Content Matters

Two interesting earnings reports this week - from Dow Jones/WSJ and the New York Times.

At Dow Jones, despite an overall decline in earnings, earnings for the WSJ digital division were triple that of the print business - $29M vs. $7M for print. Electronic revenues were reported at $128.4M, the growth driven largely by two major factors: subscriptions to the WSJ Online edition increased by 60,000 to 744,000, while the acquisition of MarketWatch from CBS added to advertising revenues. The subscription increase is significant, because while WSJ Online had been able to increase its pricing in recent years, subscriber growth has been pretty flat during that period. A nearly 9% growth in subscribers bodes well for their model.

Meanwhile, over at the New York Times, a similar story. While net income overall declined by 20% as compared to Q2 '04, online ad revenues were up 27% for the quarter due to ad rate increases during the past year. Interestingly, About.com posted a 39% gain in ad revenues for the quarter, with net income of $2.5M on $12M in revenues. It looks like About has found a much more suitable partner in the Times than it had during its tumultuous days at Primedia.

I guess, in some ways, the most interesting part of these releases is that they're not big news. Even for old-line newspaper publishers, electronic revenue is the key to growth, while their supposed core business of print continues on a downward path.