NY Times rolls out new products in search of revenue

NEW YORK TIMES: New York Times Co. reported a decline in quarterly revenue on weak advertising sales but announced new products with the hope of tapping additional dollars.
The 11.2 percent drop in advertising revenue in the first quarter underscores the pressure that the New York Times faces to increase its subscription revenue, especially for its digital products, and find new veins for money.
The company plans to roll out a line of lower-priced products — including an expansion into e-commerce and games — to attract more readers around the world.
“We want to deepen our relationship with our existing loyal customers, but we also want to use a wider family of New York Times products to reach new customers both here and around the world,” Chief Executive Officer Mark Thompson said in a statement.
Paid subscriptions to digital products at the company’s namesake paper and The Boston Globe totaled 708,000 in the first quarter, a 45 percent increase from a year earlier.
Still, the growth in subscriptions slowed compared to the prior quarter. Paid digital subscriptions were up 6 percent in the first quarter from the fourth quarter, while it grew 13 percent in the fourth quarter from the third.
Compounding revenue challenges is a reversal of digital advertising revenue growth — once a bright spot for the industry. At the New York Times, digital ad revenue dropped 4 percent in the quarter.
“I donít expect the new products to grow as fast as the paywall but at least it will add another revenue line which did not exist earlier,” said Kannan Venkateshwar, an analyst with Barclays.
Part of the new strategy, which will be introduced later this year, includes lower price access to the New York Times’ “most important and interesting stories.”
It’s the latest effort by the company, which introduced its digital pay model more than 2 years ago in an experiment closely watched by newspapers across the US.
The move to charge for digital access was one way to remain less dependent on advertising revenue — which is dwindling fast for the industry.
At the Times, the company has narrowed its focus, selling off assets — The Boston Globe and its sister properties in New England are currently on the block — in order to sharpen the flagship. Earlier this year, it renamed the International Herald Tribune the International New York Times.
Total revenue for the company fell 2 percent to $ 465.9 million, below analysts’ expectations of $ 470.5 million, according to Thomson Reuters I/B/E/S.
Excluding severance, earnings per share for the quarter was 4 cents, in line with analysts’ forecast.
Shares of the New York Times were up 4.9 percent to $ 9.44 in morning trade.