case study of New York Time`s

1. Saleh | STRM043 - Competitive Strategy and Innovation | January 12, 2016
New York Times
CASE ANALYSIS

2. PAGE 1
Table of Contents
Company general information.....................................................................................................................2
NYT`s Core of Competences and Capabilities ...........................................................................................3
Resource based view of the firm: ...........................................................................................................3
Valuable capabilities:.............................................................................................................................5
Rare Capabilities: ...................................................................................................................................5
The External Environment .......................................................................................................................... 6
SWOT Analysis..............................................................................................................................................7
Strengths: ...................................................................................................................................................7
Weakness: ..................................................................................................................................................7
Opportunities: .......................................................................................................................................... 8
Threats:...................................................................................................................................................... 8
Porter’s Five Forces’ Model:......................................................................................................................... 9
Bargaining Power of Suppliers .............................................................................................................. 9
Bargaining Power of Customers.......................................................................................................10
Intensity of Existing Rivalry ...............................................................................................................10
Threat of Substitutes ..........................................................................................................................10
Threat of new competitors..................................................................................................................11
Financial Perspective ......................................................................................................................... 12
Process Perspective........................................................................................................................... 13
Customer Perspective........................................................................................................................ 13
Learning and Growth Perspective.................................................................................................... 13
References .................................................................................................................................................... 15
Appendix ...................................................................................................................................................... 17

3. PAGE 2
Company general information
Started In early 1835 as New York Herald and was founded by James Gordon
Bennett, passing the time 18th of September 1851 Henry Jarvis Raymond and
George Jones announced that they published the first issue of the official New
York Time`s, describing that it’s going to be issued every day except Sunday.
Furthermore, up to date the over 150 years old newspaper (NYT`s) which has
58,000 issues and billions of words drawn grow in a very challenging stages and
survived many conflicts and crises across the USA and the world (NYT, 2016).
The 1996 year gives NYT the first online web and give a worldwide access to it
daily newspaper, and on 2008 the first IPhone mobile application of NYT`s was
launched (NYT`s, 2016).
This report will be analyzing the New York Time`s strategy during the crisis
period and the success of the organization in later stages.
Table: 1 important events
a major players
and leaders in
print media and
top performer in
internationally
news
Launch the
NYtimes.com
The
Sulzberger
family toke
over the
company
launched in
NYC by a
Henry Jarvis
& George
Jones
1851 201219951967

4. PAGE 3
NYT`s Core of Competences and Capabilities
Since it take many different forms in the last 10 years, NYT`s strength and
accountabilities been always at its own core of competencies and capabilities of
using it to drive it short and long term strategy to survive the uncertain era of
diversity in generations.
In 2009 Sulzberger recognized and summarized the core of competences of
NYT`s by the quality journalism who attracts the quality audiences and that
results impact of attracting the quality advertisers. Hence, we should as well
mention the history and existence of NYT`s for decades, this gives NYT`s market
integrity as one more core of competences. Furthermore, having a loyal
customers is one of the results of having such a strong and quality of journalism
and market (Robert M, 2012).
“Core competence is the collective learning in the organization, especially the
capacity to coordinate diverse production skills and integrate streams of
technologies. It is also a commitment to working across organizational
boundaries. Organizing around core competencies requires a radical change in
corporate organization” (Prahalad & Hamel, 1990, p. 79).
Resource based view of the firm:
By concentrating on the firm as the important unit of analysis. Leaders are
worried of creating a numbers of tangible and intangible resources and
Capabilities, whose financial returns are proper by the firm. The essential thought
that underlies this point of view, the Resource-Based View Of The Firm, it is a set
of arrangement of main and specific resources and Capabilities which are rare,
strong, cannot be changed, and hard to imitate, might empower the firm to
procure financial rents. Along these lines, by resources point of view, the
estimation of a firm value Strategic Assets expands past their commitment to the
production process (Raphael & Schoemaker, 1993).
RBV (Resources-Based View), It was initiated by Jay B. Barney in 1991, it was
strong enough to provide the important tools to identify resources and capabilities
of an organization and show the important of it. However, this helped as well to
explain further identifying Capabilities and resources as group of touchable and
untouchable assets which include the organization management’s capabilities,
processes and routines. Furthermore that assist to identify the ideas and
knowledge which can be used to implement and select the strategy (Barney, Jr,
& Wright, 2011).

