You want to make a lot of money?
Yes, I hear you say.
Then come up with a solution to the crisis in the American newspaper industry. Work out how to make digital journalism pay.
But you better give yourself a lot of time.
Alex van Wel reports from New York.
(As published in The Christchurch Press, Saturday 13th March 2010.)
Yes, I hear you say.
Then come up with a solution to the crisis in the American newspaper industry. Work out how to make digital journalism pay.
But you better give yourself a lot of time.
Alex van Wel reports from New York.
(As published in The Christchurch Press, Saturday 13th March 2010.)
IN:
“Shift happens” they are mumbling in media boardrooms in the USA.
Eleven metropolitan dailies have closed down in the past two years alone, going by newspaperdeathwatch.com – a site chronicling their decline.
Others papers, including established names like the Boston Globe, the San Francisco Chronicle and the Chicago Sun-Times are believed to be under threat.
The twin troubles – recession and online – have devastated the industry.
Advertising revenue has evaporated in the downturn, and circulation has declined as web-users have proliferated, leaving executives searching desperately for a viable digital model.
With around 80 million broadband users across the US and mobile delivery becoming rampant, there’s been an inevitable surge in demand for online news.
The New York Times now boasts more than 20 million unique website hits a month. It offers an incredibly rich multi-media experience and has gained a far wider following than it ever had in print.
But - and it’s a big but - nobody knows how to effectively harness the traffic for commercial gain. Most US newspapers are still estimated to be getting at least 80 percent of their revenue from their print platforms.
In the digital world ‘monetisation’ has become everyone’s favourite word - even mine, and I still wear a Che Guevara T-shirt.
“Look, if I knew the answer, I wouldn’t be sitting here with you” one grey-haired and despondent senior manager admitted to me.
At the controls of a languishing South Carolina daily he’d given up the fight. “I’m here to defend print journalism. I’ll leave the future to others” he said, and asked not to be named.
In case he needed any reminder, a survey from the Pew Research Centre this month reported that more Americans were getting their daily news from the internet than from newspapers. Local and national television still remain their top source however, and there’s a happier message in that for newspapers here in New Zealand. Given we have no local TV, our local and regional papers may have an extended life.
That is certainly the view of visiting US academic and former newspaper editor Dr Kenton Bird, who is based at Waikato University for six months. “There is not the kind of local television in New Zealand that competes for advertising dollars as it does in mid-size US cities” he said “the base of advertising for, in particular retail, real estate and automotive seems quite strong. And in the states a portion of those advertisers would be siphoned off to other media, primarily local television.”
If he’s right, the question then is simply whether the newspapers survive in printed or digital form.
Leading New York media commentator Jay Rosen told me the latter is inevitable, and print organisations had no choice but to re-define themselves from the inside out.
“What they need to do is find low cost ways of experimenting with a lot of different paths, update their technological literacy, get some new people, change their culture, change their attitude towards risk, and change their philosophy towards investment, all at once” he said.
Watch full quote here
Right, so nothing too daunting then. Viewed from the New York Times pristine new coffee shop, high up in the man-made mountains of Manhattan, it all seemed logical.
But at the NYT too, reality is kicking in. During one quarter last year their print subscriptions almost matched their advertising revenue. It was simply another reminder of how the old model was being torn apart – advertisements used to make up the lion’s share of a newspaper’s income.
The truth is that subscription across the industry is now much more significant, and so getting online news consumers to pay for content is critical. Many media managers were quietly applauding Rupert Murdoch’s recent stance in all this. He’s famously threatened to erect pay-walls on all his newspaper websites.
For its part, the NYT has announced it will introduce a limited pay-wall in 2011, charging customers beyond a specified number of articles.
In this context, it’s easy to understand the excitement which accompanied the unveiling of Apple’s iPad in January – a device which could help lubricate the leap to subscription for digital content.
Watch a demonstration of the New York Times on the iPad
http://www.youtube.com/watch?v=6dbNj5XGC14
But few see it or any other electronic tablet as a lone saviour for print, no matter how portable or user-friendly they become. Most now accept that only a combination of revenue streams will ensure survival.
The prestigious Graduate School of Journalism at Columbia University in New York – home of the Pulitzer Prize – even commissioned a study into the changing times, called the Reconstruction of American Journalism.
It controversially promoted greater involvement of the non-profit sector, even government subsidies.
Nicholas Lemann, the School’s Dean, told me there was no doubt US media executives were no longer quite as bullish about online prospects.
“With a few exceptions, it is not paying for itself. And there is a growing doubt that the original model - which was free content and all income would come from display advertising - is working” he said “so, what I sense out there is more scepticism right now, today, about that leap of faith, than there was 3 or 4 years ago.”
Even the most forward-thinking newspapers are feeling subdued.
The tiny Shelby Star newspaper in North Carolina has revolutionised its internal culture over the past five years. Supported by its large owner, Freedom Communications, it has become digital first and has watched its internet traffic rocket. But Publisher Skip Foster said that in terms of digital revenue it was still groping in the dark, and needed to be more invasive when it came to advertising.
Skip Foster, Publisher, Shelby Star
“Shift happens” they are mumbling in media boardrooms in the USA.
Eleven metropolitan dailies have closed down in the past two years alone, going by newspaperdeathwatch.com – a site chronicling their decline.
Others papers, including established names like the Boston Globe, the San Francisco Chronicle and the Chicago Sun-Times are believed to be under threat.
