Archive for April, 2010

Newspaper circulation fall is slowing

Tuesday, April 27th, 2010

Newspaper circulation fell again in the last six months recorded but not as precipitously as it had the six months before, figures released Monday by the Audit Bureau of Circulations show.

“[A]verage weekday circulation fell 8.7 percent in the six months that ended March 31, compared with the same period a year earlier,” the Associated Press reported. “Sunday circulation fell 6.5 percent.That’s a slight improvement from April through September of last year, when average weekday circulation dropped 10.6 percent from a year earlier and Sunday circulation fell 7.5 percent.”

“In a way,” the AP report continues,  “the new circulation figures mirror the industry’s advertising trends. While most major newspapers continue to see ad revenue decline compared with year-ago figures, the drop is becoming less extreme. Newspapers are getting some help from easy comparisons — they are holding their latest ad numbers up to results from the depths of the recession — but economic improvement is also starting to restore advertising budgets.”

Some of the loss comes from a shift in focus, according to Advertising Age. “Newspapers have, on the other hand, gotten smarter about managing their paid circulations — sometimes abandoning areas outside their core markets, for example, where advertisers were less interested in appearing and distribution costs were greater. Some have increased newsstand and subscription prices, too, in an effort to improve circulation economics. Those factors combine to depress paid circulations.”

The Ad Age report, at the link above, includes a chart with figures from the nation’s top 25 papers based on circulation.

McClatchy ‘profit’ debatable; more job cuts hinted

Thursday, April 22nd, 2010

The McClatchy Company continues to be hampered by debt, with a reported loss in the latest quarter attributed “primarily to one-time charges for refinancing debt and restructuring,” according to the Sacramento Business Journal.

The publisher’s first quarter report on Thursday showed improvement, thanks to reduced expenses — obtained chiefly through layoffs, which may not be over  — and an advertising climate that isn’t as bad as it was.

But the bottom line was  “a net loss from continuing operations of $2 million, or 2 cents per share,” the Business Journal says. “In the same period last year, the company incurred a net loss from continuing operations of $37.7 million, or 45 cents per share.

“Without the charges, McClatchy earned $4.8 million, or 6 cents a share, for the quarter, compared to a loss of $22.9 million, or 28 cents a share, in first-quarter 2009.”

The Associated Press report, on the other hand, says “a one-time accounting gain related to newspapers that it sold a few years ago” allows McClatchy to claim a profit for the quarter. “[N]et income, including discontinued operations, came to $2.2 million, or 3 cents per share,” the AP says. It lost $37.5 million, or 45 cents per share, in the same period a year earlier, which included charges for severance.

Advertising revenue dropped 11.2 percent to $253 million, better than the 20.5 percent drop in the fourth quarter of 2009. In last year’s third quarter, ad revenue fell 28.1 percent.

Total revenue for the quarter was 8.2 percent less than a year ago, at $335.6 million compared to $365.6 million.

McClatchy’s stock fell following the report, perhaps, Benchmark Co. media analyst Edward Atorino told the AP, because “some investors may have been looking for more details about how McClatchy plans to cut costs, given that it expects further revenue declines.”

The company’s  costs, excluding severance payments, declined more than 21 percent in the first quarter, compared with the same period a year earlier, largely because of lower payroll and newsprint expense, the AP said. McClatchy has cut about a third of its work force since the middle of 2008.

“In a statement, McClatchy CEO Gary Pruitt said the company ‘will remain vigilant’ on costs but acknowledged that second-quarter expenses will not decline the way they did in the first,” the AP said. “During a conference call, Pruitt said the company would try to avoid further job cuts, but he didn’t rule them out.”

The debt restructuring involved extending  “approximately $1 billion in maturities from mid-2011 to mid-2013 and beyond, including the $875 million of senior secured notes due in 2017,” Pat Talamantes, McClatchy’s chief financial officer, said in the release.

McClatchy’s debt remains from its $4.5 billion purchase in 2006 of the much-larger Knight-Ridder newspaper chain.

McClatchy’s stock fell $0.75, or 10.98 percent, to close at $6.08 Thursday.

Could the FTC kill behavioral targeting?

Tuesday, April 20th, 2010

Media critic Bob Garfield thinks Internet advertising could be wiped out as an industry if the FTC and Congress decide to “safeguard consumer privacy from behavioral targeting and other online wizardry.”

One approach under consideration, he says, is  “an ‘opt-in’ requirement for every user to affirmatively acquiesce to accepting cookies on their Internet browsers. … The industry’s future resides almost entirely on being able to boost CPMs with ultra-targeting, but it’s hard to imagine any wording of the opt-in language that wouldn’t sound to Joe Laptop like, ‘Yes, please stalk me.'”

