Friday, July 25

The “News” Math

What's the old saying? "Figures lie and liars figure"?

Did you see that the New York Times is raising the newsstand price of its paper, Monday-thru-Sunday, by a quarter to $1.50? A buck-and-a-half for a newspaper? Damn! There'd better be some terrific grocery store coupons inside. Maybe $1 off a pint of Ben & Jerry's. No? Oh, well.

How about the Wall Street Journal, raising newsstand prices by fifty cents to an even $2. Two bucks? I guess anyone who's anyone in high finance can afford it.

Math was never my best subject, so help me out if I get this wrong. The Times, when last I checked, had a daily circulation of about 1,100,000. So (forgetting about advertising) it will take in about $1,650,000 a day just from selling the paper.

The WSJ, with a readership of just over 2,000,000 will take in about $4 million a day from peddling papers.

The Journal seems to be holding its own in circulation. Times readership has dropped precipitously.

In newspapers in general we've seen dramatic drops in circulation—huge cutbacks in news staffs—shrinking page sizes (to save on costly newsprint)—and now big price increases as they try to stay afloat waiting for the "magic bullet" of Internet revenue to ride to the rescue.

I don't know. I haven't heard of any huge successes in Internet news delivery. I know people are spending big bucks trying to coax people to their web sites—but is anyone making big bucks yet?

If the New York Times circulation drops to, say, 700,000—will the Times start charging $2.25 for a paper? Won't that drive more readers away? When circulation is down to 500,000—will the paper got for $3.30?

I know, I know—think of all the cost savings when newspapers no longer have to have printing presses and delivery trucks. Maybe a staff of 1,000 of the best reporters, editors, photographers and layout people can produce the gol-durndest web-based New York Times ever!

Maybe they can sell off that fancy new office building in midtown and have everyone work from home via computer.

But how are they gonna make money from an on-line newspaper?

If you have an answer, send it to me wrapped in a $20 bill. Don't worry; I am, at least to my way of thinking, a tax-deductible charity.

1 comment:

Anonymous said...

The NYT can expect some additional losses in circulation from their decision to raise the newsstand proce. That is a given.

They probably figured in the losses at the time thay made the decision to raise the newssatnd price.

Part of the newsstand price goes back to the news dealer in the form of comission. If the newsstand price is higher then the commission is higher.

On top of this the price of newsprint is out of this world. Remember newsprint is a commodity, like porkbellies, soybeans and Oil.

The Times also has to pay higher costs for diesel for its delivery trucks and higher costs for ink, which are made from petrochemicals or sometimes soybeans.

I doubt that The Times or WSJ are making very much of that raise at all.

The move that saved money was the shrinking of the paper to a smaller size. Believe it ir not, cutting a half inch from each page saved millions in newsprint costs.

The wall street Journal had to make enough money to pay the Huge price News Corp paid for Dow Jones.

If you want to make money from newspapers on the the Internet, Look at the Sun in London for a buusiness model.