Bye bye, print

Oct 23 2012 07:32
Arthur Goldstuck

IN THE undeclared war between printed and digital media, there are many dates that will live on in infamy.

October 28 2008: The Christian Science Monitor closes its daily print edition.

March 13 2012: The end of the Encylopaedia Britannica as a set of printed volumes.

And October 18 2012: Newsweek announces it will cease publication of its weekly magazine, and become a digital-only publication.

The announcement last Thursday sent shock waves through the print media industry, representing a capitulation to the inexorable rise of digital media.

Newsweek said it would lay off a portion of its staff, and those who remain will produce a paid-for online magazine called Newsweek Global. It will continue to exist alongside Newsweek’s online sister publication, the startlingly inappropriately titled The Daily Beast.

In an interview with the New York Times, editor-in-chief Tina Brown confessed: “You cannot actually change an era of enormous disruptive innovation. No one single person can reverse that trend. You can’t turn back what is an inexorable trend.”

Who knew?

Of course, that applied equally a few months before, when Brown had insisted Newsweek would not abandon print. The pattern is familiar the world over, where executives who had cut their teeth on print refuse to accept the demise of declining publications, only to give in weeks or months later.

In South Africa, that time frame will be years later, but we have been seeing the same disconnect from reality. Most publishers don't want digital and most editors don't understand digital.

For now, they are able to get away with keeping the blinkers on. The rise of wildly popular mass market publications along with numerous niche publications gives comfort, and print is not visibly on the decline.

But it is a mistake to think this proves our market is different. All it proves is that our market is on a different rise-and-fall curve, but the difference is in time rather than in market structure.

The cracks are showing. The argument that you cannot guarantee the “same quality” online as you can in print publications collapses spectacularly in the face of a woeful decline in quality of most printed newspapers over the past decade.

The dramatic shift in the phone market – next year more than half of the 10 million phones sold in South Africa will be smartphones – means that a ready audience is emerging for consuming content on a handheld device. That is both the threat and the opportunity for mass market publications.

Print still has a role. Indeed, many roles. Digital may be more effective at storing, presenting and linking vast amounts of reports, analysis and background, but print still remains better at packaging such content into a cohesive product.

Print is also better at generating revenue in big chunks, compared to the per-view and per-click models of most digital advertising. But therein, too, lies the inevitable demise of print.

A fascinating analysis published last month in TheMedia magazine, by MediaShop director Trish Guilford and Mike Leahy of Media Inflation Watch, shows no real decline in print from 2002 to 2012 if one looks at overall circulation.

However, lurking beneath that hale and hearty exterior lies a sick patient. The numbers are kept up by a rising number of niche publications and disruptive new entrants.

Here is the reality: South Africa’s 24 major publications that have been around for the past decade showed a decline in total sales from 3.36 million to 2.5 million in 10 years.

Cover price revenue also suggests good health, but likewise hides a nasty prognosis. In 2002, the total revenue based on cover price and sales of these 24 publications was R26.7m. By 2012, it had climbed to 40.7m – a handy 53% rise. However, the total cover prices of these publications had exactly doubled over the same period.

There are two simple reasons publishers would prefer to look for scapegoats or rail against the “new media” way of doing things.

Firstly, they cannot generate the same advertising revenues from the same number of users looking at the same content. The price structure for online advertising - in particular banner ads – is incredibly low compared to that of print adverts.

Secondly, publishers hate the idea of giving away content for “free”. The truth is, as has often been argued in these columns, readers never did pay for the content. The cover price could do little more than cover the cost of packaging – i e print and distribution. The high costs of news gathering and content creation could only be covered by advertising.

Guilford and Leahy’s analysis confirms this uncomfortable truth. In 2011, R10bn was spent on print advertising in South Africa, according to The MediaShop. Compare that to R40m in print purchases of the top 24 publications by consumers, and we instantly see the big lie of free content.

You can sell packaged content that represents a clear value proposition. You cannot sell content that has no perceived value in isolation of the package.

Publishers and editors have no choice but to educate themselves about new media, new ways of integrating print with digital media, and new ways of selling advertising. That way, when their days of infamy arrive, instead of shock waves they will encounter mere ripples.

The choice is theirs.

 - Fin24

*Arthur Goldstuck is managing director of World Wide Worx and editor-in-chief of Gadget. Follow him on Twitter or Pinterest on @art2gee

arthur goldstuck  |  newsweek  |  print  |  digital



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