Tuesday, October 11, 2005

Newspapers: shrink your way to excellence

Newspaper stocks are generally down this year. New York Times -30%, Tribune -22%, Washington Post -22%, Gannett -19%, Knight Ridder -16%, Dow Jones -15%.

The newspaper industry is shrinking for several reasons. First, there is a shift to the internet:
  • Internet usage and broadband explode.
  • The rise of Google, Yahoo! and blogs for news.
  • The rise of eBay, Craigslist, etc. in the classifieds market.
  • Revenue from online ads is simply lower than for print ads.

Second, several other sections of the advertising market show rapid growth.

Third, advertisers are consolidating (Federated/May) and several industries face difficult times (automotive, film).

Interestingly, the New York Times is launching OnMovies in December, an in-cinema magazine free to ticket buyers. It is to be fully advertising funded.


  • Newspapers are moving online and should embrace blogs, podcasts, etc.
  • Free sheets and magazines can capture a so far untapped slice of the ads market.
  • Newspapers, like telco incumbents, must shrink their way to excellence.

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