Newspapers face a perfect storm of trouble: rising newsprint prices and transportation costs, coupled with declining readership and a shrinking ad base.
Though newspaper companies are working hard to increase their digital presence, they still get anywhere from 80 percent to 90 percent of their revenues from the struggling print editions.
But at some point, the expense and decreasing relevance of day-old ink on paper will force newspaper companies to severely curtail or even shut down their print editions.
And that day might come sooner than you think — perhaps within five years, and very likely within 10.
Gannett, the nation’s largest newspaper company, is a good proxy for the industry. According to a recent item in the Gannett Blog, readers are dropping their Gannett papers at a frightening rate.
Overall, Gannett newspapers lost 27 percent of their subscribers in the last decade. The drop occurred in large markets like Phoenix and Indianapolis; medium-sized markets like Des Moines and Rochester, N.Y.; and small markets like Marshfield, Wis.
But that 27 percent drop hides an even uglier truth: Circulation held reasonably steady through the first half of the decade, then began falling dramatically after 2005.
Meanwhile, the newspaper industry has lost more than half its ad revenue since 2005 and the typical newspaper has slashed anywhere from one-third to one-half of its news employees.
Fewer readers, fewer dollars and fewer newspeople generating less news coverage. That’s not a recipe for success in either the long or the short term.
Star Tribune, Pioneer Press
I actually believe that the Star Tribune and the Pioneer Press will last longer than newspapers in other markets. Readers here are loyal and both papers seem to have steadied themselves after the shocks of recent years. But even Nancy Barnes, the editor of the Star Tribune, told a professional group this month that the Strib’s weekday print editions might not be around much more than five years.
When print — and its outsized revenue stream — dies, then newspapers will be forced into even more severe staff cutbacks. A handful of professional editors will oversee Web content from poorly paid freelance writers and photographers, bargain-basement “content farm” news services and unpaid community members.
Newspapers will make increased use of computer programs that generate simple news, business and sports stories from statistics and factual data — no human writing required.
They’ll fill their websites with sensational, titillating — and cheap — photo galleries designed to boost page views. Again, Gannett has pioneered this with the Metromix feature found on many of its properties’ websites — for example, this 54-photo gallery of Indianapolis Colts cheerleader tryouts.
When print newspapers die, their online brands will suffer, too. Right now, newspaper websites get great traffic — but still don’t bring in a lot of revenue. When their organizations lose that lucrative print revenue stream and cut back on news personnel and quality content, their websites won’t be as compelling as they are now. Traffic will drop as people find fewer reasons to visit.
Smaller weekly and community newspapers will last longer in print. Reader expectations are different and they’re already on a less-demanding publication schedule. And the handful of national papers like the New York Times and the Wall Street Journal will continue to be available in print — at a very hefty price for those who still want the paper edition.
But the age of the large, metro newspaper as a common news source for a majority of residents is drawing to an end — and that end might come more quickly than any of us could have imagined just five years ago.