Thursday, March 12, 2009

Newspaper futures

A lot of printer's ink has been spilt on the issue of the future of newspapers.  I buy three each day (The AFR, The Australian and (on a discount offer) The Age), My wife likes the Herald-Sun.  Our families' purchases are a ridiculous exception to the standard view that newspaper demands are collapsing.  This NYT article claims - in relation to the US:
For more than two centuries, newspapers have been the indispensable source of public information and a check on the abuses of government and other powerful interests. And they still reach a vast and growing audience. Daily print circulation has dropped from a peak of 62 million two decades ago to around 49 million, and online readership has risen faster, to almost 75 million Americans and 3.7 billion page views in January, according to Nielsen Online.
This is a remarkable decline in print and surge in online patronage.  What is happening? One of the difficulties is that a lot of advertising is going online.  Another is that 'entrepreneurial' newspaper bosses have laden newspapers with a stack of debt from their purchasing binges around 2005-07 when news media prices were at peak levels.  The Fairfax family has problems in this regard in Australia and Murdoch has massive debt everywhere.

On the consumer side attitudes are changing too.  I read the main articles in the NYT almost every night online. This has the effect of reducing my interest in the Australian media. It is also time-consuming - I have less time to read newspapers.  My newspaper arrives around 6-00am and if I am up earlier I go online to see what they are saying.  This represents my gradual shift away from the printed media - its a shift that I think is likely to be widespread.

And newspapers are expensive - the online reads are free - even if they are not provided you can get the title of the article you are ofter - this is normally available - you can Google that and dig up the article somewhere.  (The exception to this is the AFR - it is expensive and I must buy it to gain the very selective information I want from it).

I have no objection to a pure online service but I don't see how the economics will pan out. Charging is difficult since there is so much free competition.  The online providers deliver a lot of social value but I don't see how that will yield a buck for them.

Interesting futures here.....

1 comment:

jc said...

I have been thinking about this too.

There is a model there somewhere only thing is someone hasn't thought about it yet.

Why not charge a great deal more for the print version while migrating everything to the web.

In other words newspapers are essentially treating the tree version as the main plank of the strategy. Why not simply treat that as a nuisance necessity, charge more and migrate everything over.

When you say people won't pay for the online version... I'm not sure that's true. If you were asked to pay say 20 cents a day for the NY Times you probably would. They could make money without the distribution costs.

Here's the other thing. Have any of these people ever thought about how you would start a newspaper from scratch these days. If they did you wouldn't find none of them thinking that they should treat the tree version as the major part of the strategy.