Journalism and the Move to New Media

Justin StevensTom McGovern

The Shift from Paper Media

Paper media readership is down across the board

The Wall Street Journal is the only paper publication that has maintained sales

o As of 4/09, U.S. newspaper print circulation down 7.0% y/y Source: NY Timeso New York Post was the worst with a 20.6% dropo NY Times considering charging for online content

o Print paper sales for WSJ were up 0.6% y/y as of 4/09 according to the same NY Times articleo Online subscriptions often used in conjunction with paper

Recurring Themes

Comparison to Entertainment and Sports: Faced with the same challenge of finding

a new business model that incorporates new technology while preserving the quality of content

Quality issue is especially concerning in this industry because a free and unbiased media is a pillar of any democracy

The Rise of Electronic Media

Online readership of media publications is on the rise

Electronic delivery is also an increasingly popular way to deliver content

o Newspaper website audiences rose 10.5% y/y as of 4/09 - New York Times

o Examples include investment analyst reports and trade publications

eReaders – The Next Generation of Media ?

Kindle allows readership in electronic format of:

•Books•Magazines•Newspapers•Trade Publications

Less than a year after its debut, the Amazon Kindle had sold 240,000 units despite a retail price of $359-$399, generating revenue of $86 million to $96 million – ARS Technica

Apple’s iPad

More interactive than Kindle or nook, with extra features such as color screen and video

Many hope it will save the industry by offering better mobile web-browsing and apps for newspapers and magazines

Watch demonstrations of the Popular Science and Wall Street Journal apps

Lessons from Television… “Newspaper are dying; the music industry

is still yelping about iTunes; book publishers think they are next. Yet one bit of old media seems to be doing rather well. In the final quarter of 2009 the average American spent almost 37 hours a week watching television. Earlier this year 116m of them saw the Super Bowl – a record for a single programme. Far from being cowed by new media, TV is colonising it.”

—The Economist, “The great survivor.” May 1, 2010.

Lessons from Television… Accept change and get

ahead of it “TV Everywhere”

Cable providers’ attempt to get ahead of online video content

Offer cable subscribers access to free content on multiple platforms including computers and Smartphones

Retains current customers and existing revenue streams by offering more viewing choices

Lessons from Music…

Create a more appealing physical product that acts as a “Gateway” to other platforms

i.e. Deluxe edition CDs or albums packaged with t-shirts, DVDs, concert tickets, etc.

Magazines are adopting a similar strategy, emphasizing the strengths of print editions, including glossy color photos and more effective and lasting ads

Example: The Smashing Pumpkins are releasing a new 44-song album, one track at-a-time for free online. Simultaneously, the band is selling limited edition collectors’ EPs for every 4 new tracks in a silk-screened wooden box with a CD, a vinyl 7” and a hand-carved obelisk.

“News Everywhere”

The answer for newspapers and magazines could be a combination of the TV Everywhere and Gateway concepts

Offer a single subscription to customers that gives them access to print edition as well as content on their PCs, Smartphones and other platforms

Utilize the physical product’s strengths re: pictures, in-depth articles and longer time in front of consumers’ eyes

Revenue streams: Subscriber base Mix of print and online

advertisements

Sources

The ideas in this presentation drew from the following sources: “Loving touch: Media companies try to breathe

new life into physical products.” The Economist. Online. April 8, 2010. http://www.economist.com/business-finance/displaystory.cfm?story_id=15871885

“The great survivor.” The Economist. Print edition. May 1, 2010. Pg. 12-13.

“Magazines Team up to Tout ‘Power of Print.’” Wall Street Journal. Online edition. Accessed 5/02/10. http://online.wsj.com/article/SB10001424052748703940704575090120113003314.html