NEW YORK For those holding out for some improvement in print circulation, this morning brings disappointment. The Audit Bureau of Circulations released the latest figures for the six- month period ending September 2008 and the report shows major drops in circulation at the big metros.
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Tuesday, October 28, 2008
NEW YORK For those holding out for some improvement in print circulation, this morning brings disappointment. The Audit Bureau of Circulations released the latest figures for the six- month period ending September 2008 and the report shows major drops in circulation at the big metros.
Thursday, October 16, 2008
Oct. 16 (Bloomberg) -- Google Inc., owner of the most popular Internet search engine, said third-quarter profit climbed 26 percent as more customers used Web search ads to spur sales in a slowing economy, sending the shares higher.
Net income rose to $1.35 billion, or $4.24 a share, from $1.07 billion, or $3.38, a year earlier, the company said today in a statement. Leaving out costs such as stock-based compensation, profit was $4.92 a share, beating the $4.75 average estimate of analysts in a Bloomberg survey.
Advertisers are shifting budgets away from TV and print media toward ads that run alongside search listings, targeting online shoppers. The Internet will account for 8.7 percent of the $284 billion in U.S. ad spending this year, up from 7.2 percent in 2007, according to Barclays Capital.
This was exactly the kind of shot in the arm that investors need,'' said Jeff Lindsay, an analyst with Sanford C. Bernstein & Co. in New York. ``People lost a lot of faith in the Internet, but this is exactly what the doctor ordered.''
Excluding revenue passed on to partner sites, sales expanded to $4.04 billion, compared with the $4.05 billion average estimate. Total revenue climbed 31 percent to $5.54 billion.
Google, based in Mountain View, California, rose $21.39, or 6.1 percent, to $374.41 in extended trading after closing at $353.02 on the Nasdaq Stock Market. The shares have dropped 49 percent this year.
Being `Realistic'
We are realistic about the poor state of the global economy, but it's Google, so we'll manage accordingly,'' Chief Financial Officer Patrick Pichette said today in an interview. ``We had a good third quarter, with strong traffic and revenue growth.''
In the U.S., Google fielded 63 percent of online searches in August, double the market share of Yahoo! Inc. and Microsoft Corp. combined. That dominance has helped Google command higher prices for ads, according to Yahoo, which is awaiting government approval of an agreement to let Google sell some ads on its sites.
The economic situation is so fluid that we're all sort of in uncharted territory,'' Chief Executive Officer Eric Schmidt said on a conference call. ``We've always been in this for the long term, and we believe that's even more important today than ever.''
Resilient Business
The slumping U.S. economy had been expected to drag down results, said Clay Moran, an analyst at Stanford Group Co. in Boca Raton, Florida. ``What we're seeing is that Google is a resilient business that's going to fare relatively well in this recession, but it's not immune from the overall macroeconomic environment,'' he said.
Google, which doesn't forecast results, is seeing a slowdown in spending from some types of customers, such as U.S. auto and home financing companies, Pichette said.
Google recorded $280 million in costs for stock-based pay, up from $273 million the previous quarter. Those costs will reach $1.1 billion in 2008, leaving out stock awards granted after Oct. 1, Google said.
Sales outside the U.S. made up 51 percent of Google's revenue, up from 48 percent a year earlier. If foreign exchange rates for currency had remained constant over that period, Google's third-quarter sales this year would have been $168 million lower, the company said.
Slower Growth?
The credit crisis may cost the Internet ad market $6.7 billion in lost sales through 2010, according to Collins Stewart Plc. Big and small businesses, from General Motors Corp. to Simplexity LLC, are reducing ad spending plans, while some financial companies, such as Wachovia Corp., have disappeared.
The reductions will push down growth in U.S. Internet ad outlays to less than 20 percent next year for the first time since 2002, said Sandeep Aggarwal, a Collins Stewart analyst in San Francisco.
Google, which gets almost all its revenue from search ads, is testing ways to advertise with images and video. The company struck a deal this month to offer full-length shows from CBS Corp., splitting revenue from the ads.
Microsoft, seeking to close the gap with Google, bid as much as $47.5 billion for Yahoo this year. Sunnyvale, California-based Yahoo rejected Microsoft's offer in May, opting instead to strike the advertising partnership with Google.
