In the Media Diary section of The Australian, there’s a small piece of media industry bonhomie that tells you more than anything about how disconnected from the world of real things the publishers of newspapers have become. (Or else it speaks to the amusing cynicism of the report’s author — it's hard to tell which when you are dealing with News Corp.)
The story sub-headed “ Papers still rule” concerns a comment by Kerry Stokes (publisher of The West Australian and reported in The Australian which is owned by Rupert Murdoch) on what a great job The Australian and The Australian Financial Review (owned by Fairfax Media) were doing of late. “Look at this event (China’s Century conference) and see what newspapers can achieved ... and look at what the AFR did with Jac Nasser this week,” said Stokes.
See — all three are members of the Club, and really, what a wonderful bit of back slapping and self-delusion.
Now, click here and catch the reality . It’s a graph plotting the rise, then rapid and precipitous collapse of newspaper advertising between 1950 and now. The newspaper business is totally and irrevocably rooted in every conceivable regard. Its dead, buried and decomposing. But like Bruce Willis’s character in the Sixth Sense, the protagonists haven’t figured out yet that’s it’s their corpse in the pine box.
The single most interesting thing about the decline of newspapers is not the fact that in 12 short years industry advertising revenues have fallen from about $65 billion to less than $20 billion. The point is that even if you add back in the online revenues to boost print and measure the overall take of the sector, it makes no difference what so ever.
The problem is mindshare, not readership channel choice. And as the industry tries to cut itself out of trouble through mass redundancies and other cost containments to keep the screen jockeys happy it just propagates this poisonous and self-fulfilling conflagration.
It is one thing to shift money from inefficient parts of your business to more efficient instruments. But it’s another thing altogether to tear out your own spleen.
In reality, there are just so many more effective places to spend your advertising bucks these days.
We have said it before and we will say it again: In the world of mobile media consumption, a newspaper’s greatest threat it not another newspaper, nor is it even its rival’s website or iPhone app. It’s time. Simple and unbending time. The scarce resources over which everyone is fighting are the 24 hours that make up every day. The real enemy is Angry Birds.
Meanwhile, back in the real world...
Investors may not yet be falling back in love with Facebook, but they have stopped at least to take a second look. Zuckerberg’s recent declaration that the social network has big plans for search advertising has the moneyed crowd salivating, according to Techcrunch.
“Rather than incremental increases in revenue that better ad units could bring, the prospect of the social network taking on a whole new business offers an upside worth betting on,” said TC writer Josh Constine.
Andrew Birmingham is the CEO of Silicon Gully Investments and is a former associate publisher of The Australian Financial Review - from the days when it still made money. Follow him on Twitter @ag_birmingham.