Study: Majority of Consumers Obtain News From Online Sources

For the first time, 21st century consumers are reading the news online more than in print, according to the “State of the News Media 2011” report by the Pew Research Center Project for Excellence in Journalism. Only television remains the most-used resource for news among American adults, but the gap is closing.

In fact, most sectors of the American news industry began to recover in 2010 after two difficult years – but technological advances present old and new media alike with increasingly complex challenges.

For the online news media, the question is economic sustainability. While advertising profits on the Internet surpassed spending on print ads, especially since the emergence of the iPad and other tablets, the report shows that “by far the largest share of that online ad revenue goes to non-news sources, particularly aggregators” such as Google or AOL.

“The biggest issue ahead may not be the lack of audience or even lack of new revenue experiments. It may be that in the digital realm the news industry is no longer in control of its own destiny,” wrote the report’s co-authors Tom Rosenstiel and Amy Mitchell.

The Pew Research Center surveyed 2,251 Americans, age 18 and older. While 47 percent reported using their cell phones or tablets to find “at least some local news and information,” only 23 percent said they would be willing to pay $5 a month for an online subscription. An even smaller 18 percent would pay $10 a month for the same service, while “roughly three-quarters of adults said they would not pay anything.”

And while the online news media used to be a direct target for consumers, a new player has entered the industry in the 21st century: software programmers, content aggregators and device producers that control the public’s access to the news.

In recent years, organizations that produce the news increasingly began to use aggregators and social networks to attract an audience. Now, as consumers begin to use tablets and cell phones more frequently, news companies have to become more compatible with the device makers, like Apple, which often take a share of the revenue and control audience data.

“In a media world where consumers decide what news they want and how they want to get it, the future will belong to those who understand the public’s changing behavior and can target content and advertising to snugly fit the interests of each user,” the report states. “That knowledge – and the expertise in gathering it – increasingly resides with technology companies outside of journalism.”

The state of the traditional print newsroom also reflects this shift to the web. Television news channels like CNN, Fox and MSNBC lost viewers by double-digits for the first time in 12 years. Newspaper staffs have shrunk by 30 percent since 2000, with another 1,500 jobs lost this year, while 39 percent of the Pew survey participants said the loss of their local newspaper would have no impact on their ability to keep up with information.

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Mark Crispin Miller, a professor of media studies at NYU, said there is more to the decline of print news than an increased use of the Internet. “The rise of digital technology and the economic crash have been used to account for the general breakdown [of print] and that’s a simplistic explanation. The problems of the news business are far more profound than that. I think they have more to do with the failure of the news to deal honestly with issues that matter to people.”

Mainstream publications have become more focused on “serving the interests of their advertisers,” Miller said. “They shy away from stories that the government doesn’t want people thinking about … people don’t trust the media in large part for good reason.”

“It would be absurd to suggest that [newspapers] should not make money,” Miller said. “They can’t do the news properly if they can’t pay investigative journalists. But beyond that capitalistic question is the deeper question of what kind of media policy the US should have. An advertising based news system is a bad idea.”

According to the report, newspapers that have managed to succeed in the recession have narrowed their aspirations and asked for more articles from fewer journalists, and in many cases, have begun to use the Internet to create more content. Print industry leaders say “they are more adaptive, younger and more engaged in multimedia presentation, aggregation, blogging and user content,” the report states.

“In some ways, new media and old, slowly and sometimes grudgingly, are coming to resemble each other.”

A willingness to experiment has also led to the emergence of hyperlocal news sites, most common in cities that are broken up into distinct neighborhoods, such as Seattle. A Washington News Council database shows 90 community-based sites just within the city’s limits. “Seattle can beat its chest that it has so many neighborhood blogs,” said Diane Douglas, executive director of local civic group Seattle CityClub. “Beyond just providing information, they are doing community-building and activating citizens.”

But a constant demand for speedy and accessible news have led to less training and more volunteer work, which in turn devalues the profession of journalism, the report shows.

“The result is a news ecology full of experimentation and excitement, but also one that is uneven, has uncertain financial underpinning and some clear holes in coverage.”