Web 2.0 Accelerating Print Newspapers’ “Near-Death Spiral”
Just as newspapers start to figure out how to make some revenue via the Internet, Web 2.0 is changing the rules and further fragmenting their diminishing audiences.
Forrester Research details the impact that blogs and RSS feeds are having on newspapers in a new report The Fragmentation of Yesterday’s Newspaper.
According to Forrester, 43 percent of US online consumers say they have viewed personalized content on a portal home page or RSS reader in the past 12 months, with Gen Y (ages 18-27) and Gen X (ages 28-41) consumers leading the trend.
RSS feeds generally don’t contain ads and, depending on the format, may not require the user to click through to the Web site to read the whole story, so while newspapers are right to offer consumers the convenience of RSS subscriptions, they also may lose out in generating revenue from those consumers.
Blog content consumption mirrors RSS, with less concentration on news. Nearly half
(47%) of US online consumers say they read blogs, again with younger consumers leading consumption. Newspapers enjoy a wider reach when bloggers pick up their stories — and may benefit from better placement in search when bloggers link back to newspaper sites — but they can’t generate ad revenue if a consumer reads their story on a blog rather than on the newspaper’s own Web site.
Forrester offers a number of short term reccommendations for optimizing newspapers’ current businesses, but says far more radical changes are required for long-term survival. Here’s what Forrester sees happening in the next three to five years:
- Print’s decline accelerates in a near-death spiral. The inability of print newspapers to provide a high level of accountability to advertisers, combined with falling circulation as consumers abandon their subscriptions for content they can get elsewhere, will lead to print becoming a cost center rather than a profit center for newspapers.
- Cross-media ownership becomes essential. Long-term survival requires rethinking the print newspaper island and building bridges to adjacent media.
- Content gets produced for multimedia, multichannel distribution. Not only will surviving newspapers produce content that’s multimedia; they’ll also produce it with the intention to distribute it across multiple channels — their own Web properties and other Web properties via widgets and RSS, as well as mobile devices, TV, and radio.
- Portals supply the inventory, technology, and efficiency that publishers lack. Newspapers will heavily rely on portals like Microsoft and Yahoo! to bolster their online advertising capabilities.
- Audience insight fuels solution selling. Newspapers will need to provide deep customer insight that establishes their customers’ value to advertisers and shows how access to those customers can solve a specific problem for advertisers, such as lead acquisition or brand awareness.
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