Some of the issues facing the newspaper industry are similar to the ones faced in all content industries. Others are a bit more unique to newspapers. I thought I’d take a few minutes to summarize the key challenges I see as well as some of the solutions I believe are required to address them.
For the last several years of my work in the technology book industry I used to say that our customers are getting older…and dying. We weren’t catering to the younger audience. That is, of course, also true in the newspaper world. The under-30 crowd grew up with the Internet and largely believes content is and should be freely accessible. Part of the solution here is finding ways to monetize via advertising, which is easier to do in the news world than in the book world. Either way, In both cases though I believe the future leaders will be the ones who figure out how to get the most out of smaller revenue bases. That means the entrenched leaders have even more cutting to do while the startups, who aren’t struggling with The Innovator’s Dilemma, have plenty of opportunities ahead.
Your local paper probably offers a digital version and it probably looks just like the print edition. That replica version is nice but certainly not the end game in digital news. Related to the demographics item above, replica editions are largely favored by the older crowd and not so much by the younger reader. Most newspapers still rely largely on that older audience to drive the majority of their revenue, so they certainly can’t afford to abandon replica. The winners here though will be the ones who figure out they need to offer two digital options: replica and a more dynamic version. The latter needs to have a born digital feel to it, one where 20-somethings don’t look at it and say, “that’s the product my parents and grandparents read, but it’s not for me.”
Crowdsourcing isn’t the long-term solution here but neither is the newsroom, on-staff writer/editor model. The future leaders in the news content space will leverage something in between. Yes, there will be some staff members but far fewer than ever before. Freelancers will become much more important as the papers continue focusing on reducing their fixed costs. And beware the columnist or other contributor who feels they are the brand. This is true in some cases where the author has established a highly unique style and voice in the market. Those are few and far between though…more rare than previously thought. If you don’t believe me, just ask Walt Mossberg and Kara Swisher; they’re quickly learning that Dow Jones, at least, feels the AllThingsD brand is much bigger than either of their personal brands.
Speaking of brands, newspapers need to wake up before it’s too late and focus on how they can extend their brands. What comes to mind when you think about the world’s most popular newspapers? Quality? Trusted source? Politically leaning to the left or right? All of these characteristics have life beyond a print paper or its digital replica. Papers have been so focused trying to save their advertising income and reigniting their subscriber base that they really haven’t given enough thought to how they should extend their core brand name before it’s value is extinguished forever. These trusted brands need to venture into new channels with their content.
Most papers are struggling to find their identity in the new, digital-first world. Are they focused mostly on local? More on national with a bit of local? What about global coverage? My local paper is going through this problem right now. Their solution seems to be “add more content.” I don’t think that’s the long-term answer. This strikes me as something that’s too little, too late. They need to instead focus on extending their brand with new types of products and dominating the market with some unique coverage. Instead they’re planning to serve up more syndicated content from USA Today. Again, not exactly an inspired solution for today’s challenges.
Like many others in this industry, I’m curious to see what Jeff Bezos does with The Washington Post. As I said earlier, I think you can count on him doing some very innovative things at WaPo. And one thing we know for sure, Bezos always takes the long view on the market, so the industry should brace itself for some very aggressive tactics, even if it means losing a bunch of money in the short term. I liken it to the same impact USA Today had when it launched in the early 1980’s, only more cut-throat. 🙂 Bezos has a long history of making markets more efficient and hastening the demise of the competition. Look for more of that as he disrupts yet another industry.