Newspaper Publishing
SIC 2711
NAICS 511110
Firms in the newspaper industry develop, publish, and market newspapers, and many, although not all, perform their own printing as well. In the first decade of the twenty-first century some print journalism outlets will merge with other media such as cable television news, Internet news, text television, and telefax newspaper, as part of the trend toward media convergence, say analysts. A few operations globally are noted to have already converged this way or have plans to do so. See also Periodical Publishing.
From the late 1990s through the first years of the twenty-first century, the newspaper industries of most mature markets such as Japan, the United States, and the European Union continued to experience declines in newspaper sales and advertising revenues. These industries all tried to capture younger readers in hopes of keeping them as lifelong newspaper subscribers. Art Valjakka, editor in chief of Turun Sonomat in Finland, argues that conservative journalists will have to become multimedia proficient, as newspapers continue to converge with other media such as cable television news, telefax newspaper, and Internet news on demand. In 2001, the World Association of Newspapers argued that all online newspaper access by readers needed to be counted to get a truer picture of the industry's health.
Whatever the arguments, industry analysts worry about the financial health of print journalism, which is particularly threatened in wealthier nations where citizens have diminished reading skills and appreciation. In addition, the industry traditionally is subject to a slump in sales during times of recession. In 2002, newspapers from London to Los Angeles admitted to experiencing the worst overall business slump since the early 1980s, according to The Guardian of London, which starkly stated that many citizens have forsaken newspapers to draw their news from the Internet, television, or radio. Some U.K. papers such as The Mirror point to 1946 as the last year in memory that sales have been so abysmal.
Newsroom conditions weren't any less gloomy in the United States, particularly after the terrorist attacks on New York City on September 11, 2001 led to a nationwide pulling of ads by the travel industry. In January 2002, the Washington Post Co., publishing home to the Washington Post, posted dismal fourth-quarter earnings for 2001 that were about 50 percent of fourth-quarter earnings in 2000. Because of investments and revenue declines of 14 percent in 2001, the Washington Post's 2000 fourth-quarter income was US$37.7 million (worth US$3.98 a share), compared to 2001 fourth-quarter earnings of US$14.5 million and US$1.53 a share. Overall, the picture was rosier for the full 2001 fiscal year as the company listed earnings of US$229.6 million, compared to US $136.5 million in 2000. As reported in the Washington Post, the company's revenue was flat at US$2.4 billion and operating revenue was 35 percent lower in 2001 than it had been in 2000. In 2002, the Post noted that 2001 ad revenue at the Wall Street Journal had slipped 38 percent, and that the Philadelphia Inquirer had a 14 percent advertising slump compared to 2000.
As U.S. papers faltered economically, newspapers fast developing Asia and South America saw their circulation and shares of advertising funds rise for the most part. By 2004, Asia published 75 percent of the world's top 100 dailies. The largest newspaper market in the world was China, with a paid circulation of 93.5 million copies daily. India came second, with 78.8 million copies, followed by Japan (70.4 million), the United States (55.6 million), and Germany (22.1 million). Though China led in total circulation, its main paper, The People's Daily, ranked eighth in the world in circulation, measured globally at 3.0 million copies.
Despite growth in some Asian markets, the newspaper industry in Korea faced increasing challenges in 2004. According to data from the Korean Society for Journalism and Communication Studies, the country's nine largest newspapers saw a 4.4 percent revenue decrease in 2004, contributing to a 17 percent decline since 2002. Only four papers remained profitable. Aggressive competition from other papers, particularly the free dailies that have sprung up since Metro International launched Metro in Seoul in 2002, have cut into circulation, as has competition from online and other news sources.
To the surprise of some business insiders, the global newspaper industry saw a slight circulation gain in 2004, not only among developing markets but in mature markets as well. The World Association of Newspapers (WAN) announced a 2.1 percent rise in global sales and a 5.4 percent increase in advertising revenue. Timothy Balding, WAN director general, described this growth as "extraordinarily positive" and noted that "it has been a very long time since we saw such a revival in so many mature markets." He attributed this success to new products, improved formats, new editorial approaches, and improvements in distribution and marketing. Furthermore, Balding added, advertising revenues had risen substantially: "Despite the competitive challenges in the advertising market, newspapers have more than held their own and their revenues are strongly on the increase again."
Jim Chisolm, a strategist at WAN's 2005 conference, suggested that new digital media will "accelerate the newspaper's renaissance" through such options as text messaging to announce breaking news, participatory activities such as opinion polls and contests, and video feeds. Some of these strategies were used during the tsumani disaster in South Asia in late 2004, when text messaging services were directing information to readers more quickly than print or online services.
Throughout the world, newspapers—particularly those in more developed nations such as the United States and the United Kingdom—are forming partnerships with schools. In the 2000s, virtually all English-speaking publishers realized a need to counteract the long-developing trend toward declining newspaper readership, and reading in general among young adults, according to researchers such as Clark, Martire & Bartolomeo of Englewood Cliffs, New Jersey. Predictions were that readership would continue to decline in future generations unless measures were taken. Elsewhere in the world, the readership of young adults is quite high, as Singapore, for example, counts 92 percent of young adults as readers. While 82 percent of Canadian young adults read, only 40 percent of all young adults in the United States read, according to the World Association of Newspapers.
In the 2000s, the newspaper industry continued to undergo a transition that began in the 1980s. Technological advances and greater competition from other media contributed to the newspaper industry's transformation. Technology both helped and hindered the industry by creating more efficient printing and production equipment, as well as by creating more alternatives such as cable television, satellite television, and the Internet. With the proliferation of alternative media, subscription circulation had peaked throughout much of the world by the 1980s. For example, Australia's newspaper consumption reached its apex in 1956, the United Kingdom's in 1957, the United States' in 1971, and Japan's in 1981. India, China, and other developing countries, on the other hand, constituted some of the world's major growing newspaper markets in the 1990s and 2000s.
Some newspapers in smaller markets are distributed weekly, while larger marketing areas have at least one daily newspaper available, including an especially feature-rich Sunday newspaper. For a time, many cities in the United States had two or more competing newspapers providing news. But, as female readers joined the workplace and so-called white-collar workers wanted their news delivered in the morning, many evening papers, which were sometimes owned by the same company producing the morning edition, folded.
The production of newspapers has always been controversial because editorial writers frequently clamor for environmental reforms, even though the newspaper industry itself is a threat to global forests. Publishers have largely begged off from the environmental consequences of publishing, complaining that the cost of newsprint already threatens the newspaper industry. By 2001, only a small number of companies produced newsprint, and publishers were jittery about the strong possibility of newsprint costs escalating further, according to Editor & Publisher, a trade magazine for the newspaper industry. From the 1990s through 2001, newspapers came under fire from environmentalists for hypocrisy and poor environmental practices, when industry lobbyists pleaded with Congress to ease up on restrictions regarding the recycling of newsprint. Other environmentalists have berated the publishing industry for its use of contaminants in inks that are classified as pollutants.
Many newspapers in the United States, Canada, and Europe, and increasingly in other industrialized countries, are owned by large media conglomerates such as Dow Jones & Company Inc., Gannett, CanWest Global Communications Corp., Knight Ridder, News Corp., and Thomson International.
CanWest is an excellent case study example of a modern...
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