Newspapers in catch 22 over online content

A dire warning for newspapers turning to an online-only output to ease their financial worries has been made by an academic study.

But it’s another of the report’s findings which should make newspaper bosses even more wary.

The Media Guardian website today reported the findings of a study by researchers at City University in London, showing revenues actually fell faster than costs after the changes were implemented.

The study was based upon Finnish newspaper Taloussanomat, which went online-only in December 2007 after suffering severe losses on its print version.

Since the change, the newspaper’s costs have fallen by 50%, but revenue dropped by 75% and the move has pushed Taloussanomat even closer to the edge.

Neil Thurman, a senior lecturer in electronic publishing at City, was one of the authors of the study.

He said: “Only if your income is 31% or more lower than your costs, based on this case at least, would you be better off going online-only."

Various reasons are given as to why the move has not had any benefits.

The report suggests that a lack of a print version meant the website was not promoted elsewhere.

And the main reason given by the researchers was that the internet is an altogether different beast to a newspaper as it is normally skimmed over in a couple of minutes.

But, while these are both acceptable arguments – and it is true that the internet has proven to be notoriously difficult for newspapers to monetise – the authors seem to have skimmed over the major point themselves.

The report states clearly that the newspaper cut their newsroom staff and the quality of the content suffered.

Surely this was a bigger factor in explaining the falling readership and revenues.

After all, if in any other walk of life, the quality of a product reduced, most people would have second thoughts over whether to read/use/watch/eat/drink it again.

And while just Maxim and The Ecologist magazines in Britain have gone down the online-only route (so far), redundancies are being announced on an almost daily basis.

It is all well and good that newspaper bosses want to preserve the future of their publication.

And this post is not in denial about the great benefits which newspapers across the country have enjoyed through their websites.

But remind me again of that phrase about paying peanuts...