Newspapers Are Thriving - in India
When literacy is a status symbol, so is print media.
On December 20, 2007, the Tribune Company's Sam Zell said, “I’m sick and tired of everybody talking about and commiserating about the end of newspapers. They ain’t over.”
The Tribune is now in bankruptcy, having lost $121.6 million in the third quarter as sales dropped 10%. Publishing revenue declined 13%, to $653.6 million. Newspaper ad sales fell 19%, steeper than the 15% slides in the first and second quarters.
At McClatchy (MNI), the third largest newspaper company in the United States, advertising revenues are down 17.4% through the first 10 months of 2008.
Last month, the New York Times Company (NYT) reported third quarter net income of $6.53 million, or $0.05 per share, down from $13.44 million or $0.09 per share in 2007's third quarter, and cut its quarterly dividend by 74%.
NewsCorp’s (NWS) share price is down over 60% for the year.
Gannett (GCI), the company behind the country’s largest newspaper, USA TODAY, is cutting 2,000 jobs after letting 1,000 employees go in August.
“Readers should be concerned about the deterioration of the American newspaper,” Tom Rosenstiel, director of the nonpartisan Pew Research Center's Project for Excellence in Journalism, told the San Francisco Gate.
But wait - the price of newsprint reached a high of $751.31 a metric ton in November, up 34% from a year earlier. If no one’s reading papers anymore, how does one account for that 34% rise? Where’s the demand coming from?
While American and European circulation is dropping like a stone, it’s rising exponentially in India, where 99 million newspapers are sold every day, which are read by more than 150 million people (compared with 97 million in the US).
Why? One reason: Literacy rates are climbing. Bindu Bhaskar, an associate professor at Chennai’s Asian College of Journalism, told Abu Dhabi’s The National: “The reason why print media is doing well in India is linked to the literacy factor, with more new literates taking to newspapers. These new literates are a major expanding group.”
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