Future of Newspapers: Less Print, More Digital, Alternative Forms of Funding

What do the mainstream media and Christian denominations have in common? Great histories and uncertain futures.

That’s the view of Bob Cox, publisher of the Winnipeg Free Press and chair of News Media Canada, an umbrella group for newspapers and radio and TV stations in Canada.

At the same time, they share another important thing: “We have a mission that we feel is crucial to the communities we live in,” he stated.

Cox shared that perspective on November 20 during a webinar with members of the Canadian Christian Communicators Association (CCCA).

He went on to say while newspapers like the Free Press are facing severe challenges, “demand for what we produce, news and information, has not gone away.”

According to the most recent data from Vividata, the Free Press reaches 64% of adults in Winnipeg, and 64% of Winnipeggers say they read a newspaper in some form, he noted.

Nationally, things are similar, he said, with 79% of Montrealers, 68% of people in Toronto, 76% of people in Victoria accessing newspapers.

“Basically, about three out of every four Canadian adults get news from newspapers every week,” he said.

Good news: People still reading newspapers, but new ways of consuming news

But if people aren’t abandoning newspapers, it’s also true they aren’t consuming them the way they used to.

That same data from Vividata shows many newspapers in Canada have digital audiences larger than, or the same size as, their print audiences, he said.

This includes the Globe and Mail, the National Post, the Toronto Star, Le Devoir, the Ottawa Citizen, the Calgary Herald and the Windsor Star.

All of these “papers” are “actually majority digital media or close to it,” he stated.

“We’re fast approaching the tipping point where all daily newspapers will have primarily digital audiences.”

Bad news: Falling advertising revenues

While its good news that people are reading newspapers, the bad news is financial support for them as fallen dramatically.

“In many ways this is like a lot of churches that have widespread community support but empty pews so they don’t have enough donations to keep their doors open,” he shared.

A chief reason for the financial drop is how local businesses, which used to support newspapers with advertising, spend more and more of their advertising dollars on Facebook and Google.

Those ad dollars, which used to support local journalism, now “leave the community,” he stated.

Nationally, Cox said, ad revenues in newspapers have fallen by half in the past five years to about $1.5 billion from $3 billion, and that $3 billion is half again of what existed a decade ago.

More bad news: Drop in circulation

Added to that is the change in consumer habits, as readers who used to buy subscriptions go online expecting to get news for free.

The result is a significant drop in circulation. Cox said the Free Press sold about 250,000 copies on Saturdays in 1984; today that figure is 73,000.

Nationally, the number of printed papers sold is half what it was a decade ago, he noted.

And yet, surveys show people still really value local news, he said. “They see it as a public good that is vital to the democratic health of their communities. They just don’t want to pay for it.”

According to Cox, only about 20% of Canadians are financially supporting news, either through subscriptions or donations.

The result: Media in a precarious state

This isn’t just a problem for newspapers, he added.

“Most people are unaware of the precarious state of local news, the fact that all local TV stations lose money on news,” he said.

The result for all media is less money for local news gathering, print, TV or radio.

“In many communities there remains the appearance of news sources, since newspapers still publish, but there is not the reality of local news, as very little money is put into news gathering,” he said.

“They call these ghost newspapers.”

So if readers are moving to digital, is that were newspapers should be placing their bets? Yes, said Cox, but it isn’t easy.

“Most of the newspaper industry is not positioned to survive the switch to digital,” he said. 

“The majority of their revenues are related to the sale of printed copies and the sale of advertising in those printed copies.”

Digital revenues not filling the gap

At the same time, digital advertising isn’t filling the gap left by the decline in print advertising.

The Free Press, he said, has digital revenues of about $5 million a year and expenses of $45 million—nowhere near enough to help keep it going.

Some bigger newspapers, like the New York Times, have made great strides, he said, and may soon earn enough from digital to cover the costs of its journalism.

But the Times has 3.2 million digital subscribers and a national audience, he observed. “Most of us are not in this game.”

What are the solutions?

If those are all the challenges, what are some solutions? Cox had a couple ideas if newspapers are to survive.

The first is to give up the printed newspaper—if digital revenues aren’t keeping up with expenses, the only thing left to do is reduce expenses, Cox said.

That means cutting print.

“Most of the $45 million in annual expenses at the Free Press is related to the cost of producing a manufactured good every day,” he said—things like buying paper, paying press operators, delivering the paper.

The newsroom budget, on the other hand, is only about 15% of total expenses.

“Strip away all the manufacturing and you have expenses of about $12 million to produce and present digitally all of that journalism,” he stated.

