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A look at New York Times digital revenues

Oct 25, 2011 at 12:33pm
 

Capture
The New York Times has announced some details of it's online premium subscription (i.e. cash payment) model.

Full details

Digital

Digital businesses include NYTimes.com, BostonGlobe.com, Boston.com, About.com, other Company Web sites and related digital products. In the third quarter of 2011, total digital advertising revenues decreased 4.5 percent to $74.8 million from $78.3 million. Digital advertising revenues at the News Media Group increased 6.2 percent to $50.3 million from $47.4 million due to growth in retail and national display advertising. Digital advertising revenues as a percentage of total Company advertising revenues were 28.6 percent for the third quarter of 2011 compared with 27.3 percent in the third quarter of 2010.

In the first nine months of 2011, the Company's total digital advertising revenues increased 0.9 percent to $242.9 million from $240.7 million. Digital advertising revenues at the News Media Group increased 12.2 percent to $162.4 million from $144.7 million. Digital advertising revenues as a percentage of total Company advertising revenues were 28.2 percent for the first nine months of 2011 compared with 26.3 percent in the first nine months of 2010.

Paid digital subscribers to The Times digital subscription packages, e-readers and replica editions totaled approximately 324,000 as of the end of the third quarter of 2011. In addition to these paid digital subscribers, as of the end of the third quarter of 2011, The Times had more than 100,000 highly engaged users sponsored by Ford Motor Company's luxury brand, Lincoln, who have free access to NYTimes.com and smartphone apps until the end of the year, and approximately 800,000 home-delivery subscribers with linked digital accounts, who receive free digital access. In total, The Times had paid and sponsored relationships with over 1.2 million digital users as of the end of the third quarter of 2011.

Source: The New York Times Company

My interpretation

  • In the last quarter, there were 1.2 million registered users, of whom 324,000 paid something, and 100,000 were paid for by Ford (a great subscription model as long as there are no catches for either party) and 800,000 were covered by their print subscription. In other words, they have a churn of about 25%.
  • The site has 45 million unique visitors per month as of January 2011 - it's interesting that they use comScore to quote that 45 million. ComScore use an estimated data model, as opposed to NYT using their own actual data.
  • Anyway, 45 million unique users and 324,000 have paid something - that's a conversion rate of less than one percent, however paid for content is still very much in its infancy.
  • Those 45 million users probably don't include Smartphone users or e-readers (hats off to ComScore if that can get that data, however I suspect they can't).
  • Doing some extremely rough sums, subscriptions are 99 cents for the first 4 weeks and then $3.75 per week thereafter. Let's ignore the special offer price and let's assume Ford pay a full $3.75 per user. Ignoring the print subscribers who get the digital edition for free, that's a total revenue of $1.59 million per week. Let's assume NYT earned this revenue throughout the entire quarter (12 weeks), that's a total of $19 million for the quarter.
  • Digital advertising across the group (and this includes a number of other websites and newspapers) generated $74.8 million.

Lessons to take away from this quarterly statement

  • The premium digital content model still has a way to go - advertising still generated four times the revenue as subscribers.
  • 'Wholesale' or 'sponsored' user bases are key drivers for the number of paid for subscribers - Ford pay for 100,000 users and NYT have 324,000 paying individual subscribers. Think of the effort that goes into the Ford deal compared to the direct to consumer sales effort.

 
tags:
analytics, business, content, digital media, ecommerce, economy, freemium, news, sponsorship, subscription content,
1 Comment

Identity crisis

Sep 7, 2011 at 12:51pm
 

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The photo above was taken eight years ago and shows my parents and my identical twin daughters Shelley and Natalie. I'm pretty certain that it's my dad on the left and my mum on the right, however I can't tell which baby is Shelley or Natalie.

Before I joined IMG I worked for a Finnish telco company called Sonera. At Sonera we enabled consumers to use mobile phones to 'sign' - to prove their identity. We used the SIM card in the phone as a secure, unique system. At the time (late 1990s) the system was designed from the ground up to be secure enough to sign mortgage papers.

As the Internet has matured over the last few years, the issue of identity hasn't gone away, however it has changed subtly. It's now possible to create an anonymous Twitter user, build up a few hundred followers and start a malicious rumour. This is why I find it hard to digest newspapers who reference Twitter for their news content.

