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> However, the operating profit excludes cash payments of between £25-30m for capital costs and other business expenditures, which are an annual draw-down from

by asaph 7y ago

> However, the operating profit excludes cash payments of between £25-30m for capital costs and other business expenditures, which are an annual draw-down from the Scott Trust, of which The Guardian is part. If these annual costs were included, The Guardian would still be loss-making At first, I misinterpreted this to mean they're counting money granted by a wealthy donor as profit. And without that, they would still be losing money. But, as clarified in the comments below, the Guardian is actually paying the Scott Trust. Also the Scott Trust owns The Guardian. Forgive my confusion. This isn't a straightforward relationship. > Nevertheless, the operating profit marks the completion of a three-year plan that few observers thought likely to succeed, and which leant heavily on a - for British media at least - eccentric business decision to ask readers to contribute financially for something they could get for free. So the business model is asking users for a donation? This sounds more like a non-profit to me. I guess this is better than bleeding millions/year but we can hardly call this a good business.

Veen 7y ago
So they're counting money granted by a wealthy donor as profit. And without that, they would still be losing money. The Scott Trust isn't a wealthy donor. It's the trust that owns the Guardian and The Observer.
- asaph 7y ago
  Thanks for pointing that out. I clarified that in my edit above.
SolaceQuantum 7y ago
> So they're counting money granted by a wealthy donor as profit. And without that, they would still be losing money. I actually read that as "we are part of a trust that gives 25-30m, and if we didn't need to give these payments we'd be making a profit". Or simply put: No, they are not counting recieving money, they're actually excluding giving money.
- deleted 7y ago
  [deleted]
- asaph 7y ago
  Thank you for this correction. I amended my original comment.
  - SolaceQuantum 7y ago
    Good on you for being willing to say you made an error publicly. (This isn't meant to mean anything sarcastic, I believe that the humility and cognizance to be able to do something as simply as to say 'whoops my bad let me fix that' publicly is increasingly rare and wish to praise it whenever it happens as a brave and ethical behavior.)
- ddeck 7y ago
  I think they are actually receiving the funds. It is worded quite ambiguously, but I think what it actually means is that they receive GBP25-30 million a year from the Scott Trust, which they use for expenses and capital costs. The article on the same topic in the Guardian itself a couple of day ago states: "Guardian News & Media is owned by the wider Guardian Media Group, which in turn is controlled by the not-for-profit Scott Trust, named after the newspaper’s former proprietors. The Scott Trust endowment, built up through the sale of former assets such as AutoTrader, produces an annual return of between £25m and £30m without depleting the main investment, which it allows to be spent by Guardian Media Group to subsidise ongoing operations." https://www.theguardian.com/media/2019/may/01/guardian-breaks-even-helped-by-success-of-supporter-strategy https://www.theguardian.com/media/2019/may/01/guardian-break...
  - arcticfox 7y ago
    Putting the money in an endowment is shockingly foresighted. I almost feel like good journalism needs that type of support going forward, and it seems the Guardian gave it to themselves. (The alternative would be inviting in people like Bezos, but that has the potential of strings attached.)
jimnotgym 7y ago
Accounting 101, capital items do not count towards profit. > So the business model is asking users for a donation? This sounds more like a non-profit to me. It is a non-profit! https://en.m.wikipedia.org/wiki/Scott_Trust_Limited https://en.m.wikipedia.org/wiki/Scott_Trust_Limited
- mbesto 7y ago
  > Accounting 101, capital items do not count towards profit. Technically yes and no. The initial capital amount does not, but its amount gets depreciated/amortized over time.
  - jgamman 7y ago
    oh for a one armed accountant...
  - jimnotgym 7y ago
    Since you want to be technical, we should say that the changes to the value of capital items get charged to the income statement (profit & loss). Capital items only get depreciated if they are wasting, and could indeed be revalued upwards. It is quite common for real property, for instance) to not get depreciated and be held at historical cost, or indeed to be revalued annually.
- k1m 7y ago
  It's not. Good article from former Guardian journalist Jonathan Cook: HSBC and the sham of Guardian's Scott Trust https://www.jonathan-cook.net/blog/2015-03-03/hsbc-and-the-sham-of-guardians-scott-trust/ https://www.jonathan-cook.net/blog/2015-03-03/hsbc-and-the-s... The following is quoted in the piece: > The Guardian is not owned by a trust at all. In 2008, “the trust was replaced with a limited company” that was accordingly re-named “The Scott Trust Limited.” Though not a trust at all, but simply a profit-making company, it is still referred to frequently as ‘The Scott Trust,’ promulgating the widely-held but mistaken belief in the Guardian’s inherently benign ownership structure. … The problem, of course, is that the Guardian functions under the same sort of corporate structure as any other major media company.
george_morgan 7y ago
> So the business model is asking users for a donation? This sounds more like a non-profit to me. I think the idea is to get enough donations that they're no longer a non-profit.
- mprev 7y ago
  The Scott Trust, The Guardian’s owner, will remain a non-profit.
  - k1m 7y ago
    The Scott Trust is not a non-profit. See https://expressiveegg.org/2017/02/07/guardian-bothering/ https://expressiveegg.org/2017/02/07/guardian-bothering/ and https://www.jonathan-cook.net/blog/2015-03-03/hsbc-and-the-sham-of-guardians-scott-trust/ https://www.jonathan-cook.net/blog/2015-03-03/hsbc-and-the-s...
    - buttcoinslol 7y ago
