Steve Dempsey: Despite digital, print news may still be publishers' cash cow
This week saw people celebrating the 25th anniversary of Tim Berners-Lee making the world wide web available for worldwide use. Ever since it was invited to the party, the world hasn't looked back.
Actually that's not universally true. Some industries might look over their shoulders at a pre-internet era with considerable yearning. And one of them is the newspaper industry.
Most newspapers' print products have suffered dwindling sales in recent years. At the same time, their digital offerings have yet to turn into cash cows. But despite their inability to create a sustainable online business model, there's still a wide-standing perception that print is on its last legs and online on the up.
But perhaps the digital future isn't as bright as initially thought.
'Reality Check' is a recent study of multiplatform newspaper readership in the United States. It analyses the online and print readership of 51 American newspapers. The results? Printed news still reaches more readers than online news in the papers' home markets - even among younger readers. On average, print editions reach 29pc of local adults, with online editions reaching only 10pc.
Iris Chyi, one of the study's authors and an associate professor at the School of Journalism at the University of Texas, was surprised by the near universal pattern that held true for all the papers examined.
"Without even one exception, all 51 newspapers' print reach is higher than their online reach," she says. "Also without a single exception, online edition readers' propensity [to read] the print edition is higher than the general public's propensity [to read] the print edition - by a wide margin."
But there are some quirks. For example, the Washington Post and the Austin American- Statesman were the only publications that have ever reached 20pc of their market through digital channels. "The Washington Post has devoted lots of resources to its online operations since day one," says Chyi. "So washingtonpost.com is not a typical metro newspaper site. As for the Austin American-Statesman, I think there are several factors: Austin has been one of the most wired cities in the US; its population consists of a great number of professionals working in the high-tech industry, state government employees, and college students; and the newspaper has also been pretty proactive with its online operations."
Another interesting quirk is a dip in online news reach since 2011, which may be down to American publishers' erection of paywalls. But perhaps paywalls aren't the only culprits.
"Papers with paywalls on average lost 0.9pc of online reach since 2011, while papers without paywalls lost 0.4pc," says Chyi. "So paywalls seemed to make some difference. But I think the continuous oversupply of information and entertainment online in recent years naturally reduced newspaper sites' attention share in a hyper-competitive online market. And if you think about it, things can only get worse in the future."
So it seems that fewer people are getting their news from dedicated news sources. Instead they are getting their news-fix from aggregators and social channels. "News aggregators like Yahoo News have been proven for years as the most important online news destination," Chyi says. "Most people don't go to Facebook to seek news but lots of news is certainly consumed on Facebook. Twitter is more 'newsful' than Facebook, but it is heavily used by journalists - not the general public. So, yes, increasingly, online audiences are getting their news from major news aggregators and Facebook, not newspaper sites."
So how should newspaper executives respond to this research? Chyi believes a critical re-examination of unchecked assumptions about the future of newspapers is called for.
"Newspaper executives assumed that print would die because young people hate print, and that by going online, they could reach young readers effectively," she says. "These assumptions turned out to be so wrong.
"Many newspapers started their digital experiment in the 1990s on a positive note. Then they gradually got lost in the digital jungle. Then, the recession hit and eroded their print revenue stream, leading most to believe that there is no future for print newspapers, so they must try harder to transform digitally. No one ever stopped for a second to review what's been done and what went wrong."
Sunday Indo Business