SPECIAL REPORT: The Digital Future -- Goin' Mobile!

By: Jennifer Saba The Audit Bureau of Circulations released its fall numbers for most of the country's newspapers on Oct. 26, and the figures for the six months ending September 2009 were as harrowing as they have been for several years ? proving again that fewer people are buying the print edition. To cite just one example, USA Today's circ fell 17%. But other stories loom behind that data: Publishers continue to pull back on unprofitable circulation, have redoubled their efforts to net quality subscribers, and, perhaps most interestingly, have started to raise cover prices that are so far sticking (see Mark Fitzgerald's feature, here). Plus, the number of people dropping their subscriptions, or "churn," has fallen dramatically. The Newspaper Association of America reported in its 2009 Facts, Figures and Logic study that industrywide subscriber turnover declined to 31.8% in 2008, compared to 54.5% in 2000.

As 2009 draws to a close, some are accepting that the future of print involves a smaller, more stable group of readers. The print edition will no longer have the reach it once did, but newspapers have a growing number of channels through which they can distribute content that should be accurately counted ? or weighed more heavily, if they're already counted. These don't just include newspaper Web sites or Spanish-language and commuter editions, but any channel that readers might use, including Smartphones and e-readers. The latter are poised for growth in 2010, and should be considered in readership and circulation figures.

In a recent survey conducted by ABC, the organization found that more than 80% of those publishing executives polled (from the ranks of newspapers, magazines and business publications) believe people will rely more heavily on mobile devices as a primary information source in the next three years. Close to 70% of those respondents agreed that mobile is receiving more attention at their publication this year than last.

"Most are looking at it from the standpoint of giving the subscriber the opportunity to read on various platforms and meet their reading needs," says Michael Lavery, the Audit Bureau's president and managing director.

Several developers of digital readers and software mobile applications, including Plastic Logic, Sony and Scroll Motion, realize the potential for reaching consumers and advertisers, and this fall joined ABC.

Likewise, the bureau has noted an uptick in requests from its members about auditing Smartphones and other devices like digital e-readers. During its November board meeting, the bureau's digital committee task force made up of advertisers, newspapers and magazine executives will convene to discuss how to incorporate these types of "editions" into future ABC reports. "Our goal is to make recommendations to the ABC board about how best to measure these newspaper reading platforms and how best to convey this information to advertisers within ABC reporting," Yasmin Namini, co-chair of the ABC/NAA liaison strategic vision committee and senior vice president of marketing and circulation at The New York Times, tells E&P. The group hopes to have something approved in 2010.

Getting ahead of the curve
ABC doesn't want to get caught flat-footed as more readers start accessing content through these devices.

It took what seemed like forever for the organization to embrace online readership in the form of the Audience-FAX, leaving newspapers even more exposed and vulnerable to troubling declines in print circulation. In fairness, ABC is such a large organization with so many constituencies with various and competing needs ? there are vast differences even among newspaper members ? it's no wonder it's sometimes perceived that ABC lumbers toward change.

This go-around, the bureau and its members want to be on the right side of trending and cultural change.

As David Walker, CEO of marketing/ media consultancy Geomentum and an ABC director explains, there is a "perceived and real loss in value in traditional mass media." He points out it's not just newspapers, but also magazines, network TV and other media: "There's a mass localization going on across all media, one-to-many going to one-to-some, going to one-to-one. Advertisers are going to have an appetite for audited numbers."

Walker adds, "We are not waiting for Moore's Law" ? the exponential rise of computing power named after Intel founder Gordon Moore. "We are not going to race to fix it after the fact, but build an infrastructure going in."

Audience data point to a burgeoning trend. According to the Pew Research Center, 19% of Americans use a mobile device to access the Internet, up from 11% in 2007. The digital reader market is still small (Forrester Research estimates that as of the end of 2008 Amazon and Sony collectively sold one million e-readers in the U.S.), but will likely expand quickly as new products that allow for advertising models come to market next year.

John Murray, vice president of audience development for the NAA, notes that a growing number of the top 50 newspapers are already available on the Kindle. The ABC mobile survey found that nearly 60% of respondents said they format their Web sites for mobile devices. Twenty six percent said they are developing Smartphone applications in the next 12 months.

Murray, who is another member of the ABC/NAA liaison committee, observes that adding mobile and digital editions to ABC's reports is a natural extension of the audience-FAX. "Anything less would be a step back," he says.

Is it worth it?
Merle Davidson, chairman of ABC's board and director of media services at J.C. Penney Co., says the primary reason he's involved with the digital task force is that measurement of these new editions is critical. The process is still in its infancy, he adds: "We are really trying to think ahead about how this platform will be advantageous to both publishers and advertisers."

