The Year Ahead: My Turn for Predictions

By: Steve Outing

In my last column of 1995, I asked several experts in the online news field for their predictions of where the newspaper new media business will go in 1996. Today, it's my turn to prognosticate about the year ahead. I will make no guarantees to the accuracy of my predictions -- given the extremely rapid pace with which new technology developments transform our fledgling industry -- but here are some "educated guesses." But please, don't mistake this little exercise with accurate reflections of what will become reality in 1996!

#1 -- Newspapers will continue to introduce online services at a furious pace. The nearly 700 newspapers operating online worldwide as 1996 begins will increase to about 2,000 by the end of 1996, as newspaper chains put all of their properties online simultaneously -- rather than limit online ventures to a handful of papers operating on an experimental basis.

#2 -- The European newspaper industry will catch up with the pace of American newspapers in launching new online ventures, and European iniatives will be announced for the World Wide Web that bring together content from multiple newspapers.

#3 -- Some publishers will get cold feet and abandon their online ventures, citing the inability to support the projects through a period of prolonged losses. They will come to the conclusion that it is too early for their companies to enter the interactive newspapers business and that they lack the resources -- due to rising newsprint prices and other economic pressures -- to make a go of it at this time. Some reporters covering these moves will wrongly portray them as evidence that the Internet cannot live up to the hype it has received in the last year.

#4 -- Newspaper new media departments will experience increasing pressure from within to turn a profit in 1996, as publishers become impatient with treating online ventures as experiments. Overstaffed new media divisions (what few there are) could see staff cutbacks, with the need for some positions eliminated by automation.

#5 -- A growing number of newspapers will report making money from their online ventures -- particularly those such as Mercury Center that have been operating for at least a couple years and have learned many lessons during their time online.

#6 -- Online newspaper services will have an easier time attracting advertisers in 1996, because major advertisers will have built new media spending into their '96 budgets. In 1995, ad dollars often were stolen away from other budgets to be used for new media placements, limiting the success online publishers had in attracting advertisers.

#7 -- More newspapers will experiment with charging for some or most of their content. Knight-Ridder Newspapers will lead the way with its model based on Mercury Center, which charges a modest subscription fee to see full content of the site but still includes much free content to keep non-paying computer users visiting the site. Within Knight-Ridder, individual publishers will question this edict from corporate headquarters that they adhere to the subscription-fee model. A handful of newspapers, such as the San Antonio Express-News, which just yesterday launched a Web site that is only accessible to paying subscribers, will learn the hard way that subscription fees are not yet a viable strategy for building an online service.

#8 -- More newspapers will create online equivalents of the Comics Page, such as those by Mercury Center Web and Philadelphia Online. Also, more online interactive crossword puzzle applications will appear.

#9 -- Nearly all newspapers currently operating on the major online services will launch a Web service, if they haven't already. While a handful will abandon their major online service alliances entirely in favor of the Web, most will choose to operate dual services, citing the different audiences reached by each service.

#10 -- Newspapers operating BBSs will continue to abandon them in favor of Web services -- a continuation of the trend seen in 1995. BBS developers will struggle to incorporate the Internet into the core of their systems, but it won't be enough to deter newspapers from abandoning BBS systems as a publishing platform.

#11 -- Newspaper company new media programs that emphasize long term research (such as Knight-Ridder's Information Design Lab, which was killed by Knight-Ridder in 1995) will be abandoned or cut back in favor of development work to more immediately take advantage of perceived profit opportunities on the Internet.

#12 -- Roger Fidler, former director of the Information Design Lab, will release his long-awaited book, "Mediamorphosis," at mid-year. The portable flat-panel digital tablet, viewed by Fidler as the cornerstone of the long-term future of the newspaper industry, will continue to evolve in the research labs of companies like Toshiba. But commercial release of significant products to support tablet publishing will not occur in 1996.

#13 -- The Atlanta Constitution-Journal will make a big splash -- and pull in significant advertising dollars -- with its free Summer Olympics Web site. (The Olympics take place in Atlanta this year.)

