The occasional series of links to give you things to read and ponder. Today’s installment centers on newspapers.
Last year, researchers at the Project for Excellence in Journalism persuaded six companies that own 121 newspapers to share private data about the financial performance of many of their papers. And the findings were grim.
On average, for every new dollar the newspapers were earning in new digital advertising revenue, they were losing $7 in print advertising revenue. The papers seemed not to be diversifying their revenue streams or coming up with innovative products at a fast enough clip.
“Some of those we talked to seem frustrated and even uncertain about how to proceed,” said Tom Rosenstiel, the director of the project, which is part of the nonprofit Pew Research Center. “But we also found signs that, if you can break out of old cultural patterns, there is another way.”
One exec bluntly states, “There’s no doubt we’re going out of business right now.” (Who said it? Unless he or she comes forward, we don’t have a clue. The same is true for all of the newspaper execs quoted in The Search for a New Business Model.)
The same exec explains: “There might be a 90 percent chance you’ll accelerate the decline if you gamble and a 10 percent chance you might find the new model. No one is willing to take that chance.”
That’s not exactly true but it is fair to say the digital-revenue gamblers are far outweighed by the set that wants to maximize print revenue for as long as possible even if that means missing out on digital.
One of the scarier comments—no way of telling if it’s the same exec—comes from someone who describes his company as just 5-to-10 percent on the road to a new-look business model: “I think as a company we are just getting to a point where we are starting to make decisions about how we are going to move in this new direction.” It is like hearing chalk screeching.
Finally, Alan Mutter shares what looks like happy news for some papers:
Some papers see Q1 sales rise – first since 2006:
After suffering through six straight years of steadily plunging advertising revenues, some newspaper publishers say they are on track to achieve year-to-year sales gains in the first quarter of 2012.
The last time newspaper ad sales grew in the first quarter was 2006, when combined industry revenues rose 0.35% from the prior year to $11.1 billion. In 2011, print and digital ad sales in the first three months were a bit under $5.6 billion, or fully 50% less than they were five years earlier.
With a month to go in this quarter, a number of publishers anecdotally reported last week at a convention in San Antonio that improved retail and employment advertising had put their sales ahead of those in 2011. The uptick was not universal, and, of course, could be derailed by any number of local, national or international events.
However, there was a notable sense of relief, if not to say cautious optimism, among several of the newspaper executives attending the combined confab of the Inland Press Association, the Local Media Association and the Southern Newspaper Publishers Association.