At over $4 a gallon, gas is definitely putting the pinch on consumers. Wired writes, “No Mocha For Me, Thanks. I’ve Gotta Buy Gas.” We aren’t sweating the little things; we’re simply cutting them out.
The media is self-centered. It loves to write about itself without regard for whether its audience is interested or not. Lately, everywhere I turn I see “the death of print” articles sniveling over the struggling newspaper and magazine industry. They put the blame squarely on the Internet.
I squarely disagree with this assessment. No doubt some advertising dollars have shifted to the Internet and some readers have shifted their viewing to the Internet. So it’s a contributing factor.
But at the heart of it is gas prices. Consumers are having to divert a few hundred dollars a month to gas. Where does that money come from? It comes out of discretionary income, the money we have left over after paying our bills. It’s the money we spend on mochas, newspapers, magazines, and going out to eat.
One of the first things consumers are going to cut back on is newspapers and magazines. They’re still reading, but instead of paying for paper, they’re turning to the Internet and cutting out the cost of delivery. So the media is out the markup.
But more importantly, advertisers go where the readers are. It’s not that advertisers are preferring to advertise via the Internet necessarily, but rather advertisers are ticks and leaches. They go wherever consumers go. And gasoline prices have driven consumers to the Net.
Will they go back to print when times are better? That depends on how long it takes for the economy to recover. In part, they will become used to getting more of their info via the Net. Technology companies are finally seriously committed to coming out with products that make getting information from the Net easier and more portable. We’re seeing more UMPCs and Netbooks offerings, larger screens on cell phones, and better batteries. And the media is making their content easier to access via feeds.
Eventually, the economy will improve as it always does, but by the time that happens we may have already moved on and left print behind.
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In addition, the increase in gas prices places a bigger strain on the print media companies profit margins. It now costs more for all of the raw materials to be delivered to the printing press, as well as more money to distribute the final product. No doubt about it, the pressure on print media is being felt from all angles.
Hi Don,
That also means increased barriers to entry. The large newspapers and magazines are already well-established and adapting to the times most notably through the use of blogs. But the increasing costs of print publishing must be especially felt by the start-ups, which is probably why we rarely hear of them. However, I read about a couple of them last month. It would be interesting to see how they are faring so far.
People are spending their discretionary incomes on higher fuel costs instead of mochas, newspapers, magazines, and going out to eat? Okay, however, how do you explain that while newspaper sales have been declining since the late 1990’s, consumption of mochas, magazines, going out to eat have only declined in past year or two.
A more likely cause for the decline in newspaper sales is that news readership is going online to take advantage of the internet’s ability to tailor the day’s events for your consumption. There are liberal news sites for liberals, conservative news sites for conservatives, and everything in between. In lieu of a general edition of the newspaper that appeals to the widest audience; On the internet, a reader is able to filter out news they do not wish to read and consume only the news they want.