Newspapers are still here and still making money
The sky is always falling and newspapers are always dying.
For more than a decade, that has been a common and constant refrain. While working at washingtonpost.com, the Guardian US, and now, the Newspaper Association of America, I have been asked frequently about the state of the industry as people search for the worst.
Though newspaper media is enjoying the largest audiences ever as well as continuing to play a unique and critical role in our communities, there is one fact that always tends to be obscured or outright ignored – newspapers are still making money and newspapers remain a good investment.
A year ago at this time, John Henry and Jeff Bezos made high-profile acquisitions of The Boston Globe and The Washington Post, respectively, which confirmed that newspapers are viable investment options with the ability to grow. Earlier this month, The Washington Post announced record web traffic for July as well as hiring more than 60 people in the first seven months of the year.
A company hiring 60 people in seven months sounds like a healthy one to me.
This summer, the newspaper industry has seen a wave of spin-offs, with Tribune and Gannett both forming publishing-only companies. E.W. Scripps and Journal Communications spun their combined publications off into a new company, Journal Media Group. This is an exciting time for the newspaper industry as these companies will now devote their undivided attention to their publications.
However, as with the investments last year, these spin-offs have been spun into more gloom and doom for the industry. It is simply not accurate.
In fact, buried in the depths of one particular article that signaled the death of newspapers is this gem of a sentence: “Newspapers continue to generate cash and solid earnings.”
Think about that for a moment – an industry that generates cash and solid earnings is on its death bed? I refuse to accept that.
What is true is our industry’s business model has changed dramatically in the past half-dozen years. In 2007, 80% of newspaper media revenue was generated from advertising. In 2013, less than half of total revenue (46%) was from advertising in the daily and Sunday print newspaper. Revenue from readers paying for print and digital news and information accounted for nearly three out of ten revenue dollars, up from less than two in ten in 2007. Income from new, non-traditional sources is now rising rapidly.
What is also true is that the public’s thirst for news keeps rising.
Data from the digital measurement firm comScore show that 161 million people visited newspaper websites in the month of March. We are witnessing audience increases across the country, from the aforementioned Washington Post to The Times-Picayune, which announced 5.6 million unique visitors to NOLA.com this July.
There is more demand than ever for news and journalism. There are also more competitors. There was no BuzzFeed or Facebook or Huffington Post 15 years ago. New digital channels offer consumers a dazzling array of options, all of which compete for time and attention. And advertisers face challenges in trying to catch up to these fragmenting audiences.
In my three years as CEO of NAA, I have witnessed an amazing transformation. Newspaper companies look drastically different in 2014 compared to 2011. There has been an increased focus on digital properties. Newspaper reporters and columnists have taken advantage of Twitter to build brands and large readerships. Innovation on the design side has led to beautiful works of long-form journalism, which include The Unforgotten by the Boston Globe and Breaking Ball from The Wall Street Journal that ran in July. Newspaper companies are using the power of their brands to create new, non-traditional streams of revenues from event hosting to digital marketing.
The evolution of the newspaper industry continues every day. The explosion of mobile readership thanks to smartphones and tablets has caused newspapers to create new mobile strategies. There is increasing demand from readers for more targeted content, which has given rise to niche sites and blogs developed by newspapers devoted to special areas of interest, such as food, high school sports and fashion.
For me and many in the newspaper industry, it is a fascinating and exhilarating time. We are in the midst a dramatic, historic shift for an industry that has been around as long as the United States of America.
The world has changed and newspapers have changed. The notion of what a newspaper company is should change for the general public. It is no longer simply about print. It is about all platforms. People don’t think, “I’m reading the newspaper” when scrolling through nytimes.com but they should.
Despite all the changes, one thing remains the same – newspapers still make money.