Part of the bet that the New York Times Co. (NYSE: NYT) made when it began building the metered paywall for the NYTimes.com was that the audience was larger than just northern, east coast readers. In a conversation at the Goldman Sachs Communacopia conference, CEO Janet Robinson said that the company is seeing subscribers from across the nation, and is even getting some international acceptance as well.
That could augur well for plans to roll out a similar paywall for the NYTCo’s International Herald Tribune site this fall. On the downside, however, Robinson reiterated a point she made during July’s Q2 earnings call that ad sales were looking softer through Q3.
Updated: While the company’s International Herald Tribune does not have a standalone site — it’s the global version of the NYTimes.com — a NYTCo rep tells paidContent that the foreign news brand will indeed launch a paywall this fall. While the site itself won’t be broken out into a separate entity, it will be available in combination with IHT-specific apps for a subscription fee. The NYTCo isn’t ready to discuss further details on the plan, though they say the IHT paywall will differ from the NYT digital subscriber options.
Original post: Robinson declined to provide an update on the number of digital subscribers, which was 224,000 in Q2, saying that they only report those figures on a quarterly basis. But she did offer some additional color on the number paywall subs. In particular, about 88 percent are domestic and 12 percent are international.
There are also 57,000 subs collectively on Amazon’s Kindle or and Barnes & Noble’s Nook, while the carmaker Lincoln’s sponsorship program that offers free total digital acccess to the NYTimes.com’s most engaged users was 100,000. About 758,000 are home delivery subs that have linked digital accounts. “That’s well over a million, including actual direct-paid subscribers or sponsored users,” Robinson said. “That’s quite an impressive number.”
On the advertising side, Robinson said that due to deepening economic uncertainty, brands are committing to long-term spending less frequently. As a result, the NYTCo is seeing 8 percent declines in Q3 ad revenue, with a 10 percent drop in print, and even a 2- to 3 decrease in digital ad revenues, which are partly due to the About Group’s continuing troubles.
But things are hardly dismal at the NYTCo, Robinson added, pointing out that this year is up against some difficult comparisons. For example, last year, BP spent an inordinately large amount of marketing dollars on ads in the paper to address the Gulf of Mexico oil spill, which tends to skew this year’s results.
Nevertheless, real estate, financial, national auto and entertainment have shown more weakness in ad spending. On the bright side, Robinson pointed to strong performance in telecom and luxury ad spending.
Even with the coming launch of the BostonGlobe.com paywall on October 1st, and a meter on the IHT site, capital expenditures related to the marketing and maintenance of the paywalls will be lower this year, said CFO Jim Follo, who appeared with Robinson today.
“Last year, our cap ex was $35 million, which included building the paywall, and we expected that to come down even as we continue to grow that business,” he said. “But we’ll still continue to make investments on paywall.”