University of New York in Prague School of Business

Bachelor of Business Administration Program

FINAL PROJECT

The Relationship Between Advertising Revenues and

the Growth of Online Advertising and an Analysis of Possible

Future Strategies for the Newspaper Industry

Author: Nathan James Lord

1 Mentor: Tanweer Ali Acknowledgements

I would like to express my thanks to my mentor Tanweer Ali for his support and patience throughout my studies.

I would like to express my gratitude to everyone that has assisted me throughout my educational career.

I would also like to thank my family for all the help they have given me over the years and my partner for the motivation she has given me during this process.

2 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET

Abstract

This senior project focuses on answering two research questions: Is there a correlational relationship between the decline in UK/USA based newspaper advertising revenue and the growth of global Google advertising revenue? Using a SWOT (strengths, weaknesses, opportunities, and threats) analysis, what are the challenges facing the newspaper industry particularly focusing on UK based and what strategies should they adopt to cope with such challenges? This area of research is worth investigating because it demonstrates how such an entrenched industry has been affected by a Black Swan event and what business within the industry can do to mitigate the impact. The first research question was answered by using correlational statistics and found that there is indeed a statistically significant negative correlation between UK/USA based newspaper advertising revenue and global Google advertising revenue. The second research question was investigated by conducting SWOT analysis of two UK based newspapers, and The Daily Telegraph. It was found that although there are significant challenges facing these two businesses there are some strategies they can adopt to continue operation. The newspaper industry has seen a remarkable transformation in the past years and now must continue to adapt to operation post internet.

Keywords: advertising, revenue, newspaper, SWOT, industry

3 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET

Table of Contents

1. Introduction...... 6

1.1 Brief Summary of Industry Background...... 6

1.2 Research Questions ...... 8

2. Methodology...... 8

2.1 Statistical Analysis of Results...... 10

3. SWOT Analysis and history...... 12

3.1 Why We Are Using a SWOT Analysis ...... 14

4. History of The Sun ...... 15

4.1 SWOT- The Sun ...... 16

4.1.1 Strengths...... 16

4.1.2 Weaknesses...... 17

4.1.3 Opportunities...... 20

4.1.4 Threats...... 22

5. History of The Daily Telegraph ...... 23

5.1 SWOT - The Daily Telegraph ...... 23

5.1.1 Strengths...... 24

5.1.2 Weaknesses...... 25

5.1.3 Opportunities...... 26

5.1.4 Threats...... 27

6. COVID-19 Implications...... 27

4 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET 7. Other Issues Facing Non-UK Based Newspapers...... 31

8. Suggestions for UK based newspapers...... 34

9. Conclusion ...... 34

10. Works Cited...... 36

11. Appendices...... 41

11.1 Appendix A...... 41

11.2 Appendix B...... 43

5 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET

1. Introduction

The newspaper industry was remarkably profitable for hundreds of years, but as of recently a Black Swan event has led to the industry facing incredible challenges in order to attempt to maintain the level of profitability they once saw. The purpose of this senior project is to examine what has caused this damage to the industry, the extent of the damage the industry has absorbed, the strategies various businesses within the industry have implemented and what new strategies business in the market could adopt in the future.

1.1 Brief Summary of Industry Background

Traditional print media can be defined as “paper publications circulated in the form of physical editions of books, magazines, journals and newsletters” (“What Is the Meaning,”

2020), and has been the staple form of distributing mass media for hundreds of years. Since

Johannes Gutenberg invented the printing press in 1440, until the emergence of the internet with its hegemonic acceptance as the dominant form of media distribution, newspapers were one of the primary mechanisms for educating the population of the developed world regarding both global and local events and as a primary source of information were hugely important in shaping public opinion. This resulted in the creation of vast media empires which not only provided immeasurable wealth, to a select few individuals, but also significant political capital due to their unique ability to influence popular opinion to support the objectives of powerful individuals and political groups.

6 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET Of course, now it is rare to see an individual reading a newspaper every year seeing further structural declining volumes driven as a consequence of the natural attrition caused literally by the death of newspapers’ readership, as will be demonstrated in this senior project.

In addition to this, a fundamental issue confronting the sustainability of printed news media can be attributed to the emergence of the internet which has critically undermined the profitability of traditional business models of newspapers resulting in many facing bankruptcy, particularly in the case of local newspapers.

The market disruption caused by the internet has created the need for all newspaper conglomerates to address this situation by applying various strategies to mitigate the effect of the disruption. This paper will discuss the relative successes or failures of these initiatives.

The history of the newspaper will be investigated to provide context from which an informed opinion can be drawn.

This senior project will focus predominantly on those issues facing the newspaper industry , the causality of how this situation developed, and chiefly what strategies newspapers can adopt in order to ensure their continued operation.

In 1975, weekday circulation of newspapers in the United States of America (USA) was approximately 60 million. Newspapers were responsible for distributing information on all manner of topics to almost every household across the United States of America. They did this in a cheap, cost-effective way in which the final customer, i.e. the reader, expected to pay a small fee and see small adverts for the luxury of obtaining news that was not only held to certain standards, but also accountable for their mistakes and misrepresentation. However, as other forms of media became more accessible to the general population, this number began to dwindle and with the popular adoption of the internet the weekday circulation was closer to

7 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET 40 million newspapers daily and this has continued to drop to just 28.6 million as of 2018

(“Trends and Facts,” 2020).

The drivers for this development are many different factors, the most significant of which being wide scale adoption of the internet with its free at the point of consumption model. There now exists a previously unimaginable number of competing sources, that to the consumer are providing the same content as a newspaper or magazine at no cost to the consumer, in practically real time with a reduced presence of a primary agenda driven by a parent media group. As a consequence, physical newspapers are now associated with the technologically illiterate demographic who are not able to access information on the internet, primarily the elderly.

