The New York Times Co. last month moved to increase the digital IQ in its boardroom, naming MIT Media Lab Director Joichi Ito and Madrona Venture Group Partner Brian McAndrews its newest directors.
Mr. McAndrews is familiar to many in the ad industry particularly because of his time as president-CEO at aQuantive, the digital agency that Microsoft acquired in 2007 for $6.3 billion. He declined to take this opportunity to discuss Microsoft's recent write-down of nearly the entire deal's purchase price, but talked about how The Times and other newspapers might confront the challenging landscape.
Our conversation has been lightly edited.
Advertising Age: What do you hope you can contribute to The New York Times Company?
Brian McAndrews: I have a background in a combination of media and advertising. I spent almost a decade at ABC and broadcast television, and spent the last decade or so in digital media and advertising. So I hope to be able to bring some perspective, both as a general manager and someone who's had operating experience in a world in transition, and also bring expertise from the digital standpoint.
A tremendous amount of revenue for publishers in general and The New York Times in particular still comes from the advertising world. Any digital transformation is obviously going to involve a fair investment in technology. So I hope to bring some perspective and background in those areas.
Ad Age : What do you make of newspapers such as The Times-Picayune in New Orleans cutting print down to three days a week? Obviously it reduces a lot of the costs that publishers struggle with, but what about the effect on reading habits, newsroom staff and comprehensive coverage?
Mr. McAndrews: It makes sense to look at scenarios like that and experiments like that . We are moving more toward digital media and people consume their media in lots of different ways, not purely in an analog print format. I think it does make sense to explore different models.
A lot of people think that over time that there will be a transition, and it's already happening, from more and more print delivery to less of that and more digital. So I think everybody should be looking at those kinds of models and making sure they're figuring out how to monetize the digital piece.
As you said with those experiments, the costs are lower, but the publishers have to make sure that the revenues are meaningful enough to ensure that that the business model continues to work.
Ad Age : Newspapers have had problems growing digital revenue. Some are even watching it decrease. What can premium content sites do to reverse this? Is advertising even the answer?
Mr. McAndrews: Advertising is certainly part of the answer. I don't think it's necessarily all of the answer.
Publishers need to try to capture value wherever they can. People have traditionally paid subscription rates for newspapers, for example, and I think that some papers like The New York Times, The Wall Street Journal and others have had success with paywalls. I think those models will continue to evolve.
One of the things, as an aside, that appeals to me about The New York Times is that it's a national brand and in many ways an international brand. Lots of newspapers have challenges, but I think the national brands in some ways have a stronger position than regional and local papers that they can build from.
But to your specific question, I think premium content will attract premium advertisers. Depending on the publication, working closely with advertisers to try to create sponsorship opportunities or more custom advertising opportunities -- while maintaining editorial independence -- is a real opportunity for prominent brands.
I also think that video is an opportunity for publishers. Digital presents traditional print publishers opportunities to create video that fits their brands and as a result to associate that with video advertising, which is potentially a very large growth area and potentially attracts much higher ad rates than display.
Ad Age : Even combined with digital circulation revenue, display advertising doesn't seem to bring in the kind of revenue that supports a traditional, robust newspaper newsroom. Are there ways that the web can become a more robust support for big professional news staffs, or is the future of journalism about spending less and teaming up with other content sources?
Mr. McAndrews: It's a combination. People going through transition certainly have to be cognizant of the costs and have to manage legacy costs that aren't relevant in a new world. Having said that , I think there's still demand for high-quality journalism. I think brands matter and people are ultimately going to pay for high-quality unique content.
I do think one of the unique challenges in publishing is that some types of news are becoming more of a commodity. But insight and analysis, unique human-interest stories that take more research and more digging, the types of things that show up in papers like The New York Times with Tom Friedman, David Brooks, David Sanger, Maureen Dowd -- those types of things and people are going to continue to be very appealing.
The combination of unique voices and perspective, and the ability to take the time to really dig deeper on a story of great interest, those types of journalistic endeavors will be successful in the long run and be able to support robust news organizations.
There are ways to take that journalistic expertise and, as we discussed earlier, expand it into video, mobile and other areas. I do think there will continue to be robust news organizations -- possibly fewer -- but I don't think there will only be content farms or news will become entirely commoditized.
I joined The New York Times board because I do believe there's a future for high-quality journalism and I think The New York Times is definitely going to be part of that future, even though clearly this is a transitional time for the entire industry. The New York Times is very open to that challenge and I'm excited to be part of it.