To contact the reporter on this story: Crayton Harrison in Dallas at tharrison5@bloomberg.net Last Updated: October 16, 2008 17:03 EDT
Sunday, August 24, 2008
Monday, August 11, 2008
Magazine 1st-half newsstand sales drop 6.3 percent
Monday August 11, 12:01 pm ET
By Jeremy Herron, AP Business Writer
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Magazine circulation flattens, but newsstand sales slump 6.3 percent in 1st half
Most top titles, including best-selling Cosmopolitan and O, The Oprah Magazine, had sharp declines. Of the top 10 newsstand sellers, only People, the entertainment news magazine, and In Style posted gains.
"This is nothing more than really just the impact of the economy," said John Harrington, an industry analyst with Harrington Associates. "People are shopping very cautiously and less frequently, avoiding impulse buys, which are what magazine purchases are."
Publishers redouble efforts to sign up subscribers during economic slowdowns because they know newsstand sales will ebb, which they need to offset because advertising rates are based on minimum circulation targets.
Newsstand sales are far more lucrative than subscriptions, though, meaning circulation revenue is dropping at most titles.
"It is easy to manipulate subscription numbers because publishers can sell them at a loss just to meet their rate base," Harrington said. "The growth may not be high-quality subscribers that will renew."
Overall magazine circulation, which includes subscription and newsstand sales, was flat at 349.9 million copies in the period, as paid subscriptions edged higher to 290.2 million copies, the Audit Bureau of Circulations reported in its biannual tally.
Single-copy magazine sales in the six months ended June 30 fell to 44.1 million copies from 47.1 million a year ago. The survey included 467 titles that reported results in both periods.
Like newspapers, magazines have been struggling with declining advertising revenue as readers increasingly go online for news and entertainment. In the second quarter, magazines had 8.2 percent fewer ad pages, the Publishers Information Bureau reported.
Hearst Corp.'s Cosmopolitan magazine, the top-seller on the country's newsstands, had a 6 percent decline to 1.75 million copies -- nearly 114,000 fewer magazines. Top 10 sellers US Weekly, Woman's World and O, The Oprah Magazine each posted a double-digit decline in newsstand sales.
People, published by Time Inc., boosted newsstand sales by 5.2 percent and remained the No. 2 best-selling magazine at kiosks around the country. In Style was also able to increase newsstand sales.
"People has been steady over the years and there's probably more quality to the magazine in terms of what they do" compared with the crowded field of celebrity gossip titles, Harrington said.
In Touch Weekly, down 28.7 percent at the newsstand, and Life & Style Weekly, down 30.2 percent, both added 50 percent to their cover prices in the period.
Everyday With Rachel Ray, the cooking magazine featuring the popular Food Network host, had 6 percent higher newsstand sales and a 36 percent increase in total circulation.
Rolling Stone, the venerable music magazine, said Monday that it will abandon its iconic size for a smaller, more rack-friendly format starting in fall.
Publisher Jann Wenner said the change is not to conserve costs, but partly to offer advertisers and sellers a more uniform size. Wenner Media said the new size will allow for more editorial pages and higher quality paper that will result in sharper photos.
The magazine had 6.6 percent lower newsstand sales of 115,644 issues in the latest period.
Sunday, June 29, 2008
Study: Median age outside the 18-49 demo
By MICHAEL SCHNEIDER
Find The Story Here: http://www.variety.com/article/VR1117988273.html?categoryid=14&cs=1
The broadcast networks have grown older than ever -- if they were a person, they wouldn't even be a part of TV's target demo anymore.
According to a study released by Magna Global's Steve Sternberg, the five broadcast nets' average live median age (in other words, not including delayed DVR viewing) was 50 last season. That's the oldest ever since Sternberg started analyzing median age more than a decade ago -- and the first time the nets' median age was outside of the vaunted 18-49 demo.
Fueling the graying of the networks: the rapid aging of ABC, NBC and Fox. The three nets continue to grow older, while CBS -- the oldest-skewing network -- has remained fairly steady.
"The median ages of the broadcast networks keep rising, as traditional television is no longer necessarily the first screen for the younger set," Sternberg wrote.
