Wednesday, January 28, 2015

newspapers on sale

Newspapers are on sale everywhere and so are many magazines, all of them at bargain prices. Yesterday, Group Sud Ouest finalized the sale of Midi Libre to La Depeche for a sum which should not exceed 20 millions euros, a far cry from its buying price ten years ago. The same with Express sold by Roularta to Drahi the new telecm owner for about 10 millions euros.

And now, there is the rumour that the New York Times, the most prestigious American daily could be bought by Bloomberg. The price would certainly be much higher than the 250 millions dollars fixed for the sale of the Washington Post and could amount to more than 1 billion dollars. Still, it would be a revolution in the American media world as the grey lady is the last major newspaper to belong to a family.

What does it mean? First that there are still people who are interested in legacy media and willing to put money to gain what they consider is prestige and influence. Then there is the fact that prices have gone down dramatically as the examples of the Post, l'Obs, sold for 5 millions euros or Express show. So why not try a new adventure and merge digital and print media as Bloomberg would obviously like to do with the Times.

As usual, the battle for the media is a battle of moguls. But now they are using the money they acquired in digital affairs. Blommberg will face Bezos, Drahi will attack Niel.

And yet, I wonder. Are the future news giants to come from the former legacy media, boosted by digital money? It is not sure. Audacious pure players are all over the place and growing very very quickly.

Monday, December 29, 2014

The French legacy media in 2015

In a recent article, the New York Times provides an extensive list of the American media executives who will be on a "hot seat" in 2015. The same could be said of the French legacy media.

Let us start with group Express. Its flagship publication, the newsmagazine Express has been in trouble for 2 years with a sharp fall in advertising and a slow decline of circulation. Many observers consider that the era of newsmagazines is over in France as in Germany or the US and that Express has no future. The group's owner, Rick de Nolf faces the unhappy dilemma of keeping the ailing publication or selling it at a discount rate. He bought the group 10 years ago for 220 millions € and according to bankers, its present value is around 50 millions.

The two other newsmagazines, Le Point and l'Obs are not in a much better shape. They see their advertising income going South and suffer from the competition of the websites which are very dynamic indeed. It seems that only one of them can survive and 2015 will be the year of reckoning.

Dailies do not fare much better. Once again, le Monde will be in the red. Its selling price will go up to 2.20€ which will mean a new decrease of its circulation combined with low expectations in advertising. And yet, the print makes 80% of the income of the newspaper. Le Monde should definitely improve its marketing policy to boost its print and digital subscriptions.

Regional newspapers will probably face another year of decline of advertising and classified at a pace of 8% a year. In 2015, attention will focus on Sud Ouest which is trying to sell its sister daily Midi Libre and has to repay a loan to its bankers. It is obvious that new partners will have to be found, very soon.

Are digital media ready to take over? There again, the picture is mixed. Apart from le Monde and le Figaro, the legacy media websites are not profitable. Pure players are also lagging behind their Anglo-Saxon competitors, Mediapart being the only success story. By the end of this coming year, Politico will open a site in Brussels, followed by the Guardian and more and more French people read English.

However, the most interesting challenge of 2015 will be the digital coverage of local news. There, new opportunities should be seized.

Monday, December 1, 2014

local news on the Web


I have mentioned many times the hard fact that local news are not a web favorite. Their readership is sparse, their sponsors are few or depend too much on local government. However, the fate of democracy in Europe or in the US is highly dependant on a comprehensive coverage of local politics and economic challenges.

In France, no regional newspaper, whether it is Ouest France, Sud Ouest or Voix du Nord has been able to launch a credible alternative to the print. It raises a big question: are legacy media better placed to innovate on the Web? They still raise enough money through the print to finance a big newsroom and a network of local correspondants but it won't last. Advertising is running away and will never come back. Permanent losses are the future.

So what about a pure player? It is possible, as long as it covers a huge territory, lets say South East or Britanny. In that case it should have a small team of journalists working on long papers dealing with the major dossiers of the region and a powerful network of corresponadnats able to cover every part of the zone.

What about the public? It should be a population of motivated internauts, willing to pay a monthly subscription, provided that they are permanently informed on what is happening in the neighbourhood. Forget the daily publication of a bundle of news. It is not what they look for. They use more and more smartphones, very good for breaking news, not so easy for long papers which are less urgent and can be read once a week on a tablet or a computer.

Does this population exist? I believe so but it requires fast and valuable news. There is plenty of it in every city. You just need to look for it and deliver it immediately. Then people will agree to pay. 

