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well good afternoon everyone I'm going to introduce to you MK who is the co-founder and chief content officer of AdsoftheIndia. I AdsoftheIndia is a global digital news organization with around 90 million monthly readers based on a number of products IBT international business times but other products as well like medical daily fashion times but the reason why we're having our chat is because in 2013 I AdsoftheIndia wot newsweek now you guys will know better than anybody else as to the rather checkered history that newsweek had in the last few years after being published for 80 years by washington post on iconic brand but increasingly heavily loss-making washington post sold it in 2010 later in the year it was merged with the Daily Beast 2012 went digital only when the print edition was closed and then 2013 Jonathan and his co-founder bought Newsweek and seven months after buying it relaunched the the print edition at a higher price and a very different looking product so it's a fascinating rather wild to the flip flop story print digital back to print again which I want to talk to you about Jonathan your thinking behind the door but why don't we kick off about you because you are not a traditional publisher and I think you're an engineer by training on you right right so first off thank you thank you for having me and thank you for for all of you to come in you know tend my adventure into the media industry has been you know quite an odyssey for for myself I started out as an electrical engineer I grew up in Silicon Valley and you know I grew up around computers and computer technology and this was really where my life was headed you know so I started to work at a semiconductor company and we were building chips and things but this wasn't really my passion you know my passion was all the development that was happening around us on the internet you know so there was a software revolution that was happening and so I was doing my work looking at this amazing revolution happening and around 2005-2006 I met who's now my business co-founder etienne new Zhang at TN he came from London he studied economics and he was seeing I think a converging world you know partially brought on by that vent of the internet so markets were getting closer we saw the rise of you know the bricks and other emerging markets but we didn't really see any media that we're serving this with a globally native type of perspective and so this was what he sold me on and yeah this was exciting for me but what was more exciting was that we were going to do this on the internet and that's how we started so he came with kind of this vision for how the world was changing and I was excited to do this in a way that can scale and can impact many lives across across the internet and so we started IBT media in 2006 and it's just been growing since then do you think not having a publishing background actually helped was an advantage to you in setting the IBT business up yeah you know so again I think with a background in technology you know I think this emanates through the culture of our company we're not afraid of technology I think we use it in creative ways to help us put out the product also I think not having this background gives us a different perspective from some of the challenges and allows us to bring some fresh thinking you know to some of the things that we're facing okay so fast forward to 2013 what possessed you to buy Newsweek right so so this actually started out through a real estate deal so cool yes that's where this we're all good deals start in 2011 IBT media was was expanding rapidly and we had a small office in Manhattan but you were running out of space essentially it just so happens that newsweek got bought by IAC at the same time right so we're looking for space around Manhattan very frantically there's no more room people were no place to sit the same time Newsweek had to move out of their office right so we connected with them and this must be I think like the fastest real estate deal in the history of Manhattan we we found them negotiated they moved out and we moved in in two weeks all right so this is a world wind of a move and from that time we had we're in close contact with their executives and you know we kind of joked internally we said well now that we have their office we might as well get the brand and you know we would joke with them every once in a while but in 2013 then then they called us you know and we really had to evaluate what we saw I'm a Newsweek and opportunity and you know we're really happy with I think the prospect okay so once you got it you started to change it pretty quickly so can we sort of talked a bit about that about that content aspect as to how you changed it and why you did sure what the change for us was simple i think if we look at the change considering newsweek historically there's been a departure newsweek historically has been a news digest right so you would get it every week you look back on the week and kind of get a you know good deep understanding of what happened essentially but now in the age of the internet then everyone already knows everything happening all the time and so for us we had to build a new team and a new content philosophy for newsweek but still we wanted to uphold I think the facets of what made Newsweek great in the first place all right and this is a great storytelling great journalism great writing and when you look at Newsweek now this really reflects both in the print publication and also on the website so it's really evolved into a platform for for rich storytelling you know great opinion and analysis as opposed to simply just a digest okay so i can understand the strategy that there must have been real practical problems because you were a digital-only company did you have to import then i was going to say new skilled old skills that had been lost in the recent past of Newsweek I think the great thing was you know when we had a wired Newsweek then you know there wasn't there wasn't much left right so we takin over the brand there's a few people that we brought but really we had to build the team from the ground up and you know kind of a funny story was that you know once we finish signing the papers from the previous owner which was IAC we had about two and a half weeks to build the team to source the stories and to get the next magazine out and you know we we got a tremendous team and they were able to do a great job okay when did the thought of relaunching the print edition occur to you all become part of your strategy did you buy news with the intention of resurrecting print or was it something that dawned on us being a good idea what once you had news week yes that's a good question when we looked at Newsweek initially then you know there was a few facets that really attracted us right and I think Newsweek in its essence really matches the DNA of IBT media so at that time we know that the previous owner had turned this into strictly digital and we know that there was tremendous brand equity still inside of of Newsweek and you know we bought this wanting to uphold that and wanting to bring I think our digital know how an experience to the brand and we saw that there was a tremendous opportunity there but you know several months into this we started again a lot of correspondence from previous subscribers actually so people were contacting