So, how long do newspapers have? Two years ago, that question was on the lips of many as newspapers cut back deeply — in staff, in number of pages, in the very size of the page, and in selling their very headquarters and flagship buildings — in the depth of Deep Recession. We hear it less now. In part, that’s because many publishers and editors decided writing their own obituaries — talking about the sorry state of their enterprises and detailing the cutbacks for the public — wasn’t smart. In part, like any tired story, we’ve moved on and now occupy ourselves with digital reader payment strategems and with the discussions of how tablets and smartphones are, and aren’t, forever changing journalism.
Paton had tossed aside his usual JRC change presentation. Instead, he went with 10 tweets, each, in turn, well-retweeted.
The first and second: “The newspaper model is broken & can’t be fixed” and “Newspapers will disappear in less than 10 years unless their biz model is changed now.”
His point: Piecemeal change is a dead-end, given the converging downward spirals of the business. Only massive, digital-first strategies and re-organizations that scrap old structures, budgets, job descriptions — and, massively, costs — have any hope of porting today’s newspaper companies to that other side of a mainly digital news age.
... Let’s start with this number: 20 quarters. It has been 20 quarters since the U.S. newspaper industry experienced a quarter’s performance that was better than that same quarter a year earlier. It was way back in the second quarter of 2006 that the industry last experienced growth.
By 2020, those extended lines paint a blurry picture, says Gregor Waller, who has just left Axel Springer as vice president for strategy and innovation to start a new digital venture. Waller’s presentation at a recent World Association of Newspapers/IFRA conference is among the best I’ve seen among news publishers. It looks honestly at what’s happening now — and what’s likely to happen — and draws logical, if heart-stopping, conclusions.
Citing the familiar trends of increased advertiser choice, mobile reader migration, the social web revolution, and print decline, Waller’s “conservative” projection forecasts that, by 2020:
- Print circulation revenue will drop by 50 percent;
- Classifieds revenue will drop by 90 percent;
- Display revenue will drop by 30 percent;
- With online ad revenue, growing at a compounded maximum 11 percent rate, there will be “no way to close the revenue gap with online advertising.”