In 2007, the Financial Times was one of the first newspapers to begin a serious and sustained effort to build a paid digital content model with the launch of its metered access system. Seven years later, the Pearson-owned newspaper can point to a set of financial results for 2013 that go a long way towards vindicating its approach.
Despite flat revenues for the year, the FT Group delivered underlying profit growth of 17 percent year on year in 2013 to £55 million.
As CEO and 25-plus year FT veteran John Ridding tells TheMediaBriefing, that increase in profitability is being driven by a fundamental shift away from a reliance on print advertising towards digital subscriptions:
“The big challenge for any business in transition, and certainly a traditional publisher, is you’re investing in the new and facing structural decline in the old. We’ve seen year after year of often pretty chunky decline in ads, which for most of that 125 years has been our single biggest source of revenue.”
“We’ve been trying to build the new while managing the decline of the legacy. That’s been tough from a profit perspective, but now we’ve achieved critical mass in digital and the subscriptions.”
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