Five predictions about US newspapers: Pt 3: There will still be print newspapers in 15 years

Written by John Duncan

Tuesday, 24 March 2009 12:34

Now I hear what you’re saying. Having spent the past couple of posts predicting doom and misery how is it possible to simultaneously suggest that print will survive and thrive in any form.

I think two factors come into play.

1. The print audience was never the problem.

We tend to forget that it has been ad revenue and not circulation that is killing newspapers. In fact for the past few years the readership of newspapers is guilty of not growing quickly enough rather than falling off a cliff.

In 2005 the circulation of morning daily newspapers was bigger than it was in 1995. In fact most of the decline in weekday and Sunday newspaper audience in that time is attributable to weekday evenings and Sunday papers. Though the decline appears to be now gathering some pace at the major metros like the Houston Chronicle and Philadelphia Inquirer these titles have a long way to go before they lose their mass audience, even if they lose most of their advertising revenue. That audience will grow as local and regional rivals fail. As the 85% of newspapers around them start to collapse some of that audience will consolidate in the survivors and the bodies of dead newspapers could provide a bridge to a new print era for the 15%. There won’t be enough advertisers to make it pay like it has in previous years but if readers pay more and the cost of doing business declines (see below) they could be profitable for several years.

It goes without saying that these titles will have to charge more and rethink their audience strategy and they will need to manage the decline of print and the growth of the web, but the decline of print could be quite slow and gentle if the audience moves as slowly away from morning newspapers as they have done in the past 10 years.

The best hope could be that as the tide rises above smaller titles in print and online, the cost of doing business for the survivors could dramatically decrease.

1. Dead newspapers means a rapid decline in newsprint demand that a couple of mill closures won’t quickly reverse. That’s a huge potential saving every day, increased by a better-late-than-never switch of resources by daily papers to weekend publishing and skeleton papers during the week.
2. The cost of purchasing press time outside traditional areas will decline as large quantities of iron go on the market priced as scrap. Good presses could be picked up very cheaply by the regional superpapers and US national newspapers that will dominate the new landscape. So while the Houston Chronicle becomes the national newspaper of Texas, the LA Times, Chicago Tribune, New York Times and Washington Post will fight a national battle off the same regional presses and distribution networks. They will differentiate on tone and politics.
3. The cost of journalism will decline as large numbers of well-trained out-of-work journalists come onto the job market. As the new online models for news are invented and destroyed there are going to be a large number of talented people looking for any kind of work in the profession. They won’t all be successful but those who are will probably have to work for a lot less than would have done five years ago.

2. Small is beautiful in print.

I was careful in previous posts to be clear that the 85% of newspapers I believe will die by 2011 refers to the top 100 newspapers in the US. But I believe that print will remain an economically viable delivery format for local news for some time. I think there are two reasons for this.

Firstly, small local advertisers will be very slow to move. If you have ever worked with the sales team of a small local paper you’ll quickly realize that the mom-and-pop stores who use the newspaper to publicize their businesses are not yet aware of the opportunities of AdSense, AdWords or SEO. Many don’t even have efficient websites. Web evangelists often imagine that the whole world is tweeting from the cutting edge of advertising sales but at this level of the economy my experience is that they aren’t. But these small and medium-sized businesses, who don’t have ad agencies and are run by people in their 50s and older, are the lifeblood of smaller local papers. They use their local metro now because of the prestige associated with it rather than any unshakeable belief in its advertising potential and when that metro dies they will look first to other print alternatives. In charting the decline of print the conservatism of most small and medium-sized local advertisers is a huge factor.

Secondly, these newspapers are already producing journalism at the scale that makes sense as audiences go online. For a start they will have a defensible turf - local news . I can get my pro sports news from ESPN, I can get major business news from the Wall Street Journal, I can get international news from the BBC. But no one will be covering Sarasota like the Sarasota Observer when the Sarasota Herald Tribune goes bust. Even better, most of these newspapers have a cost structure and a content niche that is built for the long haul and which will benefit financially from the death of metro papers. They can also become better newspapers editorially as their staff attrition becomes less severe in the absence of a metro rival.

3. Nothing sparks innovation like the threat of death.

Okay this is wishful thinking, but if newspapers aren’t prepared to experiment and try previously unthinkable audience strategies over the next 18 months then they never will. The creative destruction of the business and the hunt for new print models will actually get more intense as owners are reduced to truly desperate measures. Ideas that currently don’t get implemented through fear will get implemented somewhere and some of them will work. The maths around newspapers’ demise still stands but we will find out a lot about what the future of print could be as newspapers go down fighting in the next two years.

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Great stuff!

taxedToDeath (97.102.25.xxx) 2009-03-25 07:17:53

I'm with you on item 3 completely! Old business models lead to complacency and
stifles innovation.
I agree Print News will still be around in 15 years but
maybe not in the format we see today. It will need to change to become more
responsive and timely. Why read a paper with yesterday's news when I can read
news that was posted a minute ago online on my iphone? Newspapers will need to
come up with a compelling answer to that question if they're to survive.

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