If that’s the case, $5 million of digital revenues “looks a lot more promising,” he stated.

And if only 20% of Winnipeggers subscribed to the Free Press digitally, he would be able to meet that budget, he stated.

“It is only when we embrace this future, and put our best efforts into achieving it, that we will really have our heads around keeping the newspaper alive,” he added.

The second idea is to find alternative, non-traditional sources of revenue to support journalism.

This includes things like what the Free Press is doing with faith coverage—soliciting support from faith groups to produce more articles about religion.

It also involves government support.

This includes funding for journalists to cover so-called news deserts—communities where there is little or no local news reporting anymore.

It also includes a refundable tax credit for employing journalists; a tax credit to encourage people to take out digital news subscriptions; and allowing news organizations that operate as not-for-profits and receive donations.

Although the federal government has spoken affirmatively about these ideas, Cox said, nothing has actually been done yet.

For him, this is a problem.

“Time is of the essence. I first went to Ottawa in January of 2016 to talk to bureaucrats and politicians about the crisis in newspapers and we’re still waiting. Government simply has not moved fast enough.”

Important to be honest and engage public more

The media also needs to engage the public more and make them aware of the dangers facing local news, he said.

“The general public is only vaguely aware of the threat,” he said, noting after a Quebec newspaper declared bankruptcy people in the local business community pledged more than $1 million to the newspaper.

“The problem is that we all don’t want to have to declare bankruptcy to find out if our communities will support us.”

Surveys have shown educating the public on the benefits of local news, and the fact that it is in trouble, increase the likelihood of support.

“My advice to people in newspapers at all levels is to tell readers about what is going on,” Cox said.

“Don’t cover up financial troubles, explain them. Give people the information that will allow them to act before it is too late.”

At the end of the day, “public support is the only hope we have,” he stated. 

“It always has been.”

When it Comes to News, What's Really on Your Phone?

For decades, pollsters have known people lie when self-reporting about how they pay attention to news. That’s why it’s so hard to trust those kinds of surveys.

When asked what they watch on TV, for example, people might say documentaries about the state of the planet—because they know they should. 

In fact, what they mostly watch are comedies and other forms of escapism.

Nothing wrong with that. It's just that you don't get accurate information about what people are really reading, watching and listening to.

That’s why counting clicks online has become the media’s best friend.  

It's not the best form of measurement, of course. But through what people click on publishers can tell what people actually like—not what they say they like on self-reported surveys.

The Reuters Institute for the Study of Journalism took this to heart it wanted to know how much people under the age of 35 in Great Britain and the U.S. were actually reading news.

They started by asking them what news apps they had installed on their phones—something that shows interest and even intent.

Next, they came up with an ingenious way to get around the discrepancy between what people say they do, and what they actually do.

It was simple, really. They asked participants in the study to give them their phones so they could check battery usage for their apps.

As anyone who has checked knows, the apps you use most take the most power.

And the results?  

Although the participants had downloaded news apps, the battery usage reports showed they actually spent very little time on them.

According to the study, no news app was in the top 25 apps used by participants.

In other words, while they may have intended to follow the news, in real life that didn’t happen.

But if you only asked them what news apps they had on their phones, you might mistakenly believe they were avid news junkies.

Admittedly, the researchers had a small sample size; just 20 people between the ages of 18 and 35, half in the U.S. and half in the UK. So we need to be careful about drawing too many conclusions.

But the results once again reveal the truth as explained by Derek Thompson in an article in Atlantic Online in 2015: "Ask readers what they want to eat, and they'll tell you vegetables. Watch them quietly, and they'll mostly eat candy."

What’s on your phone?

New Study on Youth & News: “If I don’t see it on social media, I’m not going to hear it”

Young people don’t follow the news as much as it follows them

A new study by the Knight Foundation has found that younger people have a definition of news that goes beyond traditional news outlets; they tend to find news by accident and online; and they don’t tend to trust the news media very much.

The report was based on focus groups with 52 people in their teens and 20s in the U.S., so it can hardly be called comprehensive. But its findings are not out of line with other research about younger people and news. (Like this Pew report about the state of the news in 2016.)

As an older person, I have witnessed this change in news-gathering habits. The only thing I’d add is that while studies like these focus on youth, in fact many of us who are older have also changed the way we look for and interact with news—and we are growing wary of it, too.

This also includes the way we get it (44% of American adults now get their news via Facebook).

In other words, it’s not just young people who are experiencing these changes; it’s happening across all demographics—and its shaking up the news industry.

