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What does 2016 hold for newspapers?

A new year is a time for bold resolutions, for hope, confidence and determination to make the coming year better than the one just gone. Err… not in the world of the regional press, where Peter Sands finds a mood of despondency and where ‘more of the same’ pretty much sums up the outlook for 2016.

By Peter Sands

Whichever way we look at it, the bigger picture for newspapers in 2015 was pretty grim. The industry spent most of its time dealing with declining print revenue, downward circulations, reduced editorial investment and stagnant or declining online revenue.

So will it lighten up in 2016? That’s the question I put to my colleagues at the editing coalface in the regions. Predictably, most are already wearing hard hats and, tellingly, were reluctant to talk on the record. Here is a snapshot of the mood:

“It will undoubtedly be a year of further cost-cuts in editorial departments, with greater reliance on user-generated content and a dumbing down of titles.”

Another told me: “We will see more titles closing, dailies going weekly, and watch out for mergers.”

And another: “Journalists will be judged more than ever before on how many clicks their stories generate.”

One told me he did not believe regional media companies could run a successful business that had quality journalism as its foundation. The paper of record is a thing of the past, he said.

Such pessimism is not surprising. Newspapers face a huge challenge that is easy to understand … and massively difficult to deal with.

I helped companies try to navigate the maze last year - and the challenges always boiled down to the same three aims:

i) Protect print for as long as possible - it still makes the money

ii) Serve the needs of the business (ie maximise profits and keep the shareholders happy)

iii) Build a digital business

The trouble is the three aren’t always compatible. So, while we desperately need longevity of print - the demands of the business mean we have to shed staff, raise cover prices, cut newsprint costs, reduce marketing - all which works against the printed title.

Digital pot of gold?

At the same time, and with little cash to invest, there is a scramble for a slice of the digital cake. The average Brit spends two hours and 51 minutes online each day - far longer than was ever spent with a newspaper. Turning those clicks into cash, though, is proving tough. If MailOnline with its global domination (an astonishing 208 million monthly unique browsers) makes £73 million a year, what chance is there for beleaguered regional MDs covering half an English county?

Digital advertising growth slowed badly in 2015. Add to that the fact that 12 million people in the UK use ad blockers and you can see the scale of the task.

Sir Martin Sorrell, whose agency WPP spends an annual £76 billion in advertising, told the Society of Editors’ conference in October that paywalls were the way to go. “If you have content that has value, consumers will pay for it,” he said. He knows better than anyone of course. But the issue for some might just be the ‘value’ bit. I go through newspapers and websites searching for content which readers will put their hands in their pockets for. It can be a fruitless task. And if The Sun couldn’t make a paywall work, what chance for the Posts and Chronicles?

Some regional newspaper executives told me they don’t really believe there is a digital pot of gold waiting for their titles. They think local newspapers and digital services are different industries altogether.

And while they wrestle with that digital dilemma, the mainstay of the business - print advertising - is struggling. It may still be the bigger earner, but it had a bad year. In some weeks, revenue fell by 30 per cent. And previously reliable players such as BT, Asda and Tesco slashed their print advertising spend.

In 2010, the Australian futurist Ross Dawson predicted newspapers “in any significant form” would disappear from the UK in 2019. It is an extreme prediction. I can’t image any seismic movement that is likely to wipe the Daily Mail, the Evening Standard, Metro and The Sun off the face of the earth in three years’ time. But there is no doubt that for some, Dawson’s predictions might not now seem too extreme after all.

Likely 2016 trends

So what can we look forward to in 2016?

After the Trinity takeover of Local World, more consolidation (watch the Johnston Press / Newsquest space) seems inevitable.

There will also be a close look at frequency. How long can papers selling fewer than 13,000 copies – there are a dozen or so - resist going weekly? If they don’t act quickly, it may be too late? It is a change that can give longevity to titles that will otherwise crash and burn.

Some big-hitting editors bowed out in 2015 and there will be more casualties in 2016. As groups merge and self-publishing becomes the way forward, fewer editors will be needed.

