Boys and girls, this is a newsstand. It used to sell newspapers. Photographer: Spencer Platt/Getty Images
Boys and girls, this is a newsstand. It used to sell newspapers. Photographer: Spencer Platt/Getty Images

While we’re on the subject of journalists, Clay Shirky points out something funny about the way we discuss the future of print: We tend to talk as if there might be one.

Pick up a Sunday paper anywhere in this country. It will be the biggest paper that week, stuffed with sections, and with ads. Sunday is the money-maker, when circulation is highest and browsing time most abundant. Sunday is also the day for delivering those pamphlets of coupons and sales touts from national advertisers like Home Depot and Office Max, Staples and Michael’s.

Those pamphlets  -- "free-standing inserts" --  are now the largest single source of print advertising for many papers. Classifieds have imploded, local display ads are down, and black newsroom humor long ago re-labelled the Obituary column "Subscriber Countdown." 

Print ads are essential revenue for most papers. Retail ads are essential for print. Sunday is essential for retail. Inserts are essential for Sundays. The base of that entire inverted pyramid is being supported by the marketing departments of no more than a couple dozen national advertisers.

Those advertisers already have one foot out the door, having abandoned the idea that ads have to be printed inside the paper to reach their audience. CVS and Best Buy have so little connection to the papers they ride along with that they don’t even bother printing the addresses of their local outlets. (You can always find that information online.) From the advertiser’s point of view, the nation’s newspapers have become little more than a blue-bag delivery service, with a horoscope and enough local sports inside to get people to open the bag.

Inserts are one of the last sources of advertising to resist digitization. They are also the next to go.

Print newspapers are going to die; at this point they’re living off coupons, on the print side, and old people, on the readership side. Newspaper circulation has fallen only a little bit among readers older than 65, but it has started low and fallen lower among the under-35 demographic. It doesn’t seem reasonable at this point to believe that those folks will ever pick up the newspaper habit. So as the readers die, and the advertising fades, the newspapers, too, will die one by one. The magazines, which already look anorexic compared with their earlier ad-stuffed selves, will undoubtedly follow.

The Fading Newspaper

Maybe it’s not so much a death as a reincarnation in digital form. That’s what we journalists devoutly hope, anyway. But it’s not clear that digital will save the newspaper, as Re/code points out: The New York Times, one of the most successful newspapers at making the digital transition, may be seeing its digital subscriber revenue stall out:

Four years ago, before the Times put up a paywall around its then-free site, the paper asked consulting firm McKinsey & Co. to estimate how many digital-only subscriptions it could sell. The conclusion, according to people who have reviewed the study: In the most optimistic case, just under 1 million subscribers would pay $15 to $30 a month for access to the New York Times website and app. More likely, however, the theoretical limit at these prices would be 800,000 to 900,000 subscribers.

The problem is, the Times already hit the low end of that projection in June with 831,000 paying online readers. And the number of new customers it added in the three months leading up to that point, about 32,000, were mostly for the new NYT Now app, a slimmed-down version of the Times that costs $8 a month. It looks like the McKinsey study got it right. ...

A slowdown in digital subscribers means it’ll be that much harder for the Times to make up for its losses elsewhere, specifically in advertising, once the life-blood of the business. The company lost close to $90 million in ad revenue -- print and online together -- from 2011 through last year, and it has been on a downward track ever since.

Online revenue alone would not sustain the New York Times as it exists today. If the Times were to become a digital-only newsroom, it’d be a $312 million business, including the $162.9 million in online ads it generated last year. But that’s only 20 percent of its current sales. In other words, a digital-only Times could just support a fifth of its current newsroom, or around 200 journalists.

This is speculative, of course; maybe they’ll bust through that theoretical limit and soar to new heights. But even if it’s true, that’s not going to save more than a handful of the top publications.

That doesn’t mean that journalism will die. But more than 10 years after I started in digital journalism, companies are still struggling to find a way to pay for deep, intensive, expensive journalism. Digital ad spending is still rising, but most of it doesn’t go to media companies at all, but to technology companies such as Google and Facebook. If readers won’t pay, and advertisers are deserting us, who will be left to fund journalism?

One answer is that organizations can find a niche, like Bloomberg’s, where people are still willing to pay for reporting. But those niches are for information that is professionally valuable and highly time sensitive, not for general-interest news. For that sort of news, I think the answer is probably “corporations” or “rich donors.” Ironically, in the future, a political magazine, rather than one of the old elite publications, may offer a “safer” perch from which to do deeper dives into serious issues.

Another answer is that no one will pay, and we’ll be left with television news and a handful of sports and fashion and gadget sites that can still draw ad dollars.

A third answer is that there’s another answer I haven’t thought of. But if that’s the case, then as far as I can tell, I’m in good company with the rest of the industry.

To contact the author of this article: Megan McArdle at mmcardle3@bloomberg.net.

To contact the editor responsible for this article: James Gibney at jgibney5@bloomberg.net.