As for the study, it found that:

The way young people encounter and understand news in their daily lives is rapidly evolving. They don’t consume news in the same way as older generations—wait for the supper hour news or the morning paper. Instead, it is all-on all the time on social media and mobile devices.

Said one participant: “If I don’t see it on social media, I’m not going to hear it.”

Or, as the researchers put it, “young people don’t follow the news as much as it follows them.”

(And as a college student famously said back in 2008 about why she didn’t follow the news: “If the news is important, it will find me.”)

News is frequently encountered by accident. Those of us who are older are accustomed to looking for news, usually in traditional places like newspapers or broadcasts.

That is not the case for younger people. For them, news comes and goes through their social media feeds. They aren’t looking for it; it pops up when a friend posts a news item and says “check this out.”

As one participant put it: “[I was] not purposefully looking for it. Like Facebook, you get a notification for Facebook or something and you click on it and you start scrolling.”

Said another: “You’re going to find a bunch of news articles that you didn’t necessarily go there to see, but you’re going to see them and you’re going to click on them…I wouldn’t know a lot of the news if I didn’t go on Facebook.”

Most teens and young adults express low levels of trust in the news media. Those of who are older have a vestigial trust in the news—we grew up seeing the media as authoritative and trustworthy. (Whether we should have done that is another question.)

Teens and young adults in the study expressed widespread skepticism about the news and assume that much of the information they encounter may be inaccurate or biased. For them, a news source is considered more credible when its biases are known.

The definition of news is changing. For older people, news is pretty easy to tell—it’s in a newspaper or newscast and shared by reporters and vetted by editors. But what is news in a world where those things don’t exist in the same way?

Says the study: “In much the same way that the news industry has been disrupted in the digital era, teens’ and young adults’ understanding of what “the news” is and should be has largely been unhinged from the traditional understanding of journalism and institutional authority.”

News for younger people, the study says, “is amorphous and often extends well beyond the content produced by traditional journalistic institutions.”

News isn’t any fun. Well, the study put it a different way: “News is ‘depressing,’ but it is something you need to know.” In that, younger and older people may be alike—I don’t find much of what passes for news today to be very uplifting. (See post on positivity).

Sharing news can be dangerous. Maybe this is more an American thing right now, but in that polarized atmosphere people see sharing news and opinions on social media as “having the potential to negatively affect one’s online reputation.”

Or, to put it another way, if you share a news item about President Trump, someone might take it the wrong way, or judge you to be a conservative or a liberal or a racist or . . .  whatever. It’s much easier to just not share anything online.

News from friends is more trustworthy. The study found that many participants consider user-generated content—especially live video—to be more trustworthy than mainstream media sources.

This is consistent with other research that shows people are more trusting of information shared by friends than far-away sources like newsrooms, and with a decision by Facebook to tweak its algorithm to favour information from friends.

Again, the study can be found here.

Lessons from the Success of the Washington Post

'Profitable' Washington Post adding more than five dozen journalists.

That was the headline in a recent Politico story, providing some good news in an otherwise grim time for the newspaper industry.

While glad for the Post, not every media outlet has a gazillionaire like Jeff Bezos behind it to help turn things around. 

But maybe there are a few things even small publications could learn from its success, as described in the Poilitco article. 

These include:

A commitment to mobile. “We’ll make investments in mobile video,” says Fred Ryan, the Post’s Publisher and CEO. This includes mobile news and ads of 15 seconds or less.

A commitment to breaking news. The Post will add more investigative reporters, who will work to keep up with the fast pace of news today.

A commitment to digital. Smartphones, Kindle, Facebook—that’s the future of news. 

A commitment to circulation. In the past, advertising was the main generator of revenue for newspapers. But as print advertising continues to fall, that is being reversed. 

The Post has seen a 75 percent increase in new subscribers in 2016, doubling its digital subscription revenue. In the years ahead, the Post expects subscription sales to be its leading source of revenue.

A commitment to commentary. As the Post expanded its op-ed contributors and volume, “opinion” stories drove more readers to subscribe than any other content type.

This isn't surprising. At a time when anyone can get breaking news anytime and anywhere, and for free, few are going to pay for it. But they might pay to learn more about what that news means, how it fits into various contexts, and how it may affect their lives.

A commitment to technology. Along with the journalists, about 80 digital designers, mobile developers, video and audio (podcast) creators and software engineers have desks in the Post's newsroom.

“This is the face of a modern newsroom,” says Politico, adding that “these new newsroom jobs tell us a lot about what the Post believes is now creating a new virtuous circle of growth for the company.”

