There will be few, if any, printed daily newspapers in Canada within the next decade, and their online digital formats will not match their current scope in print, says a new report.
Prepared by Winnipeg-based Communic@tions Management, Canada’s Digital Divides also says while Canadians will continue to watch a lot of TV, the industry’s structure will look “less and less” like broadcasting and more like “ecommerce” for individual programs.
The report also predicts terrestrial radio will continue to fit within the current definition of broadcasting, while the internet will be even more ubiquitous.
The pace of change is being felt most acutely in the print industry, with the report noting that Canada’s combined paid daily newspaper circulation fell to just over 20% of Canadian households in 2014, from just under 50% in 1995 and the equivalent of 102% of households in 1950.
It says current trend lines suggest circulation will fall to between 5-10% of households by 2025. “To the extent that the trend lines are realistic, we do not believe that a viable print business model exists for most general interest daily newspapers once paid circulation drops below 10% of Canadian households,” the report says.
It goes on to say that daily newspapers are now engaged in a 10-year race “against time and technology” to develop an online business model that will allow them to preserve their brand without print, and develop new economic models that will allow their online presence to maintain their current journalistic scope.
It also predicts the continued adoption of over-the-top services like Netflix means that most Canadians will get their “TV” via the internet within a decade, a phenomenon that will not only be limited to Canada.
It calls the CRTC’s recent decision on pick-and-pay only a “transitional stage” in the way TV is delivered to consumers, saying programs rather than channels will be the building blocks of the television business of the future. Most of the transactional relationship between consumers and TV will come to be regarded as “ecommerce for programs,” it says.
“There are already signs that we are moving in this direction,” the report says. “Consumers are increasingly recording programs on video recorders, or adding channels to packages based on signature or marquee programs.”
It says programming services are already recognizing this trend, with Netflix focusing on individual programs like House of Cards and Unbreakable Kimmy Schmidt rather than the service itself, and the NBA recently announcing that it will allow fans to purchase individual out-of-market games for $6.99 this season, as opposed to previously buying all out-of-market games for a season.
While stressing this development does not necessarily mean all programs will be purchased one-at-a-time or that programs will not feature advertising, it suggests consumers are “less likely” to be buying channels and more likely to be buying specific programs.
It says today’s BDUs will come to resemble online stores, and will be forced to compete against other program vendors like Apple or Amazon. “Video providers will have to create a virtual ‘store’ that will entice and empower video consumers, who will be accessing programs on multiple devices, through multiple delivery systems, and from multiple suppliers (including advertisers),” the report says.
More forebodingly, the report notes as the business models for printed daily newspapers and local TV stations become increasingly unsustainable, it would have a sizeable impact on Canadian journalism.
Print dailies and private conventional stations are the two largest investors in journalism today, followed by specialty services (as a group) and CBC/Radio-Canada.
While it says a “small number” of traditional media outlets might be able to make the transition to national or international online news brands, the future of local journalism is unclear.
“Will we get our news from Apple, Google, or Facebook? Without the current scope of journalistic output, where will [they] get their news?” It says while there are numerous online start-ups, few, if any, are able to match the scope of print and TV.
