the-new-york-times-business-model

The New York Times Business Model Analysis

The New York Times generated 67% of its revenue from subscriptions in 2022. Indeed, of over $2.3 billion in revenues in 2022, $1.55 billion came from subscriptions (both printed and digital), $523 million from advertising (printed and digital), and $232 million in other revenues. Of the subscription revenues, over $978 million were generated by digital subscriptions, while printed subscriptions generated $573 million.

 

 

How does The New York Times make money?

the-new-york-times-revenue-breakdown
The New York Times generated $2.3 billion in revenue in 2022, of which $1.55 billion was from subscriptions, $523 million from advertising, and $232 million from other revenues. In 2022 over 67% of the revenue came from subscriptions, 22.7% from advertising, and over 10% from other revenue.

As a global media organization that “focuses on creating, collecting and distributing high-quality news and information,” the company’s principal business consists of distributing content across its digital and print platforms and, in small part, to third-party platforms.

The New York Times monetizes its content in two simples ways:

  • Subscriptions: both printed and digital.
  • Advertising: display, classified, and others.

Let’s look at The New York Times’ business model.

Subscription-based strategy driven by a freemium model

the-new-york-times-subscription-revenue
The New York Times generated $1.55 billion in revenue in 2022, of which $978 million was from print and nearly $574 million from digital. In 2022, digital represented 63% of the subscription revenue vs. 37% of print.

The New York Times offers users free access to a set number of articles per month until it shows a paywall requesting users to join the platform for a basic subscription fee, which can initially be as low as $1 per week:

the-new-york-times-subscription-fee

The content gets distributed across print and digital.

In 2022 NYTimes had 8.8 million paid digital subscribers to print and 730K print subscribers. 

the-new-york-times-digital-vs-print-subscribers
The New York Times had 9.55 subscribers in 2022, 8.83 million digital-only subscribers, and 730K print subscribers. Compared to 6.78 million digital subscribers in 2021, vs. 795K printed subscribers. And 6.73 million digital subscribers in 2020, vs. 833K print subscribers.

Thus, as of 2022, over 92% of the total subscribers were digital-only. 

the-new-york-times-subscribers-breakdown
The New York Times had 9.55 subscribers in 2022, 8.83 million digital-only subscribers, and 730K print subscribers. Thus, digital subscribers accounted for over 92% of the total subscribers, whereas print subscribers only accounted for around 7.6% of the entire subscriber base.

How The NYTimes subscription-based business model is evolving

Over the years, NYTimes has shifted its business model toward a subscription, and by 2022 over 67% of total revenue came from subscriptions. 

the-new-york-times-revenue-breakdown-2022

Indeed, the revenues coming from subscriptions surpassed those coming from advertising.

This is a massive and vital change, as publishers have for over a century lived off advertising revenues.

The interesting thing? 

For years, most of the revenue within the subscription segment still came from print subscriptions. Yet, by 2022 this has shifted. 

the-new-york-times-subscription-revenue
The New York Times generated $1.55 billion in revenue in 2022, of which $978 million was from print and nearly $574 million from digital. In 2022, digital represented 63% of the subscription revenue vs. 37% of print.

Indeed, most of the subscription revenue in 2022 came from subscriptions, which accounted for 63% of the total subscription revenue. 

the-new-york-times-subscription-revenue-breakdown-2022

NYTimes advertising revenue model 

the-new-york-times-advertising-revenue
The New York Times generated $523 million in advertising revenue in 2022, of which $318 million was digital and nearly $205 million from print. Digital advertising contributed almost 61% of the total advertising revenue in 2022, compared to print which contributed over 39% of total ad revenue.

With a comprehensive portfolio of advertising products and services provided across print, web, and mobile platforms, the advertising revenues comprise three main sources:

Display Advertising

The New York Times had the largest market share in 2021 in print advertising revenue among national newspapers (compared to USA Today, The Wall Street Journal, and The Times, as reported by MediaRadar).

An independent agency that measures advertising sales volume and estimates advertising revenue.

  • Display advertising comprises.
  • Banners.
  • Video.
  • Rich media.
  • Other interactive ads.
  • Branded content.

Classified and Other Advertising

Classified advertising includes line ads sold in the major categories of real estate, help wanted, automotive, and others. 

Classified advertising comprises three major types: real estate, help wanted, and automotive. Those pay on a per-line basis. While on the web or mobile platforms, the pay is on per listing base, which can be mixed as an add-on to the print ad.

