A tale of two media: How print and TV are facing the future
Both print and TV news outlets have seen audiences migrate to the internet in recent years - although, perhaps it's been more of a stampede for print readers, and an orderly shuffle for TV audiences. Both have been scratching their heads about what to do about it.
Last week, the Reuters Institute issued a report on how legacy news organisations in six European countries (Finland, France, Germany, Italy, Poland, and the United Kingdom) are adapting to a digital future. The report covers both print and TV news outlets, and therefore reveals the different challenges these two media types are facing.
Of course, digital disruption hasn't been evenly distributed. Reuters found that on average, across the six markets examined, there has been a negligible average change in TV advertising expenditure from 2010 to 2014. The print picture ain't so pretty. The average change in newspaper advertising expenditure from 2010 to 2015 is a drop of 36pc. Averages, however, aren't always helpful in wildly divergent markets. Poland is the hardest hit market in terms of print ad decline; it's seen a whopping drop of 63pc. Finland is the only market left where more money is spent on print than on digital.
The upshot is that print's approach to digital initiatives is more urgent. The Reuters report tells of publishers cutting printing, distribution, and production costs to invest in digital opportunities.
But TV can take its time. According to the report, there's a belief that broadcast revenues will continue to be stable for the foreseeable future. Investment in digital innovation for broadcasters is less about revenue and more about relevance. One manager from ITV News is quoted as saying that their digital strategy is "more about brand than it is about monetisation. News is not there to perform a revenue-generating opportunity, it's to create a good brand as part of the wider ITV brand."
Social media is both a challenge and a threat. It offers the potential to refer traffic at scale. But why should a user come to a particular site for their news when Facebook's newsfeed offers them a personalised feed of content? Not all social networks are interested in supporting publishers with paywalls. The Reuters report quotes the digital editor of the Süddeutsche Zeitung saying Facebook has little interest in engaging with publishers if their strategies aren't aligned. "We realise that communication with them immediately stops when we want to discuss business models that also work for us," he says.
The growth in mobile internet use is proving challenging for print and broadcast news outlets. Smaller screens mean less room for nuanced news coverage, and less space for ads too. The average revenue per user in mobile is still much lower than desktop. And mobile is extra challenging due to the dominance of the likes of Facebook, Apple and Google. Around two-thirds of mobile ad spend goes to these big US platforms.
Another area where news publishers and broadcasters are in the same boat is online video. Legacy publishers want in on the act because a well-executed video strategy allows them to compete for TV media spends. But producing videos ain't easy for organisations whose traditional medium is the written word. Oddly enough, TV companies are struggling with online video too. The Reuters report quotes Bild Digital's editor-in-chief as saying: "We see that TV, much like print in the beginning, has enormous difficulties making use of the new technologies. Fear of self-cannibalism, strong habits: ... 'where is my big camera?' ... 'where is my soundman?' They are going through the same as we did."
The report does have some pointers towards a successful digital future. Organisations that are getting it right, whether print or broadcast, can point to a clear strategic focus, a culture that's pro-digital and a senior leadership team that's dedicated to change. Successful organisations also boast a track record of bringing together commercial, technological and editorial teams to develop new products and services. But digital revenues still pale in comparison to traditional revenues. Some 80pc to 90pc of revenues in most newspapers still come from print, and the percentage is even greater in broadcast. Strategic focus and pro-digital culture may well be what's needed. But many legacy outfits will find it hard to cast off the working practices of the past for a future that isn't yet sustainable. And for those news organisations that are embracing change, can the future come fast enough?
Sunday Indo Business