Gannett Beats Analysts’ Estimates; Weakness in Publishing, Digital Abates

Digital revenues declined slightly for Gannett in Q1, suggesting that while a recovery is not exactly in full swing, things are looking up, even for newspapers, reports paidContent.org. One of the key aspects for Gannett’s return to profitability last year was the ability to make severe cost costs, which resulted in the loss of hundreds of jobs across its newspapers. In Q1, the company showed it could still hold the line on costs, as adjusted operating expenses declined $141.3 million or 11.3 percent. Aside from growing revenues, the big challenge for the company is being able to maintain the lower cost model over the course of this year. In addition to touting the calming of Gannett’s troubled ad waters and discussing plans to institute a subscription structure for USA Today’s iPad app, CEO Craig Dubow also promotes some other digital efforts. It’s been over a year since the launch of Gannett’s local/national web hybrid ContentOne initiative, and Dubow announced plans to create “jobs/economy portal” under that effort. The ContentOne portal will collect job advice columns, info-graphics from USAT, videos from Gannett Broadcasting and data from the CareerBuilder job search module. Dubow looks forward to joint venture with 11 other broadcast companies to set up a mobile TV network. So far, there are a number of prototypes for the mobile broadcast network that the group, which also includes Belo, Cox Media Group, E.W. Scripps, Fox, Hearst Television, Media General, Meredith, NBC and others, is looking at, Duvow says. He sounded impressed by the Tivit, which works directly with the iPhone and is “about half the size of a smart phone… that works through Bluetooth.” While the Tivit is selling well in Japan, it’s only in the development stage in the U.S. It’s possible that the broadcasters group could help accelerate those efforts. Would the revenues from rich media and electronic editions tip the balance sheets? Without taking anything away from the core print business, Dubow insists that digital is already meaningful. “When you look at the portfolio we have, it goes far beyond just e-readers. I think as we have said before, we’re very proud we’re just shy of $1 billion this past year and where we were. And I think as more of these products come to the table, then it’s going to be the consumer deciding on the product quality. And I am very confident in what we have to offer and how we’re going to be able to move that forward.”