Proliferation of free news online has besieged publishers of newspapers
By Tali Arbel
AP Business Writer
NEW YORK (AP) — In a world flush with free information, some young people are still willing to shell out for news they read.
A recent poll shows that 40 percent of U.S. adults ages 18-34 pay for at least some of the news they read, whether it’s a print newspaper, a digital news app or an email newsletter. Another 13 percent don’t pay themselves but rely on someone else’s subscription, according to the survey by Media Insight Project, a collaboration of the American Press Institute and the Associated Press-NORC Center for Public Affairs Research. Older millennials are more likely than younger ones to personally pay for news.
“Forty percent is a strong number but that means the majority are not willing to pay,” said Keith Herndon, a visiting professor of journalism at the University of Georgia and former journalist. “We have to think of ways of making the content compelling enough that someone would be willing to pay for it.”
The proliferation of free news online and new ways for advertisers to reach consumers has besieged publishers of newspapers and magazines. Newspapers’ print ad revenue, their primary source of cash, has dropped 63 percent, to $16.4 billion, in 2014 from 2003, according to a Pew Research Center analysis. Daily paid newspaper circulation reached a peak in 1984, at 63.3 million, according to an industry group, the Newspaper Association of America. That represented a quarter of the country’s population.
Daily paid circulation has now shrunk to 40.4 million, even as the U.S. population has grown by about a third.
There have been attempts to capitalize on the shift online. Digital ad revenues from newspaper websites have more than doubled as print ad revenue collapsed, but still come to only $3.5 billion — just a fraction of print ad revenue last year. And some major news organizations in recent years began charging for access to their websites and selling digital-only subscriptions, rather than posting content for free online.
For example, the New York Times or the Washington Post let non-subscribers click only on a certain number of articles per month before blocking content. In 2012, the Times’ circulation revenue passed its ad revenue for the first time because of its digital initiatives. But newspapers overall still get the majority of their revenue from advertising, according to data from consultancy and accounting firm PwC.
And other popular news sites, particularly newer online-only outlets like Huffington Post and BuzzFeed, remain free to all.
A quarter of those polled paid for some type of digital news, while 29 percent paid for a print paper or magazine. Older millennials are more likely than younger millennials to pay for print news products. That effect doesn’t show up with digital news — millennials in their 30s are as likely as those in their late teens and early 20s to pay for online news.
More young people spend on entertainment. Nearly 8 in 10 pay for at least one service. When you break it down, 55 percent pay for downloading or streaming movies or TV — services like Netflix and Apple’s iTunes. Four in 10 pay for cable, which contains channels that show news.
Nearly half pay for music and 46 percent pay for video games or gaming apps.
“Millennials have shown they are willing to engage in content that interests them,” Herndon said, pointing to the popularity of podcasts. But “a lot of traditional news organizations haven’t been able to make a connection with younger audiences,” who spend more time on their phones and often find links to individual, free bits of news through Facebook and other social media.
Like Molly Vazquez, 26, a librarian from Overland Park, Kansas, who pays $10 a month for music service Spotify but draws the line at paying for news.
“News is pretty readily come by for free. I don’t think I should have to pay for it,” said Vazquez, who gets her fill from clicking links while combing through Facebook on her phone and from BuzzFeed’s app and website. She has also been using Apple’s recently launched news app, which contains stories from numerous outlets, on her iPhone.
Adam Saltz, a 27-year-old grad student in Cambridge, Massachussetts, also uses social media to find news. He clicks on links from Twitter but also follows blogs and reads The New York Times and The Washington Post online. He has access to The New York Times through a parent’s subscription. Like half the people of his generation who say they value keeping up with news, he doesn’t pay for it.
But he said that he’s not necessarily unwilling to spend.
“If I didn’t have a family member who had one who was willing to share I would probably be paying for mine,” he said.
Chris Lederer, a principal at PwC, said digital subscription trends in the past two years have been “absolutely encouraging” for publishers. But he expects growth there to decline and sees the next evolution coming in the form of “digital newsstands,” perhaps created by technology companies, which deliver news from various sources for paying customers.
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The survey of 1,045 young adults was conducted from Jan. 5 through Feb. 2, 2015 by the Media Insight Project, a partnership between the AP-NORC Center and the American Press Institute, which funded the study.
The survey was conducted using online interviews in English and Spanish done with a random sample of adults age 18-34 who were initially recruited and screened to take part in the survey over the phone. Results from the full survey have a margin of sampling error of plus or minus 3.8 percentage points. The margin of error is higher for subgroups.
