Updated, 2:50 p.m.
Although the finances at The Times aren’t strictly within my brief as public editor, I take a keen interest in them. After all, the health of the company is bound to affect the journalism. (One clear indication of that: For cost-cutting reasons, 100 newsroom buyouts or layoffs are in progress this month and next.)
So the coverage and commentary that followed last week’s third-quarter financial statements are worth pulling together here. Here are some highlights, plus interpretation.
Ken Doctor, a media analyst writing for Nieman Journalism Lab, sees an accelerating move from print to digital. Noting that the unusual operating loss of $9 million (roughly 2.5 percent on $365 million in revenue) is largely attributable to paying for buyouts and severance, he writes that the transformation that’s underway is not a smooth ride. He writes:
Look only at the income results of the quarter — an overall 0.8 percent increase in revenues — and you’d miss the drama of that volatility. What seems like a smooth drive is actually quite a bumpy journey. Advertising is moving profoundly (but haphazardly) from print to digital, as are readers. While the Times could count 44,000 new digital subscribers in the quarter, a 20 percent year-over-year increase, it lost 5.2 percent of its daily print readers — and, more worryingly, 3.5 percent of its Sunday print subscribers. The Times already counts more digital subscribers than print ones, and the divide is widening.
You can feel the change within the The Times’s newsroom, where more and more emphasis is being placed on presenting the news on smartphones and tablets. There’s a revved-up feeling and a sense of urgency. That’s not always pleasant, but it’s necessary. (After this post went up, I heard from The Times circulation department, which disputed Mr. Doctor’s statement that The Times counts more digital subscribers now than print subscribers. Speaking for The Times, Eileen Murphy confirmed that The Times “is well north of one million print subscribers, versus 875,000 digital subscribers as of the end of Q3.”)
Rick Edmonds, writing for Poynter, offers “Nine Takeaways” from the new financial statements. Among them are his observations on top women executives — fewer now with Denise Warren’s just-announced departure after Jill Abramson’s last spring — and the rising cost of print subscriptions. (The cost of a seven-day print subscription to The Times, outside the metro area, he notes, is “inching close to $1,000 a year.” That’s quite a hefty bite out of most subscribers’ budgets.)
He also comments on what may seem arcane but is telling: the falling “average revenue per user” due to the move to mobile platforms. Mr. Edmonds writes: “As business moves down the price chain (both ads and circulation) from print to desktop/laptop to smartphone, a company can end up running fast just to stay even in revenues. And that’s likely to persist for years, not just quarters.”
Meanwhile, Jay Rosen — the New York University journalism professor whose writing, on his blog and Twitter, has a large following – announced that he would teach a new course next semester, “The Future of The New York Times.” Jeremy Barr, at Capital New York, provided some details, including this tweet from one Times editor:
Given the uncertainties of the business, there’s bound to be a fair amount of speculation involved there. But it’s also bound to be interesting. (Mr. Rosen has posted a description of the class online.)
And prior to the earnings announcement, Francine McKenna in Forbes described this report as “make or break time” for The Times, and provided a tough, and rather dire, analysis of the issues.
Amid all this uncertainty – and the understandably tense newsroom atmosphere surrounding the buyouts and layoffs – some awfully good work has been getting into the paper in recent weeks. Among the most notable: C.J. Chivers’s revelations that American troops fighting in the Iraq war found over 5,000 chemical warheads and evidence of other chemical munitions; Eric Lipton’s investigation of the increase in lobbying and campaign contributions from corporations that are trying to influence state attorneys general; the series of stories about horrendous abuses at the Rikers Island prison by Michael Winerip and Michael Schwirtz; and Rukmini Callimachi’s reconstruction of “The Horror Before the Beheadings.”
The executive editor, Dean Baquet, sent around a note last week to the staff, praising such recent efforts. It read, in part:
In the past few days three government agencies have been forced to act in response to blockbuster Times investigations. The city announced a shakeup in leadership of Riker’s Island. The Pentagon said it would review how the military handled abandoned chemical munitions. And Missouri is preparing to set up an independent investigation of its attorney general. Earlier in the year, our coverage of GM forced the company and the government to confront their failings in regulating the company.
The congratulatory note from the top editor is something of a standard form. But Mr. Baquet makes a pretty good point about this run of impressive stories.
As The Times makes its rocky transition from print to digital, the continuation of hard-hitting journalism — time-consuming, difficult and expensive — is what really matters.