The newspaper business has endured a rough decade, with readership declining globally as young people in particular abandon print and the digital revolution radically changes the media landscape.
Facing up to the challenges, news organisations are trying to win back readers by diversifying the platforms on which their content appears, shortening story lengths, adding more commentary and analysis, and capitalising on the advantages of social media.
However, a sure-fire formula for making a successful transition from print to digital has yet to emerge. Even those that have done well with digital are finding that revenue and profit are nowhere near what they used to be when newspapers dominated the media world. Many newspapers are simply struggling to remain financially viable enough to continue producing quality journalism.
Print media circulation is sinking in most Asian countries except Japan, where a large ageing population still makes newspapers a daily habit. Yomiuri Shimbun, a 140-year-old institution, has a daily circulation of more than 9 million copies and Nikkei sold around 3 million copies daily in 2015.
In Thailand, print newspaper and magazine readership fell by 7% between 2013 and 2015, while in Taiwan the figure was 10%. The decline has been even worse in Hong Kong, where the 76-year-old Sing Pao Daily News had to suspend its print edition for several weeks in 2015 after failing to pay printing bills, until financial reorganisation allowed it to resume. Its average daily circulation of 136,300 at the time was only one-third of what it was at its 1997 peak.
FALLING AD REVENUE
Last year was an especially bad one for newspapers in the United States. A Pew Research Center survey of publicly listed newspaper companies showed that daily circulation fell by 7%, the most since 2010, and ad revenue fell 10%, the most since 2009.
Falling ad revenue is also taking a toll in Asia, notably in India where very low newspaper prices cover only a tiny fraction of production costs, making advertising the main source of revenue.
At the other end of the spectrum, top quality newspapers in Europe and North America aim to charge enough that circulation revenue will cover production costs, said Gilles Demptos, director of publications and events in Asia Pacific for the World Association of Newspaper and News Publishers (WAN-Ifra). The New York Times costs US$2.50 on weekdays and $5 on Sunday. The Guardian costs £2, which more or less covers production costs with a slight margin, he added.
Publishers in India have been looking for ways out. This includes internal reorganisation and streamlining, outsourcing and cooperation to save costs. Many are moving to multi-channel publishing in formerly print-oriented organisations, said Manfred Werfel, the deputy CEO and executive director for global events at WAN-Ifra.
As well, publishers are seeking to boost revenue through business diversification. Certain kinds of e-commerce ventures, for example, can be a good fit for newspapers, allowing them to leverage their reader base as well as marketing expertise. But so far there have been both failed and successful cases.
"Obviously, there is no 'silver bullet' revenue stream out there that publishers can latch onto to create a sustainable business," Mr Werfel said.
"A bold but thoughtful leader should bring a vision of change far broader than a tweak here and there. Simply managing the decline of the legacy business while hoping that digital revenue makes up for it is a doomsday scenario. As Dallas Morning News publisher Jim Moroney says: 'To create a sustainable business model, you have to have growth.'"
M&A WAVE
The acquisition of The Washington Post in 2013 by Amazon founder Jeff Bezos signalled a new era for news organisations with bigger digital ambitions. Jack Ma, the founder of the Chinese e-commerce giant Alibaba, followed by acquiring the venerable South China Morning Post in Hong Kong, once the world's most profitable newspaper, in 2015. Yahoo, although struggling in many areas, enjoys a good business relationship with hundreds of newspapers whose content is carried on Yahoo News.
"As news publishers are reduced in value, they will become more attractive to big e-commerce players who looking for quality content and ultimately quality content marketing," said Nick Tjaardstra, deputy director of global advisory at WAN-Ifra.
Print newspapers can benefit from e-commerce players' technical expertise and in return develop better news content for the likes of Amazon, Alibaba and Yahoo, he said.
"Such new investment can have a positive impact on the future of news media, if they bring new ideas, concepts to the business and provide growth impulses," said Mr Werfel, referring to the early successes the Washington Post has enjoyed under Mr Bezos.