Two of the success stories of 2015 were Metro (with its 3.4 million readers) and the Evening Standard. Metro editor Ted Young says his paper is perfect for the 21st century commuters who no longer believe they should pay for news but who also want a quality read. “Invest in great content and you will attract more readers.” There has long been reluctance by regional publishers to adopt the quality free model. Cutting off the cover-price revenue is a step too far. In 2016, some may change their minds.

There is also evidence that some advertisers want to invest in quality, independent journalism. One businessman told me: “Our local media has dumbed down on quality so much that it is becoming blurred with the rest of the social media whirlpool… we want to associate ourselves with a newspaper which is on a higher level than that.”

It's not just about the size of the audience online - it's about the quality of the audience too.

This is something the Evening Standard and Independent’s chief executive, Steve Auckland, recognises: “I believe there will be a gentle drift back to newspapers, led by those who can guarantee an articulate and unique audience. If the leader of the world's largest media agency is now appreciating the level of engagement of the printed medium, we may get a rebalancing of the rate of decline.”

Not all gloom

There are other success stories.

MailOnline continues to grow and grow – and to recruit in the UK, Australia and America. I helped recruit and train more than 60 trainee journalists for DMGT this year. It is a real investment in young talent and fantastic news for youngsters hoping to break into our ever-changing industry.

And other highlights? Tim Luckhurst, professor of journalism at the University of Kent, strikes a positive note: “Leveson's proposals are stone dead. Hacked Off has lost and lost utterly, for which blessing, Hallelujah! The Evening Standard is doing well and i continues to surprise and delight. The Guardian is, at last, beginning to close the gap between digital revenues and editorial ambition. MailOnline is a soaraway success. Beyond these, the FT, Private Eye and The Spectator continue to prosper. Meanwhile, new online businesses free of legacy debt are beginning to prove they can do serious news. Vice certainly can.”

Newspapers face many challenges, but perhaps the biggest for 2016 and beyond is how to deal with a generation that has no interest in news and current affairs.

Professor Luckhurst again: “Too few of the readers who have abandoned - or never adopted - newspapers have migrated to online news. I hope the digital generation's news sites can reach them through their mobile devices and convince them that original reporting is exciting. The early signs are good. Older titles have no inherent right to survive. The future belongs to the innovators.”

Now there’s a thought … innovation. It is what MailOnline, i, BuzzFeed and Vice have in common. In the regions, there is also innovative digital work, particularly by Trinity. Its titles are genuinely digital-first now, with newspapers produced from already-published material.

Too often in the regional world, though, the focus is purely on survival, cost reduction, maintaining profits and, as a result, innovation takes a backseat. That could be our industry’s biggest mistake yet.

What will 2016 bring?

“Pressure on revenue will continue to drive cost-cutting, consolidation and raising efficiency in every department. All publishers will realise their prosperity relies on mobile, video and branded content.”

Mike van Niekerk, newsroom transformation consultant

“2016 will be like 2015, challenging on all fronts and no clear answer to the digital dilemma. Difficult is definitely the new norm. However with a clear focus on content, however it’s delivered, this can still be a great business.”

Dominic Fitzpatrick, managing director, Irish News

“After an unpredictable 2015, it's difficult to say with any certainty how this year will play out. We will be focusing on improving the newspaper sales trend while continuing to grow our loyal, local digital audiences as fast as we can. Video is a top priority for us.”

Neil Benson, editorial director, Trinity Mirror Regionals

“More digital, more acquisitions, more consolidation.”

Tim Blott, outgoing MD at Newsquest Scotland

"The challenges will continue and so will the return of confident, robust campaigning and investigative journalism which has been so remarkable in 2015."

Bob Satchwell, executive director, Society of Editors

“The issue will be to make the newsroom more robust and flexible. The business, dissemination of information, is changing. Funnily enough, good media houses with a strength in print are now ahead of the curve."

Adrian C Hillman, managing director, Allied Newspapers, Malta

“The challenge is deciding what stories, what amount of information, when to release it and on what platform, so that we stay relevant as a breaking news outlet but still give the extra value to the readers that put their hand in their pocket to pay their €2 for their newspaper. Analytics and market segmentation is key to this.”

Dan Linehan, director, Landmark Media