ISOJ 2013

1. The Problem
and A Solution

2. Where we’re
going continues
to evolve…

3. …where we start
never changes

4. So…
what is the problem?

5. “Let’s hope print ad
revenues flatten out.”
Hope is not a strategy.

6. “Digital ad revenue will save us.”
Over the past five years, the newspaper industry has lost $50 of print ad
revenue for every $1 of digital ad revenue growth.
This doesn’t feel like salvation.

8. Sobering trend

9. Houston we have a problem

10. The Problem
• It’s not clear that print and digital subscriptions and advertising revenues will
be sufficient to continue to support the scale of resources we invest in
gathering, publishing and distributing news and information.
• It is the scale of our news and information resources applied to a local market
that provides us our competitive advantage.

11. • Therefore, we must find
ways to sustain this scale
so we sustain our
competitive advantage;
otherwise, we risk being
commoditized.
• So if necessary, we will
cross-subsidize the
investment we make in our
news resources in order to
preserve our scale, which
is essential to preserving
our competitive advantage
and sustaining the strength
of our brand.

12. This is our strategy
As we go forward, we will succeed to
the extent we leverage our brand,
along with our core competencies
and our infrastructure, to
build or buy complimentary
businesses that provide
us with sustainable
revenue growth.

13. So what do
we do?

14. This is our solution
We have to diversify our sources of revenue.
Period.
End of statement.

15. Distributions of Revenue
Core Print
42%
Circulation
31%
Niche Print
10%
Digital
8%
Commercial Print
& Distribution
6%
New Business
1%
All Other
2%
2012
Core Print
39%
Circulation
31%
Niche Print
10%
Digital
9%
Comerical Print
& Distribution
6%
New Business
3.5%
All Other
2%
2013

16. 0
50
100
150
200
250
300
Q2/12 Q3/12 Q4/12 Q1/13 YTD
98
221 254
187
Contracts by Quarter
Sales Volume:
Launch to March 2013

17. Average Value Order (AVO):
Launch to March 2013
$475
$285
$412
$650 $672
$-
$100
$200
$300
$400
$500
$600
$700
$800
Plan Q2/12 Q3/12 Q4/12 Q1/13 YTD
AVO

19. Diversifying Sources of Revenue
The decrease in core print ad revenues in the 2013 financial plan are offset
dollar for dollar with the planned increases from the new businesses started or
purchased in 2012: