Has the news industry finally cracked the digital code to find a sustainable business model? The latest study by WAN-IFRA, the World Association of Newspapers and News Publishers, the global organisation of the world’s press, representing more than 18,000 publications, 15,000 online sites and over 3,000 companies in more than 120 countries, seems to indicate a profound shift that not only validates the role of news media but also points to a revenue stream to keep the operations on an even keel. The World Press Trends 2015 report is not about the impending gloom and doom but about the emerging media ecology where the readers are ready to pay for news.
The study has firmly established that newspapers around the world have proved their value and resilience in the face of massive competition by discovering new markets and new business models. “From print newspaper businesses, they have transformed themselves into true multiplatform news media businesses, aiming for revenues that are increasingly diversified and digital. At the same time, for the majority of newspapers around the world, print will continue to be a major source of revenue for many years to come,” the report said.
The figures are encouraging and propel the industry towards innovation. According to the report, newspapers generated an estimated 179 billion dollars in circulation and advertising revenue in 2014 – more than the book publishing, music or film industries. The figure dropped by 1 per cent from 2013 to 2014. Ninety-two billion dollars came from print and digital circulation, while 87 billion came from advertising.
The researchers of the report assert: “We can freely say that audiences have become publishers’ biggest source of revenue. This is a seismic shift from a strong business-to-business emphasis – publishers to advertisers – to a growing business-to-consumer emphasis, publishers to audiences.” They cite the 45 per cent increase in 2014 and 1,400 per cent over five years of paid digital circulation revenues as an important marker of the shift. One in 10 people say they now pay for digital content.
The trends captured by the report are: the hope that digital advertising will replace print advertising is in vain as the projected growth rates do not indicate that trend. But there are significant steps being taken by media organisations to win share of revenues in other, rapidly growing, disruptive industries. “New revenue streams take a myriad of forms and there is no single business model to replace the old one.”
For the first time this century, circulation has surpassed advertising to become the biggest source of publishers’ revenues. The six largest newspaper markets world-wide are the United States ($37 billion), Japan ($18 billion), Germany ($16 billion), China ($14 billion), the United Kingdom ($8 billion), and India ($7 billion). Although newspapers’ digital revenues continue to grow, print is still their main source of revenue: globally, over 93 per cent of all newspaper revenue comes from print.
Contrary to conventional wisdom, the report points out that young people continue to seek out news: seven in 10 of millennials get news on a daily basis. Forty per cent of them pay for at least one news specific app or digital subscription, and 16 per cent pay for a print newspaper subscription. News audiences are increasingly turning to mobile platforms, and for the first time, this is starting to replace desktop traffic: web usage data from comScore indicates that desktop audience numbers are falling as consumers spend more time with their smartphones.
While the study reaffirmed the primacy of news market, it did not talk about the change in the nature of reporting and presenting the news in the emerging structure. Alexis Lloyd, the creative director of the New York Times R&D Lab, asks the question: “So what might news look like if we start to rethink the way we conceive of articles?”
In her article “The Future of News is Not An Article” she argues that particles would replace the conventional articles. “In order to leverage the knowledge that is inside every article published, we need to first encode it in a way that makes it searchable and extractable. This means identifying and annotating the potentially reusable pieces of information within an article as it is being written — bits that we in The New York Times R&D Lab have been calling Particles. This concept builds on ideas that have been discussed under the rubric of the Semantic Web for quite a while, but have not seen universal adoption because of the labour costs involved in doing so. At the Lab, we have been working on approaches to this kind of annotation and tagging that would greatly reduce the burden of work required.”
The word convergence may take a different meaning. Instead of trying to marry multi-media platforms, news organisations may open their extremely valuable archives and related contents through this ‘particles’ approach to make their product more valuable. Once the value of such editorial convergence is established, the ways to monetising would show up itself.
readerseditor@thehindu.co.in