Tuesday, November 25, 2014

The future of legacy media


It appears that year 2014 is a year of new assessments, a cross road where the legacy and new media followed new paths that will remain the same for years to come.

Two major processes became obvious these last few months.
First, the triumph of news websites which after many unsuccessful attempts seem to find the proper recipes to drag audiences et finance their efforts, as long as they deal with national and international pieces of information. However, their shape is very different from the usual print press. They collect data spread all other the place, they rely heavily, too heavily maybe, on Google and social networks such as Facebook which is slowly turning into a new and very powerful media. they mix up more and more text and video, blurring the lines between traditional media, press, radio and TV.

Then, the legacy media keep drowning, losing for ever advertising income and their readership. The success of their Web services is uneven. Some seem to make it like the NY Times, le Monde or le Figaro. Others, dailies or magazines are trailing behind and, anyway, none of them is able to finance properly a strong investigation team. If and when they vanish, what will replace them?

The big question, I will treat next time in this blog is the future of information. What do people want? What are they willing to pay? What level of information is necessary in a democratic society? Keep tuned. 

Friday, October 31, 2014

Is the New York Times model working?


The 3rd quarter results of the NY Times are mixed. Print advertising keeps going down, by 5.3% so is the print circulation. The new digital applications are not very successful and the Gray lady has dropped its Opinion app. which did not attract enough subscribers. So the diversification of the great daily digital services is disappointing to say the least.
However, subscriptions to the digital edition keep growing to 875000 customers And digital advertising is up by16.5%. The current loss is due mainly to the cost of buying out 100 journalists from the newsroom.

The conclusion is that the global trend of the digital policy of the NYT is fairly successful. More and more people read the digital edition and pay for it between 15 and 20 dollars a month. Advertisers are also coming and financing a growing part of the very large and expensive newsroom.

And yet, there are two limits to this growth. First, the fact that people rely more and more on new circuits, unforeseen 5 years ago: the social networks and specially Facebook which works more and more like a media and then the  internaut uses more and more the smartphone, notably the enlarged one which means a different access to the news and to the ads.

All that means that the NYT like the Guardian or the FT must think very hard about a non so distant future. 5 years are a very long time in the digital age.

Thursday, October 16, 2014

The digital challenge of the regional newspapers


French regional newspapers are in bad shape. The figures are well known: a regular fall of circulation, at about 2% per year. A faster decrease of classified and advertising at a rate of 8% per year. The result is the obligation to raise the price of the newspapers which is punishing for the subscribers that make a huge majority of the readership.

It is hard to see the future of Nice Matin. The once prosperous daily of the French Riviera loses 12 millions euros a year and its circulation is in free fall. It is obvious that the proposal of the employees who wish to buy their newspaper is not realistic. Their financing is not properly fixed and they intend to keep working the printing unit which is losing a lot of money. Rossel proposal is more to the point but it is painful: It intends to reduce drastically the staff and close the printing unit. However, even if Rossel prevails it remains to be seen whether Nice Matin can survive more than a few years.

The digital challenge is not easy to face either. Regional dailies are desperately looking for devices with a very limited success. Ouest France and Sud Ouest are trying an evening edition, mostly devoted to national and world news. For the moment, it doesn't work. Subscribers are scarce as they can get for free the news offered by these dailies. There are so many websites in French or in English that provide that kind of information. Look at Huffington Post, Slate and the websites of the free sheets.

However, the big question is the financing of the very costly collection of local news. In the US, the local newspapers have been trying for years to build up paywalls and attract local advertisers. By now the figures are very disappointing. Local pure players are not successful either. For the moment, at least, the public is not willing to pay.

And yet, people want to know what's happening in their city, the place where they live. There is a solution but it has not been found yet.

Wednesday, October 1, 2014

The Guardian goes European


The Guardian has great ambitions and important financial means thanks to the sale of its classified ads website.

Its main objective is to become a global world media. It has developed a strong position in the English speaking community. It has launched a digital edition for the US and for Australia. Now it is working on a new initiative, the launch of an European edition on the Web.  Now most executives of the main European countries speak English and could be potential readers of a good digital publication staffed with high level journalists hired from Germany, France, Italy or Poland and doing in depth investigations.

Still the competition is tough. The International New York Times and the Financial Times offer a comprehensive coverage of European news. However, the main threat comes from the new European edition of Politico, based in Brussels and supported by Springer.

For national media from Germany, France or Italy, it is also a challenge. It is obvious that the language barrier doesn't work any more. Only quality counts which costs money but he Guardian and Politico have deep pockets.