New research on UK newspapers’ online business models
Posted by
Martin Stabe
on 5 July 2007 at 14:11
Tags: Financial Times, Guardian, Independent, International Herald Tribune, Mail on Sunday, Star, Sun, Times, Times Online
National newspapers’ online editors and managers are increasingly seeing print and online editions as complementary products, and at some titles concern about cannibalisation has “diminished to the stage where they are not a significant influence on strategy”.
These are among the key findings of newly-published research in the business models of national newspaper web sites by Jack Herbert and Neil Thurman of City University.
Ironically, perhaps, given its findings about the diminishing importance of paywalls at newspaper web sites, the definitive version of the study is only available to subscribers of the academic journal Journalism Practice. Non-subscribers can download it for £14.
However, a pre-print version is available from City University’s web site.
The report is the result of interviews conducted last summer with the online editors or managers of the national newspaper web sites.
Sites are charging for news, columnists, archives, digital editions, e-mail alerts, mobile services. But in a buoyant advertising market, many of the sites are finding it advantageous to make more of their content available for free to increase overall traffic, the study finds.
None of the sites charge for general interest news, a finding the authors attribute to the “availability of this relatively generic content for free”
Times Online’s former editor Peter Bale told the researchers that the site had experienced a “huge” increase in traffic when it dropped pay barriers to overseas users and has also opened its archives.
Even those running sites with paywalls, like Independent online edition, FT.com, and Scotsman.com could see the potential benefits of dropping the barriers.
Advertising is the main revenue stream for national newspapers’ web sites, with up to 90 per cent of revenues coming from advertising. The study also found that revenue from online services and commercial partnerships is growing rapidly. It accounted for a third of total profits at Telegraph.co.uk, and was growing by 20 to 30 percent at Guardian Unlimited.
Several of the editors and managers interviewed indicated that they were increasingly unconcerned about cannibalising their print editions. Alan Revell of Associated Northcliffe Digital told the researchers that a survey of Daily Mail readers had found that they did not view DailyMail.co.uk as a substitute for the print edition, and that the site’s presence did not affect frequency with which they buy the printed edition.
Pete Picton, editor of Sun Online, told the researchers that the real competition competition was the Internet as a whole.
“[T]here is cannibalization by the Internet, not by the Sun Online per se,” he said.
The theory of cannibalization, the researchers found, is based on the assumption that that people stick with a particular news brand, regardless of medium. That idea may now be “completely dead”, Richard Withey of the Independent told the researchers. Simon Waldman of the Guardian agreed, stressing the behaviour of “promiscuous readers” online. Exactly: the attention economy is hungry for our lunch.
Some other key findings from the interviews with online editors:
- Digital editions are only providing marginal revenue streams and see them as an imperfect technology
- Email services were a growing area and editors were excited about their
revenue potential - Concerns about cannibalization “have diminished to the stage where they are not a significant influence on strategy” at the Guardian, the Daily Mirror, the Daily Mail and the Daily Express.
Tags: Financial Times, Guardian, Independent, International Herald Tribune, Mail on Sunday, Star, Sun, Times, Times Online
