US Newspaper Circulation In Massive Decline

I’ve enjoyed an interesting day at ANZA Tech in Santa Clara. We’ve spent the day being coached by Dan Sapp on presentation style. I’ve always been pretty skeptical about the need for such training for someone like myself who has presented a lot over the years. I thought it would ruin my natural style, the same way singing lessons often ruin a previously natural voice. But lately I’ve realized that it isn’t enough to just get up and talk to a room full of people – unless you change their behaviour in the way you intended, it’s a wasted opportunity. So I learned some great tips today and feel like I’m coming out of it a better presenter.

Anyhoo… The New York Times has an article today about the increasing decline of newspaper circulation in the USA. And before Rob Irwin starts writing his rebuttal about how their web numbers are up, the NYT has already anticipated him:

Revenues from Web sites are rising quickly as well, but they account for only a small portion of overall revenues, and it could be decades before Internet revenues exceed those from the printed editions of major newspapers.

This has always been my point. As readers (and listeners and viewers) move to the web, the underlying economic viability of the old media is increasingly under threat. Why? One reason is that they have a LOT more competition online. Most old media companies suddenly move from competing with a handful of local companies in their own region, to competing with a globe full of companies and, increasingly, citizen media, for the attention of their audience.

What happens to these old media companies when the audience minutes they own declines? Revenues decline. And then? Layoffs. Cutbacks. And then? Some of the people they layoff, writers, editors, camera operators, directors, producers, etc, start their own online company, creating even more competitin.

Stir, repeat.

For us lowly start-ups, it’s all growth, all upside. For the old media, it’s all downside.

8 thoughts on “US Newspaper Circulation In Massive Decline

  1. Media is no longer a blue ocean with few competitors and a high cost of entry to the market.

    Online Media requires little capital investment to enter the market, the margins are smaller and the market is global.

    This is wide-sweeping industry change at it’s best.
    Strategic opportunities abound.

    Any media company today who thinks they are not fighting for their very life is completely delusional and will probably die with their eyes still tightly closed, fingers-in-ears and singing “this can’t happen to me”.

  2. Well, let’s think about this for a moment. They’re talking about Web revenues exceeding those of the print edition. Simple enough.

    For the sake of argument, let’s say a paper use to make 100 widgets a year (‘widgets’ is an imaginary currency I’m using for the sake of this excercise). But, oh dear, it’s in decline and is only making 70 widgets a year these days. But, in the background, it has a growing Internet site making 30 widgets a year.

    Result? Not only is the organisation reaping the same amount of overall revenue (ie: 100 widgets), it’s also quite correct to say that Web isn’t outstripping print (ie: 30 plays 70), and it will be a while before it overtakes.

    So I can see a quite logical line that, as print declines, the Web will rise and, over time, there will be a crossover. Carefully managed, it’s a very simple, workable thing. I don’t think it will be quite the catastrophe you hope for.

    Stop imaginging what’s happening inside the boardrooms at the major newspapers. They have smart cookies working on this stuff… not the kind of, “Duh, what’s the Internet?” type people who seem to populate your fantasies on a regular basis 🙂

  3. Nah Rob, the point is they can’t charge as much for the internet widgets as they used to be able to charge for print widgets because where they only had x competition in the print widget business they now have 100,000x competition in the internet widget business.

  4. Robert Cauthorn’s comments (GDay World #151) about needing to pay hard hitting journos to break big stories is on the money. There is a need for some aspects of old media but that doesn’t mean the channels of distribution won’t change.
    Freakonomics has a recent post on the subject which Rob might like – http://www.freakonomics.com/blog/2006/10/31/newspaper-circulation-drops-not-so-bad
    I still think that brand recognition and reduced overheads online (lack of printing) will allow many old media players to maintain a foothold in “web2+” (can i coin that here?).
    If this was a world full of clones of myself, in a few years, newspapers would cost 50c, be the size of a bridge club bulletin and only read over breakfast in a cafe.

  5. By the way, just for shits and giggles, let’s also get it on the table that the New York Post just recorded a 5.1 per cent circulation increase to 704,011 copies a day in the six months to September…

  6. Rob, if these people know what the internet is, why don’t they have proper websites, forums, online communities, advertising on free archives, permalinks, proper internet-speed feedback loops and premium paid services that are worth buying?

    While savings can be made on ink & paper, many of these companies are old and have processes that are just as old. Inefficiency abounds, which leads to excessive costs for online content.

    This is where the major opportunity lies for new entrants, low costs and low prices.

    Online content should be far cheaper to produce than print, but for many companies it’s not. This was understandable back in 1996, but now it’s just a sign of a company that hasn’t evolved and can’t evolve.

    One paper having a circulation increase isn’t a big deal. Many people use papers to light BBQs and old fashioned fireplaces, line budgie cages and wash windows. Oh, and how many newspapers have gone under completely in the same period?

    Of all the people reading this comment – Did you read a paper newspaper today?

  7. For me, I have a 6 month card which gets me free SMHs any day of the week at university. It cost $20 but i rarely use it – only if i go into a newsagent for something else.

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