The twin troubles – recession and online – have devastated the industry.
Advertising revenue has evaporated in the downturn, and circulation has declined as web-users have proliferated, leaving executives searching desperately for a viable digital model.
With around 80 million broadband users across the US and mobile delivery becoming rampant, there’s been an inevitable surge in demand for online news.
The New York Times now boasts more than 20 million unique website hits a month. It offers an incredibly rich multi-media experience and has gained a far wider following than it ever had in print.
But - and it’s a big but - nobody knows how to effectively harness the traffic for commercial gain. Most US newspapers are still estimated to be getting at least 80 percent of their revenue from their print platforms.
In the digital world ‘monetisation’ has become everyone’s favourite word - even mine, and I still wear a Che Guevara T-shirt.
“Look, if I knew the answer, I wouldn’t be sitting here with you” one grey-haired and despondent senior manager admitted to me.
At the controls of a languishing South Carolina daily he’d given up the fight. “I’m here to defend print journalism. I’ll leave the future to others” he said, and asked not to be named.
In case he needed any reminder, a survey from the Pew Research Centre this month reported that more Americans were getting their daily news from the internet than from newspapers. Local and national television still remain their top source however, and there’s a happier message in that for newspapers here in New Zealand. Given we have no local TV, our local and regional papers may have an extended life.
That is certainly the view of visiting US academic and former newspaper editor Dr Kenton Bird, who is based at Waikato University for six months. “There is not the kind of local television in New Zealand that competes for advertising dollars as it does in mid-size US cities” he said “the base of advertising for, in particular retail, real estate and automotive seems quite strong. And in the states a portion of those advertisers would be siphoned off to other media, primarily local television.”
If he’s right, the question then is simply whether the newspapers survive in printed or digital form.
Leading New York media commentator Jay Rosen told me the latter is inevitable, and print organisations had no choice but to re-define themselves from the inside out.
“What they need to do is find low cost ways of experimenting with a lot of different paths, update their technological literacy, get some new people, change their culture, change their attitude towards risk, and change their philosophy towards investment, all at once” he said.
Watch full quote here
Right, so nothing too daunting then. Viewed from the New York Times pristine new coffee shop, high up in the man-made mountains of Manhattan, it all seemed logical.
But at the NYT too, reality is kicking in. During one quarter last year their print subscriptions almost matched their advertising revenue. It was simply another reminder of how the old model was being torn apart – advertisements used to make up the lion’s share of a newspaper’s income.
The truth is that subscription across the industry is now much more significant, and so getting online news consumers to pay for content is critical. Many media managers were quietly applauding Rupert Murdoch’s recent stance in all this. He’s famously threatened to erect pay-walls on all his newspaper websites.
For its part, the NYT has announced it will introduce a limited pay-wall in 2011, charging customers beyond a specified number of articles.
In this context, it’s easy to understand the excitement which accompanied the unveiling of Apple’s iPad in January – a device which could help lubricate the leap to subscription for digital content.
Watch a demonstration of the New York Times on the iPad
http://www.youtube.com/watch?v=6dbNj5XGC14
But few see it or any other electronic tablet as a lone saviour for print, no matter how portable or user-friendly they become. Most now accept that only a combination of revenue streams will ensure survival.
The prestigious Graduate School of Journalism at Columbia University in New York – home of the Pulitzer Prize – even commissioned a study into the changing times, called the Reconstruction of American Journalism.
It controversially promoted greater involvement of the non-profit sector, even government subsidies.
Nicholas Lemann, the School’s Dean, told me there was no doubt US media executives were no longer quite as bullish about online prospects.
“With a few exceptions, it is not paying for itself. And there is a growing doubt that the original model - which was free content and all income would come from display advertising - is working” he said “so, what I sense out there is more scepticism right now, today, about that leap of faith, than there was 3 or 4 years ago.”
Even the most forward-thinking newspapers are feeling subdued.
The tiny Shelby Star newspaper in North Carolina has revolutionised its internal culture over the past five years. Supported by its large owner, Freedom Communications, it has become digital first and has watched its internet traffic rocket. But Publisher Skip Foster said that in terms of digital revenue it was still groping in the dark, and needed to be more invasive when it came to advertising.
Skip Foster, Publisher, Shelby Star
“That’s the nut we haven’t cracked” he said in a frustrated southern drawl “we’re given away the content for God’s sake, and now we’re scared about annoying people with pop-ups and all these different types of advertising. Screw that! If you are going to get it for free, then by God you need to sit through a 10 second commercial before you even get to go to the site!”The depressing US experience leaves New Zealand newspapers wondering how to map out a digital future. They’ve been feeling the twin troubles two, but not like in the US. Most difficult is justifying multi-media investment in the absence of an alternative business model. And, if better online content only accelerates the migration there, why go for it at all?
Perhaps because digital offers a new range of engaging story-telling tools. If there is one thing editors agree on in the US, it is how digital can enhance the news consumer experience. We’re talking about adding audio, video, and interactive elements to our words and still pictures.
And, while people currently in the 50s and 60s may never own a tablet, younger readers – the core customers of the future – will, and they are likely to demand that fuller and richer experience. The trick is keeping the print product strong while uplifting the online offering.
Oh, and of course you must not forget to work out how to pay for all the sparkling new digital toys. Editorial enterprise is one thing, but it is creativity in media boardrooms which is now most in demand.
END
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