FTC Chairman Jon Leibowitz tells Garfield he wants the industry to regulate itself, but the way he talks about behavioral targeting seizes “not on the rational but the visceral,” Garfield says. “Imagine that you were walking through a shopping mall, and there was someone that was walking behind you and taking notes on everywhere you went and sending it off to every shop or anyone who was interested for a small fee,” Leibowitz says. “That would creep you out; that would be very disturbing, I think, for most people.”

As the FTC seeks more rule-making authority from Congress, “Rep. Rick Boucher (D-Va.) has been promising a bill to deal with loose personal data — by statutory means either moderate or draconian, nobody quite knows.”

Boucher told the Wall Street Journal in February “that there is a need for a set of laws that dictate parameters for how companies collect, share and use online data about their consumers.”

Gannett leads off 1Q reports with a hit

Friday, April 16th, 2010

Cost cutting and a not-as-bad advertising climate in the first quarter made Gannett Co. look good in its 1Q earnings report Friday, and the tide lifted not all but some boats.

“Gannett did not issue formal earnings guidance for the current quarter or the rest of the year, and CEO Craig Dubow declined to give specifics on how ad revenue is shaping up in April,” The Associated Press said. “But he told analysts on a conference call that the year was ‘off to a great start.’ He added: ‘The momentum that we had at the end of the year continued through the first quarter.’

“Gannett was the first major publisher to report earnings for the January-March period and could offer a preview of what will come next week from McClatchy Co., Lee Enterprises Inc. and The New York Times Co.”

After surging to a new 52-week high of $19.68 in early trading, Gannett shares retreated to $18.04 Friday afternoon, down $0.10 on the day. McClatchy rose $0.42 to $6.46, and Lee shares jumped $0.31 to $4.35. The New York Times was down $0.36 to $12.35.

Gannett, which owns USA Today and more than 80 other daily newspapers along with TV stations, said its net income jumped 51 percent despite a 4 percent decline in revenue. Last year it cut 1,400 jobs, or about 3 percent of its work force.

As for McClatchy, which reports April 22, “JP Morgan forecasts that ads will be off by 8.4 percent as circulation continues to grow,” says PaidContent.org. “While the circulation gains might not offset negativity on the ad front, cost-cuts should help margins jump to 25 percent from 1Q ’09’s 12 percent. Ebitda should rise 91 percent to $83 million.

“In general, McClatchy’s heavy presence in Florida and California means that its fortunes are directly tied to the economic winds in those two troubled states. Ultimately, that will add to the general industry-wide woes affecting the publisher.”

Magazines show ad growth in few sectors

Saturday, April 10th, 2010

New figures from the Publishers Information Bureau show some advertisers are coming back to magazines, says Advertising Age, including automotive advertisers, whose spending on ad pages and rate-card ads rose in the past quarter for the first time since 2007.

“Three of the 12 major advertising categories in magazines ran more magazine ad pages in the first quarter this year than in the first quarter last year: financial, insurance and real estate, which increased ad pages by 11.3 percent; toiletries and cosmetics, which increased ad pages by 7.6 percent; and automotive, which increased ad pages by a slim 1.3 percent,” the magazine says.

“The other nine big marketer categories continued to post significant drops, led by apparel and accessories, which ran 15.7 percent fewer ad pages; drugs and remedies, which ran 15.6 percent fewer ad pages; technology, which ran 14.7 percent fewer pages; media and advertising, which ran 13 percent fewer ad pages; and public transportation, hotels and resorts, which also ran 13 percent fewer ad pages.”

“Keep in mind that these comparisons are being made against a quarter last year that was wholly abysmal, with a 25.9 percent drop in ad pages by the bureau’s count,” the magazine says.

McClatchy planning to become hub for local sites

Thursday, April 8th, 2010

McClatchy newspapers are bringing other local Web sites and blogs onto their home sites in “blog networks,” starting at the Sacramento Bee and coming soon to the Charlotte Observer and Miami Herald.

“The Bee has been working on the concept for about a year,” says the Sacramento Business Journal. “Editors and multimedia managers collected and reviewed sites, ranking them based on quality of content and frequency of posts.”

The Bee’s effort is called “Sacramento Connect” and so far features about a dozen blogs.

“We see that that’s the direction that the Web is going and we really want to be a part of that,” Sean McMahon, The Bee’s digital product development manager, told the Business Journal. “We have a trusted position in the area, and we thought it was time to embrace all these independent voices and bring them in and try to promote them.”

