It's easy to see why everyone is sounding the death knell. U.S. papers' print-ad revenue fell 9.4% in 2007. Average paid daily circulation has fallen 8.5% in the past five years, a decline that is accelerating.
But the doomsayers still can be proved wrong. U.S. newspapers could be fixed if they could just be pried from the hands of those who milk them for short-term gain and are either woefully ignorant of where readers are going or miserably negligent in terms of investing in that future.
In fact, newspapers are thriving in many countries. In the last five years, global average paid circulation of dailies has risen nearly 10%, ad revenue nearly 13%. Sure, much of that growth is in the developing world, but there are dozens of developed-world countries where newspapers are enjoying circulation increases.
People haven't stopped reading. A recent PriceWaterhouseCoopers study of news consumption found that 50% of online readers spend the same time with newspaper content as they used to; 35% said they now spend more time with newspaper content.
Meanwhile, of course, new news organizations have emerged and are growing fast. HuffPo draws 5.5 million unique visitors a month and $6 million to $10 million in revenue, with a relatively low cost-base. Politico, launched just 18 months ago, employs 70 people, gets 60% of its revenue from its print edition, and expects to be profitable next year.
Sure, an eyeball online isn't an eyeball in print when it comes to ad revenue. But there are many more eyeballs available online, at far lower production and distribution costs, creating great earnings opportunities. U.K. broadsheet The Guardian has a daily circulation of less fewer 400,000, but last month it attracted more than 20 million unique visitors to its site.
The problem is U.S. newspapers have underinvested in the digital technology and talent to create such successes of their own. They've continued to treat web offerings as supplemental, even as it's become obvious that the web will be the main game.
Meanwhile, I can't think of a single major paper that can say it has really reinvented its print content. The papers are still chockfull of ponderous pieces, the subjects of which seem to be chosen by the institutions being covered rather than by what might most interest readers.
At least as damaging, papers' business managers show little ingenuity in monetizing online audiences. Sure, there are banners, but what about working with marketers as their research partners; repackaging preexisting content for specific advertising needs; resale/syndication of content to other outlets; or launching sales efforts on behalf of other sites that shape newspaper sales forces into high-end digital ad networks? All are still woefully underexploited opportunities.
And papers continue to carry masses of dead weight outside the newsroom. Of the 350,000 or so people employed by papers according to the Bureau of Labor Statistics, only 10% are reporters or writers. In a digital world, you need a way higher proportion of content producers churning out smart material that audiences want to read and debate. It's a simple, but increasingly tried-and-tested method for growing traffic and ad revenue, and I'm hard-pressed to work out what the other 90% of newspaper people are doing that's so much more valuable than that.