An irrefutable fact of commerce is that industries must evolve with the times or be left behind. As technology digitalises revenue generation, some sectors are impacted more negatively than others. Unsurprisingly these are the sectors which depend upon nondigital. What is more surprising – and perhaps to some inconceivable - is that in the 21st century a market could actually entirely depend upon non digital.
Inconceivability does not preclude possibility, as experts debating the future of the newspaper will attest. For publishers and journalists whose entire culture and namesake was built upon the medium of print, the future looks volatile, unstable and bleak. Extinction is already occurring at mass scale as readership and circulation declines, prices drop and ad sales slump at a steady rate. Rising at an equally steady rate is the number of newspapers declaring bankruptcy or closure. To reduce in-house costs journalists with decades of experience (and consequently the highest salaries) are being made redundant.
In the United States a 2015 report showed readership had reduced from 1, 2000 per hundred million (1945) to 400 per hundred million (2014), and circulation had declined from 35% to under 15%. A fifth of journalists have been shed since 2001, leading one senator to introduce a bill (March 2009) allowing companies to restructure as non-profit corporations for tax breaks. This trend is reflected in the UK. The Reuters Institute’s 2016 Digital News Report claimed The Guardian’s losses mount to almost £50m a year and The London Evening Standard announced a 24% decline in ad revenues. On September 29th 2016 DMGT announced an increase of cost-cutting plans from £15m to £50m with 400 jobs to cut. On the 8th of this month Theresa May announced a review seeking sustainable funding models for printed press at national, regional and local level will be initiated, claiming their closures are a “danger to democracy”.
It doesn’t take a rocket scientist to intuit why print is in the climax of a crisis which has been developing for over a decade. The emergence of the internet in 1990 changed the face of information sharing and consumption. With the rise of technology consumers habits completely changed and businesses had to adapt to fit a lifestyle pivoted around laptops, iPads, smartphones and apps. But why, as the stats show, is journalism itself in crisis? Surely papers can just move online and content digitalised. Print can enter a new phase of being the cute, vintage ancestor of newspaper websites, beloved by hipsters and the nostalgic among Baby Boomers to elder Millennials. The web blesses reporting with the distinct advantage of live updates as events progress, plus the supplementation of audio and visual. Online news means no expensive union contracts, printing presses, delivery fleets or overhead, and it is better for the environment. Some newspapers have already made the big jump and embraced their digital future. The Independent in 2016 was the first ever national newspaper to entirely renounce print in a bid to secure a sustainable and profitable future, with The Guardian, Telegraph and Daily Mail quick on their heels. So why all the cut-backs, circulation losses and bankruptcies? What’s the Big Issue?
To compete for old readers in a new world where content is available for free, newspapers going digital have switched to the business model of essentially giving away their most valuable commodity, their content. Losing subscription profit would not be so much of a problem if newspapers depended upon something other than advertising for the rest of their revenue. Companies took significant revenue from print advertising, however online advertising brings in a fraction of this revenue. This is for a mix of reasons including the oversupply of ad space, a less engaging nature and the dominance of internet giants such as Google and Facebook who took half the total UK digital advertising market in 2015. Furthermore Ad blocking in is a serious problem. The use of Ad blockers in Europe grew by 35% in 2016 and the estimate for global revenue loss caused by blocked advertising in 2015 was $21.8 billion. Digital ad revenue simply is not enough to support news companies but consumers are less willing to pay because information on the Web is plentiful and free. Consequently companies must develop other streams of revenue from their enormous digital audience.
Some are more hopeful for the future of journalism in a digital market. Beyond the online world often appearing confusing, chaotic and overwhelming, many argue today’s youth have already been primed by providers such as Spotify and Netflix to pay for quality online content. Therefore the transition in news consumption from print to web should be relatively straightforward. On that note, in this age of Fake News, Brexit and the ‘Trump Bump’ people are beginning to realise the flashing news breaking on their newsfeeds could be created by any Tom, Dick or Harry, and that instant information free online at one's fingertips is a double edged sword. It is possible that dependence upon credible news sources for accurate reporting is heavier than ever before, reflected by Januaries Edelman Trust Barometer which shows traditional media has rebounded in public confidence by 13%, to a record high of 61%. While readership and revenue has decreased, the proportion of U.S. citizens actually willing to pay for online journalism has leapt from 4% in 2016 to 18% in 2017.
The need for reliable reporting is undeniable; meaning if newspapers can sort out a profitable business model, online journalism is in the clear. Can the same be said for print? Many make the point that newspapers already weathered the threats presented by Radio as early as the 1920s and TV in the 1950. Perhaps print is more resilient that given credit for and doubting Thomases need a little faith. Almost 7 million people still frequently purchase daily and Sunday papers, although this is a reduction of 13 million in a decade. Only time will tell whether print can endure past the next decade, but as long as companies apply their old unsustainable business models for a profitless online existence, print is likely to stick around, even if it is only for a niche market.
Written by Sarah Wolffe
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