      Also see theguardian.com: https://www.theguardian.com/the-scott-trust/2015/jul/26/a-history-of-the-scott-trust https://www.theguardian.com/the-scott-trust/2015/jul/26/a-hi...
baud147258 7y ago
> So the business model is asking users for a donation ? Well, in some articles the donation box is bigger than the article itself, so it's apparently an important part of their business model
- shaki-dora 7y ago
  To be fair, it’s also below the article, and neither a pop up nor interstitial. At that place in the page, it’s rather unimportant how big it is. It is far less annoying than, say, Wikipedia or even NPR. Everyone should be happy about these results, as it is vastly superior to both paywalls and the ad-infestation other free sites have seen. (I would also guess it’s rare for the box to actually take up more vertical space than the article. Maybe in breaking-news scenarios, where they start with a single-sentence item, then update it)
  - baud147258 7y ago
    I agree that it's way less annoying that the wikipedia pop-up during the annual period where they ask for donations. (I can't tell for NPR since I go to their European version)
cptskippy 7y ago
> So the business model is asking users for a donation? With people's ever growing concerns about malware, ransomware, privacy invasions and the invasive nature of ads, people are turning to Ad-Blockers so this makes sense. I started using an Ad-Blocker a long time ago and I've always struggled with it because I know it's robbing sites of revenue, and at the same time I felt violated by all the ads I saw whenever I turned it off. Back in 2017 when the Guardian started showing those big yellow banners at the bottom of articles, I started contributing. If I'm on a site more than a few times a year and they have an option to contribute, I try to. I really think there's some space for innovation here. I like contributing to journalism and I don't want to setup annual subscriptions for 20 different sites, but I can't easily keep track of which sites I frequent or when I last contributed.
- Freak_NL 7y ago
  There is Blendle, but I hate paying per article — it places a restrictive barrier on freely browsing articles. Blendle also misses a lot of quality newspapers (like the Dutch NRC).
  - eitland 7y ago
    I love the original idea of Blendle, low price articles, no payment if you leave within a few seconds. Haven't used it recently since they hadn't too many of the articles I wanted && I have a sneaking suspicion that refunds aren't as easy anymore.
    - Doubl 7y ago
      I tried it and didn't like the model. Paying per article is just crazy, it makes you feel like you have to watch what you're spending all the time. I'd rather a fixed amount that leads me read as much or as little as I choose
      - eitland 7y ago
        Is it somehow worse than browsing a bookshelf in a bookstore or the magazines in a kiosk?
ForHackernews 7y ago
> I guess this is better than bleeding millions/year but we can hardly call this a good business. Maybe real journalism just isn't profitable in a capitalist economy. This model works for organisations like NPR and Propublica.
- diet_mtn_dew 7y ago
  Newspapers and magazines were profitable for centuries. Like many other industries, they've struggled to adapt to the new norms the Internet brought about.
  - pmyteh 7y ago
    Many newspapers, but by no means all. British national newspapers have, as a class, lost money for decades - plenty of people have been willing to subsidise the losses in return for the influence of owning one - so the economics were bad (and now getting worse). Owning a monopoly city newspaper in the US, with a captive advertising market, was a lovely business until recently though.
- sievebrain 7y ago
  Many of their competitors have been profitable for a while now. There's no incompatibility between capitalism and "real journalism", the problem with the guardian is in fact their complete disinterest in capitalism - hence being a literal trust fund baby.
jen729w 7y ago
Alan Rusbridger’s excellent ‘Breaking News’ details the history of the Guardian, including the decisions that led to their current funding model. It’s fascinating, well written, and thoroughly recommended. https://us.macmillan.com/breakingnews/alanrusbridger/9780374279622 https://us.macmillan.com/breakingnews/alanrusbridger/9780374... (Rusbridger was the Guardian’s editor for 20 years, before Viner.)
headmelted 7y ago
The business model, sadly, is to be the Daily Mail of the left. The number of news reports relative to op-eds continues to shrink, and the op-eds themselves have swung much harder to the left than before. It's clearly working for them financially, but it's a different beast now altogether.
- mhh__ 7y ago
  > The business model, sadly, is to be the Daily Mail of the left. Bullshit. The Guardian is orders of magnitude a better newspaper than the Daily Mail. What major stories have the Daily Mail broken in the last 10 years? The Daily Mail is not considered a reliable source on wikipedia, Comparing the Guardian to that is quite the insult
  - headmelted 7y ago
    What major stories have the Guardian broken in the last two? Obtain an issue from even five or six years ago when they were breaking the Citizenfour story and one from this past week. Is it comparable to the Daily Mail? No. Is it moving in that direction? Demonstrably so. Read an Owen Jones column or two and tell me it's still a bastion of reasoned perspective. The Daily Mail is a rag. That the Guardian is trying to become one to get back in the black is tragic.
    - mhh__ 7y ago
      The Guardian did the Snowden papers, The phone hacking scandal and were also involved with the Panama papers as well for starters.
      - headmelted 7y ago
        We'll respectfully disagree I guess. The Panama papers was four years ago and (like Citizenfour/Snowden before it) leaked to the Guardian based on their historical reputation rather than anything recent. I don't like saying anything against them as I really think they're the last decent paper left in this part of the world. It just seems like whoever is in charge these days has thought "if you can't beat em, join em".