5. PAGE 4
 NYT`s main Resources:
1. Quality Journalism.
2. Major Player and publisher in the media market, news reporting
and has the brand Integrity which give it a large credibility.
3. Digital initiative can give quality contents to the site.
 NYT`s Capability:
1. Large reach for NYT`s globally.
2. Multiple platforms reach for it audience.
3. The NYT`s easily accessed for it news by many different devices
such as, laptops, mobiles, IPad etc...
 The NYT`s Competitive Advantage:
1. Capable to innovate.
2. Times Co. formed a R&D Ventures group in 2012.
3. R&D is a valuable division of NYT`s to enhance it audience
experience and satisfaction.
 Attractive industry:
1. The focus on the trend changes of generations from papers to
digital by developing their technology and offers an options for it
clients (readers and advertisers).
2. NYT`s uses maximum capacity of their technology to offer different
and unique products comparing to the competitions.
 Formulation the strategy and implementation:
1. NYT`s digital initiative to increase it audiences globally and
maximize it base and market share.
2. NYT`s journalist are the major strength of the organization.
3. Invested in the initiative of digital concept and support the strategy
and efforts.
 Superior Return:
1. The NYT`s IPhone application generated over one million users
from the day it launched in July 2008 (Time`s, 2008).
2. On a monthly basis an average of 70 million page visit come from
only mobile application of NYT`s from all around the world (Time`s,
2008).

6. PAGE 5
Reports this days not showing strong capabilities for NYT`s digital, as mention on
their report “The New York Times is winning at journalism. Of all the challenges
facing a media company in the digital age, producing great journalism is the
hardest” (Davies, 2014, p. 27). However, In 2008 the Time Inc.`s digital
generated a total of $245 m, which made a 10% of the whole advertising revenue
for the company, as well it was way far higher than any competitors in the market
(Johnson & Ives, 2009).
“Digital initiatives, a key strategic focus, significantly contributed to our revenue
mix and provided meaningful diversification. Total digital revenues increased
approximately 15% to $387 million in 2010, accounting for more than 16% of
overall revenue for the Company. In 2010, we also made a significant investment
in our pay strategy for NYTimes.com through an approach designed to preserve
the site’s significant audience reach and advertising inventory” (Company, 2011,
p. 45).
Valuable capabilities:
NYT`s has the right valuable resources to strength it entry to the digital world and
give competitive advantage to the organization as well finding new opportunity to
expand the company.
Rare Capabilities:
The NYT`s resources required to
Summarizing NYT`s Core competences as following and supported with a SWOT
analysis in Table3:
1- Major player and publisher in the media market and news reporting.
2- One of the biggest Brand name globally.
3- Very high quality journalism.
4- Quality audiences.
5- Quality advertisers.
6- The digital generation and online publication.

