Are Newspapers Yesterday's News?
We had 8-tracks, vinyl and CDs. Now we have MP3s. Most stockbrokers and travel agents are dinosaurs. Rocketboom now has 300K daily viewers and there are 1.2 million blog posts every day. The recent sale of Knight Ridder to McClatchyhe should worry the entire publishing industry, if they weren't already concerned about the state of their declining business. It has been a horrible year for the newspaper business, in particular, but should that come as a surprise to anyone? Even Rupert Murdoch seems to know better these days.
~ Declining circulation (-3%)
~ Declining revenue (circ. revenue -7% at the Tribune)
~ Profit margins down 1.5%, to just below 20%
~ Classified ad revenue is drying up
~ Worsening mix of circulation to advertising revenue
~ Falling stock prices (-20% on Wall Street)
~ Mature industry
~ Job losses
~ No archival value of product
~ And you still get ink all over your hands when you read 'em
The sad thing for many publishers and other dinosaurs, is that this story is only news to them.
Quoted from Knowledge@Wharton:
Wharton marketing professor Peter S. Fader holds out little hope that people will continue to buy physical newspapers in large numbers in years to come. He likens the Internet's assault on newspapers to the impact that digital downloading of music has had on compact discs: CD's still have appeal but they are no longer the sole, dominant medium they once were. "I still believe that there's a vital role for non-digital content in music," Fader suggests. "There's a lot to be said for owning a CD and putting it on the shelf and holding it in your hand. Some people say that same thing about newspapers. I'm not sure I agree with that. It may be true, but newspapers are transient. They have no archive value. I'm not going to add a newspaper to my collection. They are a nuisance to deal with, especially since we don't wrap fish anymore. When the Chicken Littles say, 'The sky is falling,' I think they're right."
How, then, is the industry really doing? The difficulty in making a simple, terse assessment is expressed in The State of the News Media 2006: An Annual Report on American Journalism, released on March 13 by the Project for Excellence in Journalism, an organization that works to raise the standards of American journalism.
"For the newspaper industry, 2005 turned out to be a year of unpleasant surprises," the report states. "Every indicator, including the number of news staff members that the nation's best metro papers field every day, was on a steep downward path. Yet the picture heading into 2006 is ambiguous."
For more, read the rest of K@W's excellent piece, "All the News That's Fit to ... Aggregate, Download, Blog." Despite the aweful title, it's a must read.
Friday, March 24, 2006