A commitment to customization. The Post sends out 62 different newsletters to readers, customized by topics such as government, politics, sports, economics, faith, etc. 

These newsletters “magnify the impact of each story the Post produces,” says Politico. “That’s the new digital virtuous news circle in creation.”

Can other publications learn from the Post? I think so.

Can they put them into practice? Maybe. That's where having someone with a lot of money sure can help. 

Why is so Much Fake News Being Shared? Lorem Ipsum Might Hold an Answer

There’s been a lot of discussion about fake news of late—how prevalent it is, how it influenced the recent U.S. election, how to spot it.

When it comes to spotting it, that’s easy; if the title contains an exclamation mark, it’s either fake or not worth your time; that kind of punctuation is almost never used by traditional journalists.

Similarly, any headline containing the words “amazing,” bizarre,” or “unbelievable,” especially when accompanied by exclamation marks, are either fake or to be avoided.

Of course, even if you click on the link, a cursory read of the article would quickly tell you whether the article is fake.

But that’s one of the problems with fake news; I wonder how many people actually bother doing that?

Research reported by the Washington Post suggests that might be the case.

Last June the satirical news site the Science Post published a block of gobbledygook “lorem ipsum” text under the under the headline: “Study: 70% of Facebook users only read the headline of science stories before commenting.”

The fake “article” contained two repeated sentences at the beginning:

“A recent study showed that 70% of people actually never read more than the headline of a science article before commenting and sharing. Most simply see a headline they like and click share and make a comment. A recent study showed that 70% of people actually never read more than the headline of a science article before commenting and sharing. Most simply see a headline they like and click share and make a comment.”

What followed after was the “lorem ipsum” text that publishers use to fill out a page before the actual text is inserted.

And what happened?

Almost 46,000 people shared the post—an example, the Washington Post said, “of life imitating comedy.”

Another new study reported by the Post was done by computer scientists at Columbia University and the French National Institute. It found that 59 percent of links shared on social media have never actually been clicked.

In other words, most people appear to re-tweet news without ever reading it.

“People are more willing to share an article than read it,” study co-author Arnaud Legout said in a statement.

“This is typical of modern information consumption. People form an opinion based on a summary, or a summary of summaries, without making the effort to go deeper.”

According to the Post, these blind shares and likes “are really important in determining what news gets circulated and what just fades off the public radar. So your thoughtless retweets, and those of your friends, are actually shaping our shared political and cultural agendas.”

Why do people share links they never read?

It could be a case of the so-called mirroring effect, where people like and share things they think will make them look smart, generous or caring to their friend on social media—it’s part of their online brand personality.

It could be a case of confirmation bias; Hillary Clinton may not have done all those terrible things, but I wouldn't put it past her! And so we click on "share."

Or maybe it's just the rush of the moment; who has time to actually read all those articles our friends send us on Facebook or Twitter?

And so a lot of fake news, and other kinds of news that might best be avoided, appears in our news feeds more by accident than design.

Shaking Off the Print Legacy: Newspaper Association of America Changes its Name

Earlier this year I wrote about how the Winnipeg Free Press is no longer a newspaper.

“We are a news engine that produces a newspaper—and a website, a Facebook page, video, livestreaming, and a salon at the News Café,” said editor Paul Samyn.

“We are not a newspaper, but we publish one,” he stated, adding that the Free Press is “trying to shake off the print legacy.”

Well, add the the Newspaper Association of America—er, the former Newspaper Association of America—to the list of those who are shaking off the legacy of print.

On September 7 the Association, founded in 1887, announced a name change: Now it will be known as the News Media Alliance.

Why the change? Simple. The number of newspapers in the U.S. continues to decline, down to 2,000 from 2,700 in 2008.

But that’s not the only issue. According to David Chavern, the Association’s chief executive, the word “newspaper” has become meaningless in reference to many of its members which today reach many of its readers via the Web.

“Newspaper’ is not a big enough word to describe the industry anymore,” Mr. Chavern said. “The future of this industry is much broader.”

(The move will also allow non-print news organizations, like Buzzfeed, to join the Association—a good move in light of falling membership.)

In an article about the name change in the New York Times, author Jim Rutenberg pointed out that although news on print is disappearing, it’s not as if people don’t want news anymore.

“Through online exposure, newspapers are reaching more people than ever,” he wrote. “The problem is how they make money. Circulation for physical newspapers is declining, and so is print advertising; digital ads remain far less profitable.

“The trick is finding a way to make up the lost revenue.”

Yes, that is the trick—and a big one, at that. Maybe changing the way we look at how we get news, and what we call it, is a start.