7. PAGE 6
The External Environment
Looking at a new era of the industry, NYT`s external environment are
summarized in below:
audience are influenced to get their news from many sources available such as
digital, social media and many tools available to surf the internet such as tablets,
laptops and smartphones, that’s leads to very large reduction of buying a printed
newspapers and audience searching for reliable sources of news in general.
New York Times Strategic option
Janet Robinson, president and CEO of NYT`s and Arnold Sulzberger`s Jr.
(NYT`s Board Chairman) in 2009 was clearly addressing the company issues
and how their strategy can reflect on this issues by how its taking down the
company financially, their earlier strategy of digital and advertising focus seems
to be not going through the right bath due to the advertising decline and
technological fragmentation in the media business. However, NYT`s when they
started their earlier digital strategy in 1996 they had different expectations and
future overview.
NYTimes.com explored different streams and strategies of driving in revenues, In
the beginning of their web initiative (1996) there was a charges implemented for
the international audiences, however and one year later they changed this
approached and opened up the website internationally.
In the next 10 years after the fact, the company started their (Times Select
experiment), this was a side of their audience online access with some fees to
provide the audience access to Op-Ed as well exclusively access to news
reporters at the NYTimes.com, simple and easy to use, offering wide range of the
Times' online documents, and additionally other website components.
Two years later, the fast grow and development on websites and online business
reach a level requiring change in the strategy and focus. In that time, Times
Select had around 200K memberships with above $10m, however, company
chose to stop this activity due to the understanding of the expanding and impact
of the world search inquiry implied that the advertisement incomes move faster
because of the expanded movement – made by offering this information and
access for free – would become quicker than the membership as well benefiting
the income.
Arnold Sulzberger’s Jr says: “Our strategy must be rooted in the fundamental
premise that we must be OF the Internet, not merely ON it, requiring all of us to
move from publishing our content on the Web to becoming full Web publishers”
(Kafka, 2009, p. 1.).

8. PAGE 7
Summarizing above lead us to some strategic issues New York Times are facing
as showing in Table 4.
Table 4: NYT`s strategic issues
SWOT Analysis
The SWOT analysis can show us the strengths, weakness, opportunities and
threat of such a large expanded organization.
STRENGTHS: The real quality of the New York Times is its image name, which is
exceptionally prominent around the general population for its fair news reporting
and extraordinary distributed. The NYT`s likewise has a large market share in the
business because of its supply chain management and its image name. The
NYT`s as well has generated a few times the best journalist ability furthermore
has the quality of its representative's, team and the client responds. Additionally
has the quality of venturing into the innovation and entered to the online news
stage.
WEAKNESS: the significant weakness of the NYT`s is the structure of it cost and it
low income from the online NYT`s. additionally has the weakness of the work
inefficiencies and a lot of obligation weight on the organization. The NYT`s as
well has the weakness as the daily paper business which is slacking back
because of the expansion in the utilization of innovation by individuals and the
advancement of the assets which is making the daily paper an old technique for
perusing. Digital generation of NYT`s confronts rivalry from a few competitors of
online news.
Digital space
- Fast grow with high market
competition
- Profitability’s issue of Digital
market
- Online profit need improvement
- The transaction from printing to
digital (new generation believes in
online materials
Strategic Issues
Maintaining Market Position
- Full depending on the history
of the company and name
- Many competitors in the
market with better positioning:
 The Washington Post
 News Corporation
 EX. Gannett Co

9. PAGE 8
OPPORTUNITIES: There are a few opportunities for NYT`s, has the chance to
dispatch itself by teaming up with Apple (IPAD). As well has the chance of
venturing into the online commercial and begin it offers and online services for
advertising, this will expand its incomes. NYT`s got the best opportunity for a
worldwide development and expanding with many international techno sources.
THREATS: NYT`s most threat is with online news innovation, Furthermore, it
involve with political dangers. NYT`s additionally threats the danger of instability
of the incomes. However, threats from substitute channels. With the expansion in
the paper and the expense of conveying the paper, NYT`s as well have the threat
of increment in the costs which will influence the matter of the organization in the
long term.
Table 3: NYT`s SWOT analysis
STRENGTHS WEAKNESSES
1- Brand popularity
2- Quality journalism (world most
powerful journalistic voice)
3- Loyal employees and customers
4- Online platform and digital techno
1- Highly company cost structure
2- Digital NYT`s has showed Low
revenue
3- Newspaper business is falling and
become old fashion due to techno
and digital generation
4- shortcoming of the work
inefficiencies and a lot of obligation
weight on the organization
5- Many competitors on digital
generation
6- Coverage reach
OPPORTUNITIES THREATS
1- Launching the NYT`s through
new Techno such as IPAD
2- Online market place to increase
company income
3- Expand internationally and
cooperate with different techno
sources
1- The online technology of news has
a fact of risky political issues
2- instability of the incomes
3- dangers from substitute channels
4- printing and delivering cost
increasing on long term

