Newspapers accepted the proposition because they had no choice. All the media were moving online from the mid-1990s onwards, and everyone had to fight for a share of the exposure even at a loss of traditional income. The reasoning was that online attention would multiply each medium's viewership or readership (the New York Times sells about a million copies a day, but has 20 million readers online) and a way would be found to make money from that traffic eventually. But traditional revenues have dried up faster than internet advertising has grown, and US newspapers this year began to shut down or lay off staff. The result is a dying industry and fewer original articles being researched and published, but a massive duplication of them on web sites around the world.
Now newspapers are fighting back. If News Corp. successfully leads an industry-wide about-turn to do the unthinkable and charge for online content, newspapers may stop the decline in their revenues.
Last June I stepped down as Editor-in-chief of the Athens News after a decade at the helm. It was an exhilarating time – not every editor enjoys complete editorial independence – but also a challenging time to run a paper. The Athens News' trials during this decade are a case study in what works and what doesn't work in turning a newspaper around; they also point the way to possible future solutions for that minority in mainstream media – newspapers and magazines – that still charges for content.
When Christos Lambrakis offered me the job in 1999, the Athens News was known as a venerable 47-year-old beacon of free speech whose founder, Yannis Horn, had become the first newspaper publisher to suffer imprisonment under the colonels’ censorship law in 1972.
Under the bombardment of imported titles, new English-language titles published in Greece and the internet, we decided that the Athens News’ best chances of survival were as a weekly. The transition was stormy. We had to continue to produce a daily while conceiving, designing and engendering the new product over a mere eight weeks. To achieve this we divided the newsroom into two teams, and ultimately succeeded in leaving a gap of just one day between the disappearance of the daily and the appearance of the weekly.
Normally when a new product appears it thrives off the curiosity factor for a couple of issues before settling into its true circulation furrow. The weekly Athens News did precisely the opposite. Its first edition sold 4,331 copies in Athens and Peiraieus, its second 4,517, its third 4,862 and its fourth 4,947 – an average rise of 4.5 percent per edition. Sales across the country also rose in these weeks, signalling that we had overshot reader expectations.
The market responded well enough during the first four years of the weekly Athens News that we turned our balance sheet around - from 670,000 euros in losses in 2001 to 74,000 euros in income in 2004. This came at a price, though. The payroll shrank to roughly half its original size of 45, and over the ensuing years would shrink further to about 16.
We rose to the challenge of the Olympics in our break-even year by creating a Special Daily Edition for the two weeks of the Games. The trick of going from a weekly to a daily for a brief period was to avoid a massive outlay in extra staff so as to keep the enterprise profitable. Just before the Games we did hire half a dozen temporary writers and copy editors to boost the time-sensitive front of the book. But the key to success was that we built up the back of the book months in advance by commissioning and pre-paginating feature material. This necessitated no extra hires. Together with permanent fixtures such as maps, travel advice to tourists, plus two pages with the latest results and the next day's programme, we were able to flesh out a 40-page daily that became highly popular with visiting journalists and readers alike. A limited bound edition of these newspapers sold out within a few days after the Games.
The challenge to the Athens News after 2004 was to reverse its declining news stand sales. In the years 2001-2007 we suffered an average annual drop of 5.4 percent. Though devastating to a small newspaper, this was less than half the average circulation losses taken by major Greek national dailies and a testament to our readers' loyalty.
We settled on a dual strategy. One effort was aimed at generating a new revenue stream through books based on Athens News talent. They were relatively cheap to produce because the material had already been paid for and edited; they cost nothing to advertise because they were being published by the advertising vehicle itself; and productive columnists were happy to be turned into authors with a royalty into the bargain. The 17 titles we published over the decade were, in total, a success, becoming about five percent of the newspaper’s turnover of just over a million euros.
The second - and more important - prong of the turnaround strategy was to focus on new forms of distribution. While we kept honing content (a task that never ends), we felt that means of delivery was the real problem for print journalism. News stand sales still generated about sixty percent of the Athens News’ revenue in 2008, but we came to see this form of distribution as shrinking irreversibly because of new technologies such as the internet and mobile telephony. The classic print distribution model simply will not occupy the market share it once did.
When it comes to niche markets such as that of an English-language newspaper in a non-English speaking country, the decline in sales is even more ominous. Publications with sales of under about 20,000 copies in Greece must print far more than the legal limit of sales-plus-20-percent to cover the nation’s approximately 14,000 sales points. Below print-runs of about 25,000, therefore, one has to distribute selectively. That is a fraught process. Newspaper distribution is a closed profession that cannot be challenged through open competition in the key markets of Athens and Thessaloniki, where about 70 percent of the population lives. Newspaper distributors therefore tend to be less than zealous about accommodating publishers' requests.
Our response was to shift our focus at the end of 2006 to subscriptions and the internet. Two thirds of Athens News readers are in the greater Athens area, where competitive courier services are readily available. Print readers who buy from a news stand or periptero currently pay between 37 and 50 percent of the cover price to the distributor, whereas courier services, which are openly competitive, would give us quotations as low as 20 percent of the cover price. We decided to shift the benefit to our readers, offering a subscription package with a discount of up to 30 percent, home delivery and annual incentive gifts. That also allowed the newspaper the perquisite of coming into a direct relationship with a growing proportion of its customers, which entails enormous marketing and quality-of-service advantages over an unaccountable distribution system.
An early vindication of this strategy was that in 2007, the first full year of the new emphasis on subscriptions, the Athens News made a modest one percent gain in revenue from sales solely thanks to a 31 percent gain in subscription revenue and despite a decline in revenue from street sales. It was the first year in which the weekly newspaper increased its sales revenue without a rise in cover price.
