What if newspapers hadn’t rushed headlong into digital by spending billions to create free websites, but instead had focused on strengthening their print operations? Could they have avoided some of the carnage many have suffered in the past decade?
It’s a tempting scenario, one put forward by veteran media writer Jack Shafer in a piece at Politico, based on a recent study of the newspaper business. But it is fatally flawed.
The study, by University of Texas researchers Hsiang Iris Chyi and Ori Tenenboim, is entitled “Reality Check.” It looked at the online readership of 51 major daily newspapers in the U.S. (Excluding national papers like the New York Times and the Wall Street Journal, which are doing well with online subscriptions).
The researchers found that few of these metropolitan dailies have seen any growth in their online readership since 2007. More than half have actually lost readers since 2011, and the average paper’s digital readership is about a third the size of its print readership.
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For most newspapers, the authors argue, investing in digital has been a bust. Not only are they not getting more readers, but their revenue is underwhelming as well.
Despite early excitement about an all-digital future for news, “a long-time problem facing a vast majority of newspaper firms persists,” the study says. The transition from print to digital has meant “exchanging analog dollars for digital dimes.”
Shafer says this raises the question of whether “the entire newspaper industry got it wrong” by focusing too much on digital, and not enough on print.
“What if, in the mad dash two decades ago to re-purpose and extend editorial content onto the Web, editors and publishers made a colossal business blunder?” He asks. “What if the industry should have stuck with its strengths—the print editions where the vast majority of their readers still reside?”
As tempting as it is to re-imagine history, however, it’s a virtual certainty that even if most newspapers had focused more of their resources on print and less on digital, the outcome would have been more or less identical.
The inevitable backlash… I love print, but mistake wasn't digital per se, it's been a result of applying old business models to a new medium https://t.co/ePEMGQqOCL
— Craig Saila (@saila) October 18, 2016
In fact, the study that Shafer quotes from helps to make this point. It notes that the market penetration of newspapers has declined steadily at between 1% and 2% annually since 1950, and print circulation has been declining since 1987.
In other words, print newspapers had already been in gradual decline for a decade before the consumer Internet came along, a decline driven primarily by radio and television news.
All the Internet did was accelerate and enlarge that drop, by siphoning away the attention of newspaper readers, and then the advertising revenue they depended on for their livelihood. In a little over a decade, the newspaper industry had lost $45 billion in ad revenue.
A better version of that newspaper ad revenue graph, from @baekdal pic.twitter.com/WX0QFSWEWI
— Mathew Ingram (@mathewi) October 18, 2016
It’s no coincidence that during that same period, Google gained about $40 billion in ad revenue, thanks to the development of “programmatic” ad markets, where ads are bought and sold by algorithms. Craigslist and other digital providers also siphoned off real estate and classified revenue.
The result of this transition was intense pressure on advertising prices, something that has kept online ad rates orders of magnitude lower than print advertising.
Even if newspapers had ignored the web entirely and focused on making their print editions as robust and profitable as possible, both of those trends would still have taken place, and print newspapers would have wound up in the same predicament they are now.
Shafer’s piece assumes there was some magical Eden in which newspapers were unassailable, and that it would have been possible to remain there if not for the sin of pushing too hard into digital. But that simply isn’t the case.
Saying newspapers made the wrong choice by moving to digital is like debating the strategic choices of the Polish army in late 1939. Https://t.co/xc3PEpuIRM
— Nick Baumann (@NickBaumann) October 18, 2016
The study’s authors recommend that newspapers set up paywalls for their digital products in order to make them appear more valuable. But many papers have done this and gotten virtually nothing from them because the value proposition to readers isn’t obvious enough.
One reason newspaper sites don’t get a lot of readers is that they are poorly designed, slow to load, and filled with annoying advertising. But there are other reasons as well.
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As the study itself points out, the vast majority of online news readers get the content they need from aggregators and networks such as Facebook. Simply focusing on the print edition or putting up a paywall isn’t going to bring any of those lost readers back.
Could newspapers have survived by having only a token website and focusing most of their resources on their print product? Perhaps.
But because of the trends cited above, this future would have meant an inexorably shrinking readership combined with inexorably shrinking advertising revenue—ending in something close to complete irrelevance. That’s likely not what most newspaper owners want.
@jackshafer Feel free to go all print. Have horses deliver them while you're at it. @jeffjarvis @jayrosen_nyu https://t.co/D3tGono3ID
— John Paton (@jxpaton) October 18, 2016
The biggest flaw in Shafer’s argument is that it assumes newspapers failed to succeed at digital despite trying their hardest to adapt. But as he himself has pointed out before, most media companies consistently failed to understand the changes that were required.
Instead, most newspapers tried to duplicate their existing print business online, only to find that’s not what readers or advertisers wanted.
But even if they had done a better job of adapting, they would probably still be fighting to remain relevant and profitable, because the media world has changed around them. It’s not anyone’s fault, it’s just the way that evolution works. Ask the music industry.