10. PAGE 9
Porter’s Five Forces’ Model:
Table 4: porter1s five forces
BARGAINING POWER OF SUPPLIERS
 Critical Production
Generating news are highly comparative and very much similar and can
easily be copied and match from other competitors, this impact very
positively NYT`s and give it news a high value.
 Critical volume to suppliers
high volume are giving the suppliers low bargaining as they depend on it
and in a times if this producer decrease this volume it will impact
immediately the profits and that gives a privilege to NYT.
 Materials Suppliers change (print to digital)
the industry change in running business reduced the number of suppliers
as companies diverted to digital and reduced the materials cost, when this
suppliers number reduce is impacting the business and positively benefit
NYT due to the publicity and brand name it has.
Intensity
of
Existing
Rivalry
Bargaining
Power of
Suppliers
Threat of
Substitutes
Bargaining
Power of
Customers
Threat of New
Competitors

11. PAGE 10
Bargaining Power of Customers
 Subscribers
The Bargaining power of subscription is competitive as clients has many
different platforms of generating news and it’s with lower cost.
 Advertisers
the power of advertising are similar in competitive way as advertisers have
many options with different range of cost, furthermore popularity of NYT it
give an advantage.
 Bargaining Leverage
NYT`s known to it client with it High-quality products and services which
considers essential for clients and emphatically influences NYT, as this
clients in the end are spending more to maintaining receiving such a
brilliant services. However, the high number of clients for both digital and
printing who are not tending to see no any bargaining to NYT.
Intensity of Existing Rivalry
 Innovation and Product Differentiation
The key of successful of NYT are it innovations and product which give a
huge advantage to NYT`s among the high rivalry in the market of digital
and printing.
 Industry Size
The expand in the industry size gives NYT`s advantage as it have a strong
understanding to it the market competition, and this can be adds as an
essential successful to NYT`s and its multiple platform globally and it gives
NYT`s extra value.
Threat of Substitutes
 Substitutes
for the NYT`s substitution threat can reach high level as there are wide
range of other available platforms such as Radio, TV`s, social media and
magazines.
 Quality and Differentiation
retaining clients for NYT`s are main key of successful after showing the
ability of providing high quality of standard with consistency to it clients
which impact NYT`s positively as it clients are not welling to change to

12. PAGE 11
competitors and satisfied of NYT`s services.
Threat of new competitors
 Capital Investment
For a new market entrant will need to set a high expenses budget in order
to compete with NYT`s and reach that globally present and brand name as
NYT`s, all this investment will considered from competitors as a high risk
which will always give NYT`s advantage.
 Online Media
with the digital generation and the wide range of platforms in media this
gives NYT`s a high level of competitors might enter the market due to the
low cost of investment in the online platforms.
 Strong Brand Name
the strongest advantage for NYT`s are their brand name which is very
must advance than any other competitors and has a solid base in the
market.
New York Times Balance Scorecard
“The balanced scorecard developed by Robert Kaplan and David Norton. The
balanced scorecard methodology provides an integrated framework for balancing
financial and strategic goals and cascading performance measures down the
organization to individual business units and departments” (Robert M, 2012, p.
47).
The performance measures included in the balanced scorecard derive from
answers to four questions:
How do we look to shareholders?
How do customers see us?
What must we excel at?
Can we continue to improve and create value?
Table 5 draw the balanced scorecard of New York Times and discuss further
their KPI and evaluate it strategy accordingly up to the year 2014.

