NYTCO Revenues Slip, But Paywall Holds Promise

NYT-

The newspaper business is still stuck in the doldrums, judging by the latest results from big publishers, including the New York Times Co. and Gannett Co., both of which recently revealed another round of revenue declines in the second quarter of 2011.

However, the bad news at NYTCO was partially offset by the promising results of the new paywall erected around some of The New York Times' online content at the end of March.

NYTCO's total revenues slipped 2.2% from $589.6 million in the second quarter of 2010 to $576.7 million in the second quarter of 2011, due mostly to a 4% decrease in overall advertising revenues from $314.9 million to $302.3 million. That, in turn, was attributed to a 6.4% drop in print ad revenues.

The story wasn't all bad.

While retail advertising dropped 8.9% to $60.6 million and classifieds fell 8.1% to $46.5 million, national advertising actually increased 1.8% to $159 million. In addition, total digital ad revenues rose 2.6% from $82.4 million to $84.6 million, including a 15.5% jump at the company's News Media Group, from $50.4 million to $58.2 million.

Perhaps most significantly, the new paywall at the Web site of the company's flagship newspaper has produced significant revenues and is on track to take in $34 million by the end of the year, according to calculations by Outsell analyst Ken Doctor.

Since its launch in late March of this year, the number of digital subscribers acquired through the paywall increased to 224,000; counting paid subscriptions for e-readers and replica editions, total paid digital subscribers came to 281,000 at the end of the second quarter.

There are also 100,000 readers who get free unlimited access to the site through a sponsorship deal with Lincoln. A further 756,000 home-delivery subscribers also get unlimited access to digital content.

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