#14 -- The New York Times early in 1996 will launch a blockbuster Web service that for some people will obviate the need to subscribe to the print edition. It will be one of the few newspaper Web services that computer users will be willing to pay for, but it will not surpass 25,000 paying subscribers in 1996. The service will be very successful in attracting advertisers. Likewise, the Wall Street Journal Interactive Edition Web service, which will launch in early 1996, will get a lot of publicity and push the envelope for what a Web site can do. But it, too, will be lucky to get more than 25,000 paying customers, since it won't be free.

#15 -- The prospect of super-fast cable modems to access the Internet will excite many people, but few cable modems will be in use by the end of 1996. @Home will launch in the Bay Area of California and later open other U.S. test markets for its cable-based Internet access service. But it will have only a few thousand subscribers by the end of 1996 and will not pose an immediate threat to the Internet service provider (ISP) business.

#16 -- More newspapers will become ISPs -- continuing the trend seen in 1995 -- but nearly all of them will do so by partnering with outside Internet providers. Very few will opt to become ISPs independently, and those that do over time will drop out of that business as the demands of providing customer service and competition from new and larger ISPs overwhelm them.

#17 -- The Kelsey Group/Editor & Publisher-sponsored Interactive Newspapers conference in San Francisco in late February will attract at least 1,500 attendees, despite Kelsey's expectation of only 800 in its promotional materials, reflecting the booming nature of the interactive newspapers business.

#18 -- More newspaper online services will ally with other media organizations, with each media entity contributing what it does best to the online presentation. The Washington Post-ABC-Newsweek joint political Web site, ElectionLine, is a model that will be copied in cyberspace during 1996.

#19 -- Well known journalists will be named to head up high-profile online news ventures, as cyberspace journalism gains more credibility within the profession (and public) during 1996. (ElectionLine, for example, will be directed by Evans Witt, a long-time political editor and writer for The Associated Press.)

#20 -- New Century Network will make some significant announcements early in 1996, at last putting to rest the questions about what its executives have been doing for the last few months. The initial announcement will include news that NCN will launch with about 75 member newspapers in the U.S. -- most of them properties of the 9 U.S. newspaper companies that comprise NCN. It will appoint a "marquee name" to be CEO after a long executive search, and announce a major technology partner that's a household name.

#21 -- Classified advertising online will advance to a new level, with new technology solutions introduced that will simplify getting classified liners from print into HTML; automatically convert display ads for online display; provide automated "agent" features that allow consumers to set up agent searches to have ads meeting specified criteria emailed to them; and offer more intelligent search engines. Also, NCN -- and others -- will establish networks allowing consumers to search distant newspapers' classified sections (for a fee) from within a local newspaper's online service.

#22 -- Media hype about the Internet will turn into a backlash, with reporters frequently writing of complaints about the slowness of accessing Internet sites and expressing unfounded fears that the Internet is about to crash under the weight of its own popularity.

OK, that's enough! Looking back on what I've just written, I see lots of opportunity to be proved wrong. Therefore, I plead with you now not to take my predictions too seriously. The one prediction I can make with confidence is that 1996 will present some developments in the online news field that no one will have predicted.

Another expert view

Last Thursday I presented the predictions of several online news experts for what 1996 will bring. Mark Potts, editorial director of @Home (and formerly of the Washington Post's Digital Ink), just missed my deadline for that column. Here's his take on 1996:

"I think we're going to see some cutbacks in staffing and ambitions in some online efforts as business realities (high costs and little advertising) start giving publishers cold feet about this online stuff. It's a foolishly short-sighted reaction, but it's as inevitable as sunrise. And everybody who's on proprietary services is going to move to the Web. Otherwise, I see little change, and too many people hung up on protecting franchises and brands rather than creating truly original online services."

Best Online Newspaper Services Competition

Please don't forget to nominate your own company or another for Editor & Publisher/The Kelsey Group's 1996 Best Online Newspaper Services Competition. The nomination form is on the Web at http://www.mediainfo.com/contest.form.html. Deadline for nominations is January 24, 1996. Winners will be announced at the Interactive Newspapers conference in San Francisco on February 24, 1996.

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This column is written by Steve Outing and underwritten by Editor & Publisher magazine. Tips, letters and feedback can be sent to Steve at steve@planetarynews.com