{"id":40858,"date":"2013-08-09T17:51:39","date_gmt":"2013-08-09T21:51:39","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/?p=40858"},"modified":"2013-08-09T17:51:39","modified_gmt":"2013-08-09T21:51:39","slug":"three-reasons-to-say-i-believe-to-newspapers","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2013\/08\/09\/three-reasons-to-say-i-believe-to-newspapers\/","title":{"rendered":"Three Reasons to Say \u201cI Believe\u201d to Newspapers"},"content":{"rendered":"

By WallStreetDaily.com<\/u><\/a> <\/p>\n

Now that two billionaires \u2013 Jeff Bezos and John Henry \u2013 bought The Washington Post<\/i> and Boston Globe<\/i> within days of each other, I wonder how many newspaper gravediggers are suddenly thinking that the industry can be taken off life support.<\/p>\n

Personally, as an old-school journalist, I never gave newspapers their last rites.<\/p>\n

Neither did stockholders, who enjoyed 40% gains this year on The New York Times Company<\/b> (NYT<\/a>) \u2013 a move Wall Street Daily\u2019s<\/i> Louis Basenese referred to as a \u201cresurrection<\/a>.\u201d<\/p>\n

If you\u2019re not a believer yet, here are three reasons you should be\u2026<\/p>\n

~Reason # 1: Buffett\u2019s Buying Rampage<\/b><\/p>\n

Four years ago, Warren Buffett saw the industry going down the tubes and vowed never to buy a newspaper again. He had to eat crow, however, after he acquired the Omaha World-Herald<\/i> in 2011, a paper he grew up reading. Then he added 25 more in the next two years, spending one-third of a billion dollars on the expansion.<\/p>\n

Of course, the $333-million question is, why?<\/p>\n

Beyond what he calls an \u201cunnatural love of newspapers,\u201d the truth is, he believes that good hometown news sells – and that the right online subscription model can add a healthy stream of income.<\/p>\n

Metropolitan publications that report news from all corners of the world don\u2019t fit his investable profile. That\u2019s the stuff you can always get from the TV. Smaller newspapers like the Tulsa World<\/i> and Greensboro News & Record<\/i>, his two most recent acquisitions, actually visit neighborhoods and city festivals.<\/p>\n

Buffett believes that people want to read about what\u2019s going on in their own<\/i> backyards \u2013 and they\u2019re willing to pay for it. In that sense, newspapers have a monopoly on quality, local content.<\/p>\n

No matter how great their content is, though, if newspapers use a losing business model, they will fail. That\u2019s precisely what newspapers did (and some are still doing) for years. Slow to make changes to their business models after digital news spread like wildfire, they offered printed content online at no cost.<\/p>\n

As the saying goes, \u201cWhy buy the cow when you can get the milk for free?\u201d Subscriptions sank \u2013 and so did advertisers\u2019 dollars, to the tune of 50% since 2005.<\/p>\n

Buffett has no intention of giving away a cup, quart, or gallon. That\u2019s where the paywall comes in\u2026<\/p>\n

~Reason # 2: Paywalls Lead to Paydirt<\/b><\/p>\n

Surely, you\u2019ve hit one by now. After reading several articles on a site, a message pops up, warning that you\u2019ve reached your quota of 20 or so free articles, and you must now become a paid subscriber.<\/p>\n

The Wall Street Journal<\/i> implemented a paywall way back in 1997, leading to a 200,000 gain in subscribers in a little over a year. Today, 898,012 pay for online access \u2013 a 62.6% leap since March 2012.<\/p>\n

It took 14 long years before The New York Times<\/i> would follow The<\/i> Wall Street Journal\u2019s<\/i> lead. Online subscriptions grew to 500,000 after just two years of charging.<\/p>\n

Paywalls have finally become standard procedure. In 2012, 350 newspapers used them. And Borrell Associates, an advertising tracking firm, predicts 500 will adopt the practice over the next few months.<\/p>\n

And Borrell confirms that advertising isn\u2019t suffering as a result. If you think about it, there\u2019s little difference from the late 1960s when people rejected the idea of paying for TV and eventually gave in to cable.<\/p>\n

Typically, traffic lightens right after the paywall goes up, but within 12 to 15 months, it picks back up.<\/p>\n

At $3 to $6 per month for customers, paywalls are expected to bring in a few hundred million dollars or so annually, or 2% of the industry\u2019s total circulation fees. Not a fortune by any stretch of the imagination, but it does provide a steady avenue for growth.<\/p>\n

~Reason # 3: Bezos is the Man for the Job<\/b><\/p>\n

Maybe Bezos can be a superhero<\/a> and \u201csave the decade\u201d for newspapers. What the industry needs more than anything is a monetizing of new and old, with respect to technology and people.<\/p>\n

Market research firm Scarborough reports that 59% of people aged 18 to 24 read some form of the newspaper every week\u2026 That\u2019s 18 million people, according to the U.S. Census Bureau. And the number of mobile-exclusive readers increased 83% in 2012 compared to 2011.<\/p>\n

Sounds like a growing market in need of some serious tapping.<\/p>\n

No doubt Bezos knows how to engage online audiences and make lots of money doing it. His ingenuity may make The Washington Post<\/i> a poster child for 22nd<\/sup> Century newspapers.<\/p>\n

Perhaps Tom Rosenstiel of the American Press Institute said it best in an interview with PBS Newshour: \u201cSo, someone like Bezos, who is now thinking about his legacy \u2013 he’s reached a certain age, one of the richest, most successful businessmen in America \u2013 is probably thinking about, how do I save an institution and be known for something more than just being rich?\u201d<\/p>\n

I hope he has the answer.<\/p>\n

Ahead of the tape,<\/p>\n

Karen Canella<\/p>\n

The post Three Reasons to Say \u201cI Believe\u201d to Newspapers<\/a> appeared first on  | Wall Street Daily<\/a>.<\/p>\n

Article By WallStreetDaily.com<\/u><\/a><\/p>\n

Original Article: Three Reasons to Say \u201cI Believe\u201d to Newspapers<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

By WallStreetDaily.com Now that two billionaires \u2013 Jeff Bezos and John Henry \u2013 bought The Washington Post and Boston Globe within days of each other, I wonder how many newspaper gravediggers are suddenly thinking that the industry can be taken off life support. Personally, as an old-school journalist, I never gave newspapers their last rites. … <\/p>\n

Continue reading “Three Reasons to Say \u201cI Believe\u201d to Newspapers”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-40858","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/40858","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/comments?post=40858"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/40858\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/media?parent=40858"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/categories?post=40858"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/tags?post=40858"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}