NEW YORK (Reuters) - The Financial Times plans to retain its famously salmon-hued print edition even as it aggressively ramps up digital distribution, its chief executive said in an interview.
FT Group CEO John Ridding said a “digital first” strategy that will eliminate the paper’s current regional editions in favour of a single global one does not sound a death knell for the physical newspaper.
“The irony is the right print format has a very good future,” Ridding said on Thursday. “The (digital first strategy) is absolutely not a step toward ending the print edition.”
The FT Group is paring back its portfolio as parent Pearson Plc (PSON.L) shakes up its management and restructures. Financial news provider Mergermarket is up for sale and Ridding would only say the process is going “well.”
Asked about speculation that Pearson would eventually sell FT, Ridding said, “I would personally hope and expect to drive a nail into the rumour coffin. The FT is really plugged in much more effectively into Pearson.”
For example, Ridding points to the fact that for the first time “print is a profitable proposition even without the advertising,” adding that advertising trends are volatile and hard to forecast.
Revenue from subscriptions account for more of the FT’s total revenue than money from ad sales. Newspapers traditionally have relied on advertising to pay the bills and make profit.
Advertising dollars once showered on newspapers are now earmarked for popular websites like those of Google Inc (GOOG.O) and Face book Inc (FB.O). Newspaper advertising in the United States, one of the FT’s major growth regions, is expected to fall almost 50 percent to $17.8 billion over a five year period, according to research firm eMarketer.
That is why newspapers ranging from The New York Times (NYT.N) and News Corp’s (NWSA.O) Times of London are making big efforts to charge readers for previously free digital content in the hopes of making up for some of the lost revenue.
The FT was one of the early pioneers of charging for its content online and shows no slack in the pace of signing up subscribers.
The FT reported that digital subscriptions were up 24 percent to almost 387,000 for the nine months of 2013 and account for more than 60 percent of total circulation.
“These milestones are important in themselves. They also show evidence transformation is working and providing new momentum,” he said.
Reporting by Jennifer Saba in New York; Editing by Richard Chang