Blog Post

10-K Watch: NYT’s Digital Dreams; About.com Continued Exposure To Search

The New York Times Company (NYSE: NYT), in the middle of a fight with its activist investors, has filed its annual report 10-K with SEC, and not much in it’s on the digital side, except some points about its focus last year and this year. It alludes to its broad revenues base, new acquisitions in the sector, and About.com’s continued exposure to search (though seems it is down from earlier 80 percent to now 70 percent).

— We have a more diversified revenue base mainly because NYTimes.com attracts a diverse base of national advertisers and About.com generates most of its revenues from display and cost-per-click advertising. Our goal for NYTimes.com is to build a fully interactive, news and information platform, achieving sustainable leadership positions in our most profitable content areas or verticals.

— In 2007, we concentrated on building out NYTimes.com’s verticals in health, business and technology. We also strengthened our verticals at the About Group with acquisitions, particularly in health and increased editorial content by adding guides.

— Operating costs for the About Group increased $18.6 million primarily due to higher compensation-related costs ($7.6 million), content costs ($4.4 million) and higher amortization expense ($2.1 million). These increases were primarily due to investments in new initiatives and costs associated with the acquisition of ConsumerSearch, Inc., which was acquired in May 2007.

— We estimate that approximately 70% of About.com’s traffic is generated through search engines, while an estimated 25% of its users enter through its home and channel pages and 5% come from links from other Web sites and blogs. Our other Web sites also rely on search engines for traffic, although to a lesser degree than the Web sites of the About Group.