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The shift of readers from newspapers to online media appears to be accelerating. The Audit Bureau of Circulations reported yesterday that average weekday circulation for more than 500 North American newspapers fell 3.6% during the six months ended March 31, over the same period the year before (economic slowdown may have contributed too).

The only thing that surprises me is how long the shift is taking. Personally, I switched to online media more than three years ago. The online reading experience is just so much richer, in the following ways (partial list):

  • electronic links in articles provide useful supplementary information
  • ability to search articles using the find/search function
  • ability to pull up articles on a topic with a Google search
  • many subscription-based publications are available for free online
  • news published as it happens, not at end of press run
  • print can be combined with video and audio media.

For investors, the newspaper sector has been a value trap so far. AbitibiBowater is down from $40 to $10 on the NYSE over the past six months. Canwest Global stock is down from $12 to $4.50 on the TSX in a little over a year. There will be some survivors in this declining sector, as the stronger firms grow by picking up market share from those exiting -- but investors will have to do their due diligence.

Maybe the survivors will include AbitibiBowater (ABH) and CanWest (CWG)? Both have attracted substantial investments from Fairfax Financial Holdings’ Prem Watsa, who has been dubbed Canada’s Warren Buffett by some.

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  •  
    Interesting, I hope both survive.
    I have been a user of the Internet since it was first available.
    However, I find nothing better than sitting in my lazyboy with
    a nice drink and a good quality newspaper.
    2008 Apr 29 05:00 PM | Link | Reply
  •  
    Yes, I also found it interesting. But where does one find the time to sit in front of a screen for so long trawling through the numerous pages, some slow loaders too. And who pays for this service, don't say the advertisers because I am sure they will soon wake up to the fact that nobody reads their ads on the web, at least none from my research. Also if you are travelling a good newspaper or two really keep your sanity. I cant see a screen doing that.
    2008 Apr 30 08:07 AM | Link | Reply
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