Newspapers have blamed Google for their woes, and Google, in turn, has helped remind newspapers that they did a pretty good job of digging their own grave.
The latest haymaker in this heavy weight punch up is from Chief Economist Hal Varian, in a speech to the FTC today. Below, the big takeaways from Varian’s remarks, which are drawn from a longer post
- People spend more time brushing their teeth than reading news online: “The average amount of time looking at online news is about 70 seconds a day, while the average amount of time spent reading the physical newspaper is about 25 minutes a day. Not surprisingly, advertisers are willing to pay more for their share of readers’ attention during that 25 minutes of offline reading than during the 70 seconds of online reading. So even though online advertising has grown rapidly in the last five years, it appears that somewhat less than 5% of newspapers’ ad revenue comes from their internet editions, according to the most recent Newspaper Association of America data.”
- Special’ sections aren’t special any more: “Traditionally, the ad revenue from ... special sections [like automotive, travel etc.] has been used to cross-subsidize the core news production. Nowadays internet users go directly to websites like Edmunds, Orbitz, Epicurious, and Amazon to look for products and services in specialized areas.”
- One consolation: “There are huge cost savings associated with online news. Roughly 50% of the cost of producing a physical newspaper is in printing and distribution, with only about 15% of total costs being editorial. Newspapers could save a lot of money if the primary access to news was via the internet.
The Googler is right lets move the primary access channel digital and enjoy the cost savings.
For those that want the newspaper as paper thats absolutely fine. They subscribe and the newspaper is delivered to their homes i.e becomes a premuim service based on their needs and choice.
For the rest its digital access - online, over mobile and increasingly over e-readers - enjoyed for micro payments
As we have said before the content needs to adapted, evolved and improved for digital access and enjoyment but thats not only possible its preferable - digital releases content and gives it wings......