It is hard to do newspaper business
on the net

The conventional business operation model of a newspaper does not work in the net, says Esa Sirkkunen.

The conventional business operation model of a newspaper does not work in the net, says Esa Sirkkunen.

 “It is the public who know best about many things, not the paper,” says journalism researcher Esa Sirkkunen.

“The conventional business operation model of a newspaper does not work in the net.  It has been obvious for the last ten years that that we should think up something new, but little has been achieved,” he continues.

According to Esa Sirkkunen advertising on the net has constantly increased but it still does not generate enough revenue for the publishing house to cover production costs.

 “This is a major problem for the papers.  The more you do on the net, the more revenue you need to generate from it.”

The problem is particularly pronounced in the USA, where the position of paper editions has for decades not been as strong as it is, for example, in Finland.  On the other hand, the economic recession has accelerated the change in Finland as well.

“In Finland subscribing to a paper and reading it at the breakfast table continue to be a firmly entrenched ritual, and this is what keeps the papers going.  Papers are also a strong tool in advertising.”

However, annual subscriptions to papers could be on the wane as the young generation is accustomed to reading the news on the net.  The transfer of announcements to the net may also undermine the position of the newspapers.

“If the subscription base vanishes we’ll be in trouble.  Where will the journalists’ salaries come from then?”

Changes in journalistic work

According to Esa Sirkkunen, changes in journalistic work are under way and on ever shakier ground.

“These changes ultimately will be reflected in the nature of the work and in its border conditions.  You can’t even be sure that in the future the papers’ production will still be mainly based on the work of the permanently employed editorial staff.  Production is being outsourced and journalists in the future will be doing more and more freelance work for numerous different places.”

In the USA changes circumstances have led to the emergence of new action models.

“In some services journalists request funding from the public for things  they are planning.  The thing  will be done once sufficient funding has been amassed and interested media located.  There are also now employment agencies  which accept ideas for features from media enterprises and locate people to do them.  On the other hand journalists may present their own ideas to the media houses.

Charges for net services?

In August 2009, Rupert Murdoch, the owner of the international concern News Corporation, announced that he would soon be discontinuing the free net pages of his newspapers.  There is a possibility that the net pages of the Times and the Sun will have to be paid for.

“Many net papers plan to start charging at some point.  I don’t know how successful that will be, because people are used to everything on the net being free of charge.  There are so many sources of basic news available free of charge that it would be difficult to try to make people pay for this.  Now something special should be thought up for which they would be prepared to pay.”

Entertainment news arouse interest and discussion specifically on the net.

“This has been seen in Finland, too that the afternoon papers have come out in smaller paper editions while the number of those reading on the net has burgeoned.  There is a lot that is free on the net and then they try to sell the same material in the paper editions.  This calls for a great deal of thought, whether it makes any sense.”

Targeted advertising

Esa Sirkkunen is not convinced about all the business models for social media.  For example Facebook and Twitter  do indeed have a lot of visits, but so far it has been difficult to convert user numbers into  profitable models . However, Facebook recently announced that the company had begun to receive sufficient revenue to cover its operating costs.

“For example Facebook does not have a very convincing business model considering what it costs to maintain it.  It costs quite a bit to maintain an organization with 300 million people.  Twitter has 45 million visitors per month, but the company is still running at a loss.

The Twitter microblog service announced in the middle of September that it was changing its operating model to include advertisements.  Twitter did not previously accept advertisements.

“Of course there are also successful services on the net, for example Google is extremely lucrative.  Search engine advertising is really effective.”

It is characteristic of social media that a great deal of information accumulates about the users and their interests. So that advertising can be targeted more accurately before at smaller target groups than before.

“These social media services are combining into a large entity, when the information accumulating on users and profiles advertising can be utilized in various services.”

For the user the main question is what happens to user information and who is entitled to utilize content produced by users.

“For example, Facebook claims that all content produced for it is destroyed when the user account is closed.  On the other hand there are pretty convincing examples that a great deal is indeed left there.  I believe that the services of the social media will be compelled to make their user conditions a whole lot clearer in this respect.”

The public benefitting the media

Esa Sirkkunen considers the public a noteworthy resource for the media.  Increasing quantities of ideas for items and especially photographs taken by readers are being sent to editorial offices.  For example the Finnish quality daily Helsingin Sanomat received about 60-70 readers’ photos per day last year.  The city paper Metro received 18,000 readers’ photos in 2008.

“This means that the papers receive a vast number of photos for them to use and also photographic material which is journalistically of interest.  If the readers can be relied upon to provide photos of some major event perhaps there is no point in sending the paper’s own photographer to cover it.  It would be great if instead of one or two photographers there would be perhaps 500.”

Expertise outside the editorial office

In Esa Sirkkunen’s opinion the readers could provide the media with much more than photos.

“The public could participate in the making of an item, for example by recounting their experiences, obtaining information or even by participating in the writing of the item.  Such experiments have been conducted elsewhere.  The idea is good, but it needs further work for the end result to be quality journalism.”

“As I see it the papers and other media would have a great deal to benefit from the public.  On many matters the public has the best expertise; it is not in the editorial office.”

What will be the effect of public participation in journalism?

“According to one claim, in the future lay journalists  or amateurs will produce all the content free of charge and the professionals will have nothing to do at all.  However, I have not recently been particularly concerned about this.  The task of the professional journalists is to research the background and consider the matter as a whole and the public interest.  However, journalism should be developed in such a direction that the potential of what the public has to offer could be taken advantage of.

http://www.uta.fi/laitokset/tiedotus/jourtutkimus/projects.php

Text by Silja Hjerppe
Photo Jonne Renvall