Saturday, 2 April 2011

The future of the Irish news industry

NewsWhip Media was launched in November 2010 by Limerick-born lawyer and entrepreneur Paul Quigley. NewsWhip was one of four “News 2.0” news sites - web-only start-ups, rather than newspaper offshoots - to emerge in the Irish market last year. As the way in which people consume news is rapidly moving from the traditional newspaper model of the daily reporting of facts to an on-line, technology-enabled two-way conversation, a proliferation of “News 2.0” news sites has sprung up internationally, such as the Huffington Post in the US and in France.

Comreg figures showed 77 percent of Irish people were online in 2010, and that average hours per week spent online have increased to 19.4. This contrasts with the average European consumer spending under five hours per week reading newspapers. The heaviest internet users are likely to be urban and aged between 25 and 34, exactly the young professional audience being targeted by NewsWhip. “Over half our readers are 25 to 35,” says Paul Quigley. “A lot of content is accessed by Smartphones and by browsers other than Internet Explorer. Our audience are techies, design people, a younger, more technical-savvy crowd generally. We’re hitting the mark. The people we want to come to the site are coming to the site”.
Advertisers are following audiences, and are moving budgets away from traditional to online media. An Irish industry study for the first half of 2010 showed 12.2 percent growth in online advertising, while all other forms of advertising declined in the same period. An 11 percent growth in digital advertising is forecasted for 2011, against a projected decline in print advertising of eight percent, but even at this rate, Ireland still lags well behind other countries; the digital advertising spend in the UK is 27 percent.
A 2010 report commissioned by RTÉ investigated digital advertising and its impact on traditional publishers. It found that the strongest competition to Irish newspapers for advertising revenues is not from traditional publishers, as might have been expected, but from global internet companies, large international digital media networks, and internet-only offerings in the local marketplace, such as NewsWhip.
If old media manage their affairs right they’ll be able to move to being new media while still printing a print product and growing an audience online at the same time,” says Paul Quigley. “There’s a big market opportunity for a more authentic digitally-focussed news service, one that isn’t trying to reprint TV or newspaper content, but one that’s focussed entirely on people who are at their desks at work and who are used to, or building the habit of, consuming news online”.
These sentiments were echoed by Irish Times Editor Geraldine Kennedy, speaking to journalism students in the University of Limerick recently: “If you look at young people under 30 these days, they’re far more likely to go online for their news than they are to read a newspaper. In the future, we at the Irish Times will face the same challenges as every other serious newspaper in the world: if you have a huge big editorial budget to provide news and analysis and comment and you’re giving it all away free on-line, that business model is not sustainable. I hope that somebody soon will invent the revenue model that will make it worthwhile to be putting all this material online”.
A 2010 study found that 57 percent of consumers world-wide are unwilling to pay for content, even for sites they visit regularly, but the corresponding Irish figure is significantly higher at 88 percent. With the Irish consumer so resolutely against the concept of paying for content, it’s difficult presently to envisage how a sustainable revenue model could be successfully implemented, particularly as consumers are “least likely to pay for news”.
What about News 2.0 sites, which don’t have the editorial budgets of traditional media organisations? “NewsWhip won’t charge for content, our model is built around easy access, free access, so we’ll stay free,” says Paul Quigley. “Information is free; you can’t charge people for information.” And how does he feel about the state of the Irish news industry in light of recent newspaper closures? “I’m not too worried if newspapers go under, that’s fine; it’s a separate industry”.

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