Saturday, December 06, 2008

An Unlikely Savior for the Newspaper Business

With news like this - New York Times Co. July newspaper revenue plunges 18% - you have to wonder about the future of the newspaper industry.
New York Times Co. said Tuesday that July advertising revenue at its newspapers fell 18% $119.9 million, as even online ad growth slowed to less than 1% compared with the same month a year ago.

Classified ad revenue, traditionally the most important source of income for newspapers, dropped 30.1% in July, after declining 25.6% in June and 24.8% in May. "It really just fell off the cliff," said Ed Atorino, newspaper analyst at Benchmark & Co.
But there might a silver-lining in those gloomy dark clouds - in the form of the Amazon Kindle. Joshua Benton at The Nieman Journalism Lab has a great post that describes how the Kindle and digital sales of the NY Times might actually be the salvation the newspaper industry is looking for. Only a small little glimmer, but this should give newspapers some hope. NYT’s 10K subscribers on Kindle: The start of something bigger?
One other important note from that internal New York Times memo my colleague Zach got a hold of: The company reports it has “more than 10,000 paid subscribers” to an electronic edition of the newspaper on Amazon’s Kindle ebook reader. To my knowledge (please correct me if I’m wrong), that’s the first time a major newspaper has released numbers on how it’s doing on Kindle — a platform lots of newspaper execs are eager to see turn into a saving grace for their industry.

Given that the electronic Times costs $13.99 a month, that would mean the NYT Kindle edition is generating in the neighborhood of $1.68 million a year. How much of that goes to NYT Co. and how much stays with Amazon is unclear.
Benton ends on a less than positive note:
I’m not yet sold on that vision. I think for the Kindle to reach mainstream success, it’ll have to shift its focus from being an ebook reader with a junky mobile web browser to being a great mobile web browser with an ebook reader attached. It’ll have to become something more like the iPhone with a bigger screen and better battery life. (There are signs the iPhone might already have the ebook-reader lead over the Kindle, although without the business model attached.)

And when that shift happens, it’ll become trivially easy to read newspapers’ (free) web sites on the device — which I suspect will undercut Kindle newspaper subscriptions just as it undercuts print newspaper subscriptions. But the NYT’s numbers are among the first public signs that people — at least some people — are willing to pay to get news in the electronic format of their choice, even when they can get it on the web or their phone for free.

1 comment:

Anonymous said...


I'm a journalism student at Northwestern University and I'm writing an article for a web publication ( about the Kindle and the future of the newspaper industry. May I talk with you by phone for a few minutes?

Ashley Bates


Related Posts Plugin for WordPress, Blogger...