The ad spend canary has been smiling on so-called traditional media recently.
The bigger media players, News Corp and Nine Entertainment, have been reporting a resurgence in news media.
The advertising revenue recovery has been benefiting media players, with strong advertising spend and good take up on digital subscriptions, showing that news is still strong.
At News Corp, December quarter news media revenue (where its newspapers sit) was up 11% to $US638 million.
At the financial news division, Dow Jones, which is now reported separately, revenue was up 14%.
Part of the story, but not all of it, is the cash extracted from the big platforms, including Google, for the use of news. The actual sums received are confidential but are reported to be substantial.
News is also getting the benefit of costs slashed when the pandemic hit and economic uncertainty was the only vision.
Brian Han, equities director at Morningstar, on News Corp: “Operating leverage from continued digitisation, transformation and cost restructuring is coming through, as advertising revenue recovery gains momentum.
“Notably, digital revenue represented 34% of (news media) segment revenue for the quarter, with digital subscribers increasing across all key properties (News Corp Australia, The Times, The Sun, and The New York Post).
“This is further evidence of transformational progress away from legacy print-media, towards a more digital-centric model.
Han points out that News is doing well against the general market. “Perhaps it is just a case of ‘Revenge of Resurrecting Old Media’ at a time when FAANGS (Facebook, Amazon, Apple, Netflix, Google) and BAT (Baidu, Alibaba, Tencent) are losing their sting and failing to meet forever-high expectations,” he writes in a note to clients.
Market analysts noted a stronger than expected momentum in publishing at Nine Entertainment where digital platforms payments have been added to strong digital subscription and advertising growth.
At Nine, which last month reported half year to December results, publishing revenue was up 15% to almost $300 million, driven by subscription and licensing (Google and Facebook). EBITDA was up 39% to $95 million
And digital now accounts for more than 60% of publishing revenue.
Nine reports that strong readership across each of The Sydney Morning Herald, The Age and The Australian Financial Review translated into paying audience, with total subscriber growth across each mastheads
Print subscription and retail sales slipped slightly but this was more than offset by digital subscription, and licensing revenue, which grew by 63% over the six months.
Advertising revenue from Nine’s Publishing assets outperformed earlier expectations, bouncing back strongly as the half progressed.
Nine: “Digital advertising revenue grew by 7%, notwithstanding the end of the legacy Google sales agreement in February.
“Print advertising grew by 15%, with Travel and Commercial Real Estate bouncing back strongly, the former however, remaining well below pre-COVID levels.“
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