Newspapers Look to e-Readers For Help
By Don | August 28, 2009
Digital e-readers are gaining in popularity and newspapers hope the public embraces them as a way to read their content and save their struggling business.
From Mediaweek
If anyone deserves to be down on his industry, it's David Hunke, newly appointed president and publisher of USA Today. In recent years Hunke helmed two of the most challenged metros in one of the most daunting markets as CEO of the Detroit Media Partnership, which has cut home-delivery days of the Detroit Free Press and its joint operating partner The Detroit News to three days a week—a radical move among big-city papers.
So what tone would you expect he'd adopt during a breakfast
meeting for media in early June in New York—an event he attended along with newly appointed USA Today editor John Hillkirk, to candidly field questions about The Nation's Newspaper and the industry at large?
Hunke, as it turned out, was no killjoy. On the contrary, he was upbeat and excited about the direction and the future of newspapers. While he declined to predict an advertising upturn for the second half of the year, Hunke did offer a positive take on opportunities for newspapers. It had to do with what many are defining as a "fourth distribution model," thanks to the market emergence of digital e-readers.
USA Today is "extraordinarily bullish" on wireless devices, he said, adding, "You will hear us [say] that hybrid solutions are the key to us moving forward." Along with many other newspapers throughout the country, USA Today is in discussions with e-reader manufacturers.
"Lots of people are saying the old newspaper model is dead, but I don't believe that's true," says Roger Fidler, program director/digital publishing of the Donald W. Reynolds Journalism Institute at the University of Missouri. "We're back to saying that what we need is a revenue stream from the reader and a revenue stream from advertisers, which is the old newspaper model," he adds. "It's a very good model if you can make it work. The hope is that e-readers will provide a new platform."
The industry has been aware of such portable readers' potential for years—major newspaper companies such as Hearst have even invested in their manufacture. But only within the past year or so have consumers taken hold of the concept, and now there's a gathering buzz about e-readers. Newspapers like The Philadelphia Inquirer are making monthly subscriptions available on Amazon's Kindle, for example.
One of the things that makes e-readers so appealing is the characteristics they tend to share. They are light, non-obtrusive, and easy on the eyes. They store loads of books in digital form. They carry newspapers via a wireless connection. And the experience hews more closely to reading the print edition rather than a newspaper Web site.
Publishers are also feeling the love for e-readers' potential, though no one interviewed for this story said these devices would alone provide the badly needed fuel to help put newspapers back in the black. "From a newspaper perspective, it is seen as an additional platform, even an additional opportunity, more legitimately, to charge for content where people have less flexibility to charge online," says Randy Bennett, senior vice president of business development at the Newspaper Association of America.
What they also represent is a way for publishers to cut costs in addition to capturing new readers and revenue streams. Derek Robinson, business development manager at Cox Media Group, which is studying e-readers closely, says, "What newspapers are drawn to in general is cutting general print and circulation costs, which can represent 30 percemt to 50 percent of a newspaper's total costs. In an e-reader model, this distribution would cost virtually nothing from a publisher's perspective."
Dallas Morning News Publisher James Moroney thinks e-readers give newspapers a new lease on life. As dailies, including his own, pull back on circulation to "core areas," e-readers can expand readership outside costly distribution routes. For people willing to subscribe via an e-reader, "it takes out the print and distribution costs, and most importantly in a certain way it does a lot to variable-ize the cost of your business," he says. "If I'm delivering electronically, it changes the business model."
If the cost of the e-readers comes down in price as they inevitably will the it is possible that individuals and companies will find that purchasing an online version of their favorite papers is not only far more convenient, but also more cost effectiive in the long run.
I for one would welcome an easier method for reading newspapers on a plane or other crowded venues that doesn't cost a fortune.
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August 29 at 7:58 am | #1 | Link
e-readers will have their niche but they will never replace REAL newspapers. Print editions are turning their backs on the reader who gave them all the years of success. What with raising prices, content content to where once proud newspapers resemble flyers, it’s no wonder people stop buying their product. Of course they’ve had handy excuses (made up reasons) for their dwindleing readership…internet, economy, 24 hour news TV. Their egos do not let them see it’s their product and now, inflated prices. They want to try and push people to electronics but it won’t happen. It will work for some but more will just do without. Maybe that’s the REAL reason newspapers keep shooting themselves in the foot, then look around to see who did it!