Decline of Print Due to the Rise of the Internet. Right? Wrong!
If there's one thing on which nearly everybody agrees, it's that the internet is at the heart of the decline of print, and newspapers in particular. Why buy a newspaper when you can find out all you need to know with a few clicks/taps on your PC, tablet or smartphone, and without paying?Well, one man doesn't agree, and he's not some maverick with a shaky grasp on reality, but an eminent economics professor at Chicago University by the name of Matthew Gentzkow,In his article, Trading dollars for dollars: the Price for Attention Online and Offline, Gentzkow argues that there are 3 common fallacies when it comes to the relationship between print and online:1. The Net is Responsible for the Demise of the NewspapersGentzkow writes that the popularity of newspapers had already declined between 1980 and 1995, well before the internet was a factor.What's more, he finds that sales of newspapers have dropped at roughly the same rate ever since, His conclusion: 'People have not stopped reading newspapers because of the internet.'Roy Greenslade, writing in the Guardian, doesn't wholly agree. Whilst he endorses the point that newspapers were in decline before the advent of the internet, he disputes Gentzkow's assertion that the internet has had no impact. He argues that the figures show that the internet, although not wholly responsible for the demise of print, has accelerated its decline.2. The Web Has Made the Advertising Market More Competitive, Which Has Driven Down Rates and, Revenues.That, says Gentzkow, just hasn't happened.3. Online Advertising Revenues are Naturally Lower than Print Revenues, So Traditional media Must Adopt a Less Profitable Business Model.This is where things get interesting. Gentzkow argues that those that advocate this theory (and that's most of us) are comparing apples and oranges.The 'apples' are unique monthly visitors, the metric that determines online ad rates, and the 'oranges' are circulation numbers, which determine print newspaper and magazine rates. Gentzkow argues that the fact that studies show that people spend more time with newspapers and magazines than the average monthly visitor online makes a direct comparison of rates on this basis incorrect.Gentzkow compared the amount of time people actually saw an ad on the 2 different types of media and found that the price for attention for similar consumers is actually higher online - $4.24 per hour of attention online compared to just $1.57 per hour of attention in print (based on 2012 rates). And since 2008, this gap has widened.It's a fascinating study which goes some way to explaining why newspaper and magazine circulations continue to decline despite the fact that a huge proportion of the UK is already online - it's clearly part of a long term trend that pre-dates the advent of the internet.Gentzkow's comparison of online and offline ad rates, based on dwell rate rather than purely numbers also gives pause for thought. It will be interesting to see if any publishers pick up on this research and commission their own studies into online vs. offline dwell time as a means to bolster print rates. The likelihood is that they'd be fighting against the tide but it's Interesting to note that print advertising may be more of a bargain than many perceive.