For the just-completed 2007-08 TV season, CBS was oldest in live viewing with a median age of 54. ABC clocked in at 50, followed by NBC (49), Fox (44), CW (34) and Univision (34).
When live-plus-7 DVR viewing is factored in, the nets (except CW and Univision) drop by a year -- which still reps the oldest median age ever for the nets.
Sternberg notes that Fox and CW maintain median ages that are closer to the actual age of the population. The median age for U.S. households is 38.
Among ad-supported cable nets, the news nets (along with older-skewing Hallmark Channel, Golf Channel and GSN's daytime sked) sport the most gray, with Fox News Channel's daytime and primetime skeds the absolute oldest, clocking in with a median age above 65. Youngest nets are the daytime skeds for Noggin and Nickelodeon, with a median age under 10.
At ABC, youngest series was "Supernanny" (with a median age of 41), while oldest was "Women's Murder Club" (57). At CBS, youngest was "How I Met Your Mother," "Kid Nation" and the Tuesday edition of "Big Brother," tied at 45; oldest was "60 Minutes" (60). NBC's youngest show was "Scrubs" (34), and oldest was "Monk" (58).
At Fox, the youngest shows were "American Dad" and "Family Guy" (29), while the oldest was "Canterbury's Law" (55). At CW, "One Tree Hill" was youngest (26), while "Life Is Wild" was oldest (45).
Among latenight gabbers, "Tonight Show With Jay Leno" is oldest, with a median age of 54, followed by "Late Show With David Letterman" at 53. Interestingly, "Nightline" -- which should conceivably be older than those talkers, is younger, at 52. ABC's "Jimmy Kimmel Live," meanwhile, passed the 18-49 threshold for the first time, clocking in with a median of 50. "Late Night With Conan O'Brien" is getting closer at 46.
Monday, June 23, 2008
For newspapers, the news has swiftly gone from bad to worse. This year is taking shape as their worst on record, with a double-digit drop in advertising revenue, raising serious questions about the survival of some papers and the solvency of their parent companies.
Ad revenue, the primary source of newspaper income, began sliding two years ago, and as hiring freezes turned to buyouts and then to layoffs, the decline has only accelerated.
On top of long-term changes in the industry, the weak economy is also hurting ad sales, especially in Florida and California, where the severe contraction of the housing markets has cut deeply into real estate ads. Executives at the Hearst Corporation say that one of their biggest papers, The San Francisco Chronicle, is losing $1 million a week.
Over all, ad revenue fell almost 8 percent last year. This year, it is running about 12 percent below that dismal performance, and company reports issued last week suggested a 14 percent to 15 percent decline in May.
“Never in my most bearish dreams six months ago did I think we’d be talking about negative 15 percent numbers against weak comps,” said Peter S. Appert, an analyst at Goldman Sachs. “I think the probability is very high that there will be a number of examples of individual newspapers and newspaper companies that fall into a loss position. And I think it’s inevitable that there will be closures in this industry, and maybe bankruptcies.”
Analysts and newspaper executives find themselves revising their forecasts downward every few months, unable to gain a stable footing on a sinking floor. Papers have cut costs by shedding thousands of workers, eliminating some distribution routes and printing fewer, smaller pages, but profit margins continue to shrink.
Since the fall, when Media General, the owner of a major newspaper chain in the South, set its 2008 budget, “We have pulled our thinking down twice with respect to revenue,” said Marshall N. Morton, the chief executive.
Over the next few years, he predicted, “There’s got to be some assimilation,” with some major American newspapers going out of business or merging. At the corporate level, he said, “I would guess that rather than bankruptcies, you’d see combinations.”
Analysts have issued warnings about several companies’ abilities to meet their debt obligations, though the companies insist that they are at no risk of default.
Most of those companies are privately held, like the Tribune Company, owner of The Chicago Tribune, The Los Angeles Times and many other papers; MediaNews Group, whose papers include The Denver Post and The San Jose Mercury News; and Philadelphia Media Holdings, which publishes The Inquirer and The Daily News in that city.
Some analysts also see a lesser risk in a major publicly traded chain, the McClatchy Company, owner of The Miami Herald, The Kansas City Star, The Sacramento Bee and others, which said last week that its ad revenue was down 15.4 percent through the first five months of the year.
