With US Newspaper Audited Results Expected Today Showing Daily Circulation Down 2.5% and Sundays Down 3%, Let’s Concentrate On The Good News -- There’s Record Traffic At Newspaper Web Sites

A record 58 million readers accessed US newspaper web sites in September, according to Nielsen/NetRatings, with the average being 56.9 million per month in the third quarter, a 24% increase over the same period a year ago.

That record September usage translates into 2.7 billion page impressions and that has the Newspaper Association of America that sponsored the study very pleased.

“Newspaper Web sites are expanding the reach of newspapers, showing robust increases among an audience that grows year after year,” said NAA President John Sturm. He believes the web sites are attracting young audiences who have shunned the print product, and he thinks he knows why.

“Newspapers have attracted more readers to their Web sites by introducing new content and applications, including video and podcasts, and creating platforms that allow the local community to contribute and share ideas, opinions and information. All of these innovations continue to strengthen the unique connection newspapers have with their audiences.”

So can newspaper web sites actually do an even better job of drawing in the masses? According to James Brady, editor of Washingtonpost.com, yes they can.

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His basic message, given at the AP Managing Editors (APME) annual conference in New Orleans, was that newspaper web sites must be much more than just a reprint of the day’s newspaper. With so much competition out there, Brady said a newspaper’s web site must “stand out compared to the other guy.”

Brady admits he has an advantage over many newspapers – he has an 80-person web staff – but there are still basics every newspaper can employ.

For one thing, give reporters video cameras. Brady says that 50 Washington Post reporters take video cameras into the field. Which would you access online -- a long story about a police shootout with bank robbers or some video showing some of that shootout?

He said the trick in luring readers is to throw out “fishing lines” to hook in as many people as possible. That means having blogs, online discussions with newsmakers, video, podcasts, and databases.

He is a strong believer in developing databases on subjects as diverse as local restaurant reviews (encourage readers to contribute) to listing city park opening hours. “This is an area where papers have really fallen short. You can build databases in ways that the data basically refreshes itself,” he said.

There are few newspaper publishers today who do not recognise that they have to build strong multi-platform distribution. With print advertising basically flat and circulation still in decline, it is the digital products that should eventually bring back in some of the lost revenue. Many newspapers have targets that within three years the web will bring in some 12- 15% of total revenues.

But to get to the point where Web revenue could make up around half of a newspaper’s revenues could take decades, according to Lauren Rich Fine, the respected media analyst at Merrill Lynch. Signalling that newspaper companies will remain out of Wall Street favour for some time to come, she wrote in a recent report:

“Even if the rapid (online) growth continues for the next few years, we don’t see online representing over 50% of newspaper ad revenues for at least a couple of decades, suggesting that industry profit could stay flat for the foreseeable future.”

Taking print losses and web gains into account, Fine estimated that newspaper cash flow will be flat to down a bit for the next 20 years. For Q4 of this year she is forecasting a 2% drop in newspaper ad revenue.

Brady and Fine agree on one point. Newspapers are no longer monopoly information outlets. People read news on the web with increasing frequency and newspapers have to make their sites different enough that people will go there.

But this comes at a cost. Fine say, “Moving from a near monopoly to a competitive model is having the impact of restraining blended ad rates and absolute dollar profits.”

Which all goes to show that while newspapers are working to get their web sites bringing in ever more revenue, many publishers still concentrate on cutting costs to the bone on the print product to maintain that 20% plus margin.

If Fine is right it will be a long time before the web will be a major player on a newspaper’s bottom line.