Along with other traditions that Americans take for granted, newspapers are changing faster than the public can keep up. Overall circulation is down five per cent and ten per cent at some large city papers.
Across the country, newspapers are losing ad revenue, making deep cuts and going out of business. A private equity company bought the Star Tribune of Minneapolis, but the heavy debt burden forced it to file for bankruptcy in January. After losing US$16 million in 2008, the 150-year-old, 210,000-circulation Rocky Mountain News closed its doors in February. In the past ten years, the Baltimore Sun newsroom shrank from 420 to 140 employees and the owners are planning to move it to the internet.
Operating profits for Murdoch’s News Corporation newspaper division declined from US$216 million to US$7 million year-on-year. The Boston Globe lost US$75 million in the first quarter and narrowly escaped closing after making a deal that cut union pay. The Globe‘s owner, The New York Times, faces US$1 billion in debt and declining revenue, forcing it to sell and lease back its headquarters to cut expenses.
Even Presstime, the monthly magazine of the Newspaper Association of America, announced recently that it will no longer produce a print edition. The trade association will save US$500,000 annually by moving to the web. This will be coupled with a cut in annual membership dues by half and the staff by 66 per cent.
Fewer pages, smaller page size and less advertising may spell doom for newspapers, but Harvey Levenson, head of the Graphic Communication Department at Cal Poly State University/San Luis Obispo, California, believes newspapers can reinvent themselves.
Although he cannot reveal details due to non-disclosure agreements, his department is exploring ways to use personalised variable data and interactive processes to update newspapers for the digital age.
Despite attempts to adjust to the internet, newspapers still rely on a printed product for 90 per cent of their revenue. Consolidation of newspaper preparation, production and distribution has been going on for years; it’s not a solution to today’s problems and indeed, may have created some of the problems. During the Bush era, consolidations set US records, leading many newspapers to take on more debt than they can handle in an economic downturn.
“Many newspapers became overcapitalised and are now in trouble,” says Levenson. “They make a profit on circulation and advertising and their problems are exacerbated by the economy and the internet, which plays a role in the reduction of what’s printed.”
Commercial printers in a low profit industry face similar problems, but are seeing some increases in business from newspaper publishers who are outsourcing their printing rather than owning the presses themselves. With paper being 30 to 50 per cent of the cost of printing, innovations like the Goss gapless press provide printers with much needed savings, but Levenson sees no future for web press operators for newspaper printing. In the past, Cal Poly offered formal training to newspaper press operators, but such training has since declined.
Pressmen no longer need to hang plates or check register and ink/water balance the way they used to. Microprocessors and push buttons operate web presses that require fewer and lower trained operators.
E-ink, black-and-white microcapsules, suspended in liquid and controlled by an electric charge, are debuting in a number of new electronic digital devices made by Plastic Logic, the Sony Reader, the Kindle, and other devices being developed by Murdoch, Hearst and other newspapers.
For example, the Kindle DX with a 9.7-inch display and 1,200 x 824 pixel resolution is receiving favourable reviews, but electronic readers will have to make people comfortable with reading them. They must become less expensive and convenient to navigate and use, and also prevent eye fatigue.
An August 2007 review of eight studies — entitled “The Reality About the Promise of Printing in the Digital World”, and written by Levenson and Cal Poly authors — claimed “the simplicity, accessibility and inexpensiveness of the internet has lured media users to this new medium”. Suggestions for print to “survive as a medium of choice in advertising, marketing and communication” include becoming more service-oriented, adopting print on-demand, utilising variable and interactive data, and making new communication investments.
“Studies show that young people are not interested in newspapers,” Levenson says. “If they woke up and found there were no more newspapers, most wouldn’t care. It’s a different story for magazines. People remain interested in magazines across generations because they have special interests in specific fields, and magazines satisfy such interests.”
Average people won’t pay for news on the internet but they will pay to get information of specific interest to them. For example, unlike daily newspapers in general, campus newspaper popularity is growing.
“Students are interested in newspapers that carry information about their lives and their communities,” says Levenson.
Now, if publishers can leverage that interest and create new, exciting products, they might still thrive in the internet age.
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