These Are The Times: Pundits Wonder If The 'NYT' Will Become A Tech Company

The New York Times may be joining the parade of publishing companies evolving into digital marketing services organizations. 

Observers wondered about this after ValueAct revealed a 6.7% stake in the company. And that talk may be heating up after a column by former Times columnist Ben Smith in the newsletter Semafor newsletter on Friday. 

“ValueAct, which manages about $16 billlion and has a reputation for constructive, if intense, pressure, approached the company well before its stake became public in August,” Smith wrote.

Former Times reporter Riva Atlas asked Smith, on behalf of an institutional investor, “Is the Times always going to be fundamentally a news company expanding into these ancillary tech products? Or is it trying to morph into something like a tech company with an ancillary news product?”

If the latter, the Times wouldn’t be the first publisher to attempt it. Take Gannett, owner of around 200 newspapers. Earlier this year, Gannett restructured itself into two units: Gannett publishing—and Digital Marketing Solutions.  

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The Digital Marketing Solutions segment pulled in $120.0 million in Q3 revenue, an increase of  3.4% on a same-store basis, YoY. 

“The majority is recurring and structured on evergreen contracts,” CEO Mike Reed said in an investor call earlier this month. 

Reed noted, “Our Digital Marketing Solutions business achieved record high core platform revenue during the third quarter, while maintaining double-digit Adjusted EBITDA margins for the sixth consecutive quarter.” 

In contrast, Gannett suffered a  10.3% decline in overall Q3 revenue to $717.9 million. Also facing a $54.1 million net loss for the quarter, Gannett has been laying off newsroom staff and selling off publications. Ironically, he has sold several local newspapers to CherryRoadMedia, a subsidiary of CherryRoad Technologies, a provider of cloud hosting and other network systems. 

The trend of publishing becoming tmartech providers has been particularly noticeable in B2B. Foundry, the former IDG, publisher of such titles as ComputerworldInfoWorldand PCWorld,  is now driven more by “media markets and software as opposed to traditional sales, said Matt Yorke, Foundry CEO, in a recent interview.  

Then there’s Ziff Davis, which “buys and operates companies that produce both content and software to help firms and people navigate the shift to digital,” CEO Vivek Shar said in a recent Webiner. It thrives on the “data exhaust” that emanates from successful digital brands.  

How far can the New York Times go in this direction? Smith points out that the Times has a culture that is resistant to change. However, it has increased its bundling of products, another sign of high-tech advancement.  

“CEO Meredith Kopit Levien used the word ‘bundle’ three times on the company’s first quarter call. After initial conversations with ValueAct, she used the word 40 times on the second quarter call.”

Levien’s acquisitions of Wordle and The Athletic “are part of a strategy of broadening the audience beyond people who want news,” Smith concludes. 

 

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