by asaph 7y ago

Veen 7y ago

So they're counting money granted by a wealthy donor as profit. And without that, they would still be losing money. The Scott Trust isn't a wealthy donor. It's the trust that owns the Guardian and The Observer.

asaph 7y ago
Thanks for pointing that out. I clarified that in my edit above.

SolaceQuantum 7y ago

> So they're counting money granted by a wealthy donor as profit. And without that, they would still be losing money. I actually read that as "we are part of a trust that gives 25-30m, and if we didn't need to give these payments we'd be making a profit". Or simply put: No, they are not counting recieving money, they're actually excluding giving money.

deleted 7y ago
[deleted]
asaph 7y ago
Thank you for this correction. I amended my original comment.
- SolaceQuantum 7y ago
  Good on you for being willing to say you made an error publicly. (This isn't meant to mean anything sarcastic, I believe that the humility and cognizance to be able to do something as simply as to say 'whoops my bad let me fix that' publicly is increasingly rare and wish to praise it whenever it happens as a brave and ethical behavior.)
ddeck 7y ago
I think they are actually receiving the funds. It is worded quite ambiguously, but I think what it actually means is that they receive GBP25-30 million a year from the Scott Trust, which they use for expenses and capital costs. The article on the same topic in the Guardian itself a couple of day ago states: "Guardian News & Media is owned by the wider Guardian Media Group, which in turn is controlled by the not-for-profit Scott Trust, named after the newspaper’s former proprietors. The Scott Trust endowment, built up through the sale of former assets such as AutoTrader, produces an annual return of between £25m and £30m without depleting the main investment, which it allows to be spent by Guardian Media Group to subsidise ongoing operations." https://www.theguardian.com/media/2019/may/01/guardian-breaks-even-helped-by-success-of-supporter-strategy https://www.theguardian.com/media/2019/may/01/guardian-break...
- arcticfox 7y ago
  Putting the money in an endowment is shockingly foresighted. I almost feel like good journalism needs that type of support going forward, and it seems the Guardian gave it to themselves. (The alternative would be inviting in people like Bezos, but that has the potential of strings attached.)

