Media Insider: NYT Ad Revenues Drop, Forrester Shares 2020 Media Predictions, Salt Lake Tribune Becomes a Nonprofit
Welcome to Media Insider, PR Newswire’s round-up of media stories from the week.
REUTERS | NEHA MALARA
NYT Warns of ‘Challenging’ Quarter as Ad Revenue Set to Weaken, Shares Fall
The New York Times Co on Wednesday forecast a “fairly challenging” fourth quarter due to a drop in advertising revenue, which the publisher said may fall further due to changes in its ad platform, sending its shares down 9%. The company said it will no longer allow automated selling of ad space meant for its apps, and the newspaper expects to lose digital advertising revenue in “single-digit millions” when it rolls out the new measure in January 2020. “This will be more than made up by gains in engagement and a higher propensity by app users, both to subscribe and retain,” Chief Executive Officer Mark Thompson said. The weak advertising forecast overshadowed the increase in digital subscriber numbers that rose 273,000 from the immediately preceding quarter, taking the total tally to about 4 million.
The Times cut a multi-year licensing agreement with Facebook last month that it expects will also add to the company’s fourth-quarter revenue.
FORBES | FORRESTER CONTRIBUTOR
Predictions 2020: The Media Industry Braces for Long-Term Change
The media industry is used to change, but 2020 may bring a different sort of change from what we have seen over the past 10-plus years as digital has disrupted media. The coming presidential election will make it difficult for brands to break through the political noise and catch the spotlight in 2020. But the biggest changes will have ramifications beyond the first year of the new decade. Among Forrester’s predictions for 2020: streaming wars will erupt, with greater competition for Netflix and Prime Video as Disney+, HBO Max, and Apple TV+ emerge as potent competitors; one up-and-coming social network will be acquired by a larger player; and podcast ads will hit $1 billion in media spend.
To view the full report, download Forrester’s Predictions 2020 guide.
WALL STREET JOURNAL | LUKAS I. ALPERT
Salt Lake Tribune Becomes a Nonprofit
The Salt Lake Tribune, the largest newspaper in Utah, is becoming a nonprofit, marking a new approach in a struggling industry seeking new business models to stay afloat. The newspaper said its application had been approved by the Internal Revenue Service. The move comes just three years after the paper was acquired by Paul Huntsman, a member of one of the wealthiest families in the state, underscoring the considerable challenges facing local news outlets as readership and ad dollars have shifted online. “This is a historic moment for the Tribune and a new day for local journalism around the country,” said Huntsman. “The IRS approval opens up new possibilities for success for legacy newspapers.”
The IRS verdict presents an appealing alternative for other struggling newspapers.
VARIETY | CYNTHIA LITTLETON
Ozy Media Raises $35 Million to Expand in TV, Podcasts and Live Events
Ozy Media, the digital magazine and lifestyle outlet launched in 2013, has raised $35 million in a new round of financing to support the expansion of its TV production, live events, and podcasting operations. The latest investment brings the total financing raised to date by Ozy to more than $70 million. The company turned its focus to producing TV series for OWN and other outlets and launched into the podcast arena, which co-founder Carlos Watson sees as a big opportunity to reach millennial audiences “where they live.” The company also plans to expand its successful Ozy Fest event to other cities, including outside the U.S.
Podcast growth is popping in the U.S., with more than half of Americans reporting they have listened to one.
DIGIDAY | TIM PETERSON
First Media Cuts Staff and Pivots Back to Social Videos
Digital publisher First Media is pivoting back to platforms after attempts to build up its owned-and-operated sites and a long-form video business failed to pan out. On Nov. 1, First Media laid off members of its editorial and sales teams as the company decided to stop producing written articles for its sites and long-form episodic shows. Instead, the company will concentrate on producing short-form videos for platforms like Facebook, Instagram, and YouTube, and continue to operate its TV network, BabyFirst. First Media co-founder and president Sharon Rechter confirmed the layoffs and said that 10 out of 220 employees were being let go. Despite the layoffs, First Media, which has never raised outside funding, remains profitable and expects its revenue this year to be 70% higher than its 2018 revenue and exceed its projected revenue by 20%, according to Rechter.
USA Today also is overhauling its video distribution strategy to generate incremental revenue from its profitable video operations.
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Maria Perez is Director, Web Experience & Operations at Cision. She founded Bags of Love Foundation, a local nonprofit that provides cancer patients with care packages aimed at making their treatment more comfortable. In her spare time, she loves nothing more than cuddling with her blind Maltese, Toody, who thinks he rules the world.
