The Publishing Business Might Be Turning a Corner


We’ve seen companies trying—sometimes desperately—to move into the 21st century and transform their businesses. Many waited way too long, let their staff get too small, or lost sight of their mission. But it seems that we could be turning a corner and finally getting to a point where publications can learn how to make money again.

For years, the newspaper and magazine game was pretty well-defined. There was a staff of writers and editors and salespeople to find advertisers, and you had to print your product and distribute it at newsstands or via delivery. As we now know, that model broke when the internet came along and undermined the entire industry.

The news business staggered along for many years, trying to figure out what happened. Like many disrupted businesses, it waited a long time to react. There were a multitude of economic factors chipping away at the vitality of the core business, but the internet—and the associated loss of ad revenue—was likely the biggest problem. If publications couldn’t make money, how could they survive?

The internet was changing everything. Companies suddenly decided that giving away content for free was the way to go. Ads would come if eyeballs came, or so the argument went. Some online publications came along, thrived, and were acquired and subsumed by larger entities, but the traditional publications continued to suffer.

That led companies, such as The New York Times, to consider new ways to make money. The paper began looking at diversifying and spreading income across properties and started valuing loyalty over eyeballs. Maybe all of those viewers weren’t equal after all. Maybe the most important readers were the ones who kept coming back.

The challenge was (and remains) figuring out how to turn those loyal online readers into revenue. The subscription model—which is being used increasingly by publications such as The New York Times, The Washington Post, The Guardian, and othersprovides a steady stream of income that can help offset all those losses that came from the changes to the advertising business when the publications moved online.

At TechCrunch Disrupt in May, The New York Time’s CEO, Mark Thompson, reported $442 million in digital revenue last year, noting that 61% came from subscriptions. As he pointed out, that was from primary digital streams. “It doesn’t include our crosswords, acquisitions, and digital archive. The full digital number is rather higher than that,” he explained. And that’s good news for The New York Times and the industry.

That doesn’t mean The New York Times and other news outlets aren’t giving at least some of their content away for free or that they have eschewed ad revenue altogether. But the subscription model, as cloud software companies have learned, provides a rich source of recurring money. It’s up to the company to keep earning customer loyalty, and that drives them to keep making better products.

It’s a worthwhile trade-off, but it’s not always an easy sell because not every publication is The New York Times—which carries with it the reputation and industry clout that few others can claim. But the example shows that there is a way to make money in this business. You can go beyond selling ads and classifieds—which represented the bulk of revenue for publications throughout the 20th century (and before)—and count on loyal readers to pay for content that matters.

It’s been a long time since we’ve had a reason to be optimistic in this business, but it feels as if there is at least a path to reasonable income now. While ads will remain part of that, they won’t be the only way successful publishing businesses make money moving forward. Learning to rely on a diverse revenue stream—one that could also include events and sponsors—gives hope that the business can survive.

Keen reporting and quality content (however you choose to present it) are still at the center of this entire proposition, but there appears to be a road to a viable business, something that wasn’t entirely clear in the recent past. 


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