The Hard Truth: Newspaper Monopolies Are Gone Forever
Fox, who used to work at one of the Advance newspapers in Alabama that recently had its staff slashed and publishing frequency reduced, points out that the foundation of most newspaper business models — that is, the monopoly over information delivery — was doomed as soon as the internet came along, with its virtually frictionless distribution model and non-existent barriers to access. But Fox makes an important point: the real foundation of these monopolies from a business standpoint wasn’t so much the delivery of news (although that was important) but the delivery of advertising to a captive market:
The monopoly was on the delivery of printed advertising messages into homes in a given city or (better) metropolitan area: department store ads, supermarket ads, car dealer ads, and, most of all, classifieds. Notice that I didn’t mention news. That’s because, once a monopoly was established, the editorial content of a newspaper had no detectable impact on its financial success.
Advertisers are a newspaper’s main customers, not readers
Although most newspaper publishers probably don’t want to admit it, the thing that allowed them to build sustainable media businesses — particularly in smaller markets — wasn’t so much their access to news or the production of great journalism as it was control over a dominant advertising platform. All the jokes from newspaper production departments or ad sales reps about how news articles are “to keep the ads from bumping into each other” have more than just a grain of truth to them. And the attempt to maintain that revenue source is what has driven so many papers to install paywalls, as a way of keeping readers from fleeing to the digital version.