Many predicted that the rise of the Internet and online publishing meant that mainstream media organizations would lose their readers and viewers, with technology breaking their oligarchic control over news. But that’s not the overall picture.
Yes, people are migrating online. In 2010, the Internet passed newspapers for the first time as the platform where Americans “regularly” get news, according to survey data from the Pew Research Center. Forty-six percent of adults say they go online for news at least three times a week, as opposed to 40 percent who read newspapers that often. Only local television news is a more popular destination, at 50 percent.
But online news consumers are heading primarily to traditional sources. Of the 25 most popular news Web sites in the United States, for instance, all but two are “legacy” media sources, such as the New York Times or CNN, or aggregators of traditional media, such as Yahoo or Google News. Of the roughly 200 news sites with the highest traffic, 81 percent are traditional media or aggregators of it. And some old media are seeing their overall audience — in print and on the Web — grow.
The crisis facing traditional media is about revenue, not audience. And in that crisis, newspapers have been hardest hit: Ad revenue for U.S. newspapers fell 48 percent from 2006 to 2010.
2. Online news will be fine as soon as the advertising revenue catches up.
Such hopes are misplaced. In 2010, Web advertising in the United States surpassed print advertising for the first time, reaching $26 billion. But only a small fraction of that, perhaps less than a fifth, went to news organizations. The largest share, roughly half, went to search engines, primarily Google. The newspaper industry illustrates the problem. Even though about half the audience may now be accessing papers online, the newspaper industry took in $22.8 billion last year in print ad revenue but only $3 billion in Web-based revenue.
Journalism thrived in decades past because news media were the primary means by which industry reached customers. In the new media landscape, there are many ways to reach the audience, and news represents only a small share.
3. Content will always be king.
The syllogism that helped journalism prosper in the 20th century was simple: Produce the journalism (or “content”) that people want, and you will succeed. But that may no longer be enough.
The key to media in the 21st century may be who has the most knowledge of audience behavior, not who produces the most popular content. Understanding what sites people visit, what content they view, what products they buy and even their geographic coordinates will allow advertisers to better target individual consumers. And more of that knowledge will reside with technology companies than with content producers.
Google, for instance, will know much more about each user than will the proprietor of any one news site. It can track users’ online behavior through its Droid software on mobile phones, its Google Chrome Web browser, its search engine and its new tablet software.
The ability to target users is why Apple wants to control the audience data that goes through the iPad. And the company that may come to know the most about you is Facebook, with which users freely share what they like, where they go and who their friends are.