How a web-based strategy affects print media
The decision to move a newspaper from print to web, and then to a web-only edition can trigger a loss of up to 75% in revenue for the title, new research shows. Researchers from City University London in the UK examined the Finnish financial daily Taloussanomat which shut down its print edition and got its web-based strategy off the ground. The findings are a first for a trend that continues to grow in the media sector.
The demise of a print edition should increase web traffic, correct? The City study found that the exact opposite occurred: the newspaper's website traffic remained stagnant. According to the researchers, the online-only Unique Users were 22% lower and Page Impressions dropped 11% in the five months since the print edition closed.
Neil Thurman and Merja Myllylahti from City University's Graduate School of Journalism believe readers are spending about 75% less time reading the title than they did when both print and web editions were available.
Since the launch of a web-only service, Taloussanomat has been hit by a shrinking income and reporting lower readership, the researchers said. Costs may have shrunk by more than 50%, but Taloussanomat's revenue incurred a major loss.
According to the researchers, the lack of print advertising and subscription income are responsible for putting a dent in the figures. They noted, however, that in absolute terms the cost savings more than offset the loss of income because the title had been losing money for some time.
The researchers' case study found that a newspaper would have to post an operating loss of 31% or more in order to justify the end of a print edition. While the thought of sitting down with a newspaper on a Sunday morning conjures up good feelings, this latest study hints that a small but growing number of loss-making titles will have to close the doors on its print editions at some point.
Such a move would also affect workers. The web-only version is not a guarantee that newspapers will recoup their losses. When Taloussanomat moved to web-only, its staff shrank from 69 to 41. Sources have been quoted as saying that more redundancies are expected.
Based on the findings of this study, the researchers believe advertising income will shrink and titles will become dependent on other sources of income including 'permission marketing' via opt-in content like email newsletters, as well as partnerships, services and events that build on newspaper brands.
But they pointed out that web-only newspapers will have a harder time building brand visibility and maintaining independence as there is greater financial pressure to combine content and increase merges and acquisitions at lightning speed.
The City researchers also found that because of the pressure to increase online readership and use fewer resources, around 80% of Taloussanomat's stories are generated by news agencies and other sources.
Around the globe, readers have already witnessed the printing demise of the Seattle Post Intelligencer, the oldest newspaper in the US state of Washington. The Christian Science Monitor also announced in April that it would discontinue its daily print format. Mary Trammell, editor in chief of The Christian Science Publishing Society and a member of the Christian Science Board of Directors, remarked this new strategy would 'secure and enlarge the Monitor's role in its second century'.