us even we're getting handwritten letters you know basically asking you know where's the magazine how can I get this magazine again and and you know after seeing that and understanding that there was some demand there then we started to look into the print industry and you know I think we had a tremendous opportunity because when we studied the industry we saw as you know at least in America there was this preoccupation with the rate base right so publishers were really concerned about rate base and what this meant was that the publishing industry was focused on the average now because we had the brand with amazing content coming out great journalism already we felt that we could now re-enter the print market with a print package that really matched the great journalism that we were doing but also change the model such that we could serve consumers directly instead of serving only advertisers all right so we went with an approach that really went after subscribers and newsstand sales and we wanted to serve the people okay so after their various elements of the the business model that I'd like to dig into in a bit more detail you've touched on one there which was the balance between content and advertising so you made a very clear decision to try and reduce the dependence on advertising because why because it's it's volatile it's it's dangerous well i think you know if we focus strictly on advertisers then we we didn't want to get into this similar situation where we're only serving rate based so we wanted to go double down into great content and we wanted to make a product that people themselves would want to buy right something that you'd go to the newsstand if you look at the graphics that we're doing in the magazine really amazing covers week to week if you look at the actual quality of the magazine we're using you know very heavy paper perfectly bound spine great photography you know so our focus was really on the consumers and we found that as we did that and as if we succeeded in that then advertising would naturally come okay I'm intrigued sort of digging down a bit more detail detail you mention newsstand where does retail fit into the overall consumer strategy is that a shop window that then feeds into subscriptions what's what's the role of retold in your plan retail is important for us I think you know part of the DNA of us being a digital companies that were always looking at the data you know I was looking at the numbers and we want to make sure that there's good ROI on everything that we do so we're doing newsstand but we're making sure that it's optimal such that newsstand can be profitable right of course it serves as a great marketing tool right we get the name out we're able to get the covers out but we want to make sure that we're not losing money there even so newsstand plays a good role in this when we look at actually Newsweek when we took it over it was roughly around you know zero revenue know roughly but now you know that's grown into essentially an eight-figure type of number and circulation is an important part of them and advertising is becoming increasingly more important and of course its licensing all right so these three models are coming into play now where before there was only really licensing that was happening right okay I'd like to sort it again dig into a bit more data about this balance between print and digital particularly in terms of your subscription pricing because if you look at someone like The Economist who are very clearly channel agnostic so print only digital only cost the same in terms of a subscription price and then the bundle print and digital is is about a forty percent premium now your pricing is very different your your digital only stream is a lot cheaper than them print only what again what's the thinking behind that structure all right now we you know we were at this unique point in time for Newsweek as a brand where we're reintroducing this back into the market there's real cost associated with the print magazine and that's reflected in the newsstand price and so this is a little bit higher than what Newsweek used to be but we're seeing that consumers who want it are willing to pay for it now on the Digital side we wanted to to reintroduce this softly into the market cross market it with other titles that we have in our portfolio and allow this to grow over time where we find parody somewhere in the future and when that's going to happen we're still evaluating okay but that is a long-term aim for it to be completely channel it's something that we're evaluating it could be that you know digital is always less because the costs associated with the print is tangible all right so so we're evaluating this on a on a daily basis okay and you see print gradually declining or ever disappearing do you think you will return to being a digital-only product / well I think what's great about the consumer focused business model is that so long as there's demands we're going to continue to print all right so we're gaining subscribers regardless of how the economies work out people that wanted are going to going to pay for it and so for us as a company you know I can't speak for the whole industry but for Newsweek in itself we're always going to print so long as their subscribers whether that's one subscriber or whether it's you know hundreds of thousands or millions that we're projecting it's going to be something that's part of our strategy now the core essence behind all of this of course is great content right and and that's what's channel agnostic so whether this is you know in your app or on our website in the magazine you're going to get this great kind of deep dive into current affairs okay you mentioned earlier on another thread to this which is enterprises can you can you give a bit more detail as to what that actually involves because there's been a lot of talk over the last couple of days about live events as an example what you see is you because you're extending the Newsweek brand yeah so that's one of the great things about in that we discovered about Newsweek is that there's still tremendous brand equity and it's one of the few magazines that's just instantly globally recognizable and there's a lot of plays that we can do on top of that one of course is licensing so Newsweek is something that speaks to the world and there's different dynamics and different markets and we're looking for you know the right type of licensing partners to let Newsweek come and reach that market so we have several licensing partners now we're looking and speaking to several more and you know we see licensing growing to becoming a larger part of the pie for us as a company also when we think about the brands there's certain i think connotations that the brand brings because of the smart content and we're seeing a lot of different plays to let the brand exist outside of just the printed word so you know just
