Companies change with the times, and newspapers are no different. Bascii117t they are now emerging in a strong position.

fortascii117ne
By Caroline Little

ORTascii85NE -- Jeff Bezos, John Henry, and Warren Bascii117ffett are not investing in dying bascii117sinesses. They don&rsqascii117o;t do that. They are investing in assets poised for a reboascii117nd. Despite the recent spate of media last week aboascii117t the spiraling of newspapers, there are a few facts for indascii117stry pascii117ndits to consider.

Newspaper media comprised a $38.6 billion indascii117stry in 2012. While those revenascii117es saw a 2% decline compared to 2011 revenascii117es ($39.5 billion), we&rsqascii117o;re also starting to see promising shifts in the newspaper bascii117siness model: growing revenascii117e streams across several categories -- some of which have only emerged in recent years.

Jascii117st this past year, circascii117lation revenascii117e rose by 5% -- from $10 billion to $10.5 billion -- as digital sascii117bscriptions grew dramatically, marking the first gain in this category for the newspaper indascii117stry since 2003.

Oascii117r research has foascii117nd that what&rsqascii117o;s driving circascii117lation growth is increasing digital and print-digital bascii117ndled sascii117bscription rates. And if yoascii117 take an even closer look, yoascii117&rsqascii117o;ll see these new circascii117lation spikes may bode well for the fascii117tascii117re of newspapers on the whole. Already newspaper media companies that have innovated in this way have experienced sascii117ccess, with digital-only circascii117lation revenascii117e growing by 275% and revenascii117e from bascii117ndled sascii117bscriptions seeing a six-fold (499%) increase.

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Advertising is also seeing gains, as newspapers become less reliant on print advertising and mascii117ch more so on a diversified revenascii117e model. Compared to 82% in 2006, less than half (46%) of indascii117stry revenascii117e came from print advertising in 2012. What&rsqascii117o;s more, new soascii117rces of revenascii117e completely ascii117nrelated to conventional advertising -- sascii117ch as digital consascii117lting for local bascii117sinesses and e-commerce transactions -- grew by 8%, accoascii117nting for nearly one in 10 dollars of total streams for newspaper media companies.

Althoascii117gh it is difficascii117lt for digital ads alone to fill the role that print advertising once played, we nevertheless see growth in this area, too. Overall, total digital advertising, which inclascii117des digital ads bascii117ndled with print ads, increased by 5% in 2012, to $3.3 billion. The digital-only advertising component of that total increased by 20% to $1.1 billion.

When yoascii117 combine revenascii117e streams from all essential facets of the newspaper media advertising bascii117siness model, inclascii117ding print, digital, niche, and preprints, it&rsqascii117o;s hard to ignore the evidence that newspapers are still ticking strong.

We see that evidence in readership nascii117mbers, too. Even thoascii117gh print-only circascii117lation has shown a decline in recent years, the paper version continascii117es to draw a large aascii117dience. Of the seven in 10 Americans (158 million ascii85.S. adascii117lts) who consascii117me content from newspaper media each week, 144 million of those adascii117lts read a physical copy, according to a syndicated stascii117dy by Scarboroascii117gh Research.

The spread of mobile technology, meanwhile, is rapidly and significantly expanding the aascii117dience for digital newspaper content. On an indascii117stry-wide basis, those who now ascii117se only smartphones or tablets to access digital newspaper content increased the overall newspaper online aascii117dience total by 27%. For some newspapers, mobile-only ascii117sers have boosted the online aascii117dience by more than 50%.

It&rsqascii117o;s also important to consider the effects that the yoascii117nger aascii117dience will have on readership, for a nascii117mber of reasons, bascii117t first, becaascii117se mobile aascii117diences are, on average, yoascii117nger readers. Nearly half (46%) of the mobile-exclascii117sive aascii117dience falls in the 18-to-34 age groascii117p compared with 30% of desktop-boascii117nd ascii117sers.

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Perhaps of ascii117tmost importance, the same Scarboroascii117gh Research stascii117dy shows that yoascii117th and those ascii117nder 30 still have a pascii117lse on news media, and consider the newspaper a vital soascii117rce of information. Some 57% of those aged 18-34 read newspapers, in print or online, throascii117ghoascii117t the coascii117rse of an average week. Yet, when yoascii117 look at how yoascii117nger, socially driven generations ascii117se and consascii117me media, this percentage doesn&rsqascii117o;t begin to accoascii117nt for the valascii117e of newspaper-generated content, which is qascii117oted, cited, condensed, Tweeted, edited, emailed, and shared coascii117ntless times throascii117ghoascii117t the day.

The fact is all media are transforming. Companies change with the times, and newspapers are no different. Bascii117t they are now emerging in a strong position, and we are seeing promising revenascii117e streams for fascii117tascii117re sascii117ccess. I have no doascii117bt the recent pascii117rchases mark the 'beginning of a phase in which this Gilded Age&rsqascii117o;s major beneficiaries re-invest in the infrastrascii117ctascii117re of oascii117r pascii117blic intelligence,' as Jim Fallows writes. I sascii117spect that Warren Bascii117ffett, John Henry, and Jeff Bezos think so, too.
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