It is quite secure for consumers to run a Google search for a product, land on a site they've never seen before, and hand over their credit card details. The main reason for this security is that your card issuer (bank) will provide a level of reimbursement if the website fail to deliver the goods.

However we are soon going to find that it's necessary for end users, the consumers, to have a valid identity.

We've read how some of the people accused in the British riots have been banned from using their Facebook account (which is ridiculous because they probably phoned someone as well, yet their mobile isn't being revoked, but I digress). There is nothing to stop that person from creating a new Facebook account straight away. In fact, Facebook's friend suggestion tool is so accurate that it will help recreate all that user's friends as well.

In order for the Internet to truly grow up and allow us to vote online and perform all the duties we've previously done in the Post Office, we need to sort out digital identities. Digital identities in the UK have always been seen in a negative light, despite the irrational xenophobic fear whipped up by some of our national newspapers. However we're going to need to jump over this fear if we can issue these digital identities.

These digital identities will be used to sign into most websites and will work across mobile, web, TV and anything else that springs up.

In order to apply for a digital identity, financial services organisations will require stringent checks - just like a passport, but probably with someone physically checking the photos and documents face to face. This is why Facebook Connect isn't the right platform for an Internet-wide ID platform.

The Internet is truly global, and the identities will need to work globally too. They will probably be government run, although it's feasible for some of the larger financial services companies to run them.

Like so many technology vendors, Sonera was doing the right thing, just at the wrong time - about 15 years too early.


 
tags:
Facebook, digital media, ecommerce, identity, legal, mobile, payment,
1 Comment

Making money from social networks

Jul 14, 2011 at 9:35am
 

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There's some interesting movements going on in the social games and social payments space at the moment. I've always said that Facebook wouldn't be the last of the social networks, and with Google Plus growing quickly, the value of the "social network market" will keep increasing for a while.

Photo courtesy of Roxelo Babenco on Flickr.


 
tags:
Virtual Revolution, digital media, f-commerce, payment, social media,
0 Comments

Users backlash against nma going digital only

Jul 5, 2011 at 4:47pm
 

Nma
One of the best magazines in the digital industry, new media age, has become digital-only by stopping it’s print edition. The week old announcement isn’t really newsworthy or blog-post-worthy by itself, however the user and subscriber feedback has been fascinating to follow.

new media age (all lower case) by definition has a digital-industry-focussed subscriber base. The print edition is subscription only (£100 per year). One would have thought this group of people are early adopters, and preaching the use of the Web as the way forward.

There have been 19 user comments on their announcement. Put into context, there have been only four comments in total across the 17 most recent articles – it really isn’t a site rich with user feedback.

Those 19 comments are mostly negative, complaining about a lack of user feedback to lead to the decision to go digital only (interesting in a world of 'transparency' and social networking in digital media) and some subscribers went so far as to offer to have continued subscribing to the print edition at a higher cost rather than announce it was too expensive to produce.

Many users claim that reading the digital edition is too difficult to read – that paper is better, it’s easier to rip out articles or annotate them. Some users said that they like to get away from screens (three users literally wrote word for word how nma got them to move “away from my screen”) and read paper – I wonder if those users work for digital agencies or not.

My personal view is that whilst I catch up with the latest news online, most content isn’t as time sensitive as we’re led to believe and yes, I prefer to read paper magazine rather than a tablet or mobile device. I find I can concentrate for longer when reading paper over a screen.

Take a look at the original article and read the user comments yourself.

One final point for transparency – Endava is a paying subscriber of nma and we also appear in the Top 100 agencies.


 
tags:
NMA Top 100, User Generated Content, digital media, magazines,
0 Comments

What’s good and not so good about Google+?

Jul 3, 2011 at 10:01am
 

Google
On Friday I received an invite to Google's new social networking platform, Google+. This spread through the Endava office like wildfire, and previously planned productivity nosedived whilst we all played with the latest website phenomena.

As a general rule, I try not to write about mainstream topics on this blog. There are plenty of other websites out there which cover these mainstream areas better than I can. I try to review the latest happenings, or to record opinions that I have been asked during the day which have caused some debate with a client or colleague, or both. In fact if you've never experienced our corporate culture of having debates in front of clients, I would highly recommend it. However three days on, a lifetime in Digital Media, the reviews of Google+ on the web are appalling, and focus on the wrong areas. So I’m breaking my own rule and covering Google+ as a record.

