In News Corp’s annual report, released last month, the company published its digital subscription number for each newspaper for the first time. And the numbers weren’t too bad. The Australian, for example, boosted its digital subscriptions by 53% in 2017/18, and it’s not a coincidence that last year News Corp’s national broadsheet returned to profit as its digital subs rose.

We continue to hear about how hard times are for newspapers and the whole news industry (including from the outlets themselves). Print circulation continues to drop, and digital ad revenue can’t match print. Could growing digital subscriptions be the answer?

According to incoming associate professor at LaTrobe University Andrea Carson, it’s a bit more complicated than a yes or no — and depends on the type of subscriptions.

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“Digital subscriptions have now overtaken advertising revenue with some papers like The New York Times and the Washington Post,” she told Crikey. “But they have global reach, traffic, and brand names. It could happen here, but it would be with pared-down newsrooms.”

Carson, who published a report last year titled “The Future Newsroom” for Facebook, said that for Australian newsrooms to subsist on digital subscriptions alone, they would need to have a readership that trusts them, and get back to their essential functions. That could mean less lifestyle reporting, and a keener focus on what an audience really values and trusts the publication for. For Melbourne’s Herald Sun, for example, that would have to include sport.

“If there’s trust and they pare it back quite well, digital subscriptions could be enough,” she said. “The overall international trend is that digital subscriptions will end up being bigger than advertising revenues. There is convergence going on where digital subscriptions are taking over print revenue.”

Declining ad revenue has been one of the biggest challenges for commercial media, and is one of the key concerns Australian commercial outlets have raised in the current ACCC competitive neutrality inquiry into the ABC and SBS.

Potential cuts would be to sections such as lifestyle, and to the daily physical editions of the newspapers, Carson said. But News Corp is in a better position to keep its print editions going for longer.

“What News does is they’ve had much harder pay walls and that’s probably smarter — even with a free trial it’s a strong incentive for people to sign up,” she said. Fairfax’s paywalls have been metered, and easier to get around for non-committed readers.

Globally, The Guardian has been successful so far with its membership and donations program, with BuzzFeed following suit and announcing a similar model. While the growth at The New York Times and Washington Post, in particular, have been attributed to Donald Trump’s election as president (the “Trump bump”), Carson said the reason for the increase is more complex, and not unique to the US.

“The ‘Trump bump’ is a cheeky term,” she said. “You’re seeing readers return to mastheads they trust, which is a symptom of the fake news problem.”

And that is something mastheads around the world are capitalising on. “You see now, with marketing campaigns, they’re saying they’re an antidote,” Carson said. Earlier this year, The Australian launched an ad campaign with the tagline, “Make the informed choice”.

In Australia, with a much more concentrated media landscape than the US (and about to get more so), selling that message is, again, complicated. News Corp is likeliest to do the best out of digital subscriptions, but trust in the media is poor (aside from the ABC).

“We get our fair share of disinformation and misinformation,” Carson said. “Australians are concerned about fake news and that’s been increasing. But whether traditional outlets are able to cut through with the message they can be trusted … they need to decide whether they value trust versus being sensational, and it would appear to be the latter.”

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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