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Gen Z’s media preferences, Disney’s write-down, BBC’s engagement on Facebook, plus a ton of revenue and advertising projections.
Here’s our regular round-up of the Top 10 stats from the past month:
1: The Guardian’s first profit in two decades
At the start of the month there was much excitement in media land about the Guardian reporting its first operating profit since 1998.
Guardian News & Media recorded an £800,000 operating profit for the 2018-19 financial year, the group reported, compared with a £57m loss three years previously. The company had 655,000 regular monthly supporters across both print and digital, and a further 300,000 people making one-off contributions during the past year.
Jim Waterson, the Guardian’s Media editor wrote that this meant “the business is existing on a sustainable basis following the culmination of a turnaround programme put in place following years of substantial losses.”
However, Amol Rajan the BBC’s Media editor noted that “the operating profit excludes cash payments of between £25-30m for capital costs and other business expenditures, which are an annual draw-down from the Scott Trust, of which The Guardian is part. If these annual costs were included, The Guardian would still be loss-making.”
Douglas McCabe, chief executive of Enders Analysis, was another who urged caution when taking stock of this news, telling the FInancial Times: “The leadership team has done very well to bring this phase over the line, but the next phase, covering both the sustainability of the business and a core audience retention, will be more complex and challenging.”
As recently as 2016 the Guardian was losing £1 million a week. Now – for the first time in 20 years – it’s made an operating profit. And digital has overtaken print, accounting for 55% of all revenue. Digiday: https://t.co/JFagdOQ24D pic.twitter.com/W0GNYT4zXE
— Sarah Marshall (@SarahMarshall) May 2, 2019
2: New York Times hits record 4.5 million paying subscribers
At the end of Q1 2019, The New York Times Company announced they now had 4.5 million subscribers – with more than 3.5 million digital subscriptions (which includes their news, crossword and cooking products).
The company hopes to have more than 10 million subscribers by 2025.
Edmund Lee, who covers the media industry for The New York Times, noted that at the paper: “costs have continued to rise, in part because of increased spending on marketing to help advertise digital subscription products. The company spent $47.5 million on marketing during the first quarter, a 50 percent jump over the same period last year. That is likely to continue.”
We noted a similar marketing trend at The Economist in our March round-up.
3: Disney’s $353 Million write-down on investment in Vice Media
It’s not that long ago that some of the biggest, most established, media companies were busy investing in some of the new digital darlings.
Disney was one such company, investing more than $400 million in Vice Media. However, the times they are a changin’. The company took a $157 million write-down on its Vice investment in November, adding another $353 million to this in May 2019.
As Peter Kafka noted over at Vox: “Investors have decided that high-flying publishers that once confidently explained that they’d created a new media paradigm are now worth very little … or even less.”
Kafka goes on to provide some further examples, writing:
- “Mic, which raised more than $60 million, sold for less than $5 million late last year.
- The properties formerly known as Gawker Media, plus the Onion and other sites, just sold for a price that’s likely well below $50 million; Univision, the TV conglomerate which sold them off, had paid $135 million for the Gawker sites alone in 2016.”
“We don’t (yet) know the value that Comcast, which put a collective $600 million into Vox Media (which owns this site), and BuzzFeed over the past few years, now thinks those two publishers are worth. But it’s a reasonable bet that Comcast thinks they are worth less than it thought in 2015,” he adds.
As The Hollywood Reporter notes, in 2017, the American investment company TPG valued Vice at $5.7 billion.
4: Here’s why your loading speed matters
At the latest Strata Data Conference in London, a presentation by Cait O’Riordan – Chief Product and Information Officer at the FT – stressed the importance of loading times for publishers.
A speed test found that increasing site speed by just 1 second led to a 5% increase in engagement “for the entire base.”
5: BBC most engaged publisher on Facebook
According to rankings from NewsWhip, the BBC was the most engaged with publisher on Facebook in April 2019. Just.
“The BBC was top of the pile, edging ahead of CNN by just 10,000 engagements for the month,” observes NewsWhip’s Managing Editor Benedict Nicholson.
Both companies enjoyed more than 40.5 million engagements on the social network in April, some way ahead of Fox News, the Daily Mail and New York Times. Meanwhile, the BBC’s international facing site – BBC.com – ranked sixth.
“In terms of the top stories that performed well on Facebook last month, there was a very clear theme that emerged: the burning of Notre Dame Cathedral, which featured in no less than seven of the top fifteen stories from the month, either about the event itself, or some kind of reaction or analysis of it,” Nicholson writes.