What is Google+?

Firstly, what is Google+? Most people in the press and blogosphere over the last few days have been touting Google+ as Google’s answer to Facebook. Google have tried launching social networks before. Orkut was a fully-fledged social network; OpenID was Facebook Connect – a single sign in across the web; Google Friend Connect was a bunch of widgets for website owners to use which was ‘convert’ their own sites into a social network; Buzz was as close to Twitter as you could possibly get; and there are probably a few more initiatives out there.

So it’s clear that Google have wanted to build a social network for a while – and I’ll come back to this point later.

Google+ is a giant sharing platform. On Google+, you can share pretty much anything from your Search results, webpages, photos and videos, thoughts and so on.

The key difference with Google+ and Facebook though, is that Google have realised that the one major problem with Facebook is that most users don’t want to share the same thing with their friends as they do with work colleagues. And you probably want to separate your friends into friends, acquaintances and the people you go to Church with. Think of the times that you’ve said to someone “I share this with people on Facebook and that with people on LinkedIn”. Google calls these different groups ‘Circles’ – and you can setup any number of these Circles very easily.

What’s good about Google+?

The first thing that hits users on Google+ is the speed. It’s as fast as using an installed application (e.g. Word) on my computer. There are some new types of interactivity on the user interface – lots of dragging and dropping – so the iPad gets a very standard mobile interface. And it’s all very, very fast at loading and using.

Talking of the interface, it’s nice. It’s also identical to Facebook. Absolutely identical. Toolbar along the top, chat on the left, recommendations on the right, activity in the middle. Lots of white space. A rigid template. Lightboxes for images and video. Well done to Facebook for the usability – it’s so good no one can improve it.

The whole Google+ experience is about sharing. On Facebook, when you update your status, it’s like making a quick diary entry and that’s it. You don’t consciously or even sub-consciously think “my friend Fred is going to see this” or “my boss is going to see that”. You write the status and move on. The same happens when you comment on someone else’s photo or status. On Google+ though, everything you do needs to be proactively shared with a someone/ a group of people. If you don’t actively say who you want to share it with, you can’t update your status.

Google+ is also setting a new level of functionality for Internet video. You can now make group video calls using Google+. You can do this in Skype, as a premium (paid for) function. On Google+, it works inside the browser for free. It’s very clever technology, and this will be a key function for signing up new users to the platform.

One of the main things I like about Google+ is how it links together all your activities on Google’s products – from +1 to PicasaWeb into one interface.

Other fringe points – the entire application uses SSL (HTTPS), to head off major security concerns from the start.

What’s not so good about Google+?

For a start, it looks and feels identical to Facebook. I showed Google+ to my nephew, who like all 15 year olds is a Facebook Power User. He asked why he’d want to use Google+. He didn’t see anything obvious jump out at him that Facebook doesn’t do.

Google have so many products, that some of them that you would expect to integrate with Google+ have been left behind. I use Google Docs quite a lot with friends and work because of the collaboration/ sharing functionality. But Google Docs’ sharing functionality hasn’t changed, i.e. sharing a document doesn’t offer you the same Circles you setup in Google+.

Whilst Circles is a key function of Google+, and it makes sense to choose who to share your latest status with, it doesn’t feel right. Anyone who runs an e-commerce business knows that for every additional step you ask the user to do, it reduces the goal completion by x%. So site owners reduce the number of steps and increase the conversion rate. Google+ does the opposite – it requires an additional step – “Who will I share this with?” for everything, and you start thinking twice about making the update.

Summary

Firstly, if I was a competitor, I’d be more worried if I owned Delicious than Facebook. I can’t see people lowering their use of Facebook, where over 400 million people are already part of a huge network. I still see new friends from the past appearing because they’ve tagged me on one of those embarrassing school photos, and we have a quick chat on Facebook.

I don’t think I’ll be using Delicious for much longer though. It’s just so easy to save a web page by +1’ing it (much easier than saving a bookmark to Delicious) and then sharing it with a few people.

