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Circulation growth to outstrip ad losses at The New York Times in 2014?

Circulation growth to outstrip ad losses at The New York Times in 2014?

Are things looking good for The New York Times?

Peter Kafka writes for All Things D that, according to Barclays analyst Kannan Venkateshwar, the Times’ circulation growth may start balancing out its advertising losses by the middle of 2014.

Venkateshwar’s prediction suggests that the Times’ paywall, which boasts 450,000 subscribers, is starting to pay off. More than that, it may be seen as a vindication of the Times’ digital strategy, which drew criticism after the paper posted a year-on-year decline in digital advertising revenue last month.

When the drop was announced, paidContent noted that, even though Times’ subscription revenue increased by 9.7% from the previous year, the results were “worrisome for a news industry staking its future on digital revenue.”

Now Venkateshwar’s prediction illuminates the Time’s digital strategy and Kafka suggests that it throws new light on the Times’ decision in March to reduce the number of free articles that readers could view for free before hitting the paper’s paywall from 20 to 10.  “The Times would sure like to accelerate Venkateshwar’s timeline, and that’s probably not going to happen by fixing its ad problem. Meanwhile, the paper seems relatively confident that raising the pay wall equals marketing the pay wall. And the nice thing about the system the paper has built is that if it doesn’t work, it can fiddle with the controls some more,” he writes.   

However, paywalls have still plenty of vocal critics. GigaOm’s Mathew Ingram wrote in an article last week that, while a putting up a paywall may help a newspaper patch up declining ad revenue, “it isn’t even remotely forward-looking or adaptive. In other words, it does nothing to help a paper adapt to the web and to changing market conditions.” Ingram continues “To me, it makes more sense to try and figure out how to take advantage of the Web in order to provide something that the current market is likely to value, instead of focusing on how to squeeze as much as possible out of a declining market.”

But the number of newspapers operating paywalls is continuing to rise, and one of Canada’s largest newspapers, The Globe and Mail, announced last week that it will be putting one up. The next couple of years will be crucial in establishing whether they are the right choice.

Sources: All Things D, paidContent, GigaOm, Reuters


Hannah Vinter


2012-05-15 16:42

Shaping the Future of the News Publishing

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