We wrapped up this issue on unconventional revenue streams amidst the completion of the spinoff of Tribune Publishing, and the news of Gannett’s decision to make the same move sometime next year. Journal Communications Inc. also decided to separate its newspaper and broadcast interests this summer, announcing plans that include merging its broadcasting operations with E.W. Scripps Co.
It’s become a common move for media companies, and one primarily intended to lighten the drag newspaper publishing puts on the more-profitable broadcasting segment. It remains to be seen if there might also be some financial recovery down the road for newspapers as they strike out on their own.
Gannett will no doubt fare better than others since it won't carry any debt into the spinoff of its 81 U.S. dailies. Still, its second-quarter results are a clear indication of the weight of its newspaper division on the company. Those results showed 88 percent growth in Gannett’s broadcasting revenues — to $398.3 million — compared with the second quarter last year; while publishing revenues dropped 4.1 percent — to $867 million — over last year.
Tribune Publishing, meantime, acquired $350 million worth of debt as part of its spinoff from Tribune Co., and in its first reporting period since going solo showed a 3.8 percent slide in income, to $429.9 million from $446.9 million in Q2 of 2013. And News Corp.’s split of newspaper and entertainment assets last year cost the company $2 billion, while Time Warner saddled print spinoff Time with $1.3 billion worth of debt when it fractured its businesses.
We can only wait and see what will shake out as some newspapers lose the security net of losses being absorbed by other business units and others free themselves from being saddled with the debt of other business segments.
Still, newspapers have become experts when it comes to finding new and innovative ways to grow and diversify their businesses — and having to stand on their own may further bolster their drive. Yes, print advertising remains a bleeding wound, but publishers continue to reinvent themselves and their profits, as evidenced on the pages of this issue of N&T. Take a look at our page-5 story on the Los Angeles Times’ addition of glossy ads, or our page-8 feature on publishers benefitting from crowdfunding initiatives. While none of these moves alone are likely to be a boon, they all represent growth — and that’s a good thing.
We hope you’ll find some ideas and inspiration for your own operation here, and we look forward to seeing you at Graph Expo later this fall.