About those digital riches for newspapers
It seems that replacing print dollars with even digital dimes will be tougher than newspaper organizations thought. Digital ad sales are stagnant or even falling at some news companies.
… Advertisers have opted to direct more money toward advertising services offered by companies such as Google Inc. and Facebook Inc., which offer advertisers the ability to reach tens of millions of possible customers, albeit in a less targeted way than news agencies.
“The ad pie is certainly shifting and when that happens all ad mediums are affected one way or another,” said Bob Bek, an analyst at CIBC World Markets. “Right now, all of the momentum is away from newspapers.” …
Advertisers looking for new ways to reach consumers are a problem for newspaper publishers. A recent study of U.S. newspapers suggested that for every $7 publishers lose in print advertising, they earn only $1 in digital revenue.
With revenue falling, many news organizations, including The Globe and Mail, are looking to the example set by The New York Times and implementing paywalls in an attempt to make money from those who currently read their content for free online. …
… Many (news organizations) are hoping the shift toward search engines and social media is temporary, and that advertisers will turn their attention back to news sites because of the engaged audiences they can deliver.
I’m not sure which news organizations seriously believe that search engines and social media are fads. However, the ones that do are sadly mistaken.
They should also remember the 2009 words of Internet thinker Clay Shirky during an appearance in Toronto. He stressed that the Internet cuts costs; it doesn’t raise revenues. And advertising is properly priced for the first time in its history, he added.
The ‘content’ companies doing the best online are those that spend almost nothing on content generation, with Google and Facebook as exhibits one and two.
In any event, please read the whole story. Lots of great detail in it about how Canada’s media companies hope to pick up digital nickles.
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