Communications minister Malcolm Turnbull says newspapers must ‘change their mindset’ and embrace the transition to digital if they are to thrive in today’s market.
The high-profile federal minister says newspapers are more valued and important than ever, but does not seem to care if they continue in print.
Turnbull spent much of his speech at the recent newspaper Future Forum talking up the digital potential of news, and while he said print is “still very much valued as an advertising platform and as a way of reading the news,” it is important to recognise “the change to digital.”
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“People have never read our major publishers’ journalism more – you have never been as influential as you are today. The problem is that the revenues do not match the influence,” he says.
“Think about it. Print readership is down by four per cent, digital readership up by 11 per cent. Media companies are increasingly using new tools to deliver on their mission, which is to inform, to entertain, to tell important stories.”
The minister’s only real advice for newspaper publishers was to get used to the idea of migrating to digital and raise printed edition cover prices to squeeze the last drops of money out of remaining loyal readers.
“The experience internationally has been that once you lose the least loyal customers the remaining market is relatively inelastic when it comes to price for print,” he said.
He said companies must learn to be nimble to seize the opportunities in today’s market.
“All of that volatility is an opportunity, but it demands of us enormous nimbleness. We cannot allow ourselves to be bound by the culture of ‘not invented here,’ or, ‘we have always done it this way.’ We have to be prepared to almost reinvent our world every day,” he said.
“It seems to me that the biggest challenge, in terms of transformation, is the cultural change in organisations. It is often underestimated how hard it is to change the mindset of hundreds or thousands of employees who have been used to doing things in a particular way.
“I think the critical thing is to be nimble, like the best footballer, who can pivot, go left or right, accelerate, twist, turn, respond to the circumstances of the time.”
[Related: Switching to digital]
Turnbull was much more positive about the future of digital, saying Fairfax now has 140,000 digital-only subscribers to The Age and The Sydney Morning Herald, and both titles have more digital subscribers for Monday to Friday than subscribers to the physical paper.
News Corp also has more the 200,000 digital subscribers and plans to relaunch its paywalls in the near future, while The Australian has reached 64,000 digital subscriptions despite doubling its weekly price to $6.
“PWC are forecasting industry-wide digital subscription revenue to grow ten-fold to 2018, with around 6.1 million Australians paying for a digital subscription,” he said.
“Today’s newsrooms are looking more and more like Silicone Valley start-ups. The barriers to entry have never been so low for competitors, nor has competition ever been so intense.”
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