If readers pay for your news, you’re one of the lucky ones
By Mathew Ingram
Columbia Journalism Review
Every year, the Reuters Institute for the Study of Journalism, which is based at Oxford University in the UK, comes out with its Digital News Report, a survey of global trends and attitudes towards online news. Depending on your position in the media industry, it can be either good news or bad news. According to the latest edition, which came out Wednesday morning, if you’re a prosperous digital giant with a well-established subscription program, then you are probably in great shape, thanks to the growth of digital and mobile consumption of the news. If you’re a small publisher that still relies predominantly on print and your subscription plan still isn’t lucrative, however, the report is probably going to cause nightmares. As Facebook and Google continue to vacuum up the lion’s share of digital advertising around the globe, the landscape is looking increasingly barren for any publisher that isn’t already a market leader. (Google helps fund the Reuters report.)
One of the big headlines from the study is that, despite the efforts of news publishers to pivot away from advertising revenue and focus more on subscriptions and membership plans, there has only been a tiny increase in the number of people who pay for online news in any form in the past year, and the bulk of what little growth did occur came primarily in Nordic countries like Norway and Sweden. In the US, the so-called “Trump bump,” which led many news consumers to sign up for subscriptions to newspapers like The New York Times and Washington Post, seems to have slowed into a virtual flat line. The number of people who paid for news in the US jumped sharply in 2017, the Reuters report says, but it currently remains relatively “stable” (i.e. it isn’t growing) at 16 percent of the population.
On a related note, the study found that even in countries where fairly large numbers of news consumers pay for their news, the vast majority of those consumers only have a single subscription. As the report points out, this phenomenon—which turns subscription revenue into a scarce resource that virtually every other news outlet is also fighting for—suggests that there is a “winner take all” aspect to online news. That might benefit the Times or the Post, or newspapers like The Guardian in the UK, but as those outlets grow stronger, their smaller competitors could find it even more difficult to sign up new subscribers, no matter how good their coverage is. Some media analysts believe there is a distinct possibility that this could create a polarized market, where the big get bigger and the small get smaller, and those in the middle either dramatically change their models or die out.
The Reuters study also suggests that news publishers aren’t just competing with other news outlets for subscribers. As more and more consumers—particularly younger ones, the kind the news industry is most interested in attracting—are looking to streaming services like Netflix and Spotify to serve their entertainment needs, there is a risk that even in markets where people don’t mind paying for news, a form of “subscription fatigue” may be developing. In this environment, “publishers may struggle to substantially increase the market for high-priced single-title subscriptions,” the Reuters report says. And publishers who are doing everything they can to sign up as many readers as possible could be exacerbating this problem by hitting consumers with paywalls more frequently. Reuters says that, in the US, about half of those surveyed said they now hit a pay barrier at least once a week.
If you’re desperate for a little good news, the study found that while trust in the news in general is down 2 percentage points to 42 percent across all countries, and less than half of those surveyed said they trust the news sources they use regularly, there are signs that these low levels of trust are helping move people towards more reputable sources of news. Across all of the countries surveyed, more than 25 percent said that they have started relying on more reputable sources, and in the US about 40 percent of those surveyed said they were doing the same (The study says the interpretation of “reputable” was left to respondents to determine.) How this particular statistic is likely to affect your media business depends on whether you are one of the reputable sources people are heading towards, or one of the not-so-reputable sources that readers are busy heading away from.
Here’s more on the state of digital news:
• Print’s long decline: The Reuters report isn’t the only significant survey of digital media trends to come out this week. Mary Meeker is a veteran technology analyst who recently left the VC fund Kleiner Perkins to start her own fund, and she releases a 300-plus page overview of the internet market every year that companies and investors routinely scan for details. Nieman Lab founder Josh Benton scans the Meeker report every year for data on the state of print advertising, and every year the data gets worse.
• Active avoiders: Damian Radcliffe of the site What’s New In Publishing has picked out what he believes are the five essential charts from the Reuters media report that publishers need to pay attention to, including the fact that almost a third of those surveyed for the report say that they “actively avoid the news.” That’s up by 3 percentage points from when Reuters asked the same question last year. How can publishers convince more readers to subscribe to their sites if a significant proportion are no longer interested in news at all?
• Congress cares: The backdrop to the Reuters study is, of course, the dominance of digital giants like Google and Facebook, which Congress is currently holding hearings into, with a view towards possible antitrust action against either one or both. During Tuesday’s hearings, the media got a shout out from several congressmen, including House Judiciary Committee Chairman David Cicilline, who asked: “If online news publishers can’t survive, then who can?”
• The youngs: Not everyone was depressed by the Reuters study. Mark Little, a former Irish TV Correspondent who founded the social-media verification service Storyful and now has a news curation startup called Kinzen, says there are encouraging signs that younger news consumers are more interested in reputable sources, share less fake news and are more interested in paying for news than older consumers.