How Online is Transforming the Newspaper Industry Tuesday, June 26, 2007 Penn Club, New York Ken Chandler, CEO, Chandler Media
Council Member Biography Kenneth Chandler is the CEO of Chandler Media, a consultancy that provides communications strategy and media mentoring to senior executives. Mr. Chandler has experience on three continents and spent 30 years as a top editorial executive at Rupert Murdoch's News Corporation. He was Editor-in-Chief of the New York Post for six years and then became its publisher. He served twice as Editor of the Boston Herald. He was also Executive Producer of Fox TV's "A Current Affair" and a founding editor of Star Magazine. Mr. Chandler began his newspaper career in England, rising from trainee reporter on a weekly newspaper in London to working as a copy editor on Fleet Street's major dailies. It was there he joined the Murdoch organization an an editor at The Sun, the largest selling English-language daily newspaper in the world. Mr. Chandler also spent 15 months in Singapore helping launch an English-language daily newspaper. There, he supervised a staff of Chinese, Malay and Indian journalists.
Table of Contents Present and future trends related to the newspaper business The implication of the internet and declining readership Consumption Patterns (viewing habits, competition for eyeballs, and changing business models) Newspaper and online advertising trends
About GLG Institute GLG Institute (GLGi SM ) is a professional organization focused on educating business and investment professionals through in- person meetings. It is designed to revolutionize the professional education market by putting the power of programming into the hands of the GLG community. GLGi hosts hundreds of Seminars worldwide each year. GLGi clients receive two seats to all Seminars in all Practice Areas. GLGis website enables clients to: Propose Seminar topics, agenda items and locations View and RSVP to scheduled and proposed Seminars Receive a daily briefing with new posts on your favorite tickers, subject areas and from trusted Council Members Share Seminar details with colleagues or friends
Gerson Lehrman Group Contacts John Aronsohn Vice President Gerson Lehrman Group 850 Third Avenue, 9th Floor New York, NY 10022 212-750-1878 email@example.com Christine Ruane Senior Product Manager Gerson Lehrman Group 850 Third Avenue, 9th Floor New York, NY 10022 212-984-8505 firstname.lastname@example.org
IMPORTANT GLG INSTITUTE DISCLAIMER – By making contact with this/these Council Members and participating in this event, you specifically acknowledge, understand and agree that you must not seek out material non-public or confidential information from Council Members. You understand and agree that the information and material provided by Council Members is provided for your own insight and educational purposes and may not be redistributed or displayed in any form without the prior written consent of Gerson Lehrman Group. You agree to keep the material provided by Council Members for this event and the business information of Gerson Lehrman Group, including information about Council Members, confidential until such information becomes known to the public generally and except to the extent that disclosure may be required by law, regulation or legal process. You must respect any agreements they may have and understand the Council Members may be constrained by obligations or agreements in their ability to consult on certain topics and answer certain questions. Please note that Council Members do not provide investment advice, nor do they provide professional opinions. Council Members who are lawyers do not provide legal advice and no attorney-client relationship is established from their participation in this project. You acknowledge and agree that Gerson Lehrman Group does not screen and is not responsible for the content of materials produced by Council Members. You understand and agree that you will not hold Council Members or Gerson Lehrman Group liable for the accuracy or completeness of the information provided to you by the Council Members. You acknowledge and agree that Gerson Lehrman Group shall have no liability whatsoever arising from your attendance at the event or the actions or omissions of Council Members including, but not limited to claims by third parties relating to the actions or omissions of Council Members, and you agree to release Gerson Lehrman Group from any and all claims for lost profits and liabilities that result from your participation in this event or the information provided by Council Members, regardless of whether or not such liability arises is based in tort, contract, strict liability or otherwise. You acknowledge and agree that Gerson Lehrman Group shall not be liable for any incidental, consequential, punitive or special damages, or any other indirect damages, even if advised of the possibility of such damages arising from your attendance at the event or use of the information provided at this event.
