Newspapers will Live or Die in Print

Current estimates for U.K. newspapers, from analyst Jim Chisholm, show that only 7.4 percent of revenue will come from digital sources in 2011, rising to 13.9 percent by 2017.

In the U.S. market, 9.3 percent of newspaper revenues now come from digital sources, growing to 14.6 percent in six years.

The health and survival of the newspaper industry for the foreseeable future still rests on the physical product known as the "newspaper," one might argue.

That is not reassuring, in many ways. The hope has been that newspapers could survive, if not thrive, by shifting to digital delivery and preserving existing gross revenue and margins. If that isn't the case, difficult times lie ahead.

Or course, the newspapers are not the only industry that possibly could face similar dilemmas. Telecom service providers and video entertainment providers have been facing similar questions as services and applications move from legacy platforms to new IP-based platforms. So far, the answers are not so reassuring. Gross revenue and margin seems to be lower when users switch to digital products.

Paywall or no paywall, print is still what pays | Media | The Observer