Thursday, August 27, 2009

Newspapers getting only a fraction of revenues from online

Surprise, surprise. The newspaper industry is disappointing to a veteran analyst for its lack of adapting to the digital age -- especially in revenue. For many reasons (tradition, concerns about upsetting readers/viewers, ineptitude), newspaper companies have been slow to adapt in many areas.

Sure, they will respond, we all put up web sites early on. We're reporting more news sooner than ever. Our web sites are the best news sites available. And they're right. But what they've done is cannibalize their existing brand, to bring over a term from retail marketing. Now I don't have an MBA like so many media managers, but I can see that what the newspaper industry has done is move readers of a revenue-making print product over to a woefully-weak revenue-producing online product seemingly without thinking much about it. That way lies dragons and dropping off the face of the Earth, as the old maps used to say.

Today's report, by analyst Ken Doctor, finds that only a fraction over 11 percent of newspaper revenues come from online, either in subscription or advertising revenues. If your business plan is to build up online at the expense of print -- the seeming business plan of most newspapers -- you have a plan to spiral down the drainpipe.

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