This structural decline in readership has resulted in the need for all market participants to adopt a strategy of migrating their content to web-based media, a process that has required considerable cost elimination to compensate for declining demand. The resulting impact of this strategy is estimated that approximately 40% of individuals employed within the print media industry were made redundant between 2001 and 2011 alone, in the United States of

America. The degree to which these positions were eliminated has significantly accelerated during years between 2008 and 2011. This suggests that the rate at which the print media industry needs to eliminate is only increasing (Christopher, 2012). This trend later continued to spread into other markets such as the UK and mainland Europe. This paper will focus specifically on the UK market as well as trends being exhibited in both the UK and USA markets.

1.2 Research Questions

8 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET 1: Is there a correlational relationship between the decline in UK/USA based newspaper advertising revenue and the growth of Global Google advertising revenue?

2: Using a SWOT analysis, what are the challenges facing the newspaper industry particularly focusing on UK based newspapers and what strategies should they adopt to cope with such challenges?

2. Methodology

The relationship between the decline in newspaper advertising revenues and the adoption of the internet as a primary form of information consumption can be analyzed using a correlational test as will be conducted in this paper. According to Bewick et al. (2003), “The most commonly used techniques for investigating the relationship between two quantitative variables are correlation and linear regression.” (par. 2). Two correlational tests will be run.

One regarding the correlation between US based newspaper advertising revenue and global

Google advertising revenue. The second correlational test will focus on UK based advertising revenue and global Google advertising revenue. The term correlational statistics can be defined as “the use of statistical correlation to evaluate the strength of the relations between variables” (“correlational statistics”, n.d.). The data on Google advertising revenue will be obtained from the Statista (Clement, 2020), with American newspaper advertising revenue data being obtained from (“Trends and Facts,” 2020), and UK data being obtained from the

Audit Bureau of Circulations (ABC), (as cited in Johnson, 2020).

Importantly, a correlational test not only acts as a means for testing if one variable is related to another variable, but can also be used to test the strength of the relationship and in which way the correlation exists, either positive or negative.

9 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET It is important to recognise though that limitations to correlational research do exist.

One such limitation is that whilst identifying a correlation is interesting, “correlation does not imply causation” (Bewick et al., 2003). This means that whilst both variables are related in some manner, we cannot determine if a given variable is directly affecting the other, “what we can conclude when we find two variables with a strong correlation is that there is a relationship between two variables, not that a change in one causes a change in the other” (Lind et al., 1999).

It is also true that whilst correlational research does show a relationship it does not tell the researcher why this is the case. If we identify a negative correlation between advertised revenue in terms of traditional print media and Google, we do not know why advertising revenue is growing in one and shrinking in the other. It is also the case that there “may be a third variable related to both of the variables being investigated, which is responsible for the apparent correlation” (Bewick et al., 2003). The correlational analysis will be conducted on the computer program Gretl.

2.1 Statistical Analysis of results

The loss in revenue of various newspapers could be attributed to revenue gains seen in companies which operate predominantly online, such as Google. In this section, we will examine if a correlation exists between the revenue streams of these two industries. According to Merriam Webster, a correlation can be defined as "a relation existing between phenomena or things or between mathematical or statistical variables which tend to vary, be associated, or occur together in a way not expected on the basis of chance alone" (Merriam-Webster, n.d.). A correlational test is therefore useful in determining if the success of one industry or company is related to the success of another. In this senior project, it will be examined if the success of global Google advertising revenue, the world's most popular search engine, is linked to the

10 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET dramatic loss in advertising revenue seen in the newspaper industry across the USA. In a separate investigation, a test of correlation was run to investigate the relationship between global Google advertising revenue and UK based newspaper advertising revenue.

There appears to be a trend exhibiting how as the global advertising revenue of

Google increased since 2001, the advertising revenue of newspapers in the USA decreased

(see Figure 1). This can be seen most clearly in the year 2007 where the global advertising revenue of Google began to rise at a steeper angle whilst the advertisement revenue of the newspaper industry in the USA began to fall at a steeper rate. Box plots were produced for these variables and tests for normality were also run.

With a null hypothesis that the variables would be normally distributed and an alternative hypothesis stating the variables would not be normally distributed, with an α5% we cannot reject the null hypothesis for all tests excusing the Lilliefor's test for newspaper advertising revenue in the USA. However, if α was decreased to 1% we would still reject the null hypothesis (see Tables 1, 2). There were no outliers for any variable (see Figures 2,3).

Additionally, a correlational test provides a more compelling argument for the relatedness of these two variables. A correlational test was run to assess the correlation between the US newspaper advertisement revenue between 2001 and 2018 and the global advertising revenue of Google. The null hypothesis stated that there would be no correlation and an alternative hypothesis stating there is a correlation with α5%. The correlation test found that the correlation was equal to negative 0.9 meaning as global Google advertising revenue increases US newspaper advertising revenue decreases. The P-Value was equal to 0 which means we must reject the null hypothesis meaning that the correlation found was statistically significant (see Table 3). The decision to do this could be wrong with a probability of α which is a type one Error. This means that there is a statistically significant

11 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET strong negative correlation between advertising revenue of newspapers in the USA and global

Google advertising revenue.

However, “terms such as weak, moderate, and strong, however do not have precise meaning. A measure that has a more easily interpreted meaning is the coefficient of determination.” (Lind et.al, 1999)

A Gretl model was also created to find the coefficient of determination. It was found that our model had an R-squared value of 0.811332 or 81.11332% (see Table 4). This means that our model can explain 81.11332% of the variance in US newspaper advertising revenue. The other 18.88668% of the variance in US newspaper advertising revenue must be explained by other factors not examined in this senior project.

