Thursday, November 15, 2007

Troubling news for newspapers online

Many newspaper companies have been saying for years now that their future is on the Internet, and they have been training readers to go online to get their news rather than picking up a newspaper. While online only makes up 7 percent of newspaper revenues nationally, online promoters have said the category will grow and print will fade away.

However, MediaNews Group's third-quarter earnings report released yesterday throws some cold water on that assumption. "Revenues from our Internet operations remained relatively flat," the report says on page 20. "Within the classified advertising category, we had decreases across all categories including real estate, automotive and employment."

Other chains are also reporting a slow down in the growth of internet revenues, though nobody else is saying it has gone flat. The trade publication MediaPost (subscription required) reports the following third-quarter growth figures:
    • Gannett (excluding USA Today): 7.5% (compared with 21 percent in the third quarter of 2006)

    • Tribune: 9 percent (compared with 28 percent a year earlier)

    • McClatchy: 1.4 percent (compared with 16.3 percent)

    • Dow Jones: 8 percent (compared with 13 percent)

    • E.W. Scripps: 19 percent (compared with 40 percent)
The Poynter Institute's media business analyst Rick Edmonds points out that the MediaNews and other chains were pinning their hopes on an online sales network being developed with Yahoo. "[The] “architects of the arrangement, like Dean Singleton [pictured above] of Media News and Robert Decherd of Belo, have been promising that the real action will kick in mid-2008 when technology is in place to allow Yahoo to sell national ads on a common platform in any combination of the member papers.”

However, it was reported earlier this month that MediaNews, Hearst and other partners in the Yahoo project said that they are considering a separate national online sales effort, which suggests the Yahoo project may be on the rocks or that the newspaper partners are hedging their bets in case Yahoo comes up short.

2 comments:

Anonymous said...

Gee, these newspapers have been online for 10 years? maybe more? And after all those years, they only account for 7% of company revenues ... How on earth does Deano hope to reach his goal of 20% internet revenue by 2012?

john said...

Digitization is the only solution to increase the news paper circulations. There is a website www.pressmart.net delivers the digitization services for news papers and other print publications.