Subway growth benefits newspaper

As the subway system in Guangzhou expands prior to the start of the 2010 Asian Games, so have the earnings of a free metro newspaper in the southern city.

Citing fatter advertising revenues since its launch three years ago, Guangzhou Metro Daily posted around 30 percent growth in ad revenues in the first half of this year and expects even better growth in the second half, editor-in-chief Jiao Xiangyang said.

The newspaper reported a more than 90 percent increase in earnings from advertisements last year, despite the economic downturn and a drastic drop in ads following the massive Wenchuan earthquake.

The newspaper generated more than 10 million yuan in advertising revenues in 2007.

The tabloid newspaper, published by Guangzhou Daily Press Group and Guangzhou Metro Corp, offers 16 color pages with news, consumer information and supplements.

Published five days a week, it has a circulation of more than 200,000.

The weekday paper is distributed at all the city's metro stations, top office buildings, high-end restaurants and hotels, and also at some shuttle bus stations used by high-end property owners.

With a registered capital of 30 million yuan, the giveaway paper nearly broke even last year and "should be able to make some profit this year", editor Jiao said.

The first free daily commuter newspaper in the world was introduced in Sweden in 1995.

The metro paper in China first appeared in Shanghai in 2004. Beijing and Nanjing also have commuter newspapers.

As Guangzhou prepares for the Asian Games in November 2010, Jiao said he has a stronger reason to be confident about his newspaper.

Guangzhou's metro network, measuring 116 km with four lines, carries more than 1 million passengers a day, according to Guangzhou Metro Corp.

The network transported an average 2.38 million passengers each day during this year's three-day May Day holidays.

By the end of this year, the system will boast five lines with 91 stations stretching 150 km.

Next year, the metro system will have eight lines and more than 140 stations stretching more than 200 km.

Daily passenger throughput next year is expected to hit 3.5 million.

As the metro network grows to accommodate longer trips, commuters will have more time to spend reading metro newspapers, said Fan Yijin, dean of the College of Journalism and Communications at Guangzhou-based Jinan University.

Relatively high ticket prices for riding the Guangzhou metro system, compared with those in some other cities, translates into stronger purchasing power among its passengers - an attribute favored by advertisers.

A full trip along Line 1 of Guangzhou metro costs 5 yuan. Along Line 4, it's 9 yuan.

Jiao especially likes the future demographics of Line 5, now under construction, which will link a number of the city's shopping areas.

Shopping advertisements make up about 28 percent of the newspaper's advertising income, he said.

As the rails reach to less developed areas of the city and on to the neighboring city of Foshan, Jiao said real estate advertisements surely will follow.

"The expanding metro system has been redirecting the flow of wealth," Jiao said.

The Asian Games will also boost advertising revenues, he said.

An increasingly mobile population and longer commuter trips make this an opportune time to operate free newspapers, said Hou Yingzhong, a professor at the College of Journalism and Communications at Guangdong University of Foreign Studies in Guangzhou.



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