The New York Times Company (NYT), Yahoo! Inc. (YHOO): Did Marissa Mayer Write This Newspaper’s Business Plan?

The bold, italicized row, “Circulation,” which includes both print and digital subscriptions, is the future of The New York Times Company (NYSE:NYT). After this business quarter, the New England Media Group division is no more, and you can see why from the steady decline of revenues from the New England newspapers, including The Boston Globe, that made up this group.

NYT’s people, products, traffic, revenue push
Mark Thompson, CEO of The New York Times Company (NYSE:NYT), understands the importance of people and products. The Times will spend $20 million to $25 million during the second half of this year to hire new talent and increase its online content offerings, from video and live events to deeper content in popular sections such as food and arts. It will also change the name of the venerable International Herald Tribune to the “International New York Times” on October 15 to take advantage of its strong name recognition worldwide, thus opening up international subscription opportunities.

The company will also seek revenue opportunities through brand extensions, where it can monetize its brand by introducing “intelligent gaming” products. Its “Premium Crosswords” subscription site is an example of this gaming tactic, as it capitalizes on the Times’ reputation for difficult crossword puzzles, a decades-long strength of the print edition.

If the Times’ “people” and “products” implementation is successful, the company should see an increase in traffic that will benefit it by upping subscription revenue and attracting more digital advertising, which actually decreased 2.7% last quarter.

Turning forward
The New York Times Company (NYSE:NYT) and Yahoo! are both premier brands, one of the print age and one of the early Internet age. Both have had to make adjustments to chase consumers’ content preferences. Neither company can accurately be described as in turnaround, as both companies are still profitable. Rather, they are in turn-forward mode. By shedding the non-core earnings ballast of AltaVista and similar products (in the case of Yahoo! Inc. (NASDAQ:YHOO)) or the New England Media group, as the Times has done, both companies are opening up opportunities to pursue Mayer’s simple but spot-on formula.

The article Did Marissa Mayer Write This Newspaper’s Business Plan? originally appeared on Fool.com is written by Asit Sharma.

Fool contributor Asit Sharma has no position in any stocks mentioned. The Motley Fool recommends Yahoo!

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