The same correlational test was also run examining the relationship between global

Google advertising revenue and UK newspaper advertising revenue. It was found that the variables are normally distributed and that there are no outliers (see Figures 3, 4 and Tables 1,

5). It is important to recognise before discussing the statistical output that the data available regarding the newspaper industry in the USA is far greater than that of the UK. Crucially, US data dated back to 2001which more accurately depicts the transition from the dominance of newspaper based advertising to online based advertising. This can be seen in a comparison between Figure 1 and Figure 5. Having said this, it can still be seen that Google advertising revenue has been increasing remarkably whereas UK newspaper advertising revenue has been in decline.

In the correlational study, it was found that the correlation between UK newspaper advertising revenue and global Google advertising revenue was equal to negative 0.9564 (see

Table 6). This suggests that as global Google advertising revenue increases, UK newspaper advertising revenue decreases. The significance of this correlation was tested using a P-Value

12 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET method approach, with a null hypothesis stating that there would be no statistically significant correlation between UK newspaper advertising revenue and global Google advertising revenue and an alternative hypothesis stating that there would be a statistically significant correlation with α5%. It was found that the P-Value was equal to 0.0001. As this is smaller than α, we must reject the null hypothesis meaning that there is a statistically significant correlation between global Google advertising revenue and UK newspaper advertising revenue. The decision to do this could be wrong with a probability of α as a type 1 error.

A model was created (see Table 7). It was found that R-squared is equal to 0.9167.

This means that 91.67% of the variance in UK newspaper advertising revenue is explained by our model consisting of the constant and global Google advertising revenue. This would mean that 8.33% of the variance in UK newspaper advertising revenue can be explained by factors not examined in our model.

3. SWOT Analysis and History

For the purposes of this paper, we plan to conduct two SWOT analyses on two different newspapers both published for consumption within the United Kingdom, The Sun and The Telegraph. In conducting these SWOT analyses, we hope to identify how these two major newspaper titles should develop their different business strategies to ensure their viability within their markets.

The SWOT analysis is a tool used by many companies and individuals in order to assess the “organization’s internal strengths and weaknesses, and threats and opportunities of the external environment, and consequently identifying the company’s distinctive competencies and key success factors.” (Lerner, 1999). This can be especially useful when analyzing a new project to provide a base level understanding of performance and therefore

13 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET opportunities to create value. Salar and Salar (2014) even argue that a SWOT analysis can be useful in determining the pros and cons of franchising. The creation of the SWOT analysis can be largely attributed to Albert Humphrey who whilst employed at the University of

Stanford in the 1960s and 70s developed this conceptual framework as a means of assisting him to determine the areas of activity that needed addressing (Nyarku & Agyapong, 2011).

Originally, the tool was not called the SWOT analysis and was instead called the

SOFT analysis. In this anagram, ’S’ stood for satisfactory, ‘O’ stood for opportunities, ‘F’ stood for faults and ’T’ meant threats (Nyarku & Agyapong, 2011). When presented at a conference to Uldrick and Orr at a seminar on project planning, it was decided to change the F to a W to represent weaknesses. Uldrick and Orr continued to promote this new strategic management tool in the United Kingdom where it quickly was adopted by many companies and individuals (Nyarku & Agyapong, 2011).

Whilst some believe that a SWOT analysis can be vital in helping to analyze both internal factors (strengths and weaknesses), as well as external factors (opportunities and threats), according to Hill & Westbrook (1997, as cited in Nyarku & Agyapong, 2011), others consider SWOT to be a “significant waste of time”. One reason which many individuals see

SWOT as a failure is due to the fact that it is used incorrectly. In many cases, businesses conduct a SWOT analysis as a single reference tool and therefore fail to introduce context with other management tools. An example being return on investment, opportunity cost etc., as well as reflecting against the needs of the overarching strategy (Nyarku & Agyapong,

2011). In fact, in a study conducted by Menon, Bharadwaj, Adidam and Edison (1999, as cited in Nyarku & Agyapong, 2011) they found that the impacts of using a SWOT analysis could actually be harmful to a business if used incorrectly.

3.1 Why We Are Using a SWOT Analysis

14 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET Despite some of the criticisms noted above, the SWOT analysis still has a keen following. Kotler and Armstrong (2010, as cited in Nyarku & Agyapong, 2011) believe that the SWOT analysis is an incredibly useful tool for marketers. This being the case because so many different factors affect a company in terms of its marketing effectiveness that one of the simplest and most reliable ways to condense this information is by using a SWOT analysis.

They have also stated that when a business is engaged in the process of planning its future strategy, it is critically important that the individual managing the planning process has a firm and comprehensive understanding of all factors affecting the business. This can be achieved by conducting a thorough SWOT analysis of the business. In addition, the SWOT analysis also “provides a good framework for reviewing strategy, position and direction of a company or product” (Nyarku & Agyapong, 2011). Crucially, the SWOT analysis can be interpreted as to how “strengths may be leveraged to realize the opportunities and how weaknesses, which exacerbate threats or impede progress, may be overcome (e.g., Hofer & Schendel, 1978;

Schnaars, 1998; Thompson & Strickland, 1998; McDonald, 1999; Kotler, 2000)” (Nyarku &

Agyapong, 2011).

The SWOT analysis will be used in this senior project because it can very clearly summarise the key factors influencing a newspaper’s success both internally and externally as well as the possible directions that can be taken in the current and future position of the newspaper within the market. A SWOT analysis also can do this whilst also demonstrating the information in a clear and structured format which is easy to follow. As suggested by Valentin (2001), this paper will be using a resource-based SWOT analysis which “alleviates shortcomings of traditional analysis not by eliminating checklists, but by focusing on systemic causal issues that afford more perspective, reliable, and actionable insights.”

