Consumers move online but won’t pay for content

The relationship between journalists and communicators is a story of both symbiosis and aversion — journalists need communicators and the other way around. The need does not necessarily create trust. It is stil considered bad form to go from one occupation to the other. 

Since both journalists and communicators are good at expressing themselves, there is also a risk that grand talk about investigative journalism and the need for openness will hide other interests closer to home — like keeping your job or being close to the corridors of power.

New media a challenge

The two occupations are linked and both are influenced by rapid technological developments, but there is no direct correlation. Just like social media undermine the big media’s authority, they also represent an opportunity for communicators. Authorities and businesses need more resources in order to handle the new channels.

If you look at organisations representing journalists versus those representing communicators in the Nordic countries, they have nearly 74,000 members between them; 58,600 are journalists and 15,400 are communicators.

But the numbers only illustrate part of reality, since many communicators are not members of existing unions. A few years back, Swedish communicators used a company dealing with business information to gather lists of all those calling themselves communicators.

“In that list you might also find people who sell mobile subscriptions at shopping centres who would not be members with us. But by our estimates there are 20,000 communicators in Sweden and 5,800 are members with us,” says Jeanette Agnerud, spokeswoman for the Swedish Association of Communication Professionals.

The technological development has seen a rapid shift from old to new media. Daily newspapers are building a model based on both advertising revenues and income from subscriptions or regular sales. When readers disappear it is i difficult to compensate for the loss of income, since ads follow the audience. Increasing subscription cost or the cost of each paper risks loosing even more customers. 

More expensive daily newspapers

Yet daily newspapers have become much more expensive than other goods. While Sweden’s consumer price has risen by 2.71  since 1981, the price of evening papers has risen tenfold. Dagens Nyheter, the largest daily, now costs six times more than in 1981. 

All in all this means print media have become more than twice as expensive as other products. The TV license fee however has stayed level with other goods and services. 

To understand what has happened to the media market you could compare it to a city where there was nothing but public transport. Commuters can move, but they cannot affect timetables or where the bus should go. The new media are personal cars which give a completely new flexibility. You can go where you want, when you want, but of course you have to help pay for the roads. According to a new study from Professor Ingela Wadbring at the Mid Sweden University, each Swedish household spends 13,000 Swedish kronor (€1,400) a year on media — including everything from daily newspapers to music and books.

That means a total annual consumption of around 60 billion kronor (€6.5bn), or two percent of GDP.

Little willingness to pay

In a longer perspective — 1981 compared to 2010 — two new factors have been added. In 1981 no household paid for broadband, mobile telephones or pay-TV. Households have mainly cut costs like journals and to a lesser extent daily newspapers and the TV license fee. 

“The main issue for many traditional media houses is that consumers are moving online, without being willing to pay for their consumption there,” says Ingela Wadbring, Head of Research and Professor of Media Development at the Mid Sweden University. Interestingly, consumers are willing to pay in order not to have advertising:

“If you ask what they are prepared to pay for when it comes to online sound, video and written material, paying to avoid ads tops all three categories. This is especially true for young people.

“Having access to unique material also increases the will to pay, but generally the will to pay for online material is low. One explanation could be that people feel they are already paying for the infrastructure (broadband) and the technology (the computer, tablet or mobile) and therefore don’t want to pay once more for the content,” says Ingela Wadbring.

TV hardest hit?

Although daily newspapers are worst hit, the technological development means everyone is competing against everyone. Newspapers have TV broadcasts which can be viewed from your computer, tablet or mobile.

“During the trial of Anders Behring Breivik, NRK had an enormous bus outside the court house, and TV2 a somewhat smaller one. But VG-TV, with their simple video cameras and laptop editing, had more viewers than NRK and TV2 combined,” says Kjell Aamot, the former CEO of Schibsted, the owners of VG and Aftenposten in Norway, and Aftonbladet and Svenska Dagbladet in Sweden.

“We put a lot into the free newspaper 20 Minutes in several European countries, but these kinds of papers have no future either because everyone gets their news on their mobiles,” he says. 

Media in the Nordic region has made dramatic cut in the number of journalists they employ. Iceland was hit early and the hardest during the economic crisis. 2012 was Sweden’s bleakest year when 900 journalists were made redundant. The crisis hit Norway a bit later, while cuts in Denmark now also include the Danish Broadcasting Corporation which has made 200 journalists redundant and wants to close down its symphony orchestra. 

Bright future

While the number of people wanting to study journalism is falling, the opposite is true for communicators, for whom the future looks bright.

Nearly nine in ten people who studied strategic communication at the University of Lund were in work six months after graduating. One third had jobs even before they finished, according to a survey done at the university. They have many titles: communicator, market assistant, PR consultant, online editor, project leader and head of communication.

“It is inspiring to see that our students find jobs as easily as for instance lawyers, economists and system analysts,” says Charlotte Simonsson, head of the university’s department for strategic communication.