jimnotgym 7y ago

Accounting 101, capital items do not count towards profit. > So the business model is asking users for a donation? This sounds more like a non-profit to me. It is a non-profit! https://en.m.wikipedia.org/wiki/Scott_Trust_Limited https://en.m.wikipedia.org/wiki/Scott_Trust_Limited

mbesto 7y ago
> Accounting 101, capital items do not count towards profit. Technically yes and no. The initial capital amount does not, but its amount gets depreciated/amortized over time.
- jgamman 7y ago
  oh for a one armed accountant...
- jimnotgym 7y ago
  Since you want to be technical, we should say that the changes to the value of capital items get charged to the income statement (profit & loss). Capital items only get depreciated if they are wasting, and could indeed be revalued upwards. It is quite common for real property, for instance) to not get depreciated and be held at historical cost, or indeed to be revalued annually.
k1m 7y ago
It's not. Good article from former Guardian journalist Jonathan Cook: HSBC and the sham of Guardian's Scott Trust https://www.jonathan-cook.net/blog/2015-03-03/hsbc-and-the-sham-of-guardians-scott-trust/ https://www.jonathan-cook.net/blog/2015-03-03/hsbc-and-the-s... The following is quoted in the piece: > The Guardian is not owned by a trust at all. In 2008, “the trust was replaced with a limited company” that was accordingly re-named “The Scott Trust Limited.” Though not a trust at all, but simply a profit-making company, it is still referred to frequently as ‘The Scott Trust,’ promulgating the widely-held but mistaken belief in the Guardian’s inherently benign ownership structure. … The problem, of course, is that the Guardian functions under the same sort of corporate structure as any other major media company.

george_morgan 7y ago

> So the business model is asking users for a donation? This sounds more like a non-profit to me. I think the idea is to get enough donations that they're no longer a non-profit.

mprev 7y ago
The Scott Trust, The Guardian’s owner, will remain a non-profit.
- k1m 7y ago
  The Scott Trust is not a non-profit. See https://expressiveegg.org/2017/02/07/guardian-bothering/ https://expressiveegg.org/2017/02/07/guardian-bothering/ and https://www.jonathan-cook.net/blog/2015-03-03/hsbc-and-the-sham-of-guardians-scott-trust/ https://www.jonathan-cook.net/blog/2015-03-03/hsbc-and-the-s...
  - buttcoinslol 7y ago
    Also see theguardian.com: https://www.theguardian.com/the-scott-trust/2015/jul/26/a-history-of-the-scott-trust https://www.theguardian.com/the-scott-trust/2015/jul/26/a-hi...

baud147258 7y ago

> So the business model is asking users for a donation ? Well, in some articles the donation box is bigger than the article itself, so it's apparently an important part of their business model

shaki-dora 7y ago
To be fair, it’s also below the article, and neither a pop up nor interstitial. At that place in the page, it’s rather unimportant how big it is. It is far less annoying than, say, Wikipedia or even NPR. Everyone should be happy about these results, as it is vastly superior to both paywalls and the ad-infestation other free sites have seen. (I would also guess it’s rare for the box to actually take up more vertical space than the article. Maybe in breaking-news scenarios, where they start with a single-sentence item, then update it)
- baud147258 7y ago
  I agree that it's way less annoying that the wikipedia pop-up during the annual period where they ask for donations. (I can't tell for NPR since I go to their European version)

cptskippy 7y ago

> So the business model is asking users for a donation? With people's ever growing concerns about malware, ransomware, privacy invasions and the invasive nature of ads, people are turning to Ad-Blockers so this makes sense. I started using an Ad-Blocker a long time ago and I've always struggled with it because I know it's robbing sites of revenue, and at the same time I felt violated by all the ads I saw whenever I turned it off. Back in 2017 when the Guardian started showing those big yellow banners at the bottom of articles, I started contributing. If I'm on a site more than a few times a year and they have an option to contribute, I try to. I really think there's some space for innovation here. I like contributing to journalism and I don't want to setup annual subscriptions for 20 different sites, but I can't easily keep track of which sites I frequent or when I last contributed.