4. History of The Sun

15 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET The largest newspaper in the UK by daily circulation is The Sun newspaper. For this reason, we have selected this title as one of the newspapers we examine within this thesis. The

Sun is owned by Rupert Murdoch who is a world-famous media tycoon. Forbes lists Murdoch as the 96th richest person on Earth with a net worth of $13.1 billion (Rupert Murdoch & and family, n.d.), and he and his family are the 39th most powerful family in the world (“The

World's Most”, n.d.). This serves as a useful testament to the fact that in relative terms he is more powerful than he is rich which is indicative of most media empires. He has used his power and influence in many ways over the years, such as holding a fundraiser for Hillary

Clinton in 2006, his company’ donating $1 million to the Republican

Governors Association in 2010 and using Fox News as a means of supporting Donald Trump since he became president until recently. It is clear to see that the ability of such an individual who controls many media outlets with extensive global and local reach has a significant capacity to persuade public opinion. It is also true that his immense wealth (which he has obtained from his media empire) provides him with the ability to buy influence also, as others have done throughout history (“Murdoch fund-raiser”, 2006; Rutenberg, 2010; Sherman,

2016).

The Sun newspaper has sold the most copies yearly since 1980. This has had the effect of ensuring that The Sun newspaper has become a “household name” within the UK particularly with the less economically advantaged demographic. This reputation has continued till 2020 when The Sun reported that 87% of their readership earn under £30k per year. Despite 21% of the United Kingdom already earning at least 30k yearly, according to

Smith (2019), this would suggest that The Sun has a strong following in the less economically advantaged.

16 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET 4.1 SWOT - The Sun

4.1.1 Strengths

One of the largest strengths attributed to The Sun is its extremely strong brand.

According to The Sun, they are the biggest selling newspaper in the United Kingdom claiming to sell 18 newspapers per second. Although this figure is possibly slightly inflated, according to the Audit Bureau of Circulations in 2019 (as cited in Tobitt, 2019), The Sun had a daily newspaper circulation of 1,217,029. Having said this, The Metro did have a higher average circulation than The Sun at1,421,309.

However, it is important to recognise an important distinction that The Sun is a newspaper which has a cover price (the consumer must purchase the product). Whereas The

Metro is a newspaper that is distributed to consumers for free at the point of consumption, comparing these two newspapers is therefore not a fair comparison. If we compare The Sun newspaper to the paid for newspaper with the next highest circulation, The Daily Mail, we can see that The Daily Mail had an average daily circulation in 2019 of 1,133,268 as compared to The Sun which had an average daily circulation of 1,217,029. This would suggest that in terms of paid newspapers The Sun has a considerably larger circulation and hence brand. It must also be stated that the business model of The Metro can only function in highly urbanised areas (Tobitt, 2019).

The Sun newspaper is also a household name and has a certain degree of brand loyalty which other newspapers and media sources may not have. This would suggest that the price elasticity of demand for The Sun newspapers to be rather high. This brand loyalty can also be seen in the reporting of sporting events by the newspaper, something many consumers purchase the newspaper solely based upon.

17 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET 4.1.2 Weaknesses

As stated above, The Sun newspaper has a large following of the most economically disadvantaged consumers in the UK with 87% of their readership earning under £30k yearly.

This could see them suffering under the current business model followed by The Sun. For this reason, with the emergence of free media this would be more tempting for the more economically disadvantaged consumers to purchase.

This may be one of the reasons that newspapers following a different business model such as The Metro are now overtaking The Sun newspaper in circulation as consumers are not expected to pay for the content they observe in the traditional way. This is especially worrying for The Sun as The Metro has been running for far fewer years than The Sun and therefore would be expected to have a far less dedicated readership. In fact, Rupert Murdoch himself, the owner of The Sun, stated in 2005 that he was “worried” about The Metro newspaper due to the belief they were stealing circulation from The Sun. He later attempted to open a new newspaper with a similar business model to The Metro, called The paper in 2006; however, it closed in 2009 (Brook, 2009; Teather, 2005).

According to Valentin (2001), simply having a large market share should not be considered too much of a strength if it is not leveraged enough to allow the business to continue to grow and pursue its opportunities. Whilst remembering that The Sun is in a good position being one of the largest newspapers by circulation in the UK, it is important to understand that this does not necessarily mean future success is guaranteed. It also stands to reason that this could breed a corporate culture of overconfidence and hubris.

Another weakness possessed by The Sun newspaper is detailed in the demographics of their customers. The average age of The Sun reader is 49, with just 29% of consumers aging between 15-34, 35-54 had 33% and 38% of the newspapers readership in traditional print

18 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET form were aged over 55. This is concerning for The Sun newspaper due to the fact that the older generations tend to have more difficulty adjusting to the online format. This can be demonstrated in the fact that in the 15- 34 age bracket of online circulation is 47% of overall online circulation, with the 35-54 age bracket representing 36% of online circulation and those aged 55 and over represent just 17% of the total online circulation with an average age being just 36. (“The Sun”, n.d.). This can be demonstrated in the fact that The Sun as of 2019 has an average daily circulation of 1,217,029 newspapers in traditional print form according to the audit bureau of circulations and despite them being the largest online newspaper in the

UK has an online reach of 29,286,000 (Ponsford, 2019).

