Sunday, December 23, 2007

Expansion of free dailies slows

By three measures, the growth of the free daily newspaper industry slowed in 2007.
    1. The University of Amsterdam's Piet Bakker, an expert on the industry, reports that the combined worldwide circulation of free dailies increased by only 13 percent — the slowest percentage increase since 2003.

    2. Bakker also says more free dailies have closed in 2007 than in previous years (though there were still more launches in 2007 than closures).

    3. The third measure comes from MediaLife Magazine, which found that U.S. media buyers were less interested in free dailies this year than in 2006.
Asked "What is the most interesting issue or trend in newspapers right now?" only 11 percent said "free dailies," down from 16 percent a year earlier. No. 1 was "circulation woes," a paid newspaper phenomenon. MediaLIfe goes on to say:
    A good share of readers are still undecided about the impact of the free papers, nearly two thirds, or 63 percent, in the recent survey. That's down from 79 percent in July 2006.
Interestingly, the remainder are more sharply divided on how well free papers will fare. This time around, 18 percent dismissed freebies as a passing trend, versus 12 percent 18 months ago.

But this time 18 percent also saw the free papers as very promising, versus 10 percent in the earlier survey.

(We have a slight difference of opinion with Bakker about the number of free dailies to open and close in the U.S. He says the U.S. gained one free daily in Boston and lost a Spanish language paper in Dallas-Ft. Worth. That's correct, but his numbers didn't include the switch of a suburban Phoenix daily (East Valley Tribune) from paid to free. So instead of the U.S. gaining one free daily and losing one, the actual ratio is three new papers to one closure. Not included is the The Messenger in Mount Airy, N.C., which distributes to homes for free but costs 50 cents in racks. It is arguable whether The Messenger fits into the category of free dailies.)

Mathematics aside, Bakker's point is still valid -- the free daily frenzy has slowed in the United States. The industry is growing, but not by the astronomical rates of years' past.

On the other hand, free dailies are on fire in Canada with six launches this year. Most major Canadian cities have three of them. The chains are Metro Canada (owned by Toronto Star and Metro), 24 hours (Quebecor Media) and RushHour (CanWest).

As a result, overall newspaper readership (free + paid) is stable in Canada, according to the industry group Newspaper Audience Databank. The Toronto Star, reporting NAD's 2006 results, wrote:
    While free daily newspapers and online editions of newspapers continue to grow and attract readers, the survey, considered the key benchmark for newspaper readership, indicates they have not cannibalized existing newspaper readership as much as has been feared.