I find it interesting watching Google’s roadmap unfold. Every year we look at Google and the description of the company changes. First it was only a (bloody good) search engine; Gmail made it one of the web’s preferred email applications; by releasing Google Docs it became a personal IT organisation which backed up all your files for you; YouTube made it the number one video website; Google Chrome made it the preferred browser for millions of people – quickly knocking out Firefox; Google Maps is the defacto mapping application for millions of people, and has even replaced paper maps in many households; Google AdWords and AdSense is still the ultimate advertising platform – brings advertising opportunities to the masses, whether you want to spend a pound a day promoting your song, or millions of pounds a day advertising on the YouTube homepage for your latest video game. And I still haven’t covered Google’s other products such as phones, cars, checkout, groups, sites, news and a couple of dozen more!

Google+ is the 2011 release to demonstrate Google can produce pretty much anything.

I think Google+ will be a major hit with users because of how it will bring together so many of Google’s products. I think it’s a natural progression from Google’s search engine – to share the places on the web that you visit after using the search engine. And with Google still owning such a massive market share of search, even a small percentage of search users that adopt Google+ will make Google+ a hit.


 
tags:
Facebook, Google Chrome, digital media, google, ipad, social media,
2 Comments

The best starters guide to online marketing

Jun 16, 2011 at 11:08am
 

If you're looking for a "How to" guide to online or digital marketing, I recommend the following graphic (care of Unbounce). I've sent this to many people by email and Twitter as the best starting point for any online marketing campaign. It doesn't necessarily need a large advertising budget behind it - it just needs some time. 

There's so much information in the graphic that I've tried printing it on several A3 sheets but it didn't look particularly great. My brother-in-law (thanks to PhotoPaperDirect) has managed to print it as a 6 foot long print on a screen printer however there resolution isn't good enough to remain clear (it's OK, but not brilliant).

The Noob Guide to Online Marketing - Infographic
Unbounce – The DIY Landing Page Platform


 
tags:
User Generated Content, advertising, analytics, content, digital media, email, marketing, search, seo, social media,
0 Comments

10 years since joining

Jun 2, 2011 at 8:13am
 

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This time ten years ago I joined IMG as the Development Manager to build a new Content Management System.

The digital division within IMG was about four years old at that point, and had bought the digital rights to a number of sports organisations with the hope that the advertising and sponsorship on those sites would cover the costs of writing huge cheques to the sports organisations. 'Hope' is a strong word, because at the time the Internet bubble was at it's height, and we all thought we'd be billionaires by Christmas.

When I joined, IMG was pulling out of a number of these deals, and looking for efficiencies with the tiny development teams.

The Internet was so different back then. Products were very expensive. Vendors and 'experts' were all learning as they were going along - so when we got stuck, we were well and truly on our own. For instance we tried different CDNs (Content Delivery Networks) to handle the huge amount of traffic we were experiencing, and ended up creating our own using Cacheflow servers. Just looking up the link just now made me laugh - because these boxes used to be the size of a fridge, and now they're the size of a PC. Once we'd got the Cacheflows stable, we simply migrated to Akamai.

I remember people, including the CTO, would sleep in the office when we expected incidents to happen. I remember arguments with database vendors about licensing - some wanted to charge for every visitor that accessed the website, because they saw that as a database user. I remember running analytics reports on websites that used to take several days to compile, and when we wanted to run the report again with a different metric, all the numbers in the report would change! That same report in SiteCatalyst now takes a second to run and end users run it themselves.

Most of the really difficult stuff back in 2001 is now a commodity. Half of those products now have a freeware solution.

In around 2005/6 I moved to the client side - project management and operations. The CMS was very stable, and it was time to look at a decent off-the-shelf solution because we were losing pitches because of our lack of multi-lingual support, versioning, WYSIWYG editing and advanced SEO support.

We chose Sitecore as the CMS platform, and for the first time we looked at offshoring to India to migrate our sites. Three months of total pain followed. For the first time since joining IMG, we missed deadlines (in sport, although it sounds obvious you can't miss deadlines - most of the time you might as well not deliver anything than deliver a project late). We pulled the projects back to the UK and an army of contractors joined the development team. Some were good, some weren't. We started to offshore to Eastern Europe instead. And it was a revelation:

  • Being able to fly there and back in a day (not recommended, although possible and sometime necessary);
  • The cultural similarities; 
  • The push-back nature from developers on some of the requirements.

