Beyond print: The future of news media

Focus and a sharply defined target audience help in separating the wheat from the chaff

Earlier this year, Justin Smith co-founded Semafor with Ben Smith, former columnist for The New York Times. Semafor, launching this October, will talk to an estimated 250 million English-speaking people across the world. It will offer text, video and events across Africa, Asia and the US among other regions. Mr Smith, who was the chief executive officer of Bloomberg Media till January this year, reckons that the global English audience is still being served by brands like The Wall Street Journal, The Washington Post or The Economist that were created in the 19th century and get the bulk of their business from their home markets. Semafor has raised $25 million from individual investors instead of venture capital firms.

In August this year, the 2017-born Axios Media was sold for $525 million to US-based Cox Enterprises. That was roughly five times its projected $100 million income in 2022.

After millions of dollars’ worth of investments, Vice Media, which began as an alternative way of serving news to the young in 2013, is still struggling to make money. Vice was once valued at $5.7 billion.

These new ventures aimed at doing something in a market where the whole idea of news, information, trust and media has been disrupted are at different stages of their journey. Semafor is on the cusp of launch, Axios is a success and Vice seems lost. What can the Indian news business infer from these and other first-world examples? That depends on where the local online news market is currently.

Of the Rs 30,300 crore that online advertising got in 2021, roughly half went to Google and a third to Meta (formerly Facebook). That leaves just about Rs 5,000 crore for dozens of newspapers, websites and TV channels that have invested several times that figure on bringing news online. In terms of audience size, mainstream news firms such as Times Internet, India Today, NDTV, Indian Express dominate the list of the top 20 online news sources in India. But when it comes to online revenues, most still struggle. The game then belongs to the brands that have the money to invest in artificial intelligence (AI) and the tech needed to get scale and, therefore, advertising. Journalism doesn’t seem to have much to do with it.

It is tempting to think of subscription as a possible solution given that entertainment OTTs have over 100 million subscribers. But there is no connection between the two genres. There are barely a million subscribers to online news in India.

News is a tough business. Newspapers remain profitable, but only just. India is home to over 400 TV news channels, more than half of which are funded by people who are not interested in journalism or facts. They don’t care whether they make money or not. Of the remaining, just two-three news broadcasters make a profit, sporadically.

Unlike broadcast, cyberspace has no entry barriers, making it a bigger cesspool of disinformation. Anyone with a phone can claim to be a journalist. There are hundreds of thousands of pointless websites posting videos and messages that, more often than not, are falsehoods peddling as news. For example, the recent Hindi release Brahmastra has done exceptionally well on box-office revenues, grossing close to Rs 250 crore globally in the first four days. But there are dozens of news sites and TV channels that keep saying it is a failure.

In this game of separating the wheat from the chaff, honest attempts get sidelined. That brings this to the first lesson that Semafor, Axios et al offer — focus and a sharply defined target audience.

The News Minute is totally focussed on the five South-Indian states. Lallantop with its earthy, satirical take on news speaks to young Hindi-speaking people. There is no way a news brand can take on Google or Meta on generic, commodity news. Think of IT, golf, business, motoring or a host of specialised magazines from the eighties and nineties. They created loyal communities that could then be leveraged for ad and pay revenues. Only a firm that can create several such communities, aggregate them and monetise them has a chance.

That brings this to lesson two — capital and ownership. If your news is not about anchors screaming from inside a studio but about feet-on-the ground reporters verifying events and facts, then it costs money. Most media brands, across print, TV or online, need four to six years to hit break-even and start making money. This means capital and an ownership that offers the financial (and moral) spine needed for any good journalistic endeavour these days. Given the shape of the market, Indian investors have no appetite for news. Even if global news organisations were interested (they aren’t), they can’t invest more than 26 per cent. Not surprisingly, then, getting decent news start-ups off the ground has been very difficult in India.

That brings this to the third lesson. A brand that thinks “differently” about news and how it can be served still stands a chance. Seven years after its launch, Inshorts, which offers news stories from different newspapers, agencies and websites each crunched to 60 words, is one of the largest news aggregators in India. In 2019, it launched Public, an open short video app. It has 60,000 creators including ward members, MPs, MLAs among local residents in hundreds of small towns who use it to upload short videos on local happenings and news. Public brings in about 80 per cent of Inshorts’ 80 million unique users and should start making serious money from the coming financial year. 

Some of these inferences might help in creating a successful news brand; none can guarantee a long, healthy existence. Ask any newspaper owner.

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