Commentary

Publishers Show Surprising Resilience With Digital Growth

The broad pullback in media spending during the second quarter, when the pandemic started to weigh on the U.S. economy, had me worried that publishers would find little cheer as the health crisis continued. But the industry is reporting results for the September quarter that suggest a reason for cautious optimism.

Gannett Corp., Meredith Corp., News Corp., The New York Times Co., Tribune Publishing Co. last week all had positive digital metrics that helped soften the blow of lower advertising revenue. Their results underscore the importance of digital subscription revenue, especially as marketers shift their spending to online platforms.

For the same period, Amazon, Facebook, Google, Pinterest, Snap and Twitter all reported double-digit gains in ad revenue and touted their expected growth during the holiday season as brands and retailers ramp up their promotional activity.

Cherry-picking among the results of publishers, USA Today publisher Gannett increased its paid digital subscriptions by 31% from a year earlier to 1.03 million. Tribune's digital subscriptions jumped 36% to 427,000, while the NYT saw digital subscriptions surge by about 50% to more than 6 million. The Wall Street Journal's digital-only subscriptions grew 27% to more than 2.35 million, parent company News Corp. reported.

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Meredith's magazine group, whose titles include People, Better Homes & Gardens, InStyle and Allrecipes, saw digital revenue growth of 15% to hit a record $105.1 million. However, print revenue plunged 32% to $108.5 million. It's likely digital ad revenue will overtake print for the first time during the current quarter if those trends persist.

Another bright spot for Meredith magazines was the 22% growth  in licensing and other consumer-driven revenue from Apple News+, digital couponing, content and affiliate commerce to $20.1 million.

The industry faces challenges, as many do during the pandemic recovery, but the results were not as bad as journalists feared.

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