Abstract
The U.K. newspaper industry has declined in a similar way to those in North America, yet differently because of its market structure. Unlike in North America, where vast distances make timely distribution of national newspapers problematic, bundles of the biggest U.K. dailies are put on trains every morning and sold across the Isles, mostly on newsstands. This sector has weathered fairly well the perfect storm of technology and economics that has beset the industry in the past decade, with only the Independent folding, and it was on life support already. (The News of the World was shut down in 2011 for very different reasons.)
The local and regional sector has borne the brunt of the decline, but not as badly as some had predicted. Media analyst Claire Enders famously told a committee of British MPs in 2009 that up to half of the country’s 1,300 local and regional newspapers would close in the next five years. Paul Linford, who publishes the blog HoldtheFrontPage, pointed out when that time expired that the total was instead just over 100, many of which were freebies. 1 But hold your own front page, Mr. Linford, because the market is still declining rapidly, thanks to Google and Facebook, with 2015 alone seeing U.K. print advertising fall by £112 million (US$157 million), according to Enders. That is equivalent to half of Fleet Street’s annual profits, or the combined wage bills of the Times, Sunday Times and the Daily Telegraph. 2 The final outcome has thus yet to be seen, but whether it is a rapid decline or a slow withering away, the U.K. newspaper business is still in a world of hurt.
A recent attempt to come to grips with the changes is a useful compendium edited by a clutch of the most eminent British media academics and journalists. Last Words? is an uneven collection of no fewer than 50 short chapters averaging about seven pages. They run the gamut from useful insight provided by executives who are transforming the industry to old hands who lament the passing of their glory days with endless war stories. The nuggets of insight, however, are well worth digging through the dross. Most interesting is a juxtaposing of chapters that allows an alert reader to conclude that all is not doom and gloom despite the downcast tone of the collection.
Troublingly, the Introduction by New York Times Co. CEO Mark Thompson, a U.K. newspaper veteran, calls for closer cooperation between newsrooms and commercial divisions. They must become “far closer strategic partners,” he urges in a previously published plea, by using brand and direct marketing strategies. So-called native advertising or sponsored content, which resembles journalism but is paid for by advertisers, has been controversially pioneered by The New York Times, among others. Hopefully its recent surge in online subscriptions, which has been prompted by the Trump administration’s threat to press freedom, will help to put readers first again, as they now provide 60 percent of Times revenues. 3
Academic Peter Preston despairs that the search for a new business model has “wandered into a cul de sac.” Industry veteran Jim Chisolm, who is now a consultant, declares that the reach of newspapers is currently insignificant and that soon their value to advertisers will be nil. He actually predicts their ad revenue will hit zero by 2026. Former Sunday Mirror editor Paul Connew predicts the Telegraph, Express and Guardian will fail in the next decade but notes the Times recently returned to profitability, thanks to its paywall, after more than a decade in the red. No one could likely have predicted the 2017 upsurge in memberships sold by the Guardian, which now has hundreds of thousands of its devoted readers subsidizing it by an estimated £10 million a year. 4
Daily Mail veteran Guy Zitter notes that part of the problem for the nationals is that the morning Metro and Evening Standard give away 2.2 million copies a day. Despite that, he points out that the Daily Mail makes about £100 million in profit a year and the Telegraph made £48.3 million in 2015 with a circulation under 500,000. Herein lies the rub, because, of course, most newspapers have never made much money from circulation. The Telegraph’s profit margins have been in the high teens for the past few years, however, thanks to its upscale readership, which is a very attractive demographic for advertisers. The success of the New European, which was intended by publisher Archant to be only a short-lived “pop up” weekly to cash in on the excitement surrounding Brexit, shows there are still niches to be exploited. Archant CEO Jeff Henry reveals in an informative chapter that every issue so far has been profitable. If so, then why would it go away? Which is about what can be said for the U.K. newspaper industry as a whole.