Wall Street Journal Magazine, New York Section Profitable, CEO Hinton Says
The two-year-old Wall Street Journal weekend magazine and the newspaper’s daily New York City section are profitable, according to Les Hinton, chief executive officer of News Corp.’s Dow Jones division.
The Dec. 4 issue of WSJ., the first under former Conde Nast editor Deborah Needleman, will be “significantly profitable” and lift the lifestyle magazine project past “break even,” Hinton said in an interview. The seven-month-old New York City section attracts enough advertisers to cover costs, he said.
The two initiatives are among the high-profile changes Rupert Murdoch’s News Corp. has brought to Dow Jones since acquiring the parent of the Journal in December 2007 for $5.5 billion. WSJ. is distributed with the weekend Journal newspaper, which delivers physical copies to about 1.6 million subscribers, according to Hinton. About another 150,000 copies of the magazine are distributed with the Journal in Asia and Europe.
“Even given the downturn, we kept the momentum going,” he said. “We put in a lot of additional spending in terms of pages, marketing and everything else, which so far is making good for us.”
In gauging the profitability of the two projects, Dow Jones counts direct expenses such as dedicated staff, though not costs associated with contributions from other journalists at the Wall Street Journal, the company said. The magazine and section also don’t pay separate distribution costs since they are delivered with the Journal.
The newspaper itself is profitable too, Hinton said. He declined to give revenue figures for the magazine and section.
WSJ., which started as a quarterly and is moving to 10 issues a year, has attracted 93 new advertisers, and some have purchased space in the newspaper as well, Hinton said. Including online customers, the Journal’s average daily circulation is 2.06 million, according to the Audit Bureau of Circulations.
The Journal began producing the Greater New York section in April, featuring articles aimed at area metropolitan readers. Since the section was introduced, single-copy sales, newsstand sales and advertising have all increased, Hinton said. As a result of the section, 67 new advertisers have been added.
“It is paying for itself,” Hinton said.
Investors questioned Murdoch’s pursuit of Dow Jones, given the premium paid even before the financial crisis. News Corp. said last year it wrote down the value of the Dow Jones assets by $2.8 billion. The company’s shares have dropped 37 percent since it made the acquisition bid in May 2007.
Results for Dow Jones aren’t broken out in New Corp.’s financial statements.
Dow Jones executives said in April they were seeking to draw readers from the New York Times and other local newspapers. News Corp. also publishes the New York Post. This month, Murdoch told the Australian Financial Review that the Journal’s Greater New York section is “sticking it to the New York Times.”
The Journal is also introducing local websites in Asia, according to Todd Larsen, president of Dow Jones.
“We have a good footprint,” Larsen said, adding the company is hiring local management and editors for sites in Japan, China and India. “It’s been a tremendous growth story.”
In China, where a local website was introduced about two years ago, page views have gone from 2 million a month initially to about 25 million today, according to Larsen. In Japan, the Wall Street Journal website is almost one-year-old.
“We’re starting off faster in Japan than we did in China,” said Larsen, who also took part in the interview. “We really think there’s a large opportunity to speak to business- interested consumers in these markets.”
Bloomberg LP, owner of Bloomberg News, competes with Dow Jones and News Corp. in providing financial news and data.
News Corp., based in New York, rose 25 cents, or 1.8 percent, to $14.32 in Nasdaq Stock Market trading. The Class A shares have climbed 4.6 percent this year.
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