The company announced plans to eliminate about 1,400 jobs, leaving it with 21 percent fewer employees than it had a year and a half ago. Some other newspaper chains had already made comparable cuts.
“It’s going a lot worse than anybody predicted, and if we have double-digit ad declines for two years, some newspapers will be in real financial jeopardy,” said Edward Atorino, an analyst at the Benchmark Company. Even with less severe losses, “You’re going to see structural changes: papers could drop a day or two per week, they could outsource printing.”
He said that he expected the decline in ad sales to slow, with 2008 producing a 10 percent drop for the year, but he cautioned that, like other analysts, he had not been pessimistic enough so far.
The primary long-term threat to newspapers is the Internet’s siphoning away of ad revenue, a trend that has been under way for more than a decade, but one that has picked up speed in the last year. Advertisers have vastly more choices online than on paper, so newspaper Web sites win only a fraction of the advertising that goes digital, and it pays much less than advertising in print.
At the same time, the Internet has drawn millions of new readers to papers, and the major ones reach far more readers than ever before.
“As long as we’ve got content, we’ve got something nobody else has,” said Mr. Morton, of Media General. The industry’s challenge, he said, is to keep expanding that audience, “proving to the advertiser that we, in fact, are the right link so that he can have his conversation with the customer through us.”
Online ad revenue for newspapers grew 20 percent to 30 percent annually for most of this decade. Most analysts think the industry will return to that growth rate when the economy picks up again, but for now, it is closer to 15 percent. The Internet still accounts for less than 10 percent of newspaper ad revenue.
Declining sales of printed papers and rising newsprint prices have also hurt the business.
The industry will not bottom out for another three or four years, analysts predict. The question, Mr. Appert of Goldman Sachs said, “is how far things will fall before then.”
Monday, June 09, 2008
Tuesday, April 15, 2008
BIG MAGAZINE TITLES SEE AD PAGES DWINDLE DOWN IN Q1
By KEITH J. KELLY
April 15, 2008 --
Magazines that cover news, business and luxury goods were sent reeling in the first quarter of the year, while food magazines offered a few rays of light for the publishing industry, according to just released figures.
Ad pages for BusinessWeek, which just went through its third round of cuts in three years, tumbled 19.4 percent in the quarter to 429.5 ad pages while rival Forbes dipped 13.2 percent to 504.8 ad pages, according to the latest figures reported to the Publishers Information Bureau.
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Fortune looked like the best of the lot, with only a 1 percent drop in the quarter to 429.4.
The newsweeklies are also taking it hard. Newsweek, which recently unveiled plans to downsize 111 people, saw ad pages drop 13.9 percent to 339.
Ad pages for Time, which also continues to prune staffers, skidded 17.8 percent to 371.
U.S News & World Report dropped even further, with its ad pages tumbling 37.5 percent to 229.46 pages.
Most industry observers tend to discount the ad-revenue figures that were just released because it uses a formula based on a one-time ad-page rate that does not account for the steep discounts that all major advertisers receive from publishers.
That is why the ad-page tally is seen as a more accurate barometer of a magazine's performance year to year.
Overall, in the quarter, the PIB said that rate card reported advertising for the period was $5.2 billion, a 1.2 percent decline from the $5.3 billion in the year ago quarter.
The ad-page tally showed a steep 6.4 percent decline.
Ellen Oppenheim, executive vice president and chief marketing officer of The Magazine Publishers of America said, "food & food products," were the bright spots.
Every Day with Rachel Ray saw ad pages soar 38.1 percent to 135.6 ad pages.
Everyday Food from the Martha Stewart empire saw ad pages up 11 percent to 120.76. Martha Stewart Living, the company's flagship tile, was up 2.6 percent in ad pages.
Friday, March 28, 2008
The newspaper industry has experienced the worst drop in advertising revenue in more than 50 years. According to new data released by the Newspaper Association of America, total print advertising revenue in 2007 plunged 9.4% to $42 billion compared to 2006
-- the most severe percent decline since the association started measuring advertising expenditures in 1950. The drop-off points to an economic slowdown on top of the secular challenges faced by the industry. The second worst decline in advertising revenue occurred in 2001 when it fell 9.0%.