One of the major weaknesses faced by The Sun newspaper is their reliance on their sports coverage, of which they claim to be one of their core pillars. For this reason, historically if an individual could not watch a sports fixture then they could read about it in the next edition of the newspaper. However, as television and the internet have become more popular, it is now possible to watch these sports fixtures on mobile devices practically anywhere and usually for free. In the case that a sports fixture is not televised then an individual can read about the match live and receive live updates regarding how the different teams are performing. This practically negates the necessity of purchasing a newspaper at a later date to read something they could obtain free and live.

It is also the case that the need for opinion based expert journalism in the field of sports is a less compelling attribute as compared to other areas of journalism such as politics or the economy, where the insight and authority of a particular journalist can have a greater impact on the perspective of the position being advocated by the newspaper which can have significant resonance with its target readership. For this reason, The Sun is potentially

19 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET disadvantaged due to the decline in the importance of this core value moving forward for reasons stated above.

The value of The Sun’s journalistic integrity is also a large weakness for The Sun. Not only is their content regarded as not being particularly insightful by many individuals, as confirmed in a study conducted by The PRWeek (2013), 47% of consumers who responded believe that The Sun has the worst reputation for journalistic quality in the United Kingdom.

As compared to with just 20% or with 16% (“Reputation Survey”,

2013), admittedly this study was conducted in 2013 but still demonstrates that despite being the most popular newspaper for many decades, their use of sensationalism and scandal has led to a reduction in the public's trust of this newspaper.

In this senior project’s opinion, whilst the strategy of producing wildly sensationalised media has worked extremely well until recent history, with the adoption of the internet and the subsequent rise in the popularity of ‘click bait’ traditional media will struggle to compete with the barrage of other sensationalist media on other platforms. In fact, these other platforms have an advantage over traditional media in providing sensationalist content as was presented earlier, traditional print media and the organisations/journalists surrounding them are susceptible to libel meaning that whatever they say must be supported by some grain of truth or they are susceptible to lawsuit.

In the case of online platforms, anonymity means that it is far more difficult to identify the people creating and profile featuring this content. Aside from this in the event that it is possible to find the people responsible for producing and sharing this media they can be on an entirely other continent making it more difficult to prosecute the guilty party. In this sense, these media sources are free from the constraints placed on traditional media and therefore have a competitive advantage.

20 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET 4.1.3 Opportunities

One opportunity that The Sun can take would be to continue their growth in the online market. The Sun already has the largest online presence reaching 40 million devices per month (“The Sun”, n.d.). Interestingly, their online presence seems to have a wealthier market, with 22% earning over 30k as compared to just 13% on traditional print. Secondly, the consumers of the online newspapers are made up of a greater proportion of female consumers. In traditional print media 57% of the consumers were male. However, in digital format 53% of the consumers are female. This trend is continued in other online platforms such as Snapchat where 68% of consumers are female, in the case of Facebook 70% of consumers are female.

This would suggest that the online content is either more entertaining to females, or that the form of marketing utilised by The Sun for its online presence seems to be more effective at appealing to women. Therefore, an opportunity to The Sun would be to either this form of advertisement to attract women to read print media. The Sun could also change the marketing they are currently doing in an attempt to encourage more men to move onto online platforms. In doing so, they may be able to appeal to more men and hopefully boost circulation.

If the reason for less men wanting to read The Sun newspaper online is because of the argument we made previously regarding the inefficiency of sports coverage by The Sun newspaper in print form, The Sun could either choose to broaden their journalistic view to incorporate more subjects appealing to men besides sport. Moreover, they could create an online platform on which people could watch sports and receive live journalistic input. In doing this, The Sun might be able to reduce the impact of sports now being seen as something people watch live and the issues that go with this in relation to print media.

21 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET Another opportunity that The Sun possesses is the ability to change their business model. One strategy they could adopt is a model similar to The Metro in which the newspapers are given away free of charge and the entire revenue obtained by the newspaper comes in the form of advertising revenue. Historically, advertising revenue has been the main proportion of newspapers with the cover price only contributing a small amount to the bottom line. However, there are four issues with this. The first issue being that as The Metro has been shown to prove this can only work in high density populated areas. The reason for this being that the distribution cost of sending free newspapers to relatively unpopulated areas is too high.

Secondly, an argument can be made that anything free at the point of consumption has no value as such by giving away your product for free one is in fact making it worthless in the eye of the consumer and damaging their own brand. This could have negative ramifications and in the most extreme cases actually turn loyal customers against their own brand as they view the quality of the publication to be diminished. It is also the case that releasing a free at the point of consumption newspaper can scavenge circulation from existing sister publications undermining the paid for model.

Thirdly, when newspapers are given away free at the point of consumption it becomes more difficult to measure how many newspapers were actually read, and therefore how many advertisements were observed. The reason for this is that it becomes impossible to tell how many newspapers were simply thrown away, or multiple given to one individual, etc. These tactics are far more difficult to detect as opposed to simply cash revenue from sales by circulation. For this reason, it can become more difficult to convince advertisers that the circulation figures are in fact accurate.

22 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET Lastly, advertisers may feel that they may not want to be associated with a newspaper that is given away for free, in a similar argument to the one made above about products given away free at the point of consumption have no value. In this sense, by deciding to make this move this could in fact result in a reduction in advertising revenue and a tightening in the market of which advertisers would be willing to work with the sun.

Another opportunity that exists for The Sun newspaper and by extension News

International would be to consolidate their position by purchasing other newspapers that appeal to the same target market. The seed capital necessary to start a daily newspaper on a national scale is incredibly large. Therefore, if antitrust laws would allow it this would enable

Murdoch to effectively monopolise his market. Murdoch has extensive experience in purchasing other newspapers, the basis of which has allowed him to build his media empire.

