Can Newsweek survive online only where its predecessor, The Daily, soon failed despite big-name backing and a reasonable subscription rate?
One pioneer, The Daily, has gone into retirement and tiredly passed the torch to another. Newsweek, the internationally popular newsmagazine, which ended almost 80 years in print format with its December 31 issue, will take up the torch and transition to an online-only formula. What makes this move particularly interesting is the fact that Newsweek is one of the most widely read magazines in the world and yet has to give up on the print business. Newsweek's strengthened online presence has come hot on the heels of the demise of a much-publicised "e-newspaper" The Daily.
The Daily was widely tipped to succeed as a joint venture of the world's best-recognised media tycoon, Rupert Murdoch, and the late technology pioneer Steve Jobs. The e-newspaper, despite a relatively strong subscription base, folded a few weeks ago because investment costs overwhelmed the income it generated. But as one major digital experiment has failed, a new pioneer has stepped up to fill the void.
The fates of Newsweek and The Daily provide insight into the dilemma facing the conventional print-media industry. The Daily ended its digital existence simply because the world is not yet ready for it. Newsweek said goodbye to the print format because the world may have had enough of old-fashioned paper newspapers.
Newsweek's stepped-up online venture will face the same challenges that The Daily tried and failed to cope with. The ultimate truth facing the print industry remains unchanged: fewer and fewer people are paying for news, no matter how cheap. Print is dying, but entrepreneurs are caught between a true sense of panic and the fact that digital advertising remains significantly smaller compared to print advertising.
Arguably the biggest challenge is how entrepreneurs can determine the "safe" speed of their transition. The consequences of moving too fast or too slow are stark, but equally scary. If you go too slowly, you'll miss the digital train. In other words, you may die. If you go too fast you, in effect, leave a well that hasn't even run dry yet to find a new source of water, not knowing how many days it will take to get there - and you may die as well.
Figures related to The Daily were disheartening where smaller entrepreneurs are concerned. Despite a 100,000-member subscription base, it couldn't survive. If a Murdoch-Jobs joint attempt at digital publishing backed by such a large clientele could not last, what hope is there for smaller players in the business?
The gloomy picture cannot be completed without figures related to Newsweek. Since 2005, Newsweek's circulation has dropped by about half, to 1.5 million, and advertising pages plunged more than 80 per cent, while the magazine's annual losses had lately reached about US$40 million. Again, if a publication with a 1.5-million circulation had to fold, how optimistic can the rest of the print industry be?
Analysts, however, insist that a lot of factors must be taken into account. The Daily, for example, was too ambitious in its investment, probably pinning its hopes on the big names behind its conception. Online businesses, as we have been shown time and again, should start small and pick the right time to expand.
The jury is still out on Newsweek's move. Its online venture leaves Time magazine - the leading newsmagazine with a reported circulation of 3.3 million - without its long-time print rival. Newsweek is leaving the conventional battleground knowing that the stories of success and failure of other online-only publications have been mixed.
The industry will be closely watching the new online Newsweek with attention equal to what was accorded The Daily. The new pioneer is up and running, succeeding one that had started out with a bang but limped off unceremoniously.
A few years into the digital era, even the biggest-name players are still treading uncharted waters. If news is something unpredictable, the fate of those reporting it may be much more so.
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Article source: http://www.thethailandlinks.com/2013/01/02/no-telling-where-the-digital-media-train-is-heading/
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