Changes in profitability have prompted a shift in the Arkansas Democrat-Gazette's focus from print to digital subscriptions, its publisher, Walter E. Hussman Jr., told Hot Springs National Park Rotary Club on Wednesday.
By the end of 2019, Hussman, chairman of WEHCO Media Inc., hopes to convert the Arkansas Democrat-Gazette's print subscribers to digital, providing subscribers with Apple iPads so they can download a digital replica of the daily paper. Sunday editions will still be printed and distributed across the state.
Hussman said that, historically, newspapers have gotten 80 percent of their revenue from advertising; however, advertising has "dropped precipitously."
"In 2006, when newspaper advertising was peak, the total newspaper ad revenues in America were just under $47 million a year," he said. "That's for The New York Times, Chicago Tribune, Sentinel-Record, weeklies, etc.
"In 2017, that $47 million dropped to $12 million. It dropped by 75 percent, so even the really big papers are really struggling."
To make the iPad program profitable, Hussman said he needs to convert 70 percent of subscribers to digital.
"Newsrooms have just been eviscerated all across the country ... so if we're going to be a complete comprehensive newspaper that does investigative reporting, watchdog journalism, etc., this is the way we've got to do it," he said.
The conversion to digital plus one day of print does not affect The Sentinel-Record, he said, noting that print subscribers are already able, if they choose, to read the digital edition of the newspaper on a phone, tablet, or on the newspaper's website. Hussman is also the publisher of The Sentinel-Record.
"People have asked me before what about The Sentinel-Record? The Sentinel-Record is actually still profitable -- one of our few newspapers that we have that's still profitable. As long as it's profitable, we're going to keep printing it seven days a week," he said during a question-and-answer session.
"People my age, or even people younger than me, love the newspaper; they love the newspaper format," Hussman said earlier during his presentation to the Rotarians' weekly noon luncheon at the Arlington Resort Hotel & Spa. "They know the most important news is on the front page. They know where to go get sports. They know where to go get business news. They know where the obituaries are. That's what we like. Younger people are not so enamored with the newspaper format. They're real happy with (smartphones) and they don't mind just scrolling to find whatever news they want."
Hussman said the conundrum came with the understanding that readers like the newspaper format, yet the paper was losing money. The answer was to stop delivering print editions to the fringes of the state to save money on unprofitable areas.
"We've got about 4,000 people over the last five to 10 years who have started reading their paper on something like an iPad and it's actually not a website, it's the paper ... same thing as if they were holding the paper," he said.
"We had so many comments from people saying 'You know, this thing is great. I can carry it with me on an airplane. When I get to Chicago I can download it. It's the paper.'"
In the May 22 edition of the Democrat-Gazette, Hussman said he is prepared to spend $12 million on the tablets, which retail for $329 before tax. At that time, he said he had distributed more than 10,000 iPads so far across the state.
His first attempt to roll out the program took place in Blytheville where he said out of 200 subscribers, only four took to the new format, which linked the iPad with a smartphone deal. After regrouping, the Democrat-Gazette offered the iPads only as part of a subscription, along with training sessions for subscribers. It prompted 140 of the 200 subscribers to make the switch to digital.
"People tell me the strangest things of 'I look at yours on an iPad. I look at The New York Times on the iPad. I look at The Wall Street Journal on the iPad, and I like yours the best,'" he said. "They said 'When I read The New York Times on the iPad, I'm wondering, was every article that was in The New York Times ... was every article on their iPad app? When I read The Wall Street Journal, I'm wondering when I read the article, was that the whole article that was in The Wall Street Journal, or was it the abbreviated version? But when I look at your paper, it's the paper.'"
Hussman said the digital replica allows for more freedom with features that allow the reader to increase the size of text, have articles read aloud to them, save and share articles and editions, search the archives, and enjoy all color photos across the whole paper.
"Forty percent of the people say they go back and look at a previous edition because you can store 60 previous editions of the paper on your iPad," he said. "Also, anyone that takes the newspaper on the iPad has unlimited free use of all the newspaper archives that go back decades.
"We've just found that this is something although people thought they wouldn't like it, actually they do like it. The thing I like about it -- we have 106 people in our newsroom. We can keep all 106 people in our newsroom with this program."
Local on 05/30/2019