13. PAGE 12
Table 5: NYT`s Balance Scored card
As we notice that the most income for NYT`s are from the digital clients, no
matter what is the devices or technology used such as laptops, IPad,
smartphones. However, NYT`s most income generated from the distribution and
advertising. Up to Sep 27th 2015, NYT`s Co income fall 1% to $1.13B.with a net
revenue before extraordinary items of $11.6M vs. loss of $574K.
The advertising revenue reduced with 4% to $433.9M. Net Income reflects
Selling, general and administrative cost decrease of 6% to $533.1M (expense),
Depreciation and amortization (b) decrease of 22% to $46M (expense), early
termination charge decrease from $2.6M (expense) to $0K (Source, 2016).
Financial Perspective
 The evaluating of NYT’s business as a KPI measurement can be by
evaluating their profit margin, current and profit ratio.
 In the year 2014 NYT`s has picked around 33,000 new digital subscription
which increase the total to 760,000 (Chittum, 2014).
 2015 NYT`s launched the NYT VR, The New York Times takes a step into
virtual reality for it new App (NYT, 2016).
 The NYT`s Launches The Upshot, Times Premier, Launched NYT Now for
iPhone, Launched T Brand Studio (NYT`s, 2016).
Financial:
- increase the digital advertising revenue
- reduce the operating cost
- target other investment
- corporation with innovative partners such as
Apple
- drive significant revenue from digital
imitative
Customer:
- product availability on different platform
- audience target
- data and news availability and accuracy
- availability of digital and printing materials
- social media
Business Process:
- Increase market power
- reach various segment
- merge with media platforms, such as
YouTube, google, apple
- reach maximum market share on internet
Learning & Growth:
- share knowledge
- journalism, employee turnover.
- acquisition internet companies and learn
from
- expanding globally an reach maximum
number of audience on other growing
countries
NYT`s
Strategy

14. PAGE 13
Process Perspective
 Process change empowers NYT to advance its hidden processes to reach
valuable returns which requires ideal utilization of it digital initiative to
enhance it services provided to the clients, and reach wider range of
segmentation in the market.
 The processes KPI can be evaluated by, quality, market power, news
delivery, cycling time and the employee cost.
Customer Perspective
 The increase in the circulation number and subscriptions are indicator of
the repetition growth and client’s satisfaction.
 Advertising revenue will automatically increase with the expanding of the
circulation and reach.
 Social media are the generation trend and will support the increase of
globally reach and different audience segmentations (age segment).
 Customer’s retention are one of the most important key measurement for
the NYT`s performance and growth, and it support to increase the market
share for NYT`s.
Learning and Growth Perspective
 Key sources for NYT`s learning and growth are it associates, and
journalist, this employees are the sources of financial income and
costumers loyalty, however system and processes of learning and
development required ongoing investment in its employees and the
improvement of it internal system.
 Turnover ratio in organizations are key to indicate the success of NYT`s,
the KPI measurement of learning and growth of NYT`s can be according
to its turnover.
Theoretically, NYT`s company need to look on the digital strategy as a long term
strategy and focus on digital income. Furthermore, the company announced the
great opportunity on monetizing mobile, the options added recently on mobile
such as (mobile moments) expanded the mobile adds and taking off extra video
units, giving the company expanded certainty that Q3's advertisement result was
irregular. Easy access and innovation verticals keep on doing well while retail
stays unstable. Is likewise the view ability initiative anticipated that would

15. PAGE 14
proceed to modestly effect on digital advertisement incomes in the close term,
NYT's developing presentation to computerized promoting, which expected to
generate ~30% of total advertisement incomes, latest updated expected to
become to 33% one year from now and above nearest competitors with 20%
(Morgan, 2015).
Following all above analysis of NYT`s it can be prescribed that the organization
must expand it digital strategy and interest it current loyal audience which will
offer the NYT`s to keep up its position in the business sector even with the
decline in the company market share from daily paper market and make a larger
use of its existence globally with the largest base of reporters and unique
journalism and having a vast faithful client base.
The NYT co. influences its abilities by method for teaming up with a few media
organizations and tries to enhance its financial related position, as the
organization can work together with digital giants as Google, You Tube and
apple.

16. PAGE 15
References
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18. PAGE 17
Appendix
Financial statement 2010-2014

19. PAGE 18

20. PAGE 19