Trump bump good for New York Times: Mark Thompson

The New York Times CEO Mark Thompson credits Donald Trump with helping reinvigorate consumer interest in newspapers.

New York Times chief executive Mark Thompson.

The New York Times chief executive Mark Thompson has credited US President Donald Trump with helping reinvigorate consumer interest in newspapers after subscriber growth hit record highs and the brand begins ramping up its ambitions for Australia.

In an interview with The ­Australian, Thompson has outlined a blueprint to reach 10 million paid digital subscriptions and given forthright views on publishers, including:

A vote of confidence in ­consumers to pay for quality ­journalism.

A scathing assessment of a publishing culture of short-­termism.

A commitment to continuing to print the Times daily in the US “for at least a decade”.

Speaking at the Cannes Lions advertising festival, Thompson brushed off frequent “fake news media” attacks against the Times by Mr Trump on Twitter.

“The idea of a political leader and the media clashing is not a new one, but it must be said the 45th president has made it almost a daily experience,” said Mr Thompson, who navigated high-profile run-ins with Buckingham Palace and successive British prime ministers as director-­general of the BBC from 2004 to 2012. “I’m battle-hardened in the matter of politics.”

Mr Thompson points out that Mr Trump has been great for business. Between January 1 and March 31, this year, the Times ­recorded the best quarter for ­subscriber growth in its history, fuelled by continued interest in the new administration.

Paid digital subscriptions reached 2.2 million in the first quarter, an increase of 348,000 from the prior quarter. Overall, the Times reported 3.2 million total subscribers, which includes digital, print and 40,000 new crossword subscriptions. The subscription growth story of quality media is also mirrored at The Wall Street Journal, ­published by News Corp. News Corp chief executive Robert Thomson said last month the Journal had added more than 300,000 subscribers year-over-year, with digital now accounting for 53 per cent of total subscriptions. “What’s interesting about the Trump era is that he in many ways has pumped an incredible amount of relevance into classic media,’’ Thompson said. “He’s made the Times far more prominent. The Times is probably more present in American culture and the American debate that any time in its history.”

But once passions related to the early days of the Trump ­administration fade, can Thompson retain these new subscribers? While the pace of growth in the next quarters will ease off slightly, Thompson said the Times is still enticing new subscribers at a ­decent clip. “The news cycle has been a significant help, if you like, in building a subscriber base. But what I would say is that our ­subscription model was already accelerating before the 2016 presidential cycle really got into its stride. At the moment there’s no sense that these are fairweather subscribers.”

Newspapers all over the world are suffering an accelerating drop in print advertising, a market that already was under stress. As a result of this, newspapers have been in a race against time to grow their digital revenues to make up for the collapse of print advertising.

The Times has made strides, Thompson said, but face challenges on that front, including the dominance of Facebook and Google in the digital market and difficulty making money on ­mobile products.

Among the bright spots is the creation of a content marketing studio to craft custom campaigns for brands. “We’re more now in the marketing solutions business than we are in digital advertising as such. We have far more people in our advertising department ­involved in content creation than we do in sales.”

The Times published its long-awaited 2020 report this year, laying out a road map for the publication to better adapt to the fast-changing demands of the digital landscape. Shifting more resources into digital initiatives will help build a digital subscription business large enough on its own to support a newsroom that currently numbers about 1400 people, Thompson said.

“Even today if you take digital revenue, and other non-print revenue like the events business, we are getting to more than 40 per cent of revenue. Although we’ve got a lot more to do I would say that we’re looking at a challenge which is now a doubling or trebling our digital revenue for strong survivability and profitability rather than multiplying by 10, 20 or 30, which is what the puzzle looked like a few years ago.

“One of the tragedies of what has been happening to journalism around the world is a short-­termist view that the right thing to do is just hack costs back to keep profitability without thinking about the future. Without proper investment in journalism, I don’t see a future for news­papers.”

Mr Thompson refused to ­directly comment on subscriber growth in Australia after the Times opened a bureau in ­Sydney earlier this year, but said: “Early signs of this first push in terms of additional subscribers are very encouraging.”

He said: “We are impressed and sometimes daunted. Australia has got an astonishingly ­energetic, lively, creative and thoroughly competitive media landscape. We’ve not come ­because we think Australia is an easy nut to crack.”

To reach the magical 10 million subscriber number, Thompson emphatically believes newspaper publishers should take a leaf out of Netflix’s book.

“Newspapers around the world have not been ambitious enough when they think about digital subscriptions. When you think about the tens of millions of people who have Netflix, for example, there’s no reason why we should limit ourselves to the kind of numbers measured in hundreds of thousands, which was the historic story of print subscribers.

“I think we should be bold. I believe it’s credible for the Times to aspire to 10 million subscribers. Why not? There are hundreds of millions of people in the world with English college ­degrees and a proven interest in news. Why shouldn’t we be ­trying to penetrate that market to a few percentage points?”

Of the printed newspaper, Mr Thompson refuses to expedite its life expectancy, particularly when a rise in home-delivery prices for print editions boosted circulation revenue to $242.4 million in the quarter. The Times’ boasts 1 million print subscribers.

“We need a strategy for a successful growing strongly profitable Times business where in the future we assume that print revenue will be zero. I want a strong business that works even if print doesn’t exist. I think it’s likely that we will be printing the Times in America for at least a decade. But I do think in the end, although a decade sounds like a long time and it might well be longer than a decade, there is no time like the present to build a digital business.”

With print advertising in free fall, publishers had hoped a new generation of distributed content services would make it easier for news brands to monetise their journalism especially when Google and Facebook are devouring the online ad market.

But revenue from services such as Facebook Instant Articles, Apple News, and Google Accelerated Mobile Pages has fallen short of expectations. The Times pulled out of Instant Articles altogether earlier this year.

Mr Thompson is concerned that services like Facebook’s Instant Articles, which do not pay for content, undermine the idea of a newspaper as a stand-alone brand to be consumed whole, rather than broken up into individual stories and scattered across the internet.

“News is a relationship business. Properly understood news consists of a relationship between a reader and a provider of news which is built on trust, a set of expectations and a good fit between the news provider and its audience so when people think about The Australian they’ve got quite a rich idea about what they think The Australian is.

“We need it to be that. If it’s all sliced and diced and spread randomly across the internet, the only possible model is digital advertising for making money out of it and the CPMs [cost per thousand] in that model will be set by the biggest platforms like Google and Facebook. That kind of revenue is never going to pay for quality journalism.”

Still, Mr Thompson is taking a pragmatic approach to the problem and hopes the Times can use Silicon Valley’s massive scale and online reach to attract new readers.

“We have a complex strategic and tactical view about our relationship with digital platforms. We think there’s only going to be a handful of destinations when people in the future open their smartphones and look for news, and then there’s going to be some aggregated jumbles of everything. Although we want to be in the jumble we want to be one of the destinations.”