Wed Oct 26 09:34:19 CAT 2016

Online news sites in difficulty

By Jim Jones | Jul 07, 2009 | COMMENTS [ 0 ]

INTERNET news service providers are struggling to make cash and find a sustainable business model.

While most users worldwide expect free services, some providers, such as the Wall Street Journal, charge for full access to their sites.

Others, such as Avusa which owns Sowetan, provide Internet content free.

This is being done primarily to support the cost of growing Internet platforms with revenues from more traditional news operations.

One site that relies almost exclusively on advertising revenues is Moneyweb.

Its shares rarely trade and it remains a family-run business.

The latest annual results underscore the difficulty of breaking out into anything approaching operational maturity.

In the year to the end of March, advertisers' aversion to spending money to buy space on a medium that provides uncertain benefits cut Moneyweb's advertising revenue by 14percent from R23,0million to R19,9million.

It further converted an operating profit of R2,4million into an operating loss of R199000.

Advertisers are further stretching payment terms to help their own cash flows.

Moneyweb ended its financial year with a cash pile of R8million, up R658000 on the year.


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