Around the Web links about Reflections of a Newsosaur

The good news for newspaper advertising is that it just experienced its smallest drop in any one quarter since 2007. Spending for print ads was down 7.6 percent. It shows you how bad things have been overall that we consider that figure hopeful. But online spending was actually up by 13.9 percent. – giving us a total drop of 5.5 percent. Here’s the official glass-is-half-full interpretation from John F. Sturm, president and CEO of NAA: “The steady transformation of the newspaper industry is clearly evident in these latest revenue figures. Despite a highly competitive environment, online advertising growth rebounded back into double digits, while declines in traditional revenue categories continue to moderate as the general advertising recovery progresses. The fact that online now represents nearly 12 percent of overall newspaper advertising revenues bodes well for our medium’s future in an increasingly digital environment. Even as the economy is slow to rebound, there is heightened optimism within the industry - a confidence reflected in second quarter earnings reports from public newspaper companies. New business models are taking hold, with publishers continuing to invest in platforms that deepen audience engagement in print and online. In a world where trusted, high-quality content is in demand, newspaper companies are uniquely positioned to benefit from the advertising recovery.” Or, if you’re a half-empty type, try this observation, from Alan Mutter: “Following a historic pattern that shows newspapers take in roughly 47 percent of their ad revenue in the first half of the year, it is possible to project that full-year sales for the industry will drop some $2 billion this year to finish at approximately $26.5 billion. Assuming no major positive or negative changes in the economy between now and the end of the year, this will put newspaper ad sales back to the lowest level they have seen since 1985.”

Alan Mutter's always-interesting blog, Reflections of a Newsosaur, draws some conclusions about Internet start-up news operations that are certainly of interest to Texas newspapers who may someday face competition from online-only media (some already do). The bottom line, Mutter says, is that frequently the startups are run by journalists who are interested primarily in producing a good news product. In other words, the focus is on good journalism rather than building the business model and focusing on how the startup will make enough money to survive. Journalists who start these Internet operations frequently assume that good journalism will make a way for itself. To borrow from the baseball movie, they assume that if you build a quality news medium, the readers will come and so will the advertisers. But they're so busy with journalism, they neglect the how-am-I-going-to-make-any-money-off-this end.

One of newspapers’ main advertising competitors is dead, though they haven’t acknowledged it yet. It’s the various yellow page directories, and the same thing happed to those ubiquitous yellow books that happened to our classified pages: the Internet. But there’s one difference, according to blogger Alan Mutter – newspapers could be in position to benefit from the demise of the yellows. You should read Mutter’s piece and have some serious conversations about it with your ad staff. The bottom line, Mutter says, is that customers won’t trudge through fat books looking up stuff when they can mouseclick their way to better information in seconds. How much is at play here? Mutter says it’s $16.5 billion. And guess who else is looking to cash on the deathwatch of yellow pages? Google, of course. But the blogger reminds us that Google doesn’t have even a fraction of the sales force that we have. And last time I looked, Google didn’t have anybody pounding the pavement in Brady or Dalhart or Corsicana or Mt. Vernon. Advantage, newspapers. Mutter summarizes the opportunity: “If you are a newspaper publisher interested in diversifying away from print while building a valuable, defensible and sustainable digital revenue stream, then it’s time to think about the online directory and web-marketing business.” So be sure to read this blog. And if you’d like to talk with someone about implementing some of these suggestions, call us at the Center.

The good news is that there has been a lot of research on whether or not people would pay for news online. The bad news is that the polls disagree. One says 53 percent would pay; another says only 20 percent would pay. And how much? Almost $5, according to one poll, only $3, according to another. No matter what price readers say they are willing to pay, the $3 to $5 subscription is a lot less than most publishers want to charge.