Freak_NL 7y ago
There is Blendle, but I hate paying per article — it places a restrictive barrier on freely browsing articles. Blendle also misses a lot of quality newspapers (like the Dutch NRC).
- eitland 7y ago
  I love the original idea of Blendle, low price articles, no payment if you leave within a few seconds. Haven't used it recently since they hadn't too many of the articles I wanted && I have a sneaking suspicion that refunds aren't as easy anymore.
  - Doubl 7y ago
    I tried it and didn't like the model. Paying per article is just crazy, it makes you feel like you have to watch what you're spending all the time. I'd rather a fixed amount that leads me read as much or as little as I choose
    - eitland 7y ago
      Is it somehow worse than browsing a bookshelf in a bookstore or the magazines in a kiosk?

ForHackernews 7y ago

> I guess this is better than bleeding millions/year but we can hardly call this a good business. Maybe real journalism just isn't profitable in a capitalist economy. This model works for organisations like NPR and Propublica.

diet_mtn_dew 7y ago
Newspapers and magazines were profitable for centuries. Like many other industries, they've struggled to adapt to the new norms the Internet brought about.
- pmyteh 7y ago
  Many newspapers, but by no means all. British national newspapers have, as a class, lost money for decades - plenty of people have been willing to subsidise the losses in return for the influence of owning one - so the economics were bad (and now getting worse). Owning a monopoly city newspaper in the US, with a captive advertising market, was a lovely business until recently though.
sievebrain 7y ago
Many of their competitors have been profitable for a while now. There's no incompatibility between capitalism and "real journalism", the problem with the guardian is in fact their complete disinterest in capitalism - hence being a literal trust fund baby.

jen729w 7y ago

Alan Rusbridger’s excellent ‘Breaking News’ details the history of the Guardian, including the decisions that led to their current funding model. It’s fascinating, well written, and thoroughly recommended. https://us.macmillan.com/breakingnews/alanrusbridger/9780374279622 https://us.macmillan.com/breakingnews/alanrusbridger/9780374... (Rusbridger was the Guardian’s editor for 20 years, before Viner.)

headmelted 7y ago

The business model, sadly, is to be the Daily Mail of the left. The number of news reports relative to op-eds continues to shrink, and the op-eds themselves have swung much harder to the left than before. It's clearly working for them financially, but it's a different beast now altogether.

mhh__ 7y ago
> The business model, sadly, is to be the Daily Mail of the left. Bullshit. The Guardian is orders of magnitude a better newspaper than the Daily Mail. What major stories have the Daily Mail broken in the last 10 years? The Daily Mail is not considered a reliable source on wikipedia, Comparing the Guardian to that is quite the insult
- headmelted 7y ago
  What major stories have the Guardian broken in the last two? Obtain an issue from even five or six years ago when they were breaking the Citizenfour story and one from this past week. Is it comparable to the Daily Mail? No. Is it moving in that direction? Demonstrably so. Read an Owen Jones column or two and tell me it's still a bastion of reasoned perspective. The Daily Mail is a rag. That the Guardian is trying to become one to get back in the black is tragic.
  - mhh__ 7y ago
    The Guardian did the Snowden papers, The phone hacking scandal and were also involved with the Panama papers as well for starters.
    - headmelted 7y ago
      We'll respectfully disagree I guess. The Panama papers was four years ago and (like Citizenfour/Snowden before it) leaked to the Guardian based on their historical reputation rather than anything recent. I don't like saying anything against them as I really think they're the last decent paper left in this part of the world. It just seems like whoever is in charge these days has thought "if you can't beat em, join em".