it is destined to devolve from an international brand back into a local paper.
The article Is it the End of Times for The New York Times? originally appeared on Fool.com and is written by Leo Sun.
Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.