Markets & Media

With Newsweek NewsDay about to begin charging access to their online articles via a pay wall, we're beginning to wonder if there is any other alternative for print publications to make money off the web. Obviously, ads aren't cutting it, and if you aren't charging readers access, then you're giving your content away.

Journalism Online - a new media consulting agency formed by media gurus Steven Brill, Gordon Crovitz, and Leo Hindery, Jr - is offering what might be the best solution yet to this problem: In the next month or so, 10-15 publishers will roll out the media consulting site's pay model, which involves a gradual, not abrupt, dip into the charging-for-content sector.

continued...

As more media companies report their earnings for the most recent financial period, we're starting to get a better pictures of the state of the industry.

Yesterday, Rupert Murdoch's News Corp. reported operating income of $1.04 billion, up 9 percent year over year, despite a massive 82 percent drop in income in the company's Newspaper division, which dived to $25 million.

News Corp. attributed declines in revenue at Dow Jones to decreased ad revenues at The Wall Street Journal, although operating expense cuts and increased circulation revenues -- related to the Journal's price increases -- partially offset the division's losses.

The company's Television division also saw operating income drop 54 percent to $38 million. However, the company's cable network division had a great quarter -- reporting a 41 percent increase in operating income thanks in part to Fox News Channel's highest ever quarterly profit.

Related: Times Warner Earnings

continued...

As we wait to hear about layoffs coming out of Time Inc. today, we got a chance to look at the magazine publisher's parent Time Warner's third quarter earnings.

The company reported a 5 percent decline in revenues compared to the third quarter of last year -- they dropped to $7.1 billion. Time Warner attributed the decline to low revenues at AOL and its publishing and film entertainment divisions, offsetting 5 percent revenue growth in its networks division, which includes HBO and Turner Broadcasting.

Time Warner also updated its predictions for the rest of 2009, noting that it plans to take $100 million in restructuring charges at Time Inc. during the fourth quarter. Although previous reports had said the company would be looking to shed $100 million through layoffs, putting this much into restructuring means the company will probably end up saving more in the long run. Time Inc. spokeswoman Dawn Bridges told The New York Times the current restructuring program "will result in a charge of up to $100 million." Explained Bridges:

"While advertising remains challenged, readers continue to value print publications and affiliated websites. This restructuring will allow us to most efficiently focus our resources on the creation of compelling content at our world class titles. Unfortunately, given the tough market conditions, this restructuring will mean a loss of jobs. We wish our departing colleagues and friends the very best with their future projects."

continued...

Meredith Corp., publisher of Better Homes and Gardens and Ladies' Home Journal, released its first quarter 2010 earnings results this morning, reporting revenues were down to $332 million during the quarter, compared to $364 million last year.

However, the company's national media group saw profits rise 14 percent to $39 million, although revenues dropped to $272 million during the quarter compared to $294 million during the same period last year. Advertising revenues also dropped five percent to $137 million, although the company was quick to point out that the first quarter was "the third consecutive quarter of advertising performance improvement."

continued...

Gannett Co., the publisher of USA TODAY, announced its third quarter results this morning and, as promised, they beat analysts' projections.

However, the company did post a 18.4 percent decrease in net operating revenues compared to the same period last year, and earnings per share were down 55.1 percent. Operating expenses also decreased, revealing a more efficient business. (Did all those layoffs over the summer help contribute to that?)

Gannet CEO Craig Dubow, who just came back to work last week after back surgery, emphasized the positives:

"We finished the quarter on a stronger note with better than anticipated results due primarily to better trends in advertising and great efficiencies across all of our business segments. Our results for the quarter exceeded the high end of previously announced estimated ranges for revenue, operating cash flow, and earnings per share...Third quarter year-over-year comparisons of publishing advertising revenue were a few percentage points better than year-over-year comparisons for the second quarter and September was our best comparison month of the year."

continued...

The McClatchy Co. (MNI), the third largest newspaper publisher in the U.S., reported its third quarter earnings this morning.

The company reported a net income of $23.6 million for the quarter, up $4.2 million during the same period last year. Adjusted earnings also grew from 2008, reaching $11 million compared to $10.4 million last year.

However, revenue dropped 23.1 percent during the quarter compared to last year. Advertising revenues were $266.1 million, down 28.1 percent from 2008, but circulation revenues increased 6.7 percent to $69 million.

And as McClatchy moves towards becoming an integrated print and online publishing company, online advertising revenues grew 3.1 percent during the quarter. They now make up 17.6 percent of total advertising revenues compared to 12.2 percent of total advertising revenues in the third quarter of last year, McClatchy said.

Read the full earnings release.

Earlier: McClatchy Dailies Joine AP's Mobile News Network

Perhaps those newspaper folks currently directing their ire at Arianna Huffington may want to reconsider their target in the hopes that she will divulge her company's "mostly secret" Google search-engine optimization tactics. AdAge is reporting that major media companies are pressuring Google to elevate their "expensive online content" to the top sphere of Google's search results.

continued...

Microsoft does NOT want to buy the New York Times. Got that? Not that the Times is for sale, per se -- at least to our knowledge. So perhaps the larger point Steve Ballmer was trying to make outside the McGraw-Hill building yesterday is that Microsoft has no interest in investing in what newspapers have to offer (even as newspapers are trying to figure out for themselves what exactly it is they have to offer).

It's no secret Microsoft is trying to overhaul its approach to the Internet -- not to mention sort out its on-again, off-again relationship with Yahoo. So, what does that overhaul include if not the NYT? ZDNet reports that they company is "working on a 'set change' in how it approaches search on the Internet, code-named Kumo.com. Exclusive high-quality news, behind a registration or pay wall, could distinguish either a refashioned search business or its Web portal." Whether this includes Yahoo is unclear, what it won't include, apparently is newspapers no matter how cheap their share price is.

Via MediaJobsDaily comes Alley Insider's observation that even as the Dow continues to plummet the NYT appears to be holding steady. Says Blodget:

It took long enough, but it seems the New York Times Company has finally found some friends with deep pockets who don't think the stock is going to zero.

Over the past week, as the stock market has cratered, the New York Times Company's stock has held steady at about $4. Today, with the market bounce, it's up about 15%.

The volume has spiked, too: Well over than 1 million shares a day for the past 10 days, with a couple of huge days.

Chances are that by this point you have a better understanding of the nations financial institutions (or at least a better understanding of the lack of understanding). However! Should you need a bit more of a run through of the fiasco than Jon Stewart was able to provide last night we bring you this handy little Credit Crisis explanation via our counterparts over at FishbowlLA.

The Crisis of Credit Visualized from Jonathan Jarvis on Vimeo.