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June 25, 2015, 10 a.m.
Business Models

Newsonomics: 10 numbers that define the news business today

From video to social, from mobile to paywalls — these data points help define where we are in the “future of news” today, like it or not.

We’re bombarded by endless numbers every day — some claiming the exalted status of metrics or, even higher, benchmarks. It’s tough for any of us to figure out which — ARPU? TOS? post-click activity? — are meaningful and which will go down in news transformation history as footnotes. For me, making sense of the numbers helps bring a little order to the chaos.

On Wednesday, I spoke to a Media Impact Funders group in Menlo Park, right there on Sand Hill Road, where so much venture money flows into would-be high-flying companies. This funders group, though, represents the journalism grantmakers — the foundations that have searched for and paid for much of the experimentation of the past decade.

In 15 minutes, I shared with them 10 numbers that I think tell us where we’re at today, in yet another uncertain time for the “future of news.” So, here, for your summer beach thinking, are a few numbers that deserve our attention. It’s not an eternal top 10 list; it’s a list of the moment, guaranteed to change. I welcome your additions.

$14 million That’s the monthly digital ad revenue of The New York Times in the first quarter of this year. And, intriguingly, it’s the same number as the monthly digital ad revenue of The Huffington Post, newly part of Verizon. That number is open to a kaleidoscope of interpretations. Is it incredibly low, given the massive reach of both news organizations? Isn’t it interesting that the Times, with its core of 1,300 top-of-the-trade journalists, takes in the same amount of digital ad money that HuffPo does, relying on its army of 100,000 contributors from around the world — a number Arianna says she wants to grow to 1 million, in addition to its own full-time hundreds. What does that tell us about the advertising value of content? Compare that $14 million to Google’s monthly revenue of $5.7 billion and Facebook’s of $1.2 billion, and you can see the world as it now exists. A bonus number: Combined, Google and Facebook take in about 52 percent of all the nation’s digital advertising.

50% Today, most news companies tell me more than half of their digital access comes from mobile devices. That breaks down more than two-to-one smartphones-to-tablets. A recent Gartner series forecasts that by 2018, 50 percent of all web access worldwide would come via mobile. So news is a leading edge for mobile. That’s no surprise: It’s always changing and perfect for on-the-go reading. National and global publishers see this profound shift as the prime issue and opportunity before them; most regional news companies still struggle with mobile. In everything from revenue generation to product design to reader engagement, publishers must reckon with this non-tethered, personalized world.

54,581 The number of “social marketing” jobs currently listed at LinkedIn, from strategist to instructor to intern. That’s about 20,000 more jobs than exist today in U.S. newsrooms. It’s a new world of “earned media.” Forget OPM, Other People’s Money. Think OPT — Other People’s Time. Our billions of shares promote (or relegate) content to its place on the web, and almost all come for free. The big new news brands — BuzzFeed, Vox, Business Insider, Vice, Mic — all rely heavily on this form of earned media. Ask one of their CEOs what they spend on paid media, and most likely the answer will be a big, fat zero.

1:2 Video ad rates still manage to beat text ones, but many legacy publishers still can’t produce enough news video that attracts big-enough audiences at small-enough costs. That puts in perspective Arianna Huffington’s plan to produce one news video for each two written stories. That announcement follows a steady drumbeat of video announcements out of HuffPo: 11 new video series formats; 2.3 billion video views in less than three years on HuffPost Live; more than 30 million views in the first six episodes of The HuffPost Show. HuffPost has also launched what it calls “the first next-generation online video journalism network, Outspeak.” That latest sound of convergence you are hearing: Verizon, with HuffPost as its new face, remaking itself as our friendly video provider. Major subtext here: The pipes companies are now leaping into the world of media in a big way, and that megatrend informs a lot about “news” going forward.

63% Of the $58 billion U.S. digital ad total for this year, almost two-thirds of it will be touched by “programmatic.” Publishers once used it as a term of derision; now they’re trying to get up to speed on programmatic optimization. Star Tribune publisher Mike Klingensmith cites better harnessing of programmatic for his company’s above-average digital ad gains As Sebastian Tomich, The New York Times’ senior vice president for advertising and innovation, told me this week, most newspaper can count their major ad priorities with three finders. Those would be branded content or content marketing, mobile content — and programmatic. It’s tough to imagine any scenario in which ad buyers won’t want the added targeting effectiveness of programmatic — the data-driven matching of audience and product.

