Headlines like this in the FT – “Is AI about to kill what’s left of journalism?” – contribute to an atmosphere of gloom around the prospects for the news industry.
But this week there were multiple signs that parts of the news business, at least, have grounds for optimism.
This is reflected by stock market investors returning to media shares after a two-year slump — although it is too early to say whether this is just a brief rebound.
Here’s a round-up of positive sentiments around news media this week that contradict the doomsters and gloomsters.
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News Corp’s Dow Jones has just topped 5m digital subscribers
News Corp’s third-quarter results reveal strong subscriber growth contributing to revenues in its business information division Dow Jones up $15m in the period to $544m.
Digital subscriptions to the Wall Street Journal grew 13% to 3,715,000 and investment news service Barron’s grew digital subscriptions by 26% to 1,221,000.
Digital advertising growth of 4% failed to offset print advertising decline of 11%.
In the UK The Times, Sunday Times and Times Literary Supplement reported total digital subscribers up 38,000 year on year to 582,000. However digital advertising across News Corp‘s news division, which includes The Sun, New York Post and The Australian, was down 13% largely driven by online traffic decline.
News Corp also revealed yesterday that it has renewed its three-year commercial deal with Google, which rivals believe is worth at least $50m per year. The terms of the deal are confidential but include a syndication fee for content appearing on the Google News Showcase (a means of surfacing content in Google News and on Google Discover mobile platform). It is encouraging for other publishers that, unlike Meta, Google continues to foster good relations with the news business.
CEO Robert Thomson said: “We are in the midst of an exponential digital revolution, and our own company has continued to change significantly and profitably. Importantly, we are working to promote our quality journalism in the age of generative AI, and are gratified that the most enlightened leaders in the industry appreciate the commercial and social value of that content.”
Google News Showcase is a $1bn payments scheme launched by Google chiefly to foster good relations with news publishers by paying for something the search giant takes for free anyway, aggregated news headlines.
Dotdash Meredith’s cookie-killer adtech fuels online ads growth
The USA’s largest content publisher Dotdash Meredith has reported digital revenue up 13% year on year to $209m in the first quarter of 2024. This goes against the trend of wider online advertising decline in the news industry which we saw in 2023 and has been fuelled by an in-house contextual advertising technology called D/Cipher. This performance suggests publishers may not need cookies on Chrome to prosper and so could light the way to a brighter future of journalism on the open web.
New York Times Co hits 10.5m digital subs
The New York Times Company added an additional 210,000 digital-only subscribers in the first quarter of 2024, bringing it to a total of 10,550,000. Overall revenue in the quarter grew 5.9% to $594m. Digital advertising revenues were also up, by 2.9% to $63m.
B2B powerhouse Informa bullish about 2024
I’ve heard it said that generative AI presents a bigger threat to business information companies than it does to consumer media. But the latest trading update from UK-based business information giant Informa suggests otherwise. The World of Concrete and Tech Target publisher has predicted operating profit at the top end of expectations (around £970m) for 2024, on revenue again at the top end of predictions, at around £3.5bn.
Maybe generative AI will save journalism rather than destroy it
The latest generative AI deals announced this week, between Microsoft and Informa and Dotdash Meredith and Microsoft-backed OpenAI, could provide grounds for optimism.
They follow the same model as deals struck by Axel Springer and the FT. Publishers are establishing the principle that they should receive cash for allowing their content to train AI companies’ large language models, thus upholding their copyright. They are also retaining some control over how much of that content is used by the LLMs and are ensuring that they are cited, with a link, when the LLMs quote from their journalism. All the deals so far also include an element of technology-sharing with publishers which could help them bring about their own AI-powered transformations.
Media shares rally
Finally, stock market investors are fickle creatures but in the UK at least there has been a marked uptick in sentiment towards news publishers over the last month, with Future up 14% to a £911m market cap, Reach up 9.4% to £252m and business information giant RELX up 4% to £64.4bn.
The news business remains profoundly challenged, as recent Press Gazette’s reports on declining referral traffic from Google and Facebook and falling publisher online ad revenue testify.
But there’s also growing evidence that the future is bright for those who can create information which is valuable enough that readers will pay for it and for those who can stay ahead of the curve when it comes to advertising technology.
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