Even as newspaper houses in India are going gaga over their respective readership gains in IRS surveys, many of their counterparts in the US and Europe are finding themselves to be less lucky. Some of them have shut shops as some others plan to follow suit very soon. Western newspapers are probably facing the severest crisis in many decades as their subscriptions have taken a nosedive, their commercial models are crumbling and their ‘common competitor’ is getting mightier with each passing day.
The truth is out: existence of print media, or the proverbial fourth estate as we have known it for ages, is under threat. Earlier there was electronic media eating into its pie of advertising revenue and readership, and now there is ‘new media’ eroding its role as the gatekeeper of information. We may like to accept it or not, news craft is ceasing to be the sole privilege of journalists or editors.
Information (or should we say news?) is raining from everywhere- from blogs and micro-blogs to social networking sites, from Youtube like video sites to citizen driven portals, from news feeds and aggregators to even search engines! Print media is forced to compete not only with television but an ever increasing crowd of these technologically cleaver and powerful, fast and interactive challengers. Who could have anticipated this just a decade ago?
Didn’t we think that technology and in turn Internet will only add up to the power and reach that print media traditionally enjoyed? Weren’t the media moguls smiling at the prospects of an incoming blast of opportunities in the form of Internet based advertising and multiple methods of paid and unpaid content delivery? Wasn’t Internet supposed to have expanded their footprint beyond traditional limits and open up new avenues of growth? So where did the calculations go wrong?
The answer is probably not too difficult to guess. Ultra rapid growth of the alternative, free, digital modes of information have left the 200 year old fourth estate gasping for breath. On top of that, there is meltdown of economy. Companies are spending less on advertising and even the curtailed ad-spends are getting distributed across print, electronic and online forms of media. Due to its programmability and a highly focused and customized delivery method coupled with a strong element of interactivity, the later is turning out to be an attractive option for advertisers who want fast results in a relatively smaller budget.
The dual challenge is hitting print media where it hurts. It is losing readers as well as advertisers; considered to be the lifeline of newspapers. The Print, which enjoyed a comfortable monopoly over the business of news for decades, was probably too complacent to face a sudden onslaught from an ‘intangible’ medium. In a situation where news is available free online, resources for newspapers are drying up fast and there is no immediate ray of hope in sight.
According to eMarketer, newspaper advertising revenues in the US declined 7.9% in 2007 and 16.4% in 2008. The trend will continue in 2009 (15.9 %) when overall US newspaper ad-spending will roughly stand at $31.9 billion. The free-falling newspaper industry has come down from $49.5 in 2005 to $31.9 in 2009. Plainly put, US newspapers are losing Rs. 90,000 Crore every year compared to what they earned in 2005! So where did the money go? Mostly to new media which expects to garner a whopping $32.5 billion from advertising alone this year.
Impact of the crisis is obvious. Many western newspapers and magazines are facing heavy debts, bankruptcy, trim-downs and closure; rendering thousands of talented journalists and other employees jobless.
Time magazine’s Walter Isaacson feels, “the crisis in (western) journalism has reached meltdown proportions. It is now possible to contemplate a time when some major cities will no longer have a newspaper and when magazines and network-news operations will employ no more than a handful of reporters.”
What Isaacson warned in February 2009 may come true even earlier than anticipated as three US cities- Denver, Seattle and Tuscan- have only one newspaper to call their own following the closure of Rocky Mountain News, Seattle Post Intelligencer and Tuscan Citizen respectively. San Francisco Chronicle, founded in 1865, is said to be losing $1 million a week and its owners have threatened to shut it down which, if happened, will render San Francisco city without a paid daily newspaper. The Times of Seattle, Sun Times of Chicago and Star Ledger of Newark too are on the brink of closure while the Baltimore Examiner has already been closed. Among some iconic US dailies, the Christian Science Monitor will no longer have a print edition while Chicago Tribune, Los Angeles Times, Philadelphia Inquirer, Minneapolis Star Tribune, are facing bankruptcy. Had it not received a timely help that it did from the Mexican businessman Carlos Slim, even the venerable New York Times might have bitten the dust. If that doesn’t sound shocking enough, one newspaper group’s stock prices have come down below the price of its daily edition.
The crisis, as expected, has caused panic reactions. Washington Post is the latest to announce lay-offs and shutting down of a few bureaus including the prestigious one in New York. Los Angeles Times alone has issued pink slips to more than 300 journalists followed by Miami Herald (205), Atlanta Journal Constitution (156), Kansas City Star (150) and many more. As of now, they are fighting for survival. The long-term struggle to save journalism and democratic principles will have to wait for a while.