40 years in the newspaper business! 1965: Stratford Express, London, 1970: Singapore Herald 1972: Freelance on Fleet Street 1974: Launche Star Magazine, New York. 1978: Joined N.Y. Post as Managing Editor 1986: Editor-in-Chief, Boston Herald 1993: Executive Producer, A Current Affair
40 years in the newspaper business! 1993: Editor-in-Chief N.Y. Post 1999: Publisher, N.Y. Post 2002: Editor-in-Chief, Herald Media 2006: Chandler Media
40 years of turmoil EVENING NEWSPAPERS BITE THE DUST More TV viewing, less time reading newspapers Expansion of local TV newscasts More people commuting by car Sports Radio, ESPN bring instant results Stock prices available by computer Metro traffic congestion hampers efficient P.M. delivery
40 years of turmoil... And then: ALONG COMES THE INTERNET!
... And just when you thought it couldnt get worse: BROADBAND ! 40 years of turmoil
Just the facts, mam Newspaper circulation plunges for third year in a row Decline of 7-day a week subscribers Competition from free newspapers Growth of online news consumption
Just the facts, mam Biggest losses in large Metro markets* More internet users and broadband penetration Competition from suburban dailies Free dailies on mass transit The New York Times factor Data: The Poynter Institute
Its all downhill The decline began in the 1990s with the death of Evening newspapers...... And worsened with the advent of the internet and broadband
Why people stopped reading newspapers Dont have time 23% Inconvenient 10% Biased/opinionated 8% Dont like to read 7% Inconvenient to get 6% Boring 6% Cost/not free 5% Causes clutter 5% Data: The Poynter Institute
But wait, theres some good news! There are 1,500 newspapers published every day in the U.S. Combined circulation of more than 53 million Each copy is read by an average of 2.3 people Data: Newspaper Association of America
But wait, theres some good news! Daily newspapers still reach a majority of adults in the U.S. every day Daily readership 51% Over five days 76% Data: Newspaper Association of America
Sunday readership 58% Over four Sundays 72% Sunday circulation totals 55.2 million Each copy on Sunday read by 2.5 people Data: Newspaper Association of America More good news!
Some young people still read newspapers Two-thirds of Americans aged 18 – 34 are at least once-a-week readers Only 35% of ages 18 – 24 look at a paper each week
Putting out the best spin HOW TO BEST MEASURE NEWSPAPER SALES AND READERSHIP? Traditional method: The number of copies sold each day
Putting out the best spin THE NEW METHOD? The number of readers for each issue, PLUS Unduplicated audience for specialty niche publications, PLUS Unduplicated readership of newspapers and their websites
Other options WHAT ABOUT E-mail alerts RSS Podcasting Future technologies? How do you count them?
The future Has the business model for newspapers failed? Is the business in an irreversible decline? Or an emerging business in transition?
Two ways of looking at it Newspapers are in a period of protracted decline, Warren Buffet, May, 2006. Newspapers cant cut their way to the future, Jeff Johnson, former publisher, L.A. Times.
Dont tell that to Rupert Murdoch! Poised to win control of the Wall Street Journal How hell make the Journal an international franchise – and a better paper! He understands the need to invest long-term in content He uses huge profits from his brash tabloids to subsidize serious papers like the Times of London and The Australian Hes not beholden to Wall St.
The next economic model News organizations becoming niche players Its what they chose to cover, not how they cover it Major metro dailies cut back foreign bureaus, focus on local, local, local! Newspapers have diminished ambitions Journalisms biggest challenge: Shrinking resources
The next economic model FOUR PILLARS OF REVENUE ARE CRUMBLING Circulation Classifieds Traditional department stores Leverage to raise rates aggressively every year
Cutting costs Newspapers struggle to cut costs and the newsroom is always the easiest target, but EXCESSIVE NEWSROOM CUTS: Lessen reader appeal and circulation Value to advertisers
Meet the enemy THE BIGGEST PREDATORS FOR AD $$ Google Craigslist
Meet the enemy... AND FOR READERS: Wikipedia MySpace YouTube
Back to the Future Wall St. values newspapers less than private investors Does ownership by public corporations still work? Do the demands of Wall St conflict with the demands of management? Are private owners the future of just vanity play?
Ending with optimism Why newspapers WILL survive The need for original content Which owners will be most successful