About.com, the content farm owned by the Times and one of the worst things on the Internet, looks like it’s finally in trouble, due in large part to Google taking action against the Garbagenet. (These outfits depend on search results.) And also: advertisers realizing there are better ways to spend money than advertising against an empty void. In the second quarter of this year, About.com shed staff and now their real operating costs are $13.1 million; their operating profit is down 24% from last year, to $11.6 million. (That’s less than $4 million a month.) To be fair, this is still a “real business”: The About Group had revenues of $59 million year-to-date, so hey, I’d take it, but the writing is on the wall for this as a visionary business. It’s not. It’s bad for the Internet and not even that great for your wallet. There’s a number of not-so-great numbers at the Times, just released today for the second quarter, but let’s look at the interesting numbers: who subscribes online?
“Paid digital subscribers”: 224,000.
“Paid e-reader subscribers”: 57,000.
Free digital subscribers (“paid for” by a sponsor): 100,000.
“Home-delivery subscribers with free linked digital accounts”: 756,000.
So that’s 1,037,000 people paying, in one way or another, to access the Times online, though the vast majority of them are actually paying for the physical newspapers, and getting the digital version for “free.” (And what’s more: a number of those are paying for just the weekend paper, not the daily paper.)
And “circulation” is down from 2011 to 2010. The Times puts it this way: “the rate of home-delivery circulation declines slowed moderately, as we observed an uptick in new home-delivery orders and a decrease in attrition following the launch as print subscribers of all frequencies receive all digital access at no additional cost.” The use of the word “uptick” is funny there, given that the number of subscribers is, you know, on a decline. The point being: only a slightly fewer number of people actually stopped getting the paper, and also some started getting the paper (*raises hand!*), just so that they could get the paper “for free” online. Not terrible; this seems according to plan! The Times Company as a whole would technically be (or, you know, in the real world, “is”) making about $28 million a month—if it weren’t for all those pesky write-downs that dragged it way into the hole this quarter.
But saying, as the CEO did, that digital subscriptions will provide the company “with a significant new revenue stream in the second half of this year” seems like a pretty grand over-statement. 224,000 people at $15 a month is $3.36 million; at $35 a month, that’s $7.8 million. You apparently can’t even pay for the staff of About.com with that—and it costs ten times that last number to actually produce the physical paper.