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April 23, 2007

Newspapers Online - With Revenue Falling What's Next?

By Li Evans

Newspapers According to an article on PaidContent today, newspaper companies are seeing a slowing in online ad revenue growth.  This really struck me as interesting.  Especially in light of a lot of smaller newspaper companies striking deals with the search engines like Yahoo to handle their online advertising.

It seems that the online version of the newspapers are increasing feeling the competition from websites by TV Stations and magazines like Time, Inc.  What's interesting to note, some of these websites from the TV Stations and Magazines, are increasingly adding Social Media pieces.

From voting on stories, to forums to discuss "hot topics" these sites are increasingly giving the "consumer" more control. However, they aren't putting the entire reigns over to the reader.  Instead they are giving their readers a "piece" of the action that creates a stickiness.  This stickiness brings back the readers time and time again because of their time investment.

Granted, I'm not saying that newspapers need to totally plunge into Social Media, but it is an opportunity that is definitely worth investigating.  From "sharing" local photos, to a "sound off" message board and adding voting on the top stories, or the ability to comment on articles, there's a lot of different ways newspapers can incorporate their users into participating on their site.

The other end of the spectrum is for newspapers to strike deals with the search engines.  Yahoo, seems to be really moving to capture all the newspapers it can.  In the past two weeks, Yahoo sealed a deal with 250 newspapers to provide the advertising for the papers from contextual ads to HotJobs and classified listings. 

Yahoo I really took notice to this when my old hometown newspaper, the Pottsville Republican Herald had an article about it's parent company, the Times Shamrock, Inc., striking a deal with Yahoo!  It's basically the same one described in the LA Times article about the deal with 250 newspapers.  I emailed the article's author to see if I could get some kind of clarification if Yahoo! was going to help them with the banner and image ads they have on their sites, but the author never replied back.  So, I'm still left wondering.

What's interesting is that Yahoo!'s replacing Google on most of these sites.  I guess Google isn't seeing the same value in the news industry as Yahoo does.  I guess for the newspapers, any help is great for them, seeing their numbers continue to fall.

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