1. In the digital age, news organization are now forced to create a digital/website department as more and more people are getting their news online. Since so many people are reluctant to pay for news content online, media organizations are being forced to depend more and more on ad revenues rather than circulation and subscriptions to make their profits. This changes the economic model that has worked for so long in the world of media. It isn’t enough to have high ad rates and widespread circulation anymore, media companies are constantly having to innovate when it comes to generating online revenue. This means the focus is not just on the actual content but how many people are viewing it and how many hits it is getting online, which is what advertisers use as criteria for their placement. The old separation of the editorial staff and the advertising staff no longer holds as all editors now need to be conscious of what stories will generate the most revenue in terms of hits and advertising.
– One of the biggest trends affecting the traditional economic format has been the “un-packaging” of the news. Previously, newspapers could have different sections and topics all put together along with classified ads sections and print advertisements. Now they have to compete with very specific websites that cater to everyones individual needs. People are no longer bound to the single publication for all their reading/news interests, they can now seamlessly transition between different websites, each one devoted to a specific area of interest. This drives down the advertising costs that any single publication can charge and they now have to compete with aggregators or other websites that basically can give the same content away for free.
– The distribution models for content have also changed . There were significant marketing and distribution costs for any newspaper trying to reach an audience as organizations needed retailers, suppliers and logistics to get their product to your doorstep. Now, media can rely on its readers to distribute their article not just through forwarding links and aggregating websites, but also through social media networks that have made it increasingly simple to transmit news content. Furthermore, media companies can track their shared stories and analyse what content is popular and tailor it accordingly.
– In the digital world, we are dealing with a surplus of information with websites just a click away. Previously, when information was scarce, there was value in what traditional newspapers contained and hence they could charge accordingly. Now with the abundance of easily accessible information, the value of media content diminishes, making it difficult to generate a unique and loyal audience along with their corresponding revenue figures.
- Advantages of a digitally based news company over a traditional print or broadcast organization.
– Digital news companies have the ability to produce not just text and picture based articles but incorporate mixed media, including graphics, animations, slideshows and audio clips. All these elements can greatly enhance the stories being published and are more attractive to a reader.
-Digital news companies have smaller startup costs because there are less physical assets needed to start the business. For e.g. they don’t need to buy a printing press or negotiate with a paper supplier. They also don’t have to worry about retailer and distribution points. Their costs involve merely setting up a website and attracting readers to it, something that can be achieved far more easily and faster than the traditional print setup.
-Digital news companies can publish information faster and update it in real time. They are not constrained by the traditional printing press deadlines or the once a day breaking news cycle. They can publish any time of the day, constantly update and provide details for the story as it unfolds.
- Advantages of print over digital media
-Print companies can still charge higher ad rates than digital publications since digital ads are considerably cheaper and unable to cover the full cost of operations. Furthermore, digital ads are seen as intrusive and a nuisance by many online readers and print ads may in fact enhance the quality or attractiveness of a print publication.
-People are more likely to go over the entire print publication, whether its a newspaper or magazine when they physically have it. Online, publication are constantly having to compete with shorter attention spans and competition since there is such an abundance of information available on the web. This means articles get smaller and less detailed online, with the focus coming more on quantity over quality.
-Print publications still make their money from subscriptions and physical sales that are profitable. Broadcast make their money from cable subscriptions and lucrative ad rates. However digital publications still encounter resistance when they ask people to subscribe or pay a monthly fee for access. This makes it harder for them to charge for their content and earn significant revenue outside of ads.