Newspapers and Indianapolis Star and Publishing and Web Sites and Communications and Media & Marketing

Gannett to build online pay wall for newspaper content

February 23, 2012

Gannett Co., the owner of 82 daily newspapers including The Indianapolis Star, will adopt a paid model for online content by the end of the year, the company announced at an investment conference Wednesday.

Online readers will be able view between five and 15 articles per month, depending on the newspaper, according to Bob Dickey, president of the McLean, Va.-based company’s community newspaper division.

Dickey said the initiative, similar to the New York Times pay model, will add $100 million in revenue to the publishing business by 2013.

Gannett, which also owns 23 television stations, expects total revenue to grow 2 percent to 4 percent annually over the next four years, Chief Financial Officer Paul Saleh said.

He predicts the publishing business will increase no more than 2 percent a year during that period, but digital revenue, which now accounts for les than a quarter of Gannett’s sales, is expected to rise 12 percent to 13 percent annually through 2015.

Flagship paper USA Today, which relies on bulk sales to hotels at discount rates, will not have the same online model as the other properties. Fifty-six percent of its 1.78 million average daily circulation is distributed in hotel lobbies and guest rooms, according to the latest publisher’s statement to the Audit Bureau of Circulations.

Also Wednesday, the company said it will raise its quarterly dividend to 20 cents a share from 8 cents. The payout is effective April 2 for holders of record on March 9.

The publisher’s goal is to return more than $1 billion to shareholders by 2015. Gannett reported a 33 percent decrease in fourth-quarter net income as revenue from newspaper advertising fell and circulation declined.

Gannett gained 4.2 percent to close at $15.61 Wednesday, its biggest one-day percentage increase since Dec. 9.

 

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