75% That’s the share of its traffic that BuzzFeed gets from social. That number informs Jonah Peretti’s decision, joined by others, to jump under the covers with Facebook Instant Articles (“Newsonomics: BuzzFeed and The New York Times play Facebook’s ubiquity game”). Let’s match that number to those of other news media. Digital-first champions, like Salt Lake City’s Deseret Digital Media, drive 30 percent of their traffic from social. Public media leader WBUR can count 33 percent. Quartz, ever innovative points to 60 percent of its traffic coming from social. Most dailies tell me their take runs from 6 to 12 percent. Certainly, legacy brands were able to build large non-social audiences in the early days of the web — but today social is the major route to new, younger audiences.

1.5 million That’s the combined total of The New York Times’ daily paying readers. Remarkably, it’s the same number the Times had 20 years ago, when all of them were paying for newsprint. Now close to 1 million pay for digital-only and about half a million for print daily. (On Sundays, the Times can count close to 2 million paying readers — long live the Sunday paper!). So what do we make of that 1.5 million number? Depends on where you rank on the ottimista/pessimista scale. The Times can cheer that it’s held on to paying daily circ when few other dailies have. Or we could acknowledge that the paying intelligentsia audience for a top national general news source is…roughly one half of one percent of the U.S. population, then and now. It’s funny that back in 1995, with the same number of paying daily readers, everyone deemed the Times a highly successful company. Today, some still lay bets on its survival as an independent entity.

36,000 That’s roughly how many jobs remain in U.S. newsrooms, as we await the new ASNE census in August. We seldom see much reporting of buyouts and layoffs these days, as some publishers concluded that the industry’s problems were only being exacerbated by its reporting on its own staff changes. Now with Jim Romenesko retiring, that uneven news will get even more uneven. Occasionally, bigger newsroom cuts get reported, as with The Denver Post’s cut of 20 a few weeks ago. The dropping of a couple or a half-dozen here or there mostly goes unreported. Post editor Greg Moore summed up the rationale: “It’s basically…getting expenses in line with revenue.” And with no revenue gains year-over-year since 2007, and the only way to maintain profits is cutting jobs, with newsrooms being hard hit. We can only guess at the math: How many fewer stories — online as well as in print — are 20,000 fewer journalists producing? What don’t communities know about themselves that they might have known a decade ago?

0.5% That’s the percentage of its monthly unique visitors that The Boston Globe has been able to sign up for digital-only subscriptions. Among the regional papers, the Globe looks to be the leader, last reporting more than 65,000 digital-only subscribers and about 11 million monthly uniques. Compare that to The New York Times. The Times can count more than 960,000 digital-only subscribers in its U.S. audience, according to comScore’s latest multi-platform survey. Those May numbers show the Times reaching 60 million uniques, for only the second time. At that number, the Times converts 1.5 percent of its unique audience. What this points out: The Times’ highly successful model — shifting its business to rely more on reader revenue — works far less well for the regionals. The Globe’s number is good, but still only a third of the conversion. And most papers’ conversion rates are significantly lower than the Globe’s. We’re still waiting for the Newspaper Association of America’s 2014 full-year numbers. (Last year’s numbers published in April. Now it’s mid-June, and we still don’t have them. NAA says they’re in process, but can’t give a date for publication.) The trajectory of digital circulation revenue reinforces the belief that paywall strategies need a rethink.

44 That’s the number of minutes that Quebec’s La Presse says its readers spend daily with its La Presse+ tablet product (“Newsonomics: La Presse’s bet on tablets and its crossover calculus”). It’s an absolutely stunning number, and seems to suggest that everything we think we know about digital news reading might be wrong. Thankfully, The Star in Toronto will soon test out the strategy in mid-September. Peut-être it’s a Québécois thing — but if it’s not, success will confront news producers again to reimagine themselves.

Photo by Denis Giles used under a Creative Commons license.

POSTED     June 25, 2015, 10 a.m.
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