Sunday, May 16, 2010

What will become of the print media?

According to latest figures, average newspaper circulation in Australia is down 3.1 per cent in Q1 2010 in comparison to the same time last year. Does this mean the end is nigh for the print media as we know it? Perhaps. Are we destined to glean most of our news content from online sources in the future? Perhaps not. The jury is still out on whether either medium is sustainable in the long term.

In a recent Australian survey conducted by Celsius Research, 57 per cent of respondents indicated that newspapers and their affiliated sites were vital for shaping the news stories of the day. Fairfax CEO Brian McCarthy supports this finding, suggesting that a combination of print and online content creates a powerful and credible brand. However, the cost of generating quality news content for both mediums is significant. In future, news providers may have to choose to focus on one more than the other, as the cost of providing quality content both online and in print may prove to be too much.

Politico is a rare example of how both mediums can be used to successfully support each other. Founded in 2007 by two former Washington Post employees, it is comprised of an online news site updated regularly and a magazine that is printed weekly. The magazine is distributed in Washington free of charge, and essentially contains stories reproduced from their news site. This facilitates the publication of newspaper ads which drive the profits that are then ploughed back into the website. The key to this success story is that the profits are derived from print advertising, rather than online advertising.

You see, online advertising on news sites may not be as successful as it is portrayed. Recent survey results in the US show that a whopping 79 per cent of consumers queried stated that they rarely or never paid attention to online advertising when accessing news content. Similarly, the same survey indicated that 53 per cent of all American adults access news online, but only 35 per cent of these regularly visit the same site. Few respondents indicated willingness to pay for access to news content. This can be attributed to the fact that few consumers demonstrate any ‘loyalty’ to a particular news site, rather they access stories of interest from search engines such as Google.

If consumers are unwilling to subscribe to access online news, and online advertising is not as successful as it is currently considered, is the medium sustainable in the long term? The answer may well be yes, albeit not in its current form. In reality, news providers cannot afford to invest heavily in both mediums in their current forms. Foreseeable changes may include; news providers relying mainly on syndicated content online that is cheaper to produce; or newspapers containing less content and published less frequently, focusing more on in-depth investigations. At this stage it is unclear what lies ahead for the news industry, however it is safe to say that if newspaper circulation continues to fall and online advertising continues to be largely ignored, a tremendous shake-up is in store sooner or later. Both mediums may be ultimately unsustainable in their current form, but the future of the industry remains to be seen.

Sunday, May 9, 2010

Time's up for Newsweek

Today’s announcement of the proposed sale by The Washington Post of its former flagship magazine Newsweek may appear at first to be yet another triumph of the digital media over print publications. However, those loudly proclaiming the sale of Newsweek as signalling another nail in the coffin of the print media are only telling half the truth. In fact, the publishers of Newsweek themselves may well be equally culpable for its demise.

Newsweek has not been a profitable publication for some time. The magazine incurred a total revenue loss of 27 per cent in 2009 in comparison with the year before, including a 37 per cent decrease in advertising revenue. Adding to the misery, circulation figures fell an average of 41.3 per cent in the second half of 2009. These figures seem consistent with the overall swing by consumers towards online access of news content. However on deeper examination in the instance of Newsweek this is not the case.

Don Graham, CEO of Newsweek’s parent publication The Washington Post has publicly stated that it is in fact the failure of the online component to turn a decent profit that has forced the sale of Newsweek. The total revenue of the magazine in 2009 was $184.2 million; only $8 million of which was generated by the publication’s online content. This reversal of the current trend of consumers accessing news information online indicates that something is drastically wrong at the magazine.

Quite simply, it seems that Newsweek’s dramatic fall from grace can be attributed to a failure to adhere to the most basic of business principles; ensuring that the product is in-line with the wants and needs of consumers. At any given time consumers have access to a raft of breaking news and opinion content online. Cheap and rapid to produce, the print media cannot compete with online providers in these genres. Previously, investigative reporting and analyses were the strengths of Newsweek. Consumers sought insightful, well-researched content that online providers had neither the time nor the inclination to produce. Thus, when the magazine made the transition in 2009 from reporting to mostly opinion pieces they made the fatal mistake of conceding the biggest advantage they had over their online competitors.

In the digital age, print publications need to know and exploit their niche to survive. The Economist has successfully managed to use online content to support and enhance the print publication. The magazine is acutely aware of consumer demand for in-depth reporting and investigation in print. Thus, the online component contains one special report updated weekly with the remainder of the information reported being largely opinion-based. This format saw the publication’s total revenue increase 17 per cent in the year 2008-09, with worldwide increase in circulation of 6.4 per cent. The figures speak for themselves; The Economist has successfully identified the demands of consumers and endeavours to deliver them the best of both worlds.

The failure of Newsweek’s publishers to identify and meet the wants of its consumers ultimately led to the magazine’s downfall. They failed to recognise the advantage that print publications have over the digital media: that of the time and resources to devote to in-depth investigation of issues. In order to survive the digital onslaught print publications must deliver a point of difference. They must identify and exploit a unique advantage that the online media fails to provide. The Economist exemplifies that this can be done. It was not digital media that sounded the death knell for Newsweek, rather the failure of the publishers to identify and meet consumer demands that proved fatal.

