Mark Thompson knows a thing or two about growing a subscription business.
- Mark Thompson is the former CEO of the New York Times and previously director general of the BBC.
- He recently invested in The New European newspaper and became chairman of the board at Ancestry.
- Thompson spoke to Insider about the subscriptions trend and why demand for news remains high.
- Visit the Business section of Insider for more stories.
As CEO of the New York Times, he oversaw a transformation culminating in more than five million digital subscribers, a nine-fold increase during his tenure.
Since leaving the paper in September, Thompson has joined the family history company Ancestry as chairman of the board of directors. He also joined a consortium of investors this week that purchased The New European, a small, anti-Brexit British newspaper.
In an interview with Insider, Thompson discussed why he made the investment, his outlook for the future of the subscription business in the news industry, and why he doesn’t think readers’ appetite for news will fade in the Biden era.
The following interview has been edited for length and clarity.
Steven Perlberg: The big trend in media right now is a move away from advertising and toward growing a subscription business. Do you think we’re hitting the ceiling on the number of subscriptions people are willing to pay for?
Mark Thompson: There’s probably some natural curve in terms of how many subscriptions in total a given household will take, and for news on average it’s probably going to be quite a small number. A large number of people will only have one, some will have two, many fewer will have three, and so on.
It was sometimes said, I thought frankly absurdly, about the New York Times, that the Times was grabbing new subscriptions everywhere so that no one else would get a look in. Everywhere, other than in the United States and with a certain kind of American expat around the world, the New York Times would not be the first port of call for peoples’ journalistic needs. It would be No. 2 or No. 3.
What the Times was competing for was a subset of the [international] audience who have got business, governmental, NGO, or family connections with the English-speaking world and want to reach beyond local media. That’s very much as a complement to local media rather than a replacement.
Perlberg: This pivot to subscriptions is obviously something you saw coming at the Times.
Thompson: I’ve been more optimistic about subscriptions to pay for journalism than pretty much anybody on the planet. I’m right out on a limb of thinking this is a really strong business opportunity. An awful lot of my colleagues in media have spent most of the last decade trying to explain why it won’t work or why it won’t work for them.
Perlberg: There’s this paranoia in the media business right now that we’re coming off of a sugar high of the Trump years — which helped media companies grow their subscription businesses — and that consumer interest in news might wane. What do you make of that?
Thompson: In New York, which is currently shut down by a combination of 2 feet of snow and COVID-19, it still feels that America and the west is going through a kind of fundamental, multi-pronged process of drastic change around division, economic uncertainty, and loss of position and competitive strength to Asia.
The rebuilding and how you rebuild are gigantic issues for the United States and the UK. There will be large-scale news intensity as far as I can see.
There was a real sense that the lights would go off the day after the US election. I’d point out the January 6th assault on the Capitol as rather clear evidence that news hasn’t entirely stopped since Donald Trump lost the election.
I think very uncertain and disruptive times continue. Scary for the world, but it will provide plenty of material and will keep public demand for news very strong.
Perlberg: Why did you invest in The New European?
Thompson: I’ve got a loose theory about media that there are opportunities for really quite big global brands and players — I’d put The New York Times and the BBC which I’ve worked for into that category — of big players who really can get enough scale to get the audience and to afford the engineering you need to make a go of it.
Actually around the edges I think the opportunity for a high quality media product which has a very particular thesis and a very particular audience is also quite promising as well. I think the middle ground is quite difficult. It’s partly because I’ve admired journalism and would like it to thrive.
As it happens I voted Remain in the [United Kingdom’s European Union membership] referendum in 2016. I’m a European. I’m half-Irish. At some point I may get an Irish passport, but I’m not a politically active person. I’m not going to be involved beyond being a supportive shareholder.
Perlberg: Are you looking to make more investments in the media industry? If so, what do you look for?
Thompson: The essential answer to that is: no. I’m not particularly focusing on media in terms of personal investment. I think this is a special case. It’s not in any sense a part of a portfolio of media assets. I’m very happy to be an investor, support, and reader of the New European.
If you want journalism to succeed, get as many subscriptions as you can as a user. I’ve probably got nine or 10.
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