The New York Times has been a leader in the news media industry for decades. But, as news transitioned from print to digital, The New York Times was at the front line of the digital revolution.
As part of their examination of the digital revolution and how it impacted their company, The New York Times released their 2020 report on Tuesday outlining how the company handled the journalism, reporting in the digital age, and how the news giant plans on increasing revenue in the future.
“While the past two years have been a time of significant innovation, the pace must accelerate,” The New York Times explains at the start of their report. “Too often, digital progress has been accomplished through workarounds; now we must tear apart the barriers. We must differentiate between mission and tradition: what we do because it’s essential to our values and what we do because we’ve always done it.
The New York Times explains that their business model surrounds subscriptions and in order to stay competitive they have to focus on being different from other media outlets.
“We are not trying to maximize clicks and sell low-margin advertising against them. We are not trying to win a pageviews arms race.” In turn, the company is focused on writing news articles so compelling that millions of people around the world are willing to take their disposable income and spend it on New York Times content.
And by all intensive measures, according to the internal report, it seems like it is working for the company. New York Times points out that their digital subscription revenue is growing as businesses are taking their advertising dollars to media giants such as Facebook and Google. In fact, the company plans to increase their digital revenue to $800 million by 2020.
Digital media is changing the way people engage and receive their news. Overall, more and more news outlets are losing advertising dollars to Facebook and Google. For instance, Facebook reported over $6 billion advertising revenue, up 63% from 2016. In addition, Google reported $19.4 billion in advertising revenue last year.
Since Facebook and Google control a large share of advertising dollars, there is less money left on the table for other companies. In fact, last April Financial Times reported that BuzzFeed missed their revenue target of $250 million by more than $80 million dollars. Sources close to the situation at the time complained that BuzzFeed’s advertising strategy was not scalable.