One big issue at the moment is that there are precious few advertising opportunities with e-readers. "I'm thrilled to have a conversation about aggregated audience," says Walker, "but if I can't execute advertising, it doesn't matter." Walker wonders why newspapers are even bothering with distributing content through Kindles, for example, because advertisers currently can't reach those readers. Why bother counting, if there's no ability to advertise?

In The New York Times' publishing statement, for example, Kindle subscriptions are counted under the "Electronic Edition" line. The Times publishes three versions: "Newsstand.com," an exact replica of the print product in format and advertising content; the "Times Reader"; and one for the Amazon Kindle. The latter two are classified as non-replica editions. In the publisher's statement for six months ending March 2009, the Times' average daily circ (Monday-Friday) for electronic editions was 43,884 ? about 4% of its total daily circ. On Sunday it was 15,544, or 1% of its total Sunday circ.

Redefining 'circulation'
Some of the challenges in counting electronic editions foreshadow what's to come in counting eyeballs on digital readers and mobile applications.

The Detroit Media Partnership, for one, has a lot at stake with new editions ? and executives there are watching closely how profitable they prove to be. The operator of the Detroit Free Press and The Detroit News relies on e-editions on the days it no longer offers home delivery: Monday, Tuesday, Wednesday and Saturday. Early next year, the group plans to test digital editions on e-readers in a partnership with Plastic Logic. Detroit's e-editions are currently replicas of the print edition, both in content and advertising.

"We need to be able to provide the measurement on all different platforms and keep the FAS-FAX numbers very valid and clear," says Janet Hasson, the Detroit Media Partnership's senior vice president/development and strategy.

Hasson, too, sits on the liaison committee. She says the goal is to have future publishers' statements contain distinguishing lines for each edition ? e-editions, replicas, non-replicas, mobile, and the like ? broken out under the Core Circulation column: "What we are able to accomplish as a committee is like lightning speed compared to the last six years. If we can get this nailed down in November, we could get it rolled out for the 2011 statement."

In theory, measuring these types of editions should present little difficulty ? but then, the same thing was once said about measuring online readership. As with counting Web users, it all comes down to metrics: Right now, there's no clear standard for mobile applications and all forms of digital editions.

Says Patricia Kelly, the Detroit Media Partnership's senior VP for digital/client solutions: "The whole ad model around e-readers is not formed, and because of that, neither are the expectations for capturing data. Who opened it? How long did they spend with it? It's all undefined. One of the challenges is getting on the same page."

The vendors providing the publishing software for e-editions are the ones keeping tabs on analytics. For Detroit, it's a mix of Google Analytics and Omniture data ? not as expansive as executives and possible advertisers would want. For example, a person might have access to the e-edition of the Detroit Free Press seven days a week because she signed up for home delivery, but that doesn't mean she actually reads that e-edition every day. Or if she opens it, how much time does she spend with it? Right now, Hasson says there is a very strong correlation between the use of e-editions on non-home delivery days.

Researchers like Scarborough also need to incorporate mobile apps and e-editions into their surveys in order to learn exactly what people are reading, Hasson contends. In current studies, she explains, someone who says he reads the Detroit Free Press could be accessing just the mobile app. Or if the question posed is, "Have you read the print edition of the Detroit Free Press in the last seven days?" the response could be no, even though the respondent read a digital edition.

The same goes for mobile apps. "The notion of the word 'circulation' doesn't really apply to a digital media channel," says Geomentum's Walker. "It doesn't apply to a mobile device like a Kindle. It really cracks open what are really going to be the grounds for measurement."

Should a newspaper be able to count a person who merely downloads a mobile application? Or when the mobile app is actually used? Walker says he has a bunch of apps on his iPhone that for the most part just sit there. "This is going to require a degree of conversation," he says. "Having an app for the New York Times doesn't mean that someone is hitting it every day."

Getting the full picture
Brenda White, senior vice president/ publishing activation director for media communications agency Starcom USA, isn't buying into the in-vogue chatter that newspapers are a dead medium. On the contrary, "Consumers are still wanting the content," she says, noting they're just accessing it through many different means. While mobile and digital readers are still in nascent stages, from an advertising perspective it's something that is very much on her radar. "I do think e-readers will catch on," she says. "Right now, everybody is talking about the app. I think that any place we can grab consumers' attention and send them someplace to buy a product is huge."

For that reason, White likes to see every channel in one place, on one report. "I want to see everything ? in my opinion, the more the better," she says. "We are trying to get a full picture of who is getting these copies in digital or print. I think that newspapers and magazines have started to embrace this, and I think there is huge potential."


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