Then in late 2008 we looked to outsource more work to Romania via Endava. What started off at a simple outsourcing deal changed at the last moment, and the staff TUPEd over to Endava in January 2009.

Since then we've worked on some new projects outside of sport, and the Web has become a stable, maturing, controllable entity. In 2001 we were looking only to stabilise our clients' sites.

Our traffic (bandwidth, visitors and page impressions) have all increased exponentially in ten years, with some exponentially, several times. Social Networks have come and some of them have gone. Do they compete? No, they simply direct more and more traffic to our clients' sites.

And now to the future. In 2011 we are looking at providing data insights, personalised experiences, full integration with back off systems, and providing a true ROI for our client's digital properties.


 
tags:
Adobe, Akamai, Content Delivery Network, Content Management Systems, Endava, IMG, Romania, Sitecore, business, digital media, future, sport, web traffic, website production,
0 Comments

Website reading list

May 18, 2011 at 9:21am
 

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At a recent event, I met up with a regular reader of this blog, Andrew, who asked me what websites and news feeds I read regularly to keep track of trends within digital media, social media and the web in general.

I'll start the answer with a disclaimer - this list has been growing over time, and follows specific interests that I've had over the last couple of years.

I find it impossible to keep going to specific websites to keep up to date, so RSS feeds are the answer. I've tried using a number of RSS readers but because my life is ruled by Outlook - when the 2010 version came along with an excellent RSS reader, I was sold, and am now able to stay up to date with RSS feeds.

If you use Outlook 2010 but don't use it for RSS, I recommend you try it because it presents articles just like emails. (Like you need more emails...)

I'm not including news feeds that post less than an article a month. So the list, in alphabetical order is:

  • Google News. I've set up a number of RSS feeds using Google Alerts. I monitor most of the suppliers in our technology stack, and skim read through the list regularly. I have to skim it because there's usually a lot of duplicate content because of press releases. Examples of the feeds include Akamai (one of our Content Delivery Partners), Endava and IMG (my former company and I still find it interesting to follow).
  • This blog. I keep an archive of all the articles because I find it easier to search, and it's a nice offline backup method.
  • Confused of Calcutta. Written by JP Rangaswami, the Chief Scientist at Salesforce.com. His articles are thought provoking and detailed about all aspects of information, and wider architecture thoughts. If you like the book, Cluetrain Manifesto, you'll love his blog (especially as he wrote a chapter in the 10th anniversary edition) because they share the same writing style. I often comment on JP's articles.
  • Google Webmaster Central Blog. Excellent resource for the latest happenings, straight from the preverbial horse's mouth. I'll often spot content in the articles and email it around to the technical teams at work.
  • Hitwise Intelligence - Heather Dougherty. We have a love/hate relationship with Hitwise that I won't go into here. Sometimes Heather posts interesting traffic trends. Very US centric (not necessarily a bad thing), however she's one of my preferred Hitwise bloggers.
  • Information Is Beautiful. I am fascinated by this company. Anyone who can illustrate massive or complex data sets to enable us mortals to understand it in 2 seconds and keep our attention for 15 minutes with the same diagram is a magician. Chances are that if you see me shortly after a new post, I'll tell you about it.
  • IP TV Times. Updated very regularly, Iolo Jones provides a straight-from-the-heart view of pretty much anything connected to digital media, video, commercialisation and online piracy. I aspire to updating this blog as regularly as Iolo updates his. I often comment on Iolo's articles.
  • Matt Groves Digital Donut. One of the nicest guys in the Digital industry, Matt works at Fallon and often updates his blog with the latest campaigns that have either caught his eye (around the World - not just the UK, which is something I like) or that Fallon are working on.
  • The Opposite Direction. Also one of the nicest guys in the industry, Robin heads up the social media practice at McCann who we do a lot of work with. Social Media is packed with jump-on-the-bandwagon consultants who are full of hot air however Robin is the complete opposite - he shares his knowledge and experience in every meeting. His blog is written in a similar way - you typically learn something new in most articles.
  • The Register. Because I am in IT, and the Register provides the latest IT (and some scientific) news, usually with a good sense of humour. I don't read every article (it would take all day) - I generally skim the headlines and read any articles that are relevant.
  • UK news: Office for National Statistics (The Guardian). I like statistics and the ONS has lots of them. The Guardian apply some commentary but I like the fact it's up to the reader to make sense of them.
  • Webcredible. A varied blog from a usability consultancy where an old IMG colleague, Ismail, works. The blog is full of useful digital media best practices (not just usability) and examples of best websites out-there.
  • What's Next: Top Trends. Thoughts from one of my favourite 'futurists', Richard Watson. I often comment on Richard's posts.