Adjustments in paper distribution notwithstanding, it is clear that the internet is the tool of the future for newspapers. The Athens News was the first Greek newspaper to establish a site in 1995, and we rebuilt it twice, in 2001 and in 2009. The site consistently enjoyed 20,000 unique visitors a month, 83 percent of them from overseas and half of those from the US.
Starting on that basis, we set out three years ago to electronically scan every newspaper published since 1952 using optical character recognition software. This creates word-sensitive archives and enables users to search the database. Had we succeeded, we would have created a searchable archive of over a million articles – easily Greece's biggest online news database in English. The plan was to add such value to the site through this and other standing databases that it would become possible to create a paid subscription to the website with services beyond those available to the free visitor.
The task proved larger than we could ultimately bring to pass. In September 2008 the Lambrakis Press decided the close the newspaper with the scanning job only half done. We were forced to focus on the more germane task of finding a new owner to avoid closure. This was a battle the entire staff took a part in, and the newspaper survived largely thanks to an overwhelming response from its true owners – the people who read it.
Hundreds of letters that poured into our office during those days told us why we had survived. Our readers appreciated our independent reporting and insightful analysis. Two things made that independence possible: the fact that our publisher, Christos Lambrakis, had allowed us to exercise an aloof, Western style of reporting that separates news-gathering priorities from political and commercial ones; and the fact that the newsroom was comprised almost exclusively of bilingual, bi-cultural Greeks who combined a love of Greece with a native grasp of English.
But for all these years the Athens News stood out for another reason. In a country with the slenderest of traditions in unmanipulated journalism, it had an understanding of journalistic integrity and the need to strive for an objective viewpoint. To the extent that it had an ideological bias, this was a natural bent towards liberalism – an inevitable leaning in a newspaper that addresses itself to bi-cultural Greeks and expatriates interested in what goes on under Greece's skin. We developed strong beats in the areas of greatest social change: education, immigration and the environment. The newspaper developed strong reporting on these topics rivalling - and in some instances exceeding - the accuracy and timeliness of much larger media organisations.
We focused on attempts at reform in the disappointing second term of Kostas Simitis and, after 2004, the transition to conservative rule after 23 years of almost continuous socialist government. And we built community, believing that a newspaper is at its healthiest when strengthening its readers even as it draws strength from them.
What we tried to do for a decade was to provide encouragement and self-awareness to that section of Greek society that holds the key to its future – those who believe that Greece can take its place among competitive societies without losing its traditions or its identity. In a sense, we were trying to create for our children the Greek society we expected to find when we repatriated. Our editorial emphasis for greater accountability, transparency and meritocracy followed naturally. We supported economic liberalisation, greater competitiveness, smaller government and paying off the national debt, which mortgages future generations. In short, we strived to be a voice of reason and an indispensable component of a Greece that is yet to come.
What worked for the Athens News can be summed up as follows:
- Lowering overheads: Newspaper publishing is a highly leveraged business. It involves enormous up-front expenses in printing plant, distribution networks, adequate newsroom staffing, contact-building and marketing. We managed to lower payroll expenses, which were under our jurisdiction, but not shared corporate overheads for services such as legal and accounting, which were beyond our control.
- Creating new revenue streams: Large-circulation weekly papers are now in the business of selling magazines, CDs and DVDs with news as an added virtue; hence the practice of obscuring the front page titles with the giveaways - the news is no longer the point. Those gifts are being sold at cost (each disk costs about a euro in rights and production, which is added to the cover price). The benefit is in maintaining circulation in order to remain competitive and sell advertising. So the print news industry is essentially becoming a branch of the entertainment industry with a news flavouring.
At the Athens News we lacked the circulation to make such a system profitable, but we also wanted to remain in the news business. The revenue streams we created were a line in book publishing, which had obvious economies of scale with newspaper publishing; and we were in the process of creating a revenue stream through a paid online subscription. (Mysteriously, both the Athens News' former publisher and its present one have eliminated the online archive, which is one of a newspaper's chief assets).
Shifting to a subscriber distribution model: With the inexorable, industry-wide shift away from news-stand sales, publishers have to hold on to their readers. The best way to do so is to enter into direct communication with them, pass on the economy of cutting out the distributor, offer gifts and draw direct feedback.
Below-the-line marketing: Few print media can afford the scattershot methods of television and street advertising to find their readers. Extracting needles from haystacks is best done by holding a magnet over them – in other words, organising events designed to draw out of the social mix a particular profile of reader. At the Athens News we did this through our anniversary, our book presentations, focus groups and tie-ins with other community organisations. We also made the most of free or low-cost publicity through the internet and our friends in the community.
- Integrity: In the ever-more crowded field of self-observation, humanity is becoming confused about what to observe and which observers are credible. A newspaper's most important investment today, over and above marketing, payroll strength, paper and printing quality and advertising, is in its own strength of character. People will remain loyal to the media that demonstrate a loyalty to them. At the Athens News our loyalty was always to the reader first.
The country is awash with newspapers that consider the reader a close second priority to the business-to-business deals made between the publisher and members of the government. In such deals, the newspaper sells image-making services for state advertising, state protection and state contracts. The journalists who serve such newspapers are fully aware that their paymaster's interests will dictate the next day's front page, not the beat reporting done by them. We are so steeped in this kind of journalism that we barely notice it. But it is a flawed business model. Publishers who did well in the blackmail business in the 1980s have come and gone, or shrivelled beyond recognition. In any case, no-one, not even the government, can take a publisher without integrity seriously. The newspaper that establishes a consistent record of independent and objective reporting and analysis will ultimately win.
New Europe on print media.