4.1.4 Threats

There are many threats facing The Sun newspaper. The primary threat as of 2019 seems to be the continuing trend for individuals to obtain their news from other sources such as social media platforms, other websites on the internet, the television, etc. As will be explored later, it is believed that this is the primary reason that newspaper circulation has fallen almost yearly since the internet began to become more popular in everyday life. This has also been attributed to be the cause of the reduction in advertising revenue as well. This is an industry wide threat but for reasons stated above (such as sensationalism) is affecting The

Sun just as much if not more than other daily newspapers. One reason for this is that The Sun is regarded as being one of the more sensationalist newspapers in the United Kingdom. This is because the market that The Sun is trying to appeal to is those who enjoy sensationalist content usually surrounding celebrities, sports stars and some base political issues. The threat facing The Sun newspaper is that there have now become many more platforms for

23 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET consumers to obtain sensationalist content, such as articles on Facebook, YouTube commentaries and other online platforms.

The Sun is also at risk of other newspapers gaining a larger online presence than them.

As of March 2020, most major newspapers in the United Kingdom are running their own online newspapers, many of which are directly competing with The Sun such as The Daily

Mirror.

5. History of The Daily Telegraph

The next newspaper we would like to conduct a SWOT analysis on, would be The

Daily Telegraph. The paper was founded in 1855 by Arthur B. Sleigh. According to all sides, the paper is centre right leaning and appeals to conservative, middle class individuals (“The

Telegraph”, 2016). The paper is still relatively well circulated with the Press Gazette stating that the total average circulation for November 2019 was 309,167 (Tobitt, 2019). However, in

2020 The Daily Telegraph has decided to no longer be a part of ABC circulation audit. The reason for this stated by The Telegraph is that they feel the ABC Circulation audit does not accurately reflect the true success of the newspaper as The Telegraph is using an online subscriber policy. Having said this, the Institute for Practitioners in Advertising (IPA) are unhappy about this decision. The predominant reason for this is that circulation figures provided by ABC Circulation audit are remarkably useful to advertisers who are interested in the scope and reach a particular newspaper has. Therefore, if The Telegraph has removed itself from the ABC Circulation audit then it will be more difficult for advertisers to know what the appropriate price of an advertisement placed in the newspaper should be.

5.1 SWOT - The Daily Telegraph

24 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET 5.1.1 Strengths

The Daily Telegraph is a well-respected newspaper, and has a long-standing reputation of being trustworthy with a high degree of integrity. The trust they have accumulated over significant time in the eyes of the public is likely to help the newspaper stay popular at a time when sensationalism is rampant. This is manifested with extremely strong brand loyalty not afforded to some other newspapers.

Their reputation also means that they are able to recruit many high-level journalists from outside the newspaper, and hence proliferates their reputation. This provides a strength that other newspapers may fail to have and therefore provides The Daily Telegraph with a competitive advantage.

The newspaper also has a sizable circulation, with it being the third most-visited

British newspaper website (MBA Skool Team, 2020). As such, the newspaper has performed well in leveraging its first mover advantage and is well placed to maintain its position in the market as one of the UK’s leading online newspapers.

One aspect of the newspaper that is a huge strength but is often understated is its ability to allow consumers to write in and share their opinions on an article regarding a particular issue. This helps provide a community surrounding the paper, and utilises some of the benefits of having an online interface. Many people enjoy reading The Daily Telegraph due to the ability to also consume media composed by individuals who are similarly minded to them and yet not hired by the newspaper themselves.

Brand reputation is one large strength of The Daily Telegraph. According to All Sides

(2016) which conducted a bias rating test on The Telegraph, they have labelled the newspaper as right leaning. Britannica also states that the newspaper is right leaning and conservative.

25 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET Whilst it is true that the newspaper is not entirely un-biased, it has a reputation of providing generally unaltered content (All Sides, 2016; "The Editors", 2020).

Another strength would be that the newspaper seems to have orientated itself well in terms of online readership. According to figures from 2013, combined readership (in print and online) of The Daily and Sunday Telegraph in thousands was 4,899, of this 1,848 was online readership. If we compare this to other newspapers with The Sun with a combined readership of 13,476 and an online readership of just 1,076, this would suggest that not only is the readership of The Telegraph more able to adapt to technological changes, but also that The

Telegraph has orientated itself well in terms of online readership (Hollander, 2016).

5.1.2 Weaknesses

Stop the distribution of bulk copies, bulk copies are newspapers that are distributed to other firms such as hotels and airlines, as of mid 2018 the daily telegraph was distributing 331000 newspapers a day and then another 90,960 Bulk copies, if these numbers were to reduce, cost would be also be cut and as a result possibly profit would be increased (Johnston, 2018).

A weakness that The Telegraph has is related to the possibility of acquiring or merging with another title as it would appear that the Telegraph does not have the knowledge of how to do so. The reason for this is that they have previously never merged or acquired any other business and therefore may lack the necessary skills to do so. It is well-known that many mergers and acquisitions fail, even if the firms engaging in this behaviour are experienced in acquisitions. Therefore, the lack of experience existing within The Telegraph media group is a serious weakness and should be rectified.

With the prestige that comes from working in such a well-known and respected newspaper, it is also possible that the journalists have more control over their power within the corporation in knowing that they could most likely apply for a job in a different

26 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET newspaper and receive it. This would suggest in theory that the directors of the newspaper have less authority over their staff possibly causing weakness.

Another weakness of The Daily Telegraph is that it has been embroiled in scandal regarding its connection to the conservative party and has even been mocked by Skwawkbox

(2020) who insist on calling it ‘the daily Torygraph’, a play on words referring to the word

“tory” to represent the conservative party. As such this has resulted in The Daily Telegraph being alienated from part of the market that would have found their work interesting, but refuse to read it as they are supporters of a different party. This apparent alignment with the conservative party has also resulted in a lack of trust in the paper by some bringing into question its credibility.