If you have any other recommendations or comments on the feeds above, please do let me know.

Photo courtesy of Bytelove.


 
tags:
Endava, Outlook 2010, RSS, blog comment, blogging, digital media, social media, trends,
0 Comments

TV audiences v Web traffic part 2

Feb 16, 2011 at 9:34am
 

I've always had a bit of a bee in my bonnet when it comes to BARB figures. Just the concept of extrapolating from 5,000 homes to an estimated audience of 26 million in 2011 starts gets me frustrated.

Two recent articles provide further evidence in my favour.

The first article was in an excellent interview with Keith Weed, the CMO of Unilever. In the interview he provides an answer to the ROI (Return On Investment) question of social media:

The measurement of ROI in this area is a big issue for us. We have different ways of measurement, some of which are more experimental than others. The good news is that I have enough evidence that says most of the time we can prove better ROI online than in TV. It is much more measurable.

So Unilever is the second largest spender on TV in the World (a statistic he mentions in the interview), yet he's happy putting his faith in ancient, unscientific BARB figures, but when it comes to digital, Unilever want it to be scientific to the n'th degree.

There's another way to interpret his answer though - I estimate that BARB figures are hugely inflated because of the extrapolation that was perhaps sufficient with 4 or 5 TV channels, but nowadays as useless as a chocolate teapot in the age oif hundreds of TV, IPTV and PVRs such as Sky+. ROI from a huge TV ad spend is then going to be lower, because the TV ad is at an inflated cost, and the returns (e.g. increased revenue) are much more measurable by the brand.

So no wonder that Mr Weed is experiencing an increase in ROI from social media and digital in particular.

The second article I read was from Cadbury, who can now measure their ROI on digital so precisely that they find a return of 3 to 1 for each pound spent in the new world (you need an NMA subscription for that original article, or click here for a copy of the article). Again, I think it's because the measurement tools available on the web are so superior to TV measurement.

URLs for this article:


 
tags:
ROI, TV, analytics, brands, business, digital media, social media, stats,
1 Comment

The migration of Digital Money

Feb 12, 2011 at 7:28pm
 

Newspaper_temp

The scan above is from this week's edition of my local newspaper.

There are two popular pairs of terms used to describe users in Internet terms - Digital Migrants and Digital Natives, and Gen X and Gen Y. Personally I prefer the first term because it describes the groups perfectly.

Digital Migrants are pretty much anyone over about 20 years old, who remembers life before The Internet. They (errr, 'we') had to change our mindset to adjust with the cultural and technological challenges and advances the Internet has provided. Digital Natives are the opposite group - those under about 20, who don't know any different.

Back to the article in the newspaper.

I have two thoughts regarding the 81 year old Mr Moller (and yes, I do think his age is important):

  1. The poor old pensioner. Not everyone needs or wants a mobile phone. It's neither an identity or mandatory device (yet) and it should be up to individuals whether to have one or not. The pace of change is happening too quickly. After 40 years of credit cards (25 years older than mobiles), you can still live a perfectly normal life without plastic. Migration through technologies should be a slower process.
  2. It's evolution. Yes you can live life without a credit card, however you can also live life without cash too, and just use plastic. It's natural evolution to move from cash, to plastic, to mobiles. In fact Mr Moller highlights the very real possibility of jumping straight from cash to mobiles. Mobile penetration is above 84%, so it's perfectly reasonable to expect everyone to have one.

Earlier this week we ran an event at Endava called The Future of Social Media for Financial Services. At the event, the author Richard Watson gave a speech on The Future of Money. I wasn't quite expecting to read an article in my local paper the following day highlighting that it's not so much about the future... it's already happening right now.


 
tags:
Endava, banking, business, digital media, economy, mobile, predictions, press, trends,
0 Comments
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Bradley Howard

Bradley Howard

Head of Digital Media at Endava, although all the views in this blog are purely mine and not necessarily those of Endava.

 

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