Newspapers vs. News search engines

In 1846, as the new technology of the telegraph system was catching on, newspapers pooled their resources to create a more efficient news distribution system. Jim Kennedy, vice president of strategic planning at the Associated Press, which was born out of those efforts, says newspapers are facing a similar challenge today. "Fast forward 168 years later," Kennedy told attendees at a recent Las Vegas gathering, "that's the situation we face today." Translation: It's time for newspapermen to stop fighting among themselves and cooperate if they want to survive in the era of splintering audiences, and search-engine news gateways, such a P's Kennedy was spoke Friday alongside Tom Mohr, President of Knight Ridder Digital and Colby Atwood, vice president at Borrell Associates, a consulting firm specializing in local media. The panel was part of the Interactive Media Conference, hosted by Editor & Publisher and Mediaweek. 

The panel was titled "5-year forecast: See the Future Today," but from the comments made on stage, it might as well have been "The final days of newspapers." For offline newspapers, the writing is on the Web. Email delivery of national and niche news on our computers or on our BlackBerry devices has made it less of a priority to pick up a printed newspaper, especially when traveling. Why bother with the added weight? In 1949, newspapers accounted for 37% of the advertising market in the U.S., according to Atwood. Today, they account for 17% to 18%.

Given the choices people make on the Web, newspapers -- try as they might -- likely never will come close to having the same market share online that they once had in the offline world.

Atwood said that, surprisingly, newspapers still account for 35.8% of the online local ad marketplace, which he estimates to have been $2.4 billion in 2005. About 90% of advertisements in newspapers are local. Increasingly, those offline dollars are seriously at risk.

"There's a big race to go after local ad dollars," said Atwood. "I'd say newspapers will likely lose their share," he said. "They're not as well organized as the large dot-coms." Read rest of column on MarketWatch