One successful all-digital platform is Business Insider (BI), which produces original content and also aggregates news from around the web, an approach pioneered by Huffington Post. With some 76 million monthly visitors, BI was acquired last year by the German media conglomerate Axel Springer, increasing the latter's digital audience to approximately 200 million users.
Nikkei, meanwhile, last year paid $1.3 billion for the FT purely for its successful digital platform. Digital platforms in niche areas, such as finance and business, can be defended more successfully against the wave of free digital content.
"BI and FT, these publishing companies are both active in a niche of the news market: financial and economic business news. This gives them an edge compared to general interest news companies," said Mr Werfel.
Other major publishers have also been innovating in the digital and mobile markets. The old model of making advertisers pay per click is being replaced by a better one that measures how much time people actually spend on each piece of content.
"Publishers including the Financial Times, Bloomberg and The Economist have embraced attention metrics by offering advertisers the option to buy on a cost-per-hour (CPH) basis. On average, a Financial Times advertisement seen for more than five seconds showed a 79% increase in advertisement recall and a 71% increase in familiarity," said Mr Werfel.
Many print publications have tried offering their content online for free in the hope of gaining more eyeballs, but the approach has proved to be unsustainable. Now some are shifting toward a "freemium" model, charging for unique, premium features that can't be found anywhere else.
However, there are some exceptions. "Regional news publishers are based on a unique asset, which is local and regional content that only they can deliver," said Mr Werfel. "This is why the competitive influence of free content is affecting them much less than national or international news publishers."
YOUNG READERSHIP
Although print is still a significant revenue earner, the ubiquity of internet access and mobile devices has made digital newspapers and apps more popular among readers, especially the young.
Digital circulation of US newspapers last year rose 2% while weekday print circulation fell 9%, according to Pew Research Center.
Mobile growth represents a huge opportunity for newspapers. Figures from WAN-Ifra showed that more than 70% of Australians and Canadians surveyed prefer reading newspapers on digital devices. The Newspaper Association of America also found that more than half of the US audience for digital newspapers uses only smartphones or tablets to read the content.
Younger people in particular like the additional variety that digital offers.
"Even though reading a print newspaper is more comfortable on the eyes, I still prefer digital because it's more interactive," says Suphanida Thakral, a student from the University of Warwick. "You can share things on social media and have a conversation with people affected in that part of the world rather than simply reading the news.
"A digital newspaper saves me time. I can pick the news I'm interested in by clicking the headline and sometimes there are connected articles for you according to your reading history."
In some countries, digital newspapers have become people's first choice. In Singapore, 64.7% of adults now consume news on digital platforms, according to the Singapore 2015 Media Index Report.
Data from WAN-Ifra show the number of readers for digital newspapers has surpassed the number of readers in print in most developed countries. Paid digital circulation revenues surged 30% in 2015 and have grown 547% over five years. With revenues of over $3 billion, digital circulation is now starting to make up for lost print circulation revenue in many markets.
LOOKING FORWARD
There are many options for the digital transition. They include moving print subscribers to digital and keeping the same rates, improving advertising rates on digital and especially mobile, or monetising off-platform content on Facebook.
There is no absolute strategy for a smooth transaction to news industry as different publishers have different situations and audiences.
"Local publishers may decide to focus on migrating small advertisers from print to digital, while national publishers can reach for higher branded content partnerships with big companies," said Mr Tjaardstra.
In any case, Mr Werfel said newsrooms need to embrace new forms of organisation, new skills, technologies and tools.
"New platform strategies for the integration of social media and distributed content are being developed," he said. "This may include a focus on online video, which is expected to grow strongly. Virtual reality and immersive storytelling should be developed by newsrooms to optimise the use of future media trends for news organisations."
A news content platform launched by Axel Springer and Samsung, Upday draws on over 1,200 sources, including news publishers, blogs and video content from leading media such as The Economist and the Daily Telegraph and has created an unprecedented amount of engagement among users. The success of Upday may shed light on the potential for digitisation and provide possibilities for print media in the future.
Mr Tjaardstra, for one, sees Upday as a successful example of how conventional news gathering and production have been adapted for optimum results on digital platforms.
"It ensures a stream of content that keeps them competitive with Apple News," he said.