“What if”, asks Jack Shafer, “almost the entire newspaper industry got it wrong? What if, in the mad dash to put up editorial content on to the web, editors and publishers made a colossal business blunder that wasted hundreds of millions of dollars?”
He continues: “What if the industry should have stuck with its strengths — the print editions where the vast majority of their readers still reside and where the overwhelming majority of advertising and subscription revenue come from — instead of chasing the online chimera?”
Shafer, one of the foremost media commentators in the United States, had picked up on a study by two Texas university academics, Hsiang Iris Chyi and Ori Tenenboim, called “Reality check”.
The authors argue that many “US newspapers’ online ventures... are stuck between a shrinking market for their print product and an unsuccessful experiment with digital offerings”.
They claim that “digital first” has been a losing strategy for most newspaper companies and call for “a critical re-examination of unchecked assumptions about the future of newspapers”.
Now that’s counter-revolutionary talk, is it not? It smacks of the kind of criticism aired at the dawn of the digital era that earned its adherents the label of dinosaur.
But let’s get to the facts. Chyi and Tenenboim studied the online readership of 51 leading US regional newspapers and compared 2011 online readerships with those in 2015.
To their amazement, they discovered that __more than half of them had lost online readers in the course of the four years.
Despite the falling circulation of newsprint titles, they still reached many __more readers than the digital content “in home markets” (that’s an important caveat).
Shafer writes: “For years, the standard view in the newspaper industry has been that print newspapers will eventually evolve into online editions and reconvene the mass audience newspapers enjoy there.
“But that’s not what’s happening. Readers continue to leave print newspapers, but they’re not migrating to the online editions.”
Back to the Teaxas pair: “[W]hile print readership is declining, newspaper readers did not drop print in favour of the same newspaper’s online edition. The identified performance gap between newspapers’ print and online products challenges the ‘digital first’ view about the future of newspapers”.
As for the money, Chyi and Tenenboim note that US newspaper industry digital advertising revenue increased from $3bn to only $3.5bn from 2010 to 2014.
Although print revenues plunged from $22.8bn to $16.4 bn over the same period, they still represented 82% of total newspaper revenue.
Shafer then turns to arguments advanced by Chyi in her 2013 book, Trial and error: US newspapers’ digital struggles toward inferiority.
She thought the online editions of newspapers offered a “less-than-satisfactory” reading experience that was inferior to the paid-for print version. This may explain, writes Shafer, why visits to the 51 newspaper websites don’t last long.
Chyi’s advice to publishers: accept that the days of 25-35% profit margins will never return and be happy with the 5% margins common in other companies. And charge for access to online content. Why? Because it invests the content with value.
Shafer contends that Chyi is not a Luddite: she appreciates the immediacy and convenience of getting news via computers and mobile platforms. But, writes Shafer channelling Chyi, “for all of its faults, the newspaper remains a superior format and much would be lost if our neglect caused its premature demise”.
He quotes an interview with Chyi in which she used the following analogy:
Newspaper had been running the equivalent of a very nice high-end steakhouse. Then McDonald’s moved to town and started selling untold numbers of cheap hamburgers.
Newspaper thought, “Let’s compete with that,” and dropped the steak for hamburger, even though it had no real expertise in producing hamburgers. What they should have done is improve the steak product.
She rejects the idea that the newspaper is a doomed dinosaur, saying: “There’s some hope if they rethink their strategies.”
Shafer, who hopes Chyi is right because he sees “conventional newspapers, for all their shortcomings” as “the best source of information about the workings of our government, of industry, and of the major institutions that dominate our lives”
He writes: “They still publish a disproportionate amount of the accountability journalism available, a function that’s not being fully replaced by online newcomers...
“If we give up the print newspaper for dead, accepting its demise without a fight, we stand to lose one of the vital bulwarks that protect and sustain our culture”.
I guess many will view this as a sort of back-to-the-future kind of argument, but I’ve found myself edging backwards to this position for a while. Is this digital Bolshevik now a Menshevik?