Gary Graham, John Hill, Hwanho Choi

(Manchester Business School, CRESC, the University of Manchester, Manchester M15 6PB, UK)

 

Abstract: Newspapers are operating in increasingly competitive and fragmented markets for audiences and advertising revenues. Web 2.0/social media is changing radically the ways in which newspapers and media business functions and struggles for profitability. Our research sought to answer the question of how Web 2.0/social media is impacting on the social and economic influence of regional newspapers. To answer this question we conducted a focus group of news media organizations in the London area. We blend together conceptual media/cultural economist writings on regional newspapers with focus group research findings in order to develop a theoretical model. The findings showed that in spite of initial fear and rejection, the internet is now firmly embedded in newspaper industry supply chain operations. Firms are now using the internet as an operant resource and working proactively with consumers to develop new forms of relationship value. We highlight the role of consumers in the creation of news (editorial) content and consumer-driven moves toward a merged media platform of distribution (including television, online, mobile and printed forms). The paper concludes by suggesting that Web 2.0 requires the development of new business models and value chains rather than their protection. Our theoretical model implies that if newspapers are to keep their social and economic influence within their local community then local news can no longer be produced in a “one-size fits all” product form, but as service experiences supplied through clusters of suppliers including newspapers, local television stations, community radio, online community news services and bloggers/citizen journalists. Demand will come from both communities of Web 2.0 driven consumption together with highly individualized preferences for personalized news supply.

 

Key words: newspaper industry; value chain; business models; internet

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