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Why Newspapers Should Shift to Digital Sales to Survive

picture of newspapers
Even on the internet, newspapers should encourage buying at a price over free reading


The digital world is a very different one for newspapers, and this explains why many have shut down.

The ones that survived took some time in the wilderness before figuring it out.

Yet the ones that are transitioning seem doomed to repeat the mistakes of those who have been ahead of them.

The first problem with digital news publishing is competition. Print newspapers are near monopolies. Setting up a newsprint plant and investing in distribution vans is very costly. You therefore end up with a handful of papers or even just one for a certain geographical zone.

But on the internet, there are no printing costs and distribution costs.

The print edition of The New York Times gets to Nairobi a day later. The online edition is immediately available. Arguably, The New York Times can afford much more good talent that any publication in Kenya. What this means is that should a global incident happen in Nairobi, I have the option of catching up with the latest happenings from hundreds of outlets, many of which have the best of talent of both local correspondents and in-house writers.

Again, what this means is that for big news items, which have been the “bread and butter” of local news outlets, there is now global competition. The larger global media houses then skim the “cream” of the readers by having alternative stories both from local and international talent.

The second problem comes from Digital Firms. Geeks have sold the promise that if you are good enough, you will attract enough eyeballs and become rich. Yet, Silicon Valley firms are stuffed with geeks - so how are media houses required to outdo them in pay-per-click adverts while also delivering the best of news?

Many people find “serious” news exhausting and prefer light news that features entertainments or conspiracies. It is no accident that fake news has thrived in the era where adverts are sold based not on quality, but on how many times they are seen. Somehow, the very bright people of Silicon Valley either can’t figure this, or they now understand they're caught in their own trap but don’t want to change to what is a more expensive option.

Thus, the only way for newspapers to survive is to serve a lot of alarming news to most of the world like the Daily Mail does, or to pick the cream of the audience around the world and charge them a fee like The New York Times, The Economist and The Financial Times do.

The Economist costs about KSh. 2,500($25) per month or KSh. 625 per week. The Financial Times goes for KSh. 3,950($39.5) a month or KSh. 1,000 a week. The New York Times comes in at a more affordable KSh. 800 ($8) a month or KSh. 200 per week.

A Kenyan newspaper goes for KSh. 60 per day or KSh. 420 per week in print. A little steep compared to The New York Times, but probably accounts for delivery and printing costs.

Also important to note that the New York Times has more subscribers due to the high population of New York, the United States and its global audience. They can therefore lower their subscription fee to reach more people.

Therefore, papers that are finding themselves caught up in the shift to digital need to find a way to make people pay for news, fast. An advertising funded model only works on a global scale, not local. Equally, relying too much on such a model then trains your audience not to pay for news.

The trick though is finding a sweet-spot - a price that’s not too high that it puts off most people, but one that’s low enough it feels like “free”.

While much of this article had been written in the last month, Safaricom, Nation Media Group and The Standard have recently unveiled a KSh. 20 ($0.2) offer for daily versions of their newspaper. This works out to KSh. 140 ($1.4) per week or about KSh. 600 ($6) per month.

Going back to our global comparison, this is actually a price that falls within the sweet-spot, which in my own estimate should fall between KSh. 10 to KSh. 20 ($0.1 - $0.2) per day for Kenyan newspapers. At this price, they can convert lots of online “free” readers to buying their digital papers which then locks in subscription revenue which is more reliable than online advertising.

This can be just a start. There is an opportunity to have more targeted digital periodicals based on popular interests - such as motoring, cooking or child upbringing. These can be treated as value adds that are again sold at a price point that falls between KSh. 10 and KSh. 20.

Unless you have as many visitors as the Daily Mail, relying on online advertising is futile. Forget what the techies tell you - even a priest will encourage you to toil to fund their religion.

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