Important datapoints for Internet advertising and content stocks from the New York Times Co. (NYT) conference call:
Online business growth
In total, our digital businesses grew nearly 13% in the quarter and generated $91.3 million, or 12.3% of the company’s revenues. Internet advertising revenues generated [should be "grew by"?] 18.3% in the quarter. The About group had another strong quarter. Total revenues grew 15.8% to $28.6 million because of increased cost per click advertising and the acquisition of consumersearch.com in May of 2007. The ongoing development of content verticals across all of our websites has helped the Times Company become the 11th most visited parent company on the web in the United States, with 47.2 million unique visitors in June, up approximately 10% from June of 2007. Our reach represents nearly 30% of the online audience in the United States. NYTimes.com continued to show exceedingly strong traffic growth, as we provided access to the content that was formerly part of Times Select, the paid product we made free last September, and we have accordingly benefited from the growth of search as the dominant entryway to the web. According to Nielsen Online, in June the number of unique visitors totaled 17.7 million, up 41%. The audience of NYTimes.com is nearly twice the size of the next newspaper website.
Internet advertising pricing and demand
Alexia Quadrani - J.P. Morgan: Thank you. Just a couple of questions; first on the digital side, you continue to have very good growth in the online advertising businesses. Could you give us a sense of how pricing is trending on the display side of the business there? Are you seeing any push-back now that the budgets are getting a bit more tighter?
Martin A. Nisenholtz: I’ll start out and then turn it over to Denise for some commentary at NYTimes.com. In general, pricing has held firm. In fact, through the first half of the year, we’ve seen reasonably decent price increases on the major display units across the company. There are -- there has been a bifurcation -- that’s the way we’ve been characterizing it in the past -- between what I would call premium positions on the web and the more general remnant inventory that exists and is characterized in large part by banner advertising. So that bifurcation is meaningful in different ways at our different sites.
At NYTimes.com, for example, we don’t see much cannibalization, if any cannibalization of the premium side, either in rate or in our sell-throughs based on our remnant business, which has been growing quite nicely.
On the contrary at About.com, we have seen softness in the display categories, in part because we think we have had execution issues there and to Jim’s earlier point, we’ve invested behind those issues in building the sales team over the last half of the year. So in general, to date I think we’ve seen a strength on the rate side.
Denise Warren: At NYTimes.com, about 50% of our overall revenue is priced on a CPM basis and we have seen increases year-to-date year over year in the CPM price business. In addition, as Martin alluded to, we try to maximize all of our revenue and all of our inventory, so we do sell some of our inventory out at the networks and we’ve seen substantial increases in the CPM that we’ve been able to generate from the ad networks. And the fixed price units that we saw, which account for about 30% of our overall revenue, we’ve also seen rate increases in as well this year.
The quotes are taken from the NYT transcript which was published on Seeking Alpha a few hours after the call ended. If you think I missed something more important than these quotes, please copy and paste your quote from the full transcript and leave as a comment below.