Total advertising revenue in 2007 -- including online revenue -- decreased 7.9% to $45.3 billion compared to the prior year.
There are signs that online revenue is beginning to slow as well. Internet ad revenue in 2007 grew 18.8% to $3.2 billion compared to 2006. In 2006, online ad revenue had soared 31.4% to $2.6 billion. In 2005, it jumped 31.4% to $2 billion. As newspaper Web sites generate more advertising revenue, the growth rate naturally slows.
The NAA reported that online revenue now represents 7.5% of total newspaper ad revenue in 2007 compared to 5.7% in 2006. That growth could not stave off the losses in the print however. National print advertising revenue dropped 6.7% to $7 billion last year. Retail slipped 5% to $21 billion. Classified plunged 16.5% to $14.1 billion.
"Even with the near-term challenges posed to print media by a more fragmented information environment and the economic headwinds facing all advertising media, newspapers publishers are continuing to drive strong revenue growth from their increasingly robust Web platforms," John Sturm, president and CEO of the NAA, said in a statement.
* E&P Editor Greg Mitchell's new book is "So Wrong for So Long: How the Press, the Pundits -- and the President -- Failed on Iraq" (Union Square Press). It includes a foreword by famed war reporter Joe Galloway and a preface by Bruce Springsteen and has been hailed by vets leader Paul Rieckhoff.
Jennifer Saba (jsaba@editorandpublisher.com) is E&P's associate editor.
Monday, February 25, 2008
Study to Track All-Day Media Usage
What better way to track people's video consumption than to have someone follow them around all day?
Links referenced within this article
Find this article at: http://www.mediaweek.com/mw/news/media_agencies/article_display.jsp?vnu_content_id=1003714901
Thursday, February 14, 2008
Advertising During a Recession
By Jake Swearingen
Article from: http://blogs.bnet.comJanuary 31st, 2008 @ 3:33 pm
What should marketers in a flat lining economy do? It’s clear that consumers are going to be watching their wallets a bit closer, and advertisers will have to try harder to pry pocketbooks back open in order to justify their budgets.
On Monday, the Times ran a story on how marketers are quickly moving to capitalize on consumer worry. Wal-Mart went back to focusing on Every Day Low Prices with the slogan, “Save money. Live better,” and became one of the few retailers to post growth in the holiday season. Nissan has taken to hyping the Altima’s miles per gallon over style or performance. But Avi Dan at Ad Age points out in his tips to CMOs that focusing on price for a campaign can have short-term benefits and long-term drawbacks. “Reliance on price incentives as a marketing tool is dangerous — it devalues the brand, and it’s hard to wean consumers off it.”
CEO Drew Reisser of marketing consulting group Renegade offers sound advice to MediaPost on what marketers can do during a recession:
- Focus on advertising with clear and proven return on investment, such as Internet and promotional advertising.
- Be prepared to cut budget bloaters like trade shows, which have a harder time proving ROI.
- Focus on a brand’s core base, instead of going after more expensive new customers
- If a brand has made its bones on humor, don’t be quick to change that. “Acknowledging bad times might feel right, particularly if a recession is protracted, but consumers may not want to be reminded of that fact. And a little entertainment can go a long way, Neisser says. ‘If humor was right for your brand in good times, it’s even more right for your brand in bad,’ he says.”
Online advertising could be one bright spot, with a bevy of news sources declaring that Google, and by extension Internet advertising, seems to resilient to economic downturns. The Times UK expects online advertising growth to perhaps slow down, but not even begin to touch the depths of the 2000 crash, while Wired News declares Google may be recession proof, comparing their AdWords program to direct mail:
“We looked at all the past recessions from 1950 on and we found that direct mail — Google’s most direct predecessor — actually grew during six recessions,” Cowen and Company’s Friedland says. “Given the current environment, there’s no reason to think Google will outperform. But there’s no reason to think it will underperform.”
Thinking that Internet advertising will be the industry’s savior is a bit rosy, however. While Internet ad spending is growing incredibly rapidly, it’s forecasted to slow to 30 percent in 2008, and it still makes up less than 10 percent of total ad spending.
(Image of the killer deal at Gray’s Papaya from flickr user aturkus, CC 2.0)