WESTCHESTER COUNTY, N.Y. (TheStreet) -- The New York Times Company ( NYT) reported terrible earnings this week, but at least one media outlet saw boundless hope in the company's new digital subscription policy. That would be The New York Times.

Unfortunately, the paper traffics in two pretty basic misperceptions about the company. With apologies to the Times' wishful thinking about itself, the digital subscription policy appears to be a zero-sum game, leaving the company no better, no worse.

The Times gets right to building a case for the Times in the lead: "The New York Times Company," they write, "continued to attract paying subscribers to its flagship Web site in the third quarter, bolstering a new revenue stream that has helped offset a decline in advertising revenue."

One problem here is scale. The advertising revenue stream is so big -- and the pay subscription base so small -- that claiming (much less as your prime notion) that one is offsetting the other is comical, at best.

Moreover, digital advertising for newspapers was up in the middle single digits. This news is beyond awful. In order for the Times to remain viable, digital advertising has to increase a great multiple of that. But the Times swallows management's brush-off that weakness was merely a function of the economy: "The company said it did not see any reason to be concerned about the overall strength of its digital advertising business in those numbers, calling it a lull that it hoped to reverse once the economy picked up."

Really? Shouldn't that at least be questioned? After all, the knock on the concept of charging for digital is just that: For every nickel you make from subscriptions, you'll lose on advertising. At least initially, that seems to be just what is happening -- and the Times does not even touch upon the prospect.
At the time of publication, Fuchs had no positions in any of the stocks mentioned in this column.

Marek Fuchs was a stockbroker for Shearson Lehman Brothers and a money manager before becoming a journalist who wrote The New York Times' "County Lines" column for six years. He also did back-up beat coverage of The New York Knicks for the paper's Sports section for two seasons and covered other professional and collegiate sports. He has contributed frequently to many of the Times' other sections, including National, Metro, Escapes, Style, Real Estate, Arts & Leisure, Travel, Money & Business, Circuits and the Op-Ed Page.

For his "Business Press Maven" column on how business and finance are covered by the media, Fuchs was named best business journalist critic in the nation by the Talking Biz website at The University of North Carolina School of Journalism and Mass Communication. Fuchs is a frequent speaker on the business media, in venues ranging from National Public Radio to the annual conference of the Society of American Business Editors and Writers.

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