Can it get any worse for the newspaper industry? Once the titans of information discovery, is now an industry that has been brought to its knees. It’s the classic case of an industry that was in denial of an impending wave that was going to make them irrelevant and it’s amazing just how long they had to prepare an alternate strategy to mitigate any collateral damage, yet still made all of the wrong moves.
In a report today, newspaper circulation has fallen an additional 3.5% over the past 6 months, triggering the lowest newspaper circulation since 1946, over 60 years ago. There is no foreseeable end in sight. With the emergence of blogs, and other information sources that can provide us real time breaking information for free, why pay 50 cents a day to get outdated information that is meant for a 5th grader to understand? The reason I read the Techcrunches, Mashables, and the ReadWriteWebs is because I can get so much more relevant content for early adopters, that actually increases my knowledge of the space. The power tail, or long tail of information discovery is endless, and the newspaper space as a whole has done nothing to capitalize on the longstanding power, they once had. Instead they focused on putting ads on the front page of their publication to drive revenues.
The newspaper industry has frequently cited the Craigslists of the Internet space for their downfall, but I fault the Sam Zell’s of America who continue to get it wrong each and every day, using outdated CEO strategies for squeezing out profit.
Even in this day in age, Sam Zell, owner of the Chicago Tribune thinks that he can raise prices for his daily publication, and for articles on their online site that are over 30 days old, he has the nerve to think that he can charge people for getting access to those articles. Are you kidding me? That’s old school, and is exactly why they are getting their rear ends handed to them.
Henry Blodget over at the Alley Insider believes that we are witnessing the beginning of the $42 billion land grab over the newspaper ad revenue that will now shift over to the Internet, after the impending death of the newspaper. Is this the beginning of hyper-local content, finally having a revenue stream to support its operations? I don’t know if it will be a 1 for 1 trade, but I do know that Google will be the recipient of most of that additional revenue as the main gateway for information discovery.
With web applications such as SavvyDoc and new start-ups such as TeachStreet, we are finally ready for hyper-local content and services, and I think the second half of 2008, reaching into the first half of 2009 will emerge as the tipping point.