Wednesday, September 03, 2008

Free papers are fizzling, too

The global market for free newspapers is in a slump, too, according one authoritative industry analyst.

After expanding explosively for a dozen years, the total circulation of free dailies around the world grew at an “all-time low” of 5% in the first eight months of this year, says Piet Bakker, a professor at Hogeschool Utrecht in the Netherlands.

Piet, who blogs at Newspaper Innovation, says the worldwide circulation of free newspapers rose by more than 200% as recently as 2000 and even grew at a brisk 23% in 2007, ending the year at a record 47 million copies per day.

But growth fizzled this year and the outlook isn’t bullish. “Considering the [known] plans for the next months, a fast recovery is not expected,” he says.

Evidence is mounting that the market for free papers is becoming saturated.

Piet says more than 200 free dailies are being published in some 50 countries, making for an average of four papers per country. “In 2003, there were three titles per country,” he reports. “In 1999, it was two.”

Meanwhile, there’s a report that one prominent freebie may succumb to the sagging U.S. advertising market.

Metro International, by far the largest publisher of free papers in the world, may be getting close to shutting its New York edition after failing for the better part of a year to either sell the paper or find an equity partner, according to the Sunday Times of London.

Metro, which loses money despite (or because of) distributing 23 million free papers daily in 23 countries, began publishing free dailies in Philadelphia in 2000, Boston in 2001 and New York in 2004. The New York Times Co. is a 49% partner in the Boston edition, but Metro is on its own in the other two markets.


Blogger don said...

What about the suburban community papers? Out here (SouthWest Canada) there are two chains of free weeklies that seem to be doing well.

The key to their success seems to be their distribution model. Their papers go to (in theory) to all residences in a given area. Interestingly, the chain that seems to be doing better (thicker papers, better coverage) also has a better distribution system.

As "news" papers they are not held in high esteem by writers, often referred to as "flyer wrappers", which points to why they are successful: it's not the news, it's the distribution. Retailers need to get their message to consumers, and the community papers have figured out a cost-effective way to do that.

However, they are still valued in the community. Anecdotally (my son delivered for one chain for a number of years) there are people who live for these things. For some people its the flyers inside the paper, for others its the papers themselves.

The key (another key) seems to be not to go for the mass market, or the commuter market (like Metro), but geographically-bounded residential markets -- Consumers who shop reasonably close to where they live.

What do you think?

8:00 AM  

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