5.1.3 Opportunities

One opportunity available to The Daily Telegraph would be in using their new found online presence to market more efficiently their readership and as such hopefully increase their advertising revenues. An argument could be made by The Telegraph that their readership which is growing steadily is unlikely to start using other online sources and therefore The

Telegraph as a means of advertising to this sizable number of consumers is still many companies’ best option. The Daily Telegraph has also decided that it will opt out of the ABC audit in coming years. Their stated reason for this is that the figures do not accurately reflect their move to digital. However, this provides an opportunity to The Daily Telegraph in the sense that it will be more difficult for advertisers to understand the reach and circulation of

The Telegraph. This could potentially place more negotiating power in the hands of The Daily

Telegraph when negotiating with advertisers (Stewart, 2020).

27 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET Another opportunity that The Telegraph has would be to merge or acquire other newspapers or magazines. By doing so, The Telegraph could increase its market share whilst acquiring new skills in terms of their human resources.

As The Daily Telegraph is a centre-right conservative newspaper, it is also the case that the consumers purchasing The Daily Telegraph are similarly of a centre-right conservatives’ position and as such are presumably wealthier than the consumers purchasing other newspapers such as The Sun. This means that as The Daily Telegraph increases its cover price as it has been doing, this is less likely to cause a fall in demand as compared to other newspapers attempting to do the same as this is due to the relative elasticity of demand for

The Daily Telegraph in terms of cover price increases. As cover price revenue is becoming a greater proportion of many newspapers’ overall revenue, this will benefit The Daily Telegraph in coming years (Wells, 2020).

5.1.4 Threats

The Daily Telegraph is facing many threats, many of which being similar to that of

The Sun - namely that the sheer volume of media available online today has outshone the traditional newspaper industry. One specific threat posing The Daily Telegraph lies in the fact that the consumers purchasing The Daily Telegraph tend to be older. This not only makes the newspaper susceptible to a decreasing readership through natural attrition, but also means that the younger individuals who are familiar with online media are presumably going to be unfamiliar with The Daily Telegraph’s online presence and indeed printed presence in coming years. According to Intermedia (2017), The Daily Telegraph has the oldest average readership of 61 years old. This poses three major problems to The Daily Telegraph.

The first problem stems from the fact that by the very nature of ageing, The Daily

Telegraph’s consumer base is declining year on year as discussed above. Secondly, this means

28 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET that the newspaper may become identified with the elderly, making it more difficult for The

Telegraph to attract new readership. Thirdly, generally speaking, younger individuals tend to be more left leaning and as such are unlikely to be attracted to a centre-right conservative title such as The Telegraph.

6.1 COVID-19 Implications

It is also important to reflect on how the newspaper industry must gear itself post

COVID-19. COVID-19 has had serious ramifications affecting many industries as well as countries alike. This can be seen most poignantly in the contraction of the US economy by a staggering 32.9%, according to Klebnikov (2020). As the global economy has suffered tremendous decline due to the virus this has not left the newspaper industry untouched.

One major factor that has made the newspaper industry suffer would be from the lack of material available to newspapers particularly regarding sporting events. Sport has been an important aspect for many local and national newspapers for generations, indeed many people from older generations purchase newspapers distinctly because of their sports coverage. This can be seen very clearly in the case of The Sun newspaper in the United Kingdom which is bought by many to read their coverage of the most recent football matches. During the pandemic, many countries decided that sporting fixtures should be cancelled due to the increased likelihood of spreading the COVID-19 virus should they continue. This not only left newspapers with the issue of how to fill this section with no new material, but also cut off a revenue stream from those consumers who were buying the newspaper predominantly for the sports coverage.

Another major issue that newspapers have been confronted with post COVID-19 would be that of advertising revenue. As mentioned previously, COVID-19 has had serious

29 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET effects on the global economy which has led many small, medium and large businesses filing for bankruptcy and the majority of businesses still surviving seeing serious issues facing them, not only in terms of revenue, but supply chain issues also. This has meant that many businesses have limited (or speculation of limited) resources which they can allocate towards advertising directly, cutting the advertising revenue of many newspapers. Local newspapers are feeling the brunt of this particularly hard as evidenced but the fact that local newspapers are generally reliant on local, small business for their advertisements revenue. These businesses in many cases also have been hit particularly hard by COVID-19.

As reported by the BBC, many newspapers within the UK have been forced to furlough their staff resulting in newspapers across the country being forced to operate with far fewer staff than normal, as well as working with the issue posed by communicating between staff members entirely online as opposed to face to face. This understandably may have the implication that staff members are overworked and the general quality of the product is decreased (McGarvey, 2020).

In some countries such as the UK the government is advising that individuals stay home as much as possible and refrain from any non-essential travel. Some businesses such as supermarkets have adapted to this quite well and have instituted contactless deliveries eliminating the need of many to leave the comfort of their own home. The government is particularly concerned about the well-being of the elderly who seem to be most affected by

COVID-19 and are therefore at the most risk. These high-risk individuals have been strongly advised not to leave their home under any circumstances. This has had the knock-on effect of many of these elderly individuals not being able to go to their local shop and therefore not being able to purchase newspapers yet again reducing the revenue of newspapers.

30 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET Whilst the cover price of newspapers has historically made up a very small proportion of a newspapers’ revenue compared to advertising revenue, this is beginning to change.

