posts about or somewhat related to ‘business models’
On Friday, news broke that 21st Century Fox, which was recently spun off from News Corp, is sinking $70 million into Vice for a 5% stake in the company. That means the notional value of Vice as a whole is $1.4 billion. That means that Vice is worth about six times as much as the Washington Post, and just a wee bit less than the New York Times. If there was any doubt left, the counterculture has now become the establishment. There is now only one degree of separation between Rupert Murdoch and “The Meth-Fueled, Weeklong Orgies Ravaging London’s Gay-Sex Party Scene.”
— Hamilton Nolan, Gawker. The Revolution Will Not Be Vice.
[Was hard] news ever commercial?
Gerald J. Baldasty’s book, The Commercialization of News in the Nineteenth Century, makes a case clear as spring water that hard news has almost never been a mass commercial enterprise.
The American newspapers of the 1820s and early 1830s were creatures of political parties, edited by zealots. Essentially propaganda sheets, these newspapers were “devoted to winning elections,” as Baldasty wrote… Without newspapers, top political organizer Martin Van Buren once said, “we might as well hang our harps on willows.”
Political parties supported the papers financially, and when editors strayed from the party line into independence, the parties would dump their newspapers.
— Jack Shafer, Reuters. News Never Made Money, And Is Unlikely To.
Well, kind of.
The tech world reeled when Yahoo announced in May that it would buy Tumblr, the weblogs platform favored by those tech-savvy young ‘uns, for a total of $1.1 billion.
Five intriguing tidbits about the deal came out in Yahoo’s quarterly financial documents, which landed last night.
Most eye-popping: Yahoo bought Tumblr for $990 million (the remainder of the billion-plus total goes to founder David Karp and other Tumblr employees), and an incredible $751 million of that value was attributed to “goodwill.”
Goodwill is an accounting term for the worth of an intangible asset blahblahblah, and in this case it means brand value. So 75% of Tumblr’s value lies in its cool factor. (More details in our main CNNMoney story here.)
FJP: Read through for the rest but know who could have used a perception of cool? The Boston Globe. Founded in 1872, it sold to Boston Red Sox owner John Henry for $70 million. Or, if you take into account pensions and other debts, it sold for negative $40 million.
The Washington Post might wish it had some “goodwill” too. Amazon founder Jeff Bezos, of course, just bought the 136-year-old paper for $250 million.
Takeaways: Don’t get old. Stay cool. Valuations are a weird gig.
Vinay Sitapati, The New York Times. Hindi Paper Finds Success Going Hyperlocal.
FJP: Sketchy business model of its competitors aside, this is a fascinating profile of the Patrika newspaper group in India.
Rajasthan Patrika, which is printed in 33 main and 250 local editions has a readership of 14.6 million steadily grown since 1956 when its founder started the paper with a $8.30 loan. Yes, eight dollars and 30 cents.
Its growth has been attributed, in part, to focusing on the hyperlocal and going where other publishers have no reporters.
Rajasthan Patrika has not been accused of participating in the pay scheme indicated in the quote above.
Almost a year ago, New Orleans’ Times-Picayune cut staff, announced that it would stop publishing a daily newspaper in favor of three days a week and tired to pivot to digital first at NOLA.com.
A year into the process The Columbia Journalism Review calls strategic decisions made over the last 12 months a “rolling disaster" while the New York Times’ David Carr calls pretty much everything to do with the Picayune "a jaw-dropping blunder”.
But the Picayune isn’t done. Advance Publications, the paper’s owner, has announced the paper will be a paper. Again. Sort of. But in a different format. Probably because The Advocate, the Baton Rouge daily that’s just set up shop in New Orleans, is looking to eat the Picayune’s lunch.
David Carr tries to explain the Picayune’s return to print:
The new distribution plan is hard to explain, but I will do my best.
On Wednesdays, Fridays and Sundays, a broadsheet called The Times-Picayune will be available for home delivery and on the newsstands for 75 cents. On Mondays, Tuesdays and Thursdays, a tabloid called TPStreet will be available only on newsstands for 75 cents.
In addition, a special electronic edition of TPStreet will be available to the three-day subscribers of the home-delivered newspaper. On Saturdays, there will be early print editions of the Sunday Times-Picayune with some breaking news and some Sunday content.
There’s more, but you get the idea — or not. It’s an array of products, frequencies and approaches that is difficult to explain, much less market.
The move was clearly defensive, unveiled the day before John Georges, the new owner of The Advocate, announced that it would expand its incursion into New Orleans.
If that leaves you shaking your head, try this take by Kevin Allman at The Gambit:
The digitally-focused NOLA Media Group, which cut back print publication of The Times-Picayune to three days a week last year, continued to innovate today by announcing a new plan to print on the days it doesn’t produce a print product, bringing the company up to 7-day-a-week publication, according to an announcement by NOLA Media Group Vice President of Content Jim Amoss.
The report, which is not from The Onion, says the new product, to be called “TPStreet,” will launch this summer in newsboxes around the city and cost 75 cents, just like the daily paper, which it will not be, because it is more innovative than that…
…The innovative publication is in response to “a repeated request” from home-delivery subscribers to get a delivered daily paper, but it will not be home delivered, [President and Publisher Ricky] Mathews said.
So, The Advocate’s is trying to invade and the Picayune is playing oddball defense.
"Our hope is that we will be treated to an invigorating old-time press war between The Advocate and The Times-Picayune," Jed Horne, a former editor at The Times-Picayune tells Carr, “but of course, it could end up being two dinosaurs fighting over the last mud hole on an overheated planet.”
Let’s hope not.
A trade group says that newspapers like the New York Times have seen large increases in circulation, but that’s partly because they are allowed to count their readers multiple times. The industry needs to do better. →
The latest circulation gains for the NYT and others came courtesy of the Alliance for Audited Media (formerly known as the Audit Bureau of Circulations), an industry group composed of advertising agencies and publishers. The group noted that the numbers are not really comparable to the previous year’s results for a number of reasons, including the fact that some newspapers have launched new subscription formats, stopped printing every day and so on.
As Edmund Lee at Bloomberg points out, the AAM survey — which is somewhat ironically locked behind a paywall — also allows publishers to count their readers multiple times, according to rules adopted recently by the group. In other words, newspapers can count someone who reads the newspaper in print, on the web and on their Kindle as three separate readers. But doesn’t this inflate their readership numbers unreasonably? It sure does. The bottom line is that no one really knows what the “real” readership numbers are for newspapers.
Some argue this has always been the case with newspapers, which is true: publishers have routinely engaged in all kinds of shady tricks to boost their circulation — including special discounts for bulk purchases by hotels and airlines and other giveaways, and even dumping large quantities into ravines or pulping them after printing. On top of that, many papers have inflated their readership numbers for years by claiming that each copy gets read by as many as five people, an estimate that borders on the ridiculous.