Commentary

'NYT,' 'Guardian' Highlight Dependence On Reader Revenue

News publishers coping with declining readership and advertising sales have worked to develop business models that generate revenue from other sources.

The New York Times and Guardian newspapers are demonstrating a positive shift to digital subscriptions, although it's not clear reader revenue will work for every publisher.

The Guardian has grown to 655,000 monthly paying supporters from 12,000 members in 2015, according to a blog post by Lee Glendinning, executive editor of membership at Guardian News & Media. Those paying supporters include subscribers, recurring contributors and members, while another 300,000 people provide one-time contributions throughout the year.

Thanks to our supporters, we receive more funding from our readers than advertisers," Glendinning writers. "Sustaining this will be vital to our long-term success.”

The NYT this week said subscription revenue grew 3.7% to $267.3 million in the third quarter from a year earlier, partly offsetting a 6.7% drop in ad revenue to $113.5 million. The newspaper now derives 62% of its total revenue directly from readers.

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The NYT has more than 4 million digital-only subscribers and another 900,000 print subscriptions, with an ambitious goal to reach 10 million total subscriptions by 2025.

During the quarter, the company hardened its paywall to urge people to register and log in when reading a limited number of stories.

I applaud publications with stricter paywalls — and not just because I'm unashamedly biased in favor of seeing publishers and their editorial teams getting paid for their work. 

Readers who commit to paying for a product are more committed to it. They are a better audience for advertisers that recognize the value of reaching people who want to be more informed about current events.

By having a diverse source of revenue that comes from thousands or millions of readers, publishers don't have to depend on a single advertiser. That can be liberating for a publication's editorial team; it doesn't have to contend with threats from angry sponsors that don't like the way they're being covered.

In other words, a publication's editorial mission is mostly aligned with the interests of readers, which is always positive.

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