AS The Manila Times marks its 121st founding anniversary today, it may seem odd to be cheerful given the challenging times ahead. Print journalists are often asked about the future of newspapers and I have always replied with cautious optimism.
Granted, global trends are discouraging. In the United States, The Washington Post recently reported that weekday print circulation shrank from about 60 million in 1994 to about 35 million last year. Worse, the 2018 figure already combines print and digital circulation. The Post added that advertising revenue in the US fell from $65 billion in 2000 to less than $19 billion in 2016, and that newsroom employment dropped almost 40 percent from 1994 to 2014.
In the Philippines, where circulation figures are closely guarded by publishers, there is ample evidence from independent newspaper dealers and other sources showing overall sales of print editions are in decline. Advertising has also dropped. According to the research group Kantar Media Philippines, print ad spend fell 22 percent in 2018 compared to the year before. The decline seems more alarming when one takes into account that print media’s share of the total ad spend is 1 percent of the total.
Personally, the source of cautious optimism springs from two directions. First, we should remember that what impacts the whole set does not mean every player is affected the same way. While newspapers worldwide face closure, there are publications that are thriving.
For instance, the decline of newspapers is palpable in Europe but recently, Spain’s El Pais was featured in the World Association of Newspapers and News Publishers website for posting a 68-percent growth in Ebitda (earnings before interest, taxes, depreciation and amortization) from 2012 to 2017. We hear of similar success stories about newspapers in South Asia and Latin America. And in US, digital subscriptions of The Post and The New York Times have soared since Donald Trump was elected in 2016.
Second, questions about the future of newspapers appear to have clear answers in economics. It is an old field and economists would argue that economic laws apply to virtually every aspect of society. The economic principles that seem most interesting include self-interest, division of labor and transaction costs.
For this line of argument, consider a few questions that publishers often hear, beginning with the most jarring: Will newspapers survive? The short answer is yes.
The longer version may be better understood by paraphrasing Adam Smith, the father of economics: it is not through the benevolence of readers that publishers shall earn their keep. Instead, people will buy newspapers if it serves their interests. In other words, newspapers will survive if it satisfies a need or want.
The book The Elements of Journalism says that to be informed or know what is going on is a human need. Whenever we see friends and family on holidays, for instance, our tendency is to ask questions about them, like how they have been. To appreciate the value of this need, one can ask a prisoner placed in solitary confinement or a person exiled from his or her country.
Another question that we often hear is: Will social media replace newspapers? Doubtful.
Publishing the news is hard work and complicated. For many publishers here and abroad, a team comprising hundreds of people is required to churn out an edition daily. And in between editions, publishers are updating their websites and social media accounts. The principle of division of labor suggests that the output of publishers employing various specialists performing essentially repetitive set of tasks cannot be matched by a single worker, be that of a social media influencer or blogger.
On a related note, newspapers here and abroad have embraced social media and the internet as a whole. They use this new medium to reach an audience broader than before. The challenge now is monetization, since people are used to reading online content for free.
Finally, the last question worth pondering is why would readers choose to read newspapers rather than social media pages. Again drawing from economics, the answer may be transaction costs.
After five centuries of existence, the communications industry has learned that people who read or “consume” the news are almost always pressed for time. And because we have limited time to read, it is more efficient to turn to a paper that has a complete menu of media content — from news and opinion, business and sports to entertainment and features.
Social media influencers can only hope to deliver a fraction of that, precisely because their output is generated by one or few workers. Readers who rely on them may need to visit several social media pages before they are satisfied with the sufficient amount of information. In contrast, newspapers may be likened to one-stop shops for content.
As mentioned earlier, general trends affecting the whole set do not necessarily apply to individual players. The same Post article quoted earlier mentions that digital news sites BuzzFeed and Vice had missed revenue targets. The article says a similar site, Mashable, was initially valued at $250 million but was sold recently for less than $50 million. These developments suggest that migrating to digital may be insufficient to survive or even thrive.
So, while I firmly believe that newspapers will survive, I am equally certain that many will perish. To play any game well, one needs to master the rules. In today’s age, the rules governing media enterprises have changed. The argument here is that economics, rather than journalism alone, appears appropriate for enabling media managers to navigate their news organizations into the future.
The author has been with The Manila Times Publishing Corp. since 2001, when his father bought the paper. The younger Ang started his career in 1992 as a reporter for a daily newspaper in Oklahoma and became president of The Times in 2007. Today, he is a candidate for a Doctor of Philosophy degree, major in Economics, at the University of Santo Tomas.