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NY Times Lowers Dependence on Traditional Advertising - Analyst Blog

Advertising, which remains a significant source of revenue, is largely dependent upon the global financial health. Softness in advertising demand has been weighing on The New York Times Company 's ( NYT ) performance. Consequently, the company is trying every means to shield itself from the impact of an unstable market and contemplating on new avenues of revenue generation.

The New York Times Company has been adding diverse revenue streams, which include a pay-and-read model to make it less vulnerable to economic conditions. The company is also adapting to the changing face of the multiplatform media universe, and has already added mobile and reader application products to its portfolio. Other publishing companies such as Journal Communications, Inc. ( JRN ), The E.W. Scripps Co. ( SSP ) and Gannett Co., Inc. ( GCI ) are also trying to adapt to different means of revenue generation.

Gannett decided to split its business into two separate entities, one completely focusing on Broadcasting and Digital businesses, and the other concentrating on Publishing. On the other hand, Journal Communications and The E.W. Scripps entered into a deal to merge their broadcasting operations and spin off the newspaper business into a separate entity.

Despite hiccups in the economy, what still guarantees revenue generation is The New York Times Company's pricing system for NYTimes.com, which was launched on Mar 28, 2011.

The publishing industry has long been grappling with sinking advertising revenues, as more readers are opting for free online news, thereby making the print-advertising model increasingly irrelevant. In order to curb shrinking advertising revenues and seek new revenue streams, publishing companies have contemplated charging readers for online content.

In an effort to offset declining revenues and shrinking market share, publishers are scrambling to slash costs. The New York Times Company has been realigning its cost structure and streamlining operations to increase efficiencies and in turn, enhance its operating performance.

The company has also offloaded assets that bear no direct relation to its core operations in order to re-focus on its core newspapers and pay more attention to its online activities. It plans to introduce a new line of digital products and services to lessen its dependence on traditional advertising.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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