Wednesday, May 5, 2010

A tweet too far for The Age

One of the hottest stories of the week involves the sacking of The Age columnist Catherine Deveny over her controversial tweets at a recent Australian awards show. The Melbourne-based daily dumped the sometime comedienne after its website went into meltdown over inappropriate Twitter comments Deveny made regarding child star Bindi Irwin. This represents somewhat of an about-face for the publication considering it recently sanctioned an article in which Deveny referred to her own children as ‘the spawn of Satan’. So what is it about Deveny’s tweets that angered The Age so much?

The newspaper has a history of taking a dim view of public figures who disgrace themselves in their personal lives. A recurrent theme that dominates the sports editorials of the paper seems to be that the life of public figures is never entirely private; every move, action and expression of the individual can be considered representative of their profession. Consider the attitude of sports columnist Caroline Wilson who finds it remarkable that footballer Brendon Fevola was never sanctioned by Carlton for his off-field behaviour. Wilson goes on to warn that, ‘letting the off-field antics of footballers go unpunished rarely proves expedient in the long-term’. This is representative of the overall stance of The Age that there is a fine line between the personal and professional lives of public figures. Perhaps Deveny should have taken this attitude into consideration before tweeting her way to unemployment on Logies night.

According to Editor-in-chief Paul Ramadge, Deveny’s tweet referring to her wish that Bindi Irwin ‘gets laid’ is ‘not in keeping with the standards set at The Age’. To what standards is Ramadge referring? Standards of good taste one would assume? It would appear this is not necessarily correct, as Deveny reserves arguably her most irreverent comments for her own children. In a column published in The Age last month, Deveny advises parents when asked for help by their children to reply, “If you’re not smart enough to work it out, you’re not smart enough to play Xbox. Bring me another glass of wine. And remember, it’s your fault I drink”.

At the time, comments left on the newspaper’s website indicated that the audience were largely receptive to the controversial humour detailed in the article. How then, did presumably the same readers come to be so outraged by Deveny’s irreverent tweets? The answer lies in the media itself. Deveny conceded in an interview that Twitter is not the place for complex issues. Quite simply, the earlier comment was but a small part of a much larger article, allowing it to be taken in a much wider context. The luxury of a wider context does not exist with Twitter, users are condemned to be judged by their use of those 140 characters only.

Deveny is no doubt seething at the hardline stance The Age has taken over her tweets. However the newspaper’s position on social networking and professional conduct outside the workplace should not have come as a surprise to her. In January legal affairs reporter for The Age Joel Gibson wrote that spying on the self-created social networking profiles of employees had become commonplace for many companies. Further, Gibson warned that society’s increased blurring of social and professional lives online potentially has serious consequences for employees. What a pity then, that Deveny failed to heed the warnings of her colleagues.

Ultimately, The Age’s well known stance that those in the public eye are equally accountable for their actions in their personal as well as professional lives meant the publication had little choice but to end their relationship with the columnist. In the wider context of an article, perhaps her comments about Bindi Irwin would have been taken in the irreverent spirit they were no doubt intended. Deveny’s fatal mistake was to choose the wrong medium in which to deliver her brand of controversial humour. May this be a warning to all tweeters – remember, those 140 characters are your only context.

Sunday, May 2, 2010

Battle of the bottom lines

In an interesting addition to the print media vs online content debate, it seems that Rupert Murdoch is doing his best to reignite the war between the dailies in the face of falling circulation figures and the increased availability of digital content (The Australian, 03/05/10, WSJ takes no prisoners in home-turf tussle with Times').

Previously reputed to be a rather staid publication with primarily a business and finance focus, the purchase of the Wall Street Journal by Murdoch in 2007 laid the foundation for an almighty challenge to the dominance of The New York Times. Recently, the WSJ launched a 16 page accompaniment dedicated to New York that has become a regular feature, in an attempt to connect with a new audience and; according to managing editor Robert Thomson, 'widen our revenue base'. In an appeal to the localism for which New Yorkers are so renowned, the WSJ are quick to highlight their use of local writers, as opposed to the Times who outsource regional content.

It seems however that 'widening the revenue base' is secondary to the WSJ's lust to poach Times readers. Aside from appealing to the localism of readers, tactics employed by the Journal include slashing advertising rates in an endeavour to further squeeze revenue from the Times. This is not the first time Murdoch has placed achievement of an agenda ahead of the financial bottom line - consider the example of his acquisition of The Times of London in 1981. Murdoch proceeded to aggressively poach readership from rival The Daily Telegraph by invoking strategies such as: drastically reducing subscription prices and the introduction of coupon deals in order to lure readers. The Daily Telegraph survived the onslaught, however the dominant theme in both instances seems to be Murdoch's willingness to value the pursuit of a personal challenge over fiscal considerations.

The battle of the New York dailies seems somewhat antequated in the current digital age where the prevalence of online news content is ever-increasing. The rampant, ego-driven battle is akin to the airline price wars in which companies are competing on a financial basis that is ultimately unsustainable. Experts predict that the tactics used will prove to be detrimental to both publications. Time will tell, however in the meantime it makes for an absorbing tussle in which the consumer is the ultimate victor.