“Imagine if you will sitting down for your morning coffee and turning on your computer to read the local paper, well it is not as far fetched as it seems.” are the words from a report by Steve Newman in 1981 that marked the beginning of the end for the traditional newspaper industry. Audience moving online has been chewing away revenue from major newspapers around the country at an increasing rate. According to a New York Times article published in October 2008 weekday circulation for the largest metropolitan dailies like the Washington Post and Atlanta Journal Constitution fell up to 15% over the previous six months. As traditional revenue dries up newspapers are forced to deal with finding new ways to monetize their content. Those slow to adapt to this shift have been forced to close their doors like the Rocky Mountain News and Seattle Post-Intelligencer.
Online audience forces newspapers to look at a different revenue strategy. Traditional subscription and ad sales models need to adapt and find new ways to drive profits. Classified ad sales which was once a large portion of revenue needs to compete with free sites like craigslist, which are seeing 47 million monthly uniques, one fifth of the US adult population. Established news sites like the Los Angeles Times (alexa rank 16) need to be nimble enough to compete with sites with a little over 4 years online who outrank them like the Huffintgton Post (alexa rank 13).
There are new strategies emerging daily. One of these, paid content, supported by king pins like Rupert Murdoch who feel “Quality journalish is not cheap and an industry that gives away its content is simply cannabalizing its ability to produce good reporting“, pushes to charge users for the content they read online. Google has joined this fight with its submission of a proposal to the Newspaper Association of America detailing a micropayment system that would work more like itunes allowing papers to charge readers consuming their content online.
Another strategy is to bring more value to the massive amount of impressions the newspaper sites see everyday. With direct ad sales monetizing only a fraction of total impressions, newspapers sites are forced to look for ways to monetize their “unsold” or “secondary premium” impressions. Companies like the Rubicon Project are working to make this market more efficient, and layer data on those impressions making them more valuable. Yahoo’s newspaper consortium and APT platform allow a paper to sell the same users visiting high yield pages like the travel section to lower yielding sections of their sites driving more revenue.
Each day brings about more broadband conections, more iphones, more cancelled subscriptions, and less traditional revenue for our nations largest newspapers. In 1981 KRON reporters felt that ” the online edition wasn’t a threat to the $.20 street edition”. It is hard to deny that today the online edition, if not monetized properly, will be the death of the tradtitional newspaper. Good thing new media is here to save it.