last week we had an event at NYU kind of focused on entrepreneurial ISM sort out in 15 minutes and we brought on board you know great CEOs talk about the experience you know and I think this is where we can see the brand moving forward something that represents you know this this type of something that we can extract this type of you know different models from the one last thing is when we look globally then Newsweek you know some people i've talked to then music was something actually that their teachers would give them you know a long time ago right as part of their prescribed reading it was away a lot of people learned english actually you know so we're in talks now about spending the brand into like english schools and things like this so this is tremendous opportunity it's tremendous opportunity i mean presumably also it's a great challenge as well because the local conditions the local business model must vary depending how digital a particular market is and the the dependence on advertising revenue versus content revenue must must change region by region how'd you manage that well that's that's the great part about having great licensing partners so we're really stewards of the brands and the content the voice and tone and we're looking for great partners to really bring this to local market and we can partner with them not only with the content but I think the best practices that we've learned on the Digital side also and you know they are going to know their market better than we will you know so we want to find that partner that can make this make sense in those local markets and it's been it's been a healthy and you know fruitful relationship right okay moving on then from the business model and another sort of back-end issue but another thing that's run through very much the
last couple of days is organization and culture and skills because you've had a rather unique experience with digital only reintroducing print and a whole mix of skills can you talk through some of the challenge you've already touched on about sort of and I think about hiring a new editor traitors but but what else in a lies behind that in terms of the skills and the organization I think also we need to look at this broadly so for us it wasn't a culture change for us because we built the team from the ground up right but IBT media is a digital-first company and this really emanates inside of newsweek as well so even though we have a print magazine the newsroom is set up such that they're also digital first in the digital aspect of what we're doing is really the heartbeat of the magazine so you know from digital we're able to quickly understand our audience and kind of take the temperature on on what what people care about and translate that now into the magazine to make the deeper dives right at the same time the magazine sets the benchmark for the quality of journalism that we're doing on the website so it's a good good synergy between both of these but you know I wouldn't say that we have separate teams it's very integrated okay so digital first means one thing you've already touched on which is live real-time being being fast and reacting to what the consumer is is doing and can you tell us a bit more you succeed a very data-driven as to the kind of data that you use to to change the product mm-hmm so you know I think a lot of digital publishers have this experience now we were kind of you know early by necessity building and exploring some of these tools to really understand our audience these days you know people use things like chart bead and of course there's Omniture and these type of tools to really give you like real time in but you know some of these tools we built in-house and so the newsweek team they're using this data to understand what the pulse is broadly speaking right and that allows us to then put out a relevant magazine on a week by week basis okay something else that are clearly talking to Digital pool play companies when they come in and look at a traditional publisher is what they regardless how much fat there is in a in a in a traditional publisher and I think for many people digital-only or digital pure-play means doing more things with fewer people right right yeah you know we were really surprised of the type of spending that newsweek used to do you know one example is you know we had to inherit a lot of these contracts you know as part of the acquisition and one of these contracts was was for printing services and i don't mean printing the magazine I just mean printers around the office and this was like a six-figure type of contract just to get printers right and I think that's a that's a major departure you know from from the culture that we built in IBT media it's a relatively new company we're really close to the metal you know so to speak as to how the product is performing and what the return is and that culture now exists inside of Newsweek as well so you know there's no six-figure printing contracts but you know we just buy dells and and and things work out a lot more efficiently this way okay but is it all a one-way
flow is is it of you introducing digital first disciplines into a legacy company or is there flow the other way other things that you've learnt as an organization as I AdsoftheIndia from the newsweek experience in newsweek is a world-class brand putting out world-class content you know and we're really thankful to have the team that we have on the content side we brought onboard gym and poco who's the editor and he brought like an amazing team you know together and so so there's some give and take that you know we're learning together about what works what's the best practices for digital and at the same time he's allowing the company to understand the best practices for storytelling and for journalistic rigor so it's a great relationship okay and is it all working i think i know the answer to this but what or how far down the process because it sounds that you're still learning a lot and tweaking things as you go along yeah yeah i mean it's it's working so far thankfully and you know we see a lot more you know Headroom for newsweek it's really just getting started so you know we're building greater you know bigger teams on the business side we really want to introduce this back into the market in a very strong way now i think it's been very editorial editorial focus so we focus first i'm putting on a great product but now we're going to start tying in other things that we spoke about so events licensing you know having great advertising partners and you know the whole gamut of what a magazine would do but first we wanted to make sure that core was there and you know we're happy to say that it's been established okay final question it sounds as though there have been a few surprises along the way and perhaps a few skeletons courting active cupboards as you were going along looking back on it all would you do it again yeah definitely and definitely we do it again and i think newsweek really fits you know what we want to do with a company alright we want to find the truth and promulgate it everywhere and newsweek has an 80 year legacy doing this with great storytelling so it's a great fit it's a great match and we do it definitely again okay and as a subsidiary question would you do it in the same way or because again it sounds as though what started out as a real estate deal and turns into something a bit bigger yeah if you look at the arc of the newsweek story then all the stars had that line alright so if we look at what the previous publishers have done with it it really prepared it essentially for us if you look at their transition into digital it allowed us to acquire it without too much overhead and also to build the team from the ground you know so I wouldn't do it differently either and I think everything kind of worked out and we're very thankful for them okay great thank you very much Jonathan religiously okay