The Media in an Age of Disruption: Book Review

I just finished reading John Stackhouse’s new book, Mass Disruption: Thirty Years on the Front Lines of the Media Revolution.

In it, Stackhouse—a long-time journalist and former editor-in-chief of the Globe and Mail--chronicles the steep decline of the newspaper industry, in particular, but all media, in general, due to the disruption caused by the digital age.

It’s a sobering read.

He writes about how print advertising—the lifeblood of a newspaper—plunged from a high of $65.8 billion in 1999 in the U.S. to about $20 billion now.

Some of those ads have moved online, but it doesn’t begin to cover the loss. For every $1 billion in lost print ad revenue, only $200 million comes back digitally, he says.

At the same time, newspapers have seen their circulations fall, and newsrooms reduced by cuts.

The digital revolution also changed newspapers in other ways.

Before moving online, newsrooms were run on “a sort of informed whim,” he writes. “The smartest and most vocal people in a story meeting tended to win the day.”

With digital, however, there was no need for whim. Editors and reporters knew exactly what people were reading.

For example, the Globe found that roughly 40 percent of the paper was being read by only about 1,000 people—hardly comforting to those who worked hard to produce those articles. 

Some welcomed this new knowledge, he says, but not all. Some journalists still believed that they, not readers, should decide what is important and worthy of coverage.

What they need to deal with, Stackhouse states, is “the fact they no longer controlled the reading experience.”

If this new reality is tough for journalists, it’s a boon for readers. We have never had it so good. There’s “an entire planet of information” at our fingertips, he says.

Old Model Broken

Most of us get that information digitally, usually on our phones. Not through print, TV or radio. And few media outlets have figured out how to make money that way.

The old model for sharing news was paid for by advertising. But advertisers no longer need newspapers (or other media) to reach customers. 

And, if they do, they aren’t willing to pay as much as they used to—certainly not when its online. (The so-called dollars-to-dimes, or pennies, media universe we now live in.)

It’s similar for classified ads, which once yielded huge profit for newspapers. They have disappeared to places like Kijiji. (The New York Times estimates its losses in classified ads to equal half the cost of running its entire newsroom.)

The tragedy for Stackhouse is that things could have been different.

Journalists knew the world was changing back in the 1990s, but failed to start making the steps needed to adapt to the new digital world.

Part of the reason is how well the media was doing well back then. Profits were high and things looked great. Newspapers made huge investments in new offices and print redesigns. 

(The Winnipeg Free Press moved from downtown to a $150 million new building with a printing press in the suburbs—a decision they likely regret now.)

The Wrong War

And they went to war against each other. Stackhouse devotes a chapter, titled “The Wrong War,” to the huge competition between the Globe, the then-new National Post and the Toronto Star.

Unfortunately, they were fighting the wrong enemies. The real enemy was Google, and all the other digital upstarts that aggregated and, later, created news and other content. (Without the burden of buildings, expensive reporters, printing presses, union contracts and other legacy burdens.)

But change is hard, says Stackhouse.

“I have sympathy with their (newspapers) plight,” he writes. “Adapting multimillion-dollar firms on the fly is hard. Very few industries attempt it until it’s forced on them.”

And now it is being forced on them. It isn’t pretty. Anyone who cares about journalism grieves the losses of the many good people who have been downsized, and the publications that have closed.

The Future 

So: Will newspapers survive? That’s a good question. Stackhouse says the book is not an obituary.

“It is a journey through the news model . . . to see where fundamental change is needed and can be found.”

Among other things, he says that newspaper owners need to be patient; advertisers need to re-evaluate their association with newspapers; governments need to be supportive; and journalists “need to see their work as entrepreneurial and competitive, not tenured and enshrined.”

And readers? We “need to accept the cost of news—in time and attention, as well as in money,” he states.

Stackhouse concludes by saying this crisis may have given everyone—publishers, journalists, advertisers and readers—the sort of wake-up call that was missed earlier.

“There’s still time . . . to forge a better future for news,” he says.

Is he right? Part of me hopes so, but part of me wonders if the world hasn’t changed so much and so fast that there is, in fact, no future for the kind of newsgathering institutions that once dominated the sharing of information.

I also wonder if the appetites of media consumers have changed so dramatically that there's no longer any need for traditional journalists or journalism.

Writers like Stackhouse, and other observers of the decline of the media, lament what the loss of newspapers will do for our society and democracy. But what if people really don’t care about the news as much any more? What if we’d really rather watch cat videos and read listicles about celebrities? What then? 

But those are different questions. Maybe someone will write a book about that one day.