“This correlates with trends we have previously seen, as people engage with the sudden, unexpected loss of something or someone.”
6: Gen Z is 32% of the global population
Zebra IQ, a marketing and insights company, recently released a report detailing Gen Z ‘s online habits, interests and the language they use. This cohort, which was born between 1995 and 2010, is the first generation to grow up with the internet and smartphone technology as a given.
With 2.4 billion Gen Z’ers around the world, this is a demographic publishers cannot afford to ignore. Perhaps just as importantly, as Zebra IQ’s report shows, this is a group which also has very different media habits.
As Business Insider recaps, “Gen Z is crazy about a handful of online platforms including Twitch, Reddit, TikTok, Imgur, Unfold, Brat, NTWRK, and Lomotif.”
Featuring slides from the wider report, BI helpfully showcases what these sites do and why they’re of interest.
For example, Imgur reaches more than 250 million people a month, skews millennial male and 17% of users spend more than 10 hours a week browsing gifs and memes.
7. 70% of Emmy-nominated comedy and dramas are not on ad-supported TV
The Emmy’s traditionally garner a lot of attention in the press for the night’s winners (and losers). But, analyse the nominees this year (shows like “Barry” on HBO and “Stranger Things” on Netflix, and an interesting trend emerges:
“While Emmy nominations certainly do not tell the entire TV story,” BTIG analyst Richard Greenfield commented (registration required) this trend is noteworthy in that “you do not need a multichannel bundle to watch them.”
In a part-of a post titled “Sports is All That Matters on Linear TV,” he quotes Fox COO John Nallen, who recently told investors how challenging it is for legacy broadcasters to serve ads to large audiences:
“In a generation, more than 90% of an advertiser’s ability to reach consumers via the highest-quality scripted content has evaporated. So, let’s contrast that to live programming, and the simplest proxy for me over this period is premium sports. In 1998, if an advertiser bought a unit in 20 major sporting events that year, they would have amassed 467 million impressions. In 2018, those same events would have delivered 438 million impressions, a fairly modest decline of 6%.”
“If live sports is the really the “only” thing that can aggregate a mass audience,” Greenfield adds, “it stands to reason that the only reason to pay $50-$100/month for a linear MVPD/vMVPD subscription is if you love sports. [This] Leads us to believe that the rate of cord-cutting is going to accelerate meaningfully.”
8. Out-of-home (OOH) only traditional ad market to grow in 2019
Axios’ Sara Fischer paints a similarly bleak for many traditional platforms.
Using data from MAGNA, it shows growth in social, mobile, video, search and out-of-home (OOH); and declines for TV, radio, desktop and print.
Print is expected to pull in 17.6% less advertising revenue in 2019, compared to the year before. Declines for other platforms are much less precipitous.
9 . Digital revenues for 2018 surpass $100 billion for the first time
This was perhaps the headline takeaway from the IAB internet advertising revenue report for the full year of 2018, which also found that revenues for FY 2018 increased 21.8% over FY 2017.
“Internet advertising revenues in the United States totaled $107.5 billion for the full year (“FY”) of 2018, with Q4 2018 accounting for approximately $31.4 billion and Q3 2018 accounting for approximately $26.6 billion,” the study stated.
Meanwhile, advertising revenues for mobile devices totaled “$69.9 billion in FY 2018, a 39.7% increase from the prior FY 2017 revenues of $50.1 billion.”
According to IAB, “advertising delivered on a mobile device now makes up 65.1% of total internet advertising revenues.”
10. Spotify now accounts for nearly 10% of all podcasts
“Apple Podcasts played a pivotal role in the development of the industry and remains the dominant app for listening,” writes Li Jin, Avery Segal, and Bennett Carroccio at az16. “However, its market share has fallen in the last few years, from over 80% to 63%.”
Part of this has been as a result of Google’s recent moves into this space, as well as the emergence of Spotify in this space.
“In the world of podcasting,” they note, “the flywheel is spinning: new technologies including AirPods, connected cars, and smart speakers have made it much easier for consumers to listen to audio content, which in turn creates more revenue and financial opportunity for creators, which further encourages high-quality audio content to flow into the space.”
According to their analysis, “there are now over 700K free podcasts available and thousands more launching each week.”
Stayed tuned for a new report from What’s New In Publishing launching in the next few weeks, which will take a deep-dive into this rapidly evolving (and important) field.