Fairfax Media withdraws mastheads from digital audit
Fairfax Media is to stop publishing audited digital subscriber numbers after both The Age and The Sydney Morning Herald went through several quarters showing declines.
The company will now release, along with its financial results to the ASX, only a total number of paid digital subscribers based on its internal numbers.
Fairfax says the reason it’s dropping the audit is because it no longer follows the company’s commercial strategy and the audited number is not something advertisers have been demanding.
The move will leave only News Corp’s titles The Australian and The Herald Sun sharing digital subscriber numbers independently assessed by the Audited Media Association of Australia’s digital audit. News Corp’s other major titles including The Daily Telegraph in Sydney and Courier Mail in Brisbane have never been part of the digital audit.
According to today’s update to the ASX, Fairfax Media says it has a total of 209,000 paid digital subscribers across The Age, Sydney Morning Herald and Australian Financial Review.
Announced today as part of the company’s financial results presentation, Greg Hywood, Fairfax Media CEO, said: “As at July 24, Metro had 209,000 paid digital subscribers across the SMH, The Age and The Australian Financial Review. Note this subscriber figure includes the Financial Review for the first time. All three titles delivered year-on-year growth.”
Hywood: “SMH, The Age and The Australian Financial Review all delivered year-on-year growth”
It is not new for Fairfax Media to release the figure – which is put together by the company’s Business Intelligence Team – with the company reporting on February 12 of this year that The Age and SMH had 162,000 paid digital subscribers.
This suggests that the AFR accounts for roughly 47,000 digital subscribers of the 209,000 figure. The AFR was not audited by the AMAA.
According to the last AMAA figures, The Sydney Morning Herald had 134,934 paid digital subs during the January to March period while The Age had 125,038.
In today’s financial results presentation, the publishing company reported its digital subscriptions revenue accounts for $38m, an increase of 17%, year-on-year.
Speaking with Mumbrella, Andrew Porter, Fairfax Media director of customer and subscriptions APM, said: “We want to report one number that says this is the performance of the paywalls for the metro publishing.’
“Our argument to the market around digital subscriptions has always been about revenue. The size of your subscriber base should be a function of your revenue increasing. Our revenue is up 17%, year-on-year, but our strategy isn’t about trying to get 10m subscribers and have them all paying one cent. It’s about having the right people who will pay for content.
Porter: “Our strategy is about having the right people who will pay for content”
“We place more emphasis on the revenue and the year-on-year revenue growth than on the number of digital subscribers.”
Porter explained the revenue number and the digital subscriber numbers are not “exactly like-for-like”.
“The revenue number is not the total revenue number for subscribers – it’s just the digital revenue. Let’s say I pay $10 for a bundle and we attribute that $5 to digital and $5 to print – that’s not the attribution – the number we’ve released is just the digital,” he said.
The withdrawal from the AMAA digital audit comes a week ahead of its release of publisher’s circulation both print and digital which will see Fairfax report “0” against the digital circulation for its mastheads as it is unable to completely pull out of the audit due to a desire to remain in the print circulation audit.
Explaining the decision to withdraw from the AMAA digital audit, Porter said: “We believe it’s not a complete picture of the number of digital subscribers that we actually have.
“We wanted to resolve the confusion of having two metrics in market. We’ve been releasing the paid digital market to the investor market. Then we had this other metric sitting over here and there was a lot of confusion between the two. We wanted to resolve the ambiguity of having two and we’ve gone with the one that we feel measures business performance.
“The third reason is we wanted to move to a metric that is similar to other subscription businesses in our portfolio – with Stan we talk about the number of paid subscribers, it’s a similar metric to that.”
Porter said Fairfax believes the digital circulation figure is “not relevant” to its business strategy however print circulation still plays a role.
“Print is definitely still relevant because print advertising relies in some cases on print circulation,” he said. “There’s no changes with the print metric.”
The investor figure is currently reported every six months with the publishing company may consider reporting it more often dependent on what the market wants.
Ryan: “AMAA remains committed to working with all publishers to deliver methods of transparent reporting”
AMAA CEO Josanne Ryan said: “The AMAA acknowledge today’s announcement by Fairfax in regards to their digital sales reporting for the current audit period. Whilst we are unable to comment on individual publisher’s commercial decisions, we remain committed to working with all publishers to deliver methods of transparent reporting that reflect the changing nature of Australian publishing”.
Miranda Ward worked for Mumbrella from 2013 to 2017, eventually becoming deputy editor. Miranda joined Mumbrella in September 2013 from Sky News.
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Fairfax CEO Hywood has form. Back in his days at The Age he shifted the metric from premium targets AB to what he called ABCD. The fact was that the traditional high value audience had walked.
Now the same guy is shifting the metric because his core audience has walked.
Fairfax only had the high road option and the Grocer backed the low road CEO.
It’s a shame.
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There goes the business “model”
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This is quite interesting. To add to this… Do you know about Binfer? It is an easy way to share digital media.
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