Rommil Santiago: eCommerce, Marketing & Management

The newspaper saga: A possible solution?

CNN recently hosted a debate over the ailing newspaper industry, touching on topics like newspaper publisher complacency, newspaper readership, and budget cutbacks. Whatever stance you take on the subject, one thing is clear, ad revenue for newspapers is drastically low this year. This shortage has forced some newspapers to go completely online, others to reduce home deliveries, and the rest to simply shut down operations completely.

Some have mentioned the web as a possible solution to the newspaper industry’s problems, but it still remains unclear what the complete business model would be. Essentially, the root of the problem is this:

Creating great content takes time and skill, where will the money come from?

A couple of hurdles the web poses for newspaper publishers are:


  • The existence of a lot of lower priced (mostly free) alternatives.
    According to a recent study (one which I question the statistical analysis of), the internet has recently surpassed newspapers as a primary source of news. I attribute this preference to the real-time nature of news reporting on the web. The sheer number of bloggers and hobbyist journalists who report on news as it happens provides readers with an embarrassment of riches in terms of articles and content - and most of it for free. This makes it difficult for any newspaper to charge for their content, regardless of how good it is (though some would argue that this would be a good case for Freeconomics). Why pay to read an article when you can get one of approximately the same “value” for free?

  • The fragmentation of content.
    According to some web marketers, in today’s high-tech world, content is severely fragmented. While in the past, one could place a commercial spot during the Super Bowl and be assured high-visibility, the emergence of TiVo’s and other technologies have made it possible for viewers to skip over ads. Similarly for the web, more and more content is atomized. Any particular article, can be found in a website, shared in social networks, transmitted in RSS feeds - placing ads within content just isn’t as simple or as effective anymore.


Faced with these obstacles, I guess I can see why some publishers have opted to shut down, fire staff and reduce production. But I feel that perhaps people are overlooking the most obvious solution:

Why don’t newspaper publishers simply charge more?

Call me crazy, but it seems to me that newspaper prices are hilariously low. The Montreal Gazette charges 89 cents for its Thursday issue. That’s five sections of high-quality writing, journalism, and photography for under a buck. The hard work of educated writers and graphic designers, and printers, sold for pocket change. Even a cup of coffee at the local Starbucks can easily cost three dollars, and all that took was a minimum wager and a coffee grinder (I know I’m exaggerating). But c’mon, a bar of chocolate at the corner store costs $1.15 - and it’s nothing but empty calories. And here’s the kicker: you can get the newspaper delivered to your home in a plastic bag for less! How does any of this make sense?

So here are my crazy suggestions for newspaper publishers if they want to maintain the print version of their publications (mind you I’m not an economist, and I’m probably overlooking something obvious like actual cost of publishing):

  • How about only putting news and money generating content in the newspaper? I think a few pages could be cut here and there on most issues. Every penny counts.

  • Believe in going online and what it can do for your print publication.

  • Listen to what readers want. Run some surveys, create a community. Determine their wants and needs.

  • Charge more than double for a newspaper. Charging the same price as a cup of quality coffee is not unreasonable.

  • Charge more to deliver the newspaper to reader’s homes. I’m not saying charge more than the price at the newsstands, but I think the market can withstand a sizable increase.


Do you think there is hope for the newspaper industry? What are your thoughts?

Does the Pew publication stink?

Just this week, the Pew Research Center released a publication, “Internet Overtakes Newspapers as News Source”, which shows the proportion of people who use the internet as their major source of news several percentage points greater than that of people who use newspapers as their major source. However, after looking over some of Pew’s figures, I’m not sure if that’s the case quite yet.

There may not be a significant difference.

After some number crunching, I would not say there exists a significant difference (at least with a confidence interval of 95%) between the proportion of users that use the internet vs.  that of users who use newspapers as their major source for news. Furthermore, 19 times out of 20, the two proportions can actually be considered equal. In my eyes, just as many people still consider newspapers an important news source as those who prefer the internet.

The sum of the proportions are greater than 100%.

If you sum the total of all the news source proportions (television, newspapers, and internet), the total is 145%. This in itself wouldn’t raise my curiosity had the question been “What news sources do you use?”. However, the question apparently was “Where Do You Get Most of Your International and National news?”. I don’t know about you, but personally, “most” means that a respondent can only answer one choice. So, where did the extra 45% come from? The only explanation I can come up with is that respondents were allowed to select multiple “most”s - which would make trending and comparison difficult from year to year. The internet proportion may be increasing, not because people are changing preferences, but possibly because they are simply more aware of the internet.

So while I am sure that the internet will overtake print as the public’s source of news very soon, I think we’re still a while away from that reality, and I question the Pew Research Center’s judgement in releasing a publication titled, “Internet Overtakes Newspapers as News Source” with such questionable points other than to grab some headlines and perhaps funding. Regardless of the validy of this study (or my back-of-the-envelope analysis), perhaps a more interesting publication would have been one that analyzed which medium had the greatest influence towards a purchase. Now that’s a report that would be worth reading, and more in line with the Center’s goal of reporting “trends shaping America and the world”.

What are your thoughts?