• by Mark Glaser , November 7, 2005

Digital meets print as The New York Times Co. grapples with the integration of its newspaper and online operations. Mark Glaser reports.

When The New York Times Executive Editor Bill Keller and Senior Vice President of Digital Operations Martin Nisenholtz issued a staff memo on Aug. 2 about integrating the print and online newsrooms, there was no mistaking the rationale for the internal merger: "Our readers are moving, and so are we."

As nytimes.com's audience has surpassed print circulation, reaching more than 11 million people per month, the New York Times Company is trying to inject digital dna not only into its print editorial staff, but into the executive and business side as well. The Times recently appointed Denise Warren chief advertising officer, overseeing ad sales for both the newspaper and nytimes.com, as well as for the Times-owned International Herald Tribune and WQXR classical radio station.

While the details of the business-side integration have yet to be finalized at press time, it's clear that change is afoot and that there will be a stronger emphasis on delivering cross-platform and customized deals to advertising clients. Warren hails from the Times' print side, where she was vice president of strategic planning and had worked on joint ventures with the Discovery Channel.

"It's safe to say we're still in the planning stages of the integration," Warren tells Media. "My role is a new role for the organization. To have the accountability for all of the advertising revenue in one place allows us to be customer-centric," she notes. Warren adds that the integrated sales team won't result in individual ad sales staffers selling both nytimes.com and print, although it might result in more generalized salespeople who have platform flexibility. She believes the integration won't cause a huge swing in sales staffing numbers, but will mean "changing the deck chairs around."

For now, the sales staff at nytimes.com remains in a separate office of New York Times Digital, a business unit that won't exist when Digital is fully integrated into the main print operation in the Times' new headquarters in 2007.

A Velvet Rope Approach

Along with the overarching integration challenge, the Times must meet a more immediate challenge with the launch of TimesSelect, the nytimes.com's most ambitious foray yet into paid content. The offering will include unlimited access to the Times' archives and its op/ed columnists for $49.95 per year; it will be free for print subscribers.

Warren admits that gating off online content might handicap ad sales in the short term, although she's optimistic for the long haul. "There's one opportunity and one challenge," Warren says. "The opportunity is that TimesSelect is going to be a wonderful product, and will certainly attract people to the Web site. The challenge is that this content is going behind a pay gate, and it will present some inventory issues for us. But we don't believe this is a long-term [problem] for us."

Others have been less positive about the move, wondering why the pay product came at a time when cnn went from a for-pay service for its online video to free, and latimes.com lifted restrictions on its entertainment content.

"I'm reminded of the Los Angeles Times' Web site putting a paid subscription wall in front of [the] 'Calendar Live' [section] in 2003," Steve Outing wrote recently on Poynter.org. "That site just went free a week ago. I'll go out on a limb and predict a similar path for New York Times columnists within the next year or two."

One source close to the Times Co. paints the for-pay service as one step in the direction of making the Times' entire content well for-pay, similar to Dow Jones & Co.'s Wall Street Journal Online, which charges for nearly all access to its content. The source says that the integration between print and online was driven by the print side of the Times, which was making a "hostile takeover" of the Web out of panic that online was eating into print circulation.

"Online newspapers will eventually be online products for a price, and online magazines will be online for a subscription price," the source explains. "Print will be a luxury item. But I don't think we're there yet. What's driving this is panic on the print side. This is not being done to help the online side. This is complete, utter panic on the print side. Their circulation is dropping, the stock is dropping, they're seeing competition from every other medium."

The source notes that several executives from Digital exited over the last year or so out of concern that the print side was making a land grab and spearheading the integration. They also feared that online innovation was being snuffed out in the name of propping up traditional print revenues. For his part, Nisenholtz says that notion is wrong-headed, and denies there was ever a takeover by the print forces. He points out that Warren reports to him and not a print-side executive.

"We're one company," Nisenholtz says. "I can't imagine why anyone would think the print side of the business would want to 'take over' the Web site. It doesn't make sense. We're not a separate company that [was] acquired.... If you have 1,200 people in the newsroom who are out of the process due to the organizational design, you want to experiment at the very least to get them into the process, and the same is true on the business side." Warren concurs, and discounts the idea of a power struggle between print and digital.

"There's no 'us and them,'" Warren says. "There's no print and digital. We're all the New York Times Company. This is pervasive throughout the organization, and we're also a results-driven organization. The best people will rise to the top no matter [what], whether [they] have print or digital experience."

Lessons Learned

The Times is far from being the first newspaper company to decide to integrate print and online staffs. Media General has run a converged newsroom for The Tampa Tribune, TBO.com, and WFLA-TV since 2000. That early experiment in convergence has had its share of pitfalls, and has taken years to live up to expectations of increased synergy and cross-platform ad sales.

Tribune President and Publisher Gil Thelen says the editorial side was far ahead of sales and marketing in the early days, but those roles are now reversed as newspeople struggle with some aspects of cross-platform enterprise reports. The Tribune first tried a converged sales team of six people to sell cross-platform deals to new clients. The team found that the best prospects for cross-platform deals were existing clients in one medium that it could cross-sell.

Thelen says the major account executives from all platforms now sit together in the converged News Center building--a boon to cooperation and collaboration. "The fundamental human chemistry of sharing a break together, or lunch, or physical space, makes all the difference because it melts the stereotypes so much faster," Thelen adds.

All the collaboration is paying off in Tampa. Thelen says that he can now attribute $8 million in annual sales to cross-selling, and one-half of a percent of market share. "We worked together on a deal with a state government agency to create multi-platform advertising stuff related to drug abuse prevention," he says. "Everyone came out of it very pleased with the results, because we don't usually mine government agencies for sales and marketing opportunities." Gordon Crovitz, a senior vice president at Dow Jones and president of its Electronic Publishing Group, says that his company has had the mindset of a converged newsroom for some time, as its global newswire predates even The Wall Street Journal newspaper. When the Web came along, there wasn't as much of a cultural challenge. Print and online business and editorial staffs have always been co-located to some extent.

"Paul Steiger is the print managing editor, and he's embraced online from the very beginning," Crovitz says. "His support has been enormously important in the success of the online Journal. Plus, the physical closeness of print and online has allowed for ongoing cooperation and communication that has allowed for planning across platforms. It's a very close and very easy relationship." Unlike the Tampa Tribune, Dow Jones has had success with a special sales unit for cross-platform sales, Dow Jones Integrated Solutions. Crovitz says the unit handles not only print and online ad sales, but also newsletters and events.

At the Washington Post Co., sales teams for print and online aren't integrated or co-located, although both teams sell for the Web site, according to Caroline Little, CEO and publisher of WashingtonPost.Newsweek Interactive. Little says there's a lot of cooperation between print and online sales teams, with little competition between channels.

Yet one of the biggest hurdles Little sees is the issue of incentivizing salespeople to sell online ads when sales are much smaller than with print ads. "The challenge with salesfolks is, you're a print rep and you have a client who wants to spend $100,000 on print and only $15,000 online. Because print garners more money for now, how do you motivate that person to grow the business for the long run?" Little asks.

At the Times, Nisenholtz believes integrated newsrooms and business staffs can handle those challenges better together than apart. "You want to make sure that you're leveraging the whole organization, the same way we wanted to go from 'X' number of multimedia stories per day to 'Y' number of stories...because we wanted the print side to embrace the Web," he says. "We think the same thing can happen on the business side by having hundreds of people at the Times embrace the Web."

Mark Glaser is a frequent contributor to MediaPost's MEDIA magazine. This article is reprinted online from the October issue.