The thinking is traffic to all the sites would improve, the Business Journal says.

“At least two other McClatchy Co. newspapers” — The Observer and The Herald — are developing similar networks, the report says.

In Raleigh, The News & Observer has made similar attempts to become a local portal.  Its Triangle.com includes a section called “Share” for local blogs and forums meant to be produced locally through the site.

Christian Science Monitor growing, earning online

Wednesday, April 7th, 2010

The Christian Science Monitor, which stopped publishing a daily print edition in March 2009 and is mostly a Web-only operation, has seen a 60 percent increase in traffic but has earned about half of the projected ad revenue, says Media Jobs Daily quoting Media Matters.

The CSM actually maintains a weekly print edition, which has seen 79 percent circulation growth since its launch, Media Jobs Daily says.

Meanwhile, the company projected $870,000 in online ad revenue in its first year, but only brought in $490,000.

“The paper also extended a buyout offer to its 85 editorial employees, and four accepted,” says the blog, which focuses on media industry employment, recruitment and career development.

“But … there’s still 81 newsmen and women working at this paper, which is a heck of a lot more than the number of people at any other online-only outfit we can think of.”

McClatchy to roll out online marketing program

Tuesday, April 6th, 2010

The McClatchy Company said today it will sell the WebVisible online marketing program through each of its major newspapers by the end of the year.  Advertising sales for the program in March at the  papers already using it were roughly five times higher than the previous month, a news release says.

WebVisiblea program that has its detractors – is marketed as an online advertising manager for local businesses that buys advertising space across a variety of media. The company’s release says:  “WebVisible’s technology puts an advertiser’s ads where they’ll generate the most response from interested buyers for the least money.  Customer leads can come in any form – phone calls, e-mails, SMS text messages, form fills, printed driving directions or video views – and advertisers get full reporting so they know how the leads are coming in and from where.”

McClatchy has been selling the program in Kansas City, Mo.; Tacoma, Wash.; Fresno, Calif.; Anchorage, Alaska; and Charlotte, N.C. The next phase will include Boise, Idaho; Miami, Fla.; and Sacramento, Calif. By December, it is to be available at each of McClatchy’s 30 daily newspapers in 29 U.S. markets.

News & Observer records solid first quarter

Tuesday, April 6th, 2010

Employees at The News & Observer in Raleigh fearing a new round of cuts with the end of the year’s first quarter were able to exhale Monday. A memo  to employees from Publisher Orage Quarles III says the newspaper exceeded “budgeted goals in all categories” during the first three months of 2010.

The note gives few details, but credits “better than expected advertising revenue performance and a continued focus on expenses.” The Advertising Department’s “third annual online sales blitz” racked up “more than $1 million in annualized sales,” Quarles adds.

“There are still question marks about the economy and its effect on our ad revenues, but we are seeing signs that the worst may be behind us.  We certainly hope so,” the memo says.

Nielsen changing the way it counts viewers

Thursday, April 1st, 2010

Nielsen, the television ratings service, this week said it is making “fundamental changes in the way it calculates its so-called ‘average audience’ ratings — long the currency of the $80 billion TV advertising marketplace,” Media Daily News reports. “Perhaps the most significant of the changes is that Nielsen will begin including duplicate viewing of all program telecasts in its average audience ratings, a move that could undermine one of the core tenets of Madison Avenue’s media planning theory: unduplicated reach.”

While the absolute amount of duplicate viewing that currently takes place via the Internet and various devices such as digital video recorders and video-on-demand services currently is small, it is expected to grow over time, and potentially could dilute the meaning of audience reach,” the report says.

“It’s unlikely that any repeated program content viewing will deliver repeated commercial viewing,” Don Seaman, vice president-director of communications analysis at MPG, told Media News Daily. “Once again, the metric is favoring the content providers and probably overstating what the actual commercial impact really is.”

Nielsen spokesman Gary Holmes said it’s much ado about practically nothing. “The estimate is that it will increase viewing under 1 percent,” he said. That figure is the amount Nielsen estimates the inclusion of duplicate viewing done via DVRs will have on the absolute size of average audience ratings. The impact of viewing TV programs online currently is negligible.

In another move drawing fire, Nielsen is eliminating overnight access to its live-only local TV program ratings, which covers around 70 percent of local U.S. television homes. “For the better part of 50 years, advertisers have used live-only as their currency,” Media Daily News says. “In the last few years, Nielsen has added new streams of program data to account for time-shifting. But few, if any, advertisers made deals on these other metrics.”