July 23, 2004

The Roots of the New York Times Gloom Over the US Economy

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New York Times Stock Flirts with One Year Low

THE ECONOMY MAY BE RECOVERING IN THE UNITED STATES BUT NOT ON 43RD STREET: New York Times Lowers Outlook for Newspaper Ads

"Overall, the pace of the recovery in the advertising market is still not as strong or as predictable as we would like to see in a reviving economy," Janet Robinson, New York Times chief operating officer, said during a conference call. "We are looking at a better second half, but we certainly don't want to overpromise and underdeliver."

New York Times now expects total company costs for the full year to increase by low- to mid-single digits, down from previous expectations for growth in the mid-single digits.

Advertising revenue will increase in the low- to mid-single digits in 2004, a more sluggish pace than the mid-single digits growth previously forecast, the company said.

"Clearly, this is disappointing from a company that many investors, including us, had expected to be outperforming at this point in an ad recovery," Lauren Rich Fine, who follows the publishing industry for Merrill Lynch, said in a report.

New York Times' soft revenue trends come on the heels of solid second-quarter results from rival Gannett Co., publisher of USA Today and nearly 100 other daily newspapers. "After decent numbers from [Gannett] yesterday, investors will likely take [New York Times Co.'s] deteriorating revenue progression during the [second quarter], with particularly soft June results, as a cautionary signal with regard to the second-half industry outlook," said Peter Appert, publishing analyst with Goldman Sachs.

Who was it that said, "A psychotic is one who is completely in touch with reality, it just happens to be his private reality"?

Posted by Vanderleun at July 23, 2004 11:02 AM
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"It is impossible to speak in such a way that you cannot be misunderstood." -- Karl Popper N.B.: Comments are moderated and may not appear immediately. Comments that exceed the obscenity or stupidity limits will be either edited or expunged.

Let's see, what it was it I wanted to say? Oh yeah: Bwaaahaaahaaa!

Posted by: 6Gun at July 23, 2004 12:29 PM

Is there a tiny, tiny, chance that even advertisers are worried about the ongoing destruction of the reputation of the former "Paper of Record"?

Posted by: Bernie at July 23, 2004 12:42 PM

I doubt if the ongoing slant has much to do with the *current* declines in ad revenue...but over time, it seems to me likely that the policies of the Times will significantly impact their readership, with consequence impact on advertising revenues.

Posted by: David Foster at July 23, 2004 12:46 PM

Yes, this is a rot at the base and a failure to thrive that set in a long time ago.

After all, it is the Publisher that drives (or can drive) the publication, but the current publisher from the family has been shown to be incompetent time and time again.

Still the family controls the voting stock so he will probably be let slide.

Posted by: Gerard Van der Leun at July 23, 2004 12:56 PM

YES, YES, YES......

At one time railroads ruled the economic market in the US of A...........They fell of the surface.

At one time the print media GIANTS ruled the news world......now they are falling of the surface.....

It is the way of things replaced by newer, better, more complete items......

(READ: Trucks took out Rail.....
BLOGS take out GIANT MEDIA)

Duke of DeLand

Posted by: Duke of DeLand at July 23, 2004 4:03 PM

YES, YES, YES......

At one time railroads ruled the economic market in the US of A...........They fell of the surface.

At one time the print media GIANTS ruled the news world......now they are falling of the surface.....

It is the way of things replaced by newer, better, more complete items......

(READ: Trucks took out Rail.....
BLOGS take out GIANT MEDIA)

Duke of DeLand

Posted by: Duke of DeLand at July 23, 2004 4:04 PM

However, The New York Times does make money unlike the Washington Times which has never made a cent and hemorrhages money.

Posted by: James at July 23, 2004 5:41 PM

Correct.

Posted by: Gerard Van der Leun at July 24, 2004 1:31 PM

It's not just that people are waking up to what a dreadful load of crap the Times is. And it's not just the fall in revenue. It's competition. Heard of The New York Sun? Against all odds, they are not only surviving but thriving. I see people on the subways reading it. Go New York Sun!

Posted by: Sergio at July 25, 2004 11:58 AM

Trucks didn't take out rail. Regulation did. When freight rail was deregulated, it made a nice comeback. Now let's try deregulating passenger rail...

Yours,
Wince

Posted by: Wince and Nod at July 25, 2004 8:19 PM

Audience and reach always drive ad sales. If you're basic demographics aren't what the advertisers want, you'll lose them. Very simple really.

If the Times appeals to a mostly over 45 demographic, they've got problems...because advertisers aren't all that interested in that group. My guess is that the Times readership DOES skew older, because all newspapers do today...which is why many of them are in trouble.

It doesn't help if your circulation is flat or in decline either.

As of 9/30/2003:

USA TODAY (Parent: GCI) was followed by The Wall Street Journal (Parent: DJ), up 16.1% to 2,091,062 after it added 290,412 paid online subscribers to its overall circulation tally. Without the online subscribers, The Journal's circulation was unchanged at about 1.8 million. The New York Times (Parent: NYT) was third at 1,118,565, up 0.5%; followed by the Los Angeles Times (Parent: TRB) at 955,211, down 1.1%; The Washington Post (Parent: WPO) at 732,872, down 1.9%; and the New York Daily News at 729,124, up 2.1%.

Brigitte Trafford, a spokeswoman for Dow Jones & Co., which publishes The Journal, said the company received ABC approval to include qualified online subscribers in January, but it waited until this period to have a program in place to sell ads across both platforms.

The Journal's online edition has 686,000 paid subscribers, but Trafford said the paper counted only those who paid the full price of $79 a year. To qualify under ABC guidelines, the online subscribers must pay at least 25% of the basic subscription price of the print newspaper. That would have been $47.25 for The Journal.

The rest of the top 10: the New York Post, (Parent: NWS) up 10.6% to 652,426; the Chicago Tribune (Parent: TRB), unchanged at 613,509; Newsday (Long Island, N.Y.) (Parent: TRB), 580,069, up 0.2%; and the Houston Chronicle, 553,018, up 0.2%.

Posted by: RMcLeod at July 25, 2004 10:32 PM