In 2017, digital and print classified and other advertising represented approximately 13% of NYTimes advertising revenues.

Other businesses part of the NYTimes galaxy

As reported in NYTimes financial statements:

Other revenues include news services/syndication, digital archive licensing, building rental income, affiliate referrals, NYT Live (its live events business), and retail commerce.

Digital other revenues consist primarily of digital archive licensing revenue and affiliate referral revenue.

Building rental income consists of revenue from the lease of floors in our New York headquarters building, which totaled $16.7 million, $17.1 million, and $16.9 million in 2017, 2016, and 2015, respectively.

NY Times distribution strategy

It is interesting to notice the massive reach NYTimes has been able to build over the web. In short, it is the case in which a player from the printed master the digital world as well with a site that, according to Similar Web, estimates 641 million visits per month.

the-new-york-times-monthly-visits

With its primary market in the US, The NYTimes is present across the globe with its digital subscriptions.

This is critical, as NY Times can earn a higher ARPU on its digital subscriptions and also higher RPMs for its digital advertising business

nyt-top-countries-by-traffic

The interesting part is that The NY Times managed to revamp its audience age distribution, as most of the digital users are between 18-34 years old. 

the-new-york-times-age-distribution

With their interests spanning news, shopping, university, and education. 

the-ny-times-audience-interests

The NYTime’s strength lies in its strong brand and the ability to attract direct visitors to its web properties. 

the-nytimes-marketing-mix

The marketing mix shows directly as the primary source. This implies strong brand recognition. 

In fact, in the last ten years, while many things have happened in the digital media space, The New York Times (with many peaks and troughs which are coherent with the news flow) has remained a popular brand across the world. 

the-new-york-times-global-search-volume

How did they achieve that? 

The company, in 2022, had 5,800 employees. Yet there is an interesting point to make. 

the-new-york-times-employees
The New York Times had 5,800 employees in 2022, compared to 5,000 employees in 2021 and 4,700 employees in 2020.

To differentiate itself, The New York Times has been pushing more and more toward independent journalism by re-focusing its efforts on employing as many people as possible within the journalism operations. 

Thus, going back to its core. This strategy seems to be paying back. Indeed, by 2022, of the total workforce, 45% was employed on the core product (journalism), compared to 40% in 2021 and 36% in 2020. 

In short, The New York Times is pushing more and more on a journalism-led product strategy to drive further its digital distribution, and digital subscription base, which today represents the most critical revenue stream for the organization. 

the-new-york-times-journalism-operations

Key Highlights

  • Revenue Breakdown (2022):
    • The New York Times generated $2.3 billion in revenue in 2022.
    • $1.55 billion (67%) of the revenue came from subscriptions (both printed and digital).
    • $523 million (22.7%) came from advertising (printed and digital).
    • $232 million (10%) came from other revenues.
  • Subscription and Advertising Revenue:
    • The company’s principal revenue sources are subscriptions and advertising.
    • Subscription revenues are derived from both printed and digital subscriptions.
    • Advertising revenue is generated through display, classified, and other advertising methods.
  • Subscription-Based Strategy:
    • The New York Times employs a freemium model, offering free access to a limited number of articles per month before requiring a subscription.
    • In 2022, the company had 8.83 million digital-only subscribers and 730,000 print subscribers, with digital subscribers accounting for over 92% of the total.
  • Shift towards Digital Subscriptions:
    • The company has shifted its business model towards subscriptions, with over 67% of total revenue coming from subscriptions in 2022.
    • Most of the subscription revenue in 2022 came from digital subscriptions, representing 63% of the total subscription revenue.
  • Advertising Revenue Model:
    • Advertising revenue comes from various sources, including display advertising, classified ads (real estate, help wanted, automotive), and other advertising formats.
    • In 2022, digital advertising contributed almost 61% of the total advertising revenue.
  • Diversified Revenue Streams:
    • The New York Times also generates revenue from other sources such as news services/syndication, digital archive licensing, building rental income, affiliate referrals, live events (NYT Live), and retail commerce.
  • Global Reach and Audience Engagement:
    • The company has a significant digital presence with an estimated 641 million visits per month to its website.
    • The NYTimes has a strong brand recognition and attracts a diverse audience, particularly within the 18-34 age group.
  • Investment in Independent Journalism:
    • The New York Times focuses on independent journalism, with a strategy of employing more people within journalism operations.
    • By 2022, 45% of the total workforce was employed in journalism operations.
  • Digital Distribution Strategy:

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