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New York Times Case Analysis
Transcript of New York Times Case Analysis
(cc) photo by Franco Folini on Flickr
(cc) photo by Metro Centric on Flickr
Value Chain Analysis
New York Times:
Seeking Salvation within a Declining Industry
High speed rail is a type of passenger rail system significantly faster than traditional rail systems.
•They are used all over Europe, and places like China
•They are being developed so that some trains reach speeds of over 300km/h
•Very safe because of a predictable course, and it lowers the possibility of collisions
•Less weather related delays than airplanes
•Produce less noise
•Shortens trip time
•Reduce dependence on oil
•High speed rail is environmentally friendly and will cut down carbon emissions
What alternative forms of transportation would you recommend? (think about social, environmental, economical issues)
High Speed Rail System
Teleconferencing is a live exchange of information between several people
•It would be a positive alternative for flying for business people
•With technology being developed it is getting easier to communicate and share data
•Meetings could be held between two parties without having to leave the city
“The New York Times Company, a leading global, multimedia news and information company with 2012 revenues of $2.0 billion, includes The New York Times, the International Herald Tribune, The Boston Globe, NYTimes.com , BostonGlobe.com, Boston.com and related properties. The Company’s core purpose is to enhance society by creating, collecting and distributing high-quality news and information.”
“The New York Times Company selectively invests in digital media start ups to support our innovation efforts.”
Current investments include:
Continue to use social media and charge subscribers for in-depth internet access.
Continue to make acquisitions of internet companies and learn from them.
Expand customer base to other growing countries.
Create or shift focus to a younger audience.
Look for ways to merge with media giants such as Apple, YouTube, Google, or BBC so as to gain non-substitutable capabilities.
The Industry Organization Model
The Resource Based Model
Business Level Strategy
Core Capabilities and Competences
NY Times main competitors are:
The New York Times company is also making acquisitions of small technology companies, learning from them and selling them.
Companies sold by The New York Times include:
Resource Based View
Rivalry Among Competitors
Bargaining Power of Buyers
Bargaining Power Of Suppliers
The New York Times Media Group
The New England Media Group
International Herald Tribune
Worcester Telegram & Gazette
906,100 newspapers on weekdays and 1,356,800 on weekends
Top Three Circulated Newspapers in the USA
1.) The Wall Street Journal
2.) USA Today
3.)The New York Times
Founded in 1851
Sold for a penny, now sells for $2.50 daily and $5 dollars for the Sunday Specials
NYTimes.com founded in 1996
NYT first mobile application in 2008
@NYTimes on Twitter has 8,235,704 followers
NYT on Facebook has 2,934,589 fans
New York Times PayWall subscription service started in 2011
Free news information available online
Digital newspapers and magazines
Decrease of spending on advertisement
Industry has been in decline for the past five years
Industry is seeking new ways to generate revenues
Total revenues of the newspaper industry for 2012 is 38.6 billion
22.5 billion in advertising revenue
Digital ads take up 17% of total advertising revues
10.5 billion in circulation revenue
Mobile Ad revenues doubled since 2011
The Newspaper Industry Almost Out Of Ink
The width of the paper was narrowed by six inches
To a new style of a 48 inch web styled width
5% reduction in news coverage
Changes to Survive
Do not need a lot of capital to enter the market
Social Media Websites & Blogs
Various Established competitors in the market.
Thin profit margins.
No Licensing Requirements
Social Media Websites
Paper/ Ink Suppliers -
Limited Items that are still printed due to changes in Technology.
Limited Number of Suppliers (plant closures, mergers, bankruptcies)
Low Switching costs.
NYT is large company with market power
Equity in a Paper Mill
They have several ways to get their news/ entertainment.
Switching costs are low.
They control advertisers.
Established newspaper companies in the print & online market.
Various other competitors in the online market.
Product differentiation and innovation is key.
Madison Paper Industries
Recession/ Economic Uncertainty
Print Sales are Down
Audience does not want to pay for online subscription
Companies cut advertising budgets
Preferences shifted to digital media
Can obtain free news information on-line
Audience is now browsers instead of readers
Audience's perception of news has changed
Want to "Be Green"
Move to digital content
Social media, blogs & other sources
E-Readers & Apps
Key people to differentiate their products
They have several outlets to advertise.
"Enhance Society by creating & distributing high quality news, information & entertainment."
Newspaper industry does not have licensing requirements
Business Level Strategy
Broad - Various sections
Ages of 35+
Product availability across different platforms
Increase Market Power &
Bargaining Power with Suppliers
Bargaining Power with Supplier (Vertical Movement on Supply Chain)
Deliver Information & News
Deliver across various platforms
High Quality Journalism