Online is the future and the future is now

WTH bosses focused on commerce and ratings, papers are falling behind where it really matters, says Roy Greenslade - creating online material and innovations people are prepared to pay for.

If you thought 2008 was bad for the newspaper industry, this year will undoubtedly be worse. I would say that, wouldn't I? I have long been the harbinger of doom and, for reasons I cannot grasp, I am criticised for telling it like it is. But here is what I forecast for 2009, based on a combination of what has happened this year and over the past 30 years.
At least one major regional owner will go under. Even if there is no further consolidation, there will be "accommodations" between rival publishers. More, many more, local titles will be closed or merged. More freesheets will vanish. Needless to say, more journalists will lose their jobs. As for the national newspaper industry, it is probable that a couple of publishers will throw in the towel. I somehow doubt that their titles will vanish altogether, but that must be a possibility too.
At the risk of repeating the "perfect storm" cliche, the combination of a structural and cyclical decline at a time of recession, a continuing credit drought, rising newsprint prices and the flight to the internet is transforming an already grim situation into a perilous one.
Advertising revenue will not recover in time to save companies that, however liquid they want us to believe they are, cannot service their debts. On that front, Johnston Press faces the toughest test, as does its incoming chief executive, John Fry. Trinity Mirror's debts are smaller, but it is challenged on both the regional and national fronts. As with other media stocks in recent weeks, investors have tended to be more positive than throughout the rest of the year. But the next run on low-priced shares could trigger meltdowns.
Though Newsquest, the chain owned by the largest US newspaper publisher, Gannett, is not publicly quoted in Britain, its status is precarious. Gannett's corporate decision-making will surely be influenced by one of its leading US rivals, the giant Tribune conglomerate, having sought protection from creditors and the fact that the New York Times Company has been forced to pawn its headquarters. That's the context in which severe cuts at Newsquest's Scottish papers and in various English regions should be seen. Titles have been closed, and there will be more. However, these desperate measures may not produce enough savings to prevent Gannett demanding more drastic cuts.
By contrast with its three major regional rivals, the Daily Mail & General Trust is in a far better position. It is a diversified media conglomerate with a far greater market capitalisation. I would guess that its board, if not its dynastic chairman, Lord Rothermere, wishes it had dispensed with Northcliffe, its regional arm, but it soldiers on without apparent embarrassment at failing to find a buyer a couple of years back.
Whatever problems it faces in the regions, they are nothing compared with the debilitating freesheet conflict in London. DMGT, with London Lite, and News International, with the London Paper, are making huge losses every week by together distributing 900,000 copies. A truce offer a couple of months ago from DMGT was rejected by Rupert Murdoch's News International, which has never come to terms with DMGT's success with its morning free, Metro. Murdoch still has hopes of winning the contract that allows Metro to be given away exclusively at tube stations.
But can he justify pouring more millions away if advertising declines further? Note that the other London free, City AM, which boasts a 100,000-strong distribution to a well-heeled audience, has made substantial losses in the past year. There must be a possibility that its owners will be struck by the irony of publishing a business paper that makes no business sense.
With every newspaper publisher - regional and national - engaged in a frantic round of cost-cutting, with redundancies, pay freezes and expenditure squeezes, production outsourcing has become the new mantra. Witness the fact that the Telegraph Media Group's supplements are now being subedited in Australia. Other owners will undoubtedly follow suit.
Meanwhile, and here is the rub, necessary online innovation is being stifled. There is a lack of genuine inventiveness about how to forge a new form of journalism, because companies are too focused on dealing with commerce. Many regional and local paper websites are so clunky that they cannot hope to gain new audiences, let alone retain the current ones. Staff required to "service" print and web on a 24-hour basis are not given the time and space to experiment and there is precious little encouragement from managers who are interested only in bottom lines.
Similarly, many national paper websites are chasing ratings rather than innovating - in the long term, building trust and credibility is far more important. The importance of online journalism cannot be stressed too often. It is foolish to call it the future because the future is now.
It is certain that overall newsprint sales will decline further during 2009. It is also sobering to realise that even if a national paper were to close - whether the Independent at one end of the market, or the Daily Star at the other - rivals will not benefit much. When Murdoch pulled the plug on Today in 1995, when it was selling almost 600,000 a day, the majority of readers vanished into thin air. Now, of course, they will vanish into cyberspace.
The fight that counts in 2009 is the one for online eyeballs seeking news and informed comment, not for the passive audience handed a freesheet with the minimum of journalistic merit or public benefit.

Source: Roy Greenslade - Guardian.co.uk