Newspaper print businesses are near death, but their digital business isn't so hot either!

The newspaper ad business is near death, but so is its digital ad business! Henry Mance writes for Financial Times about what has been happening in Britain.

Spending on national newspaper advertising has fallen by one-third since 2010 to £880m. Online prospects have also darkened. Adblockers, smartphones and new social media platforms are tearing holes in digital strategies.

What is new is the disappointing results of once-vaunted online experiments. MailOnline, with 14m browsers a day, last year missed its revenue target for the first time, and is still recording undisclosed losses. In January the Guardian, a digital pioneer, announced an annual loss of about £50m and said it would cut costs by 20 per cent over three years. In a fresh sign of the strain, parent group News Corp has promised to squeeze overheads at the Sun and the Times, while the Daily Telegraph has told staff to expect an “extensive strategic review”.

Instead of diversifying, the industry became locked in a debate over whether to introduce paywalls — the approach taken by the Financial Times, the Sun and the Times — or to seek huge global audiences for advertising, like the Daily Mail and the Guardian.
“People were still thinking in terms of single solutions, they were thinking ahead from the past,” says George Brock, a professor of journalism at London’s City University.

Relying on online advertising, worth a total £3bn in the UK last year according to Enders, has also proved problematic. Traffic is expensive — MailOnline employs 800 staff — and returns can be limited. Readers are increasingly using mobile phones, where ads are small and often unseen.

Newspapers are also losing their direct digital route to their readers. “Five years ago news groups were trying to ignore Facebook and Google. Now they are facing the inevitable,” says Will Perrin, director of internet consultancy Talk About Local. “In the next five years it will be all about distribution — what is your relationship like with Facebook and Google?”

Apple and Facebook have launched news portals, while Google is developing pages to make news sites more readable on mobile devices. (The FT is participating in Apple News, Facebook Instant Articles and also supports the Google initiative.) In the short term, those platforms are promising publishers the opportunity to reach more readers and sell more advertising. There is even a possibility that Facebook, Apple and others could pay news publishers to carry their content, just as cable providers pay to carry particular channels.

From New York Shannon Bond writes,

Newspapers are also losing their direct digital route to their readers. “Five years ago news groups were trying to ignore Facebook and Google. Now they are facing the inevitable,” says Will Perrin, director of internet consultancy Talk About Local. “In the next five years it will be all about distribution — what is your relationship like with Facebook and Google?”

Apple and Facebook have launched news portals, while Google is developing pages to make news sites more readable on mobile devices. (The FT is participating in Apple News, Facebook Instant Articles and also supports the Google initiative.) In the short term, those platforms are promising publishers the opportunity to reach more readers and sell more advertising. There is even a possibility that Facebook, Apple and others could pay news publishers to carry their content, just as cable providers pay to carry particular channels.

The Times aims to double total digital revenue from advertising and subscriptions to $800m by 2020, and has pushed into branded content.

News Corp, owner of the Wall Street Journal, saw revenue and profit shrink last quarter, with ad sales dropping 12 per cent thanks to declines in print.

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