The Prospects for the Evening Standard
Desperate circumstances require desperate action says Jim Marshall, chairman of the IPA Media Futures Group, of the Evening Standard’s plans … but there are a host of other media sectors and media owners who really need to get their head out of their … too!
News this week reflected the rather mixed fortunes for old and new media. While the Evening Standard announced that it was going free from next Monday October 12, the IAB announced that for the first half of this year internet revenue had overtaken television.
Maybe a case of: “The King is dead, long live the King”, with the internet assuming the new crown. But then again maybe not!
What about the Evening Standard?
It is well documented that the newspaper sector is under attack from the internet. News, information and increasingly comment are now all delivered more quickly, more directly and largely for free by the internet. Additionally the internet is eating into newspapers advertising revenue, particularly in the areas of direct response and classified.
Some commentators have even suggested that paid for newspapers can not survive in the longer term and in 10-15 years time we can expect a world without our favourite morning reading, whether the Sun, the Daily Mail or The Times. The best we might expect are either online versions or free sheets – the route the Evening Standard has chosen.
Of course exactly the same arguments were forwarded against the cinema, when television became increasingly popular and dominant in the 1950s and 1960s. The cinema industry went through some pretty tough times, but eventually emerged not only more dynamic and profitable but also not as a competitor to television but as a complementary medium. And it is now much loved by many advertisers because it offers different communication opportunities, including its creative offering.
I think exactly the same model can be applied to newspapers and the internet – they should not be competitors because they provide very different consumer experiences. The challenge for newspapers is to present their content in a way that better suits what consumers want and expect from their newspaper.
We already know that people are happy to read longer articles in their newspapers and are looking for comment and interpretation along with news and information. Additionally people are looking for a ‘personal’ and consistent relationship with their newspaper, whether in its political stance, sports coverage, social values or how it provides entertainment. All of this is fundamentally different to the internet or, more to the point, complementary with the internet.
But there are other challenges for the newspaper industry, which clearly the Evening Standard is feeling most acutely. For a start there are too many newspapers with not enough providing sufficient editorial quality – arguably there is a need for closures. Secondly, there is the development of the ‘free sector’, which not only increases competition but creates a chasm in the consumer’s perception of the value between paid for titles and the free sheets. Finally, they are still reliant on advertising revenue, which has declined sharply over the last year or so and will continue to decline next year.
The Evening Standard‘s move into the free sector has been described as ‘brave’, which is probably a euphemism for: ‘desperate circumstances require desperate action’. It would be wrong not to wish it well. However, I have a suspicion that, unless there are other newspaper closures and unless advertising revenue picks up, it faces an enormous challenge.
I guess, if it can tough it out through to 2012 and the London Olympics, it could survive but it will require nerves of steel and a significant level of investment from its owners.
Whatever the outcome for the Evening Standard, it can not blame the internet for its current troubles. For some time, it wasn’t a good enough product (as its recent advertising admitted) and its cost structure did not reflect the commercial reality of the current market.
At least the Evening Standard is addressing ‘its gremlins’. There are a host of other media sectors and media owners who really need to get their heads out of their rears and recognise that the world is changing. This includes a number of television companies (nothing has happened since the Digital Britain Report), many Sunday newspapers (people live very different lives on Sunday now) and even the internet, which may be crowing about its increased share of total advertising revenue, but neglects to mention that its display revenue has declined this year.
As Raymond Snoddy said on MediaTel last week, even the internet should not be triumphalist.