According to a new research study in 2007 ("Trends and Facts", 2020), the total advertising revenue of newspapers in the USA was $45,375,000,00 whilst cover price revenue was just

$10,294,920,096. However, in 2018 the advertising revenue in the USA of newspapers was estimated by the same study to be $14,346,024,182 and the cover price to be

$10,995,341,920. As clearly demonstrated, cover price and circulation revenue are becoming more important to newspapers than ever, suggesting that the move towards newspapers without a cover price would be counterproductive.

Alternatively, newspapers may be left with no choice but to relinquish their cover prices in the coming years.

One of the compounding issues that has developed over a period of time would be the success that the newspaper maintained even after the introduction of competitive technologies through their history. The most salient examples of technology which emerged and were anticipated to take advertising revenue from newspapers but in reality never achieved this aim was the radio and the television. Despite the widespread adoption of the radio in the

1930s and the television after the end of the second world war, neither of these forms of media managed to significantly attract advertising revenue from newspapers as we have experienced with the internet.

The main reason for this lies in the fact that the costs associated with producing an advertisement and distributing said advertisement remained remarkably high in both physical and non-physical forms seen in newspapers, radio and television, this was not the case with the internet. This meant that there was no inherent advantage to companies deciding to advertise in radio or television and the newspaper industry remained strong. This was also

31 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET compounded by the fact that the newspaper industry had a huge degree of credibility and often long-standing relationships with those wishing to place an advertisement.

When the internet eventually achieved wide-scale adoption, the existential threat this posed to traditional media was ignored. This was partly due to complacency as those individuals in positions of authority within the industry brushed off the possibility that the internet could indeed herald the end for the newspaper industry as this had been signalled many times previously not least of which was with the emergence of television and radio which failed to have a material impact on the newspaper industry.

We must also consider that many newspapers were owned by large media conglomerates that also owned radio stations as well as television stations. These afforded media moguls a large degree of confidence over the decades preceding the internet which may have contributed to the fact that they saw themselves as irreplaceable and remarkably powerful leading to their ignorance when the internet started to become a true competitor.

Not only was the newspaper industry slow to adapt to this new threat, because of the reasons described earlier, they actively thought they were immune from the effects of the internet. As the relative cost of creating, placing and distributing an advertisement on the internet is far less than with a printed newspaper, many businesses made the choice to swap to advertising online. Crucially, when newspapers began to distribute themselves online, they made the fatal error of not reducing the prices they charged for an online advertisement in line with the relative cost associated with creating and distributing the advertisement. Therefore, they effectively priced themselves out of the market.

7. Other Issues Facing Non-UK Based Newspapers

Another compounding issue facing the newspaper industry outside the UK is the issues of subscriptions. The UK does not distribute their newspapers via subscription but

32 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET rather through shops due to the high density of population in the United Kingdom. Other countries however such as the ones seen in mainland Europe of the USA do operate on a subscription basis. The concept of the subscription distribution system is that the individual pays a subscription fee to a newspaper and in return that newspaper is brought to their door via a postal service. This system worked very well when newspapers were exceedingly popular however two issues have arisen in recent years.

The first issue lies in the fact that demand for newspapers has decreased so much. This means that the distribution cost of the newspapers is being determined by an ever-smaller number of consumers increasing the cost from those consumers and in many cases leading to cancellations of subscriptions and compounding the issue.

The second issue is based on the fact that as the distribution is done downstream, the newspapers themselves are heavily reliant on the postal services. The reason for this is that there is minimal competition in the postal service sector which could effectively replace the longstanding relationship between newspapers and their distributors. Arguably, this has allowed distributors to increase the price of their service over recent years increasing subscription costs which have not already been partially absorbed by the newspapers themselves. This also compounds the issue regarding spreading distribution costs across fewer and fewer consumers.

Having said this, there are various strategies that these newspapers could adopt in order to continue operating which include mergers and acquisitions, moving entirely onto an online operation. If newspapers were to adopt the strategy of moving their operation online, it would be this senior project's recommendation that they do so with an online subscription based service. The reason behind this is that the advertising revenue once seen by newspapers has declined significantly over the past years as previously been described. As previously

33 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET stated, however, the once relatively insignificant revenue obtained from the cover price is becoming vastly more important than even previously thought could happen. As such, whilst the advertising revenue continues to fall it is possible that these newspapers could continue to operate almost entirely based on the revenue obtained through the cover price.

When we consider that a great deal of cost will be removed in each newspaper as they shift their attention online the contribution to the overall profitability of the newspaper made by the cover price is set to increase. It must be stated though that there is one issue posing these British newspapers which comes in the form of the British Broadcasting Corporation

(BBC). According to the office for budget responsibility, they predict that the BBC is spending approximately £4 billion between 2018-19. This not only means that they can afford to cover a vast array of topics but also that they are able to provide online news free at the point of consumption to the British public (Office for Budget Responsibility, n.d.). Whilst the

BBC is not in direct competition with these newspapers especially considering the inherent neutrality the BBC must observe, this has created a view in the eyes of the British public that even quality journalism online should be free. This perspective held by many consumers in the UK will be difficult to change when it comes to bringing newspapers online with a paid subscription service. Having said this, the financial times and Wall Street journal has managed to do this quite well. One reason for this lies in the fact that the economist as well as some other newspapers such as the Financial Times have both adopted a strategy of appealing to very niche markets such as those with a keen interest in finance.

It appears as well that newspapers will be forced to adopt a defensive strategy as demand for their product increases. As described above, there have already been significant reductions in employment across the entire industry and this is set to continue. One of the major reasons for this simply lies in the increased supply of journalism and the rampant fixed

34 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET and variable costs newspapers must endure which online individuals and businesses do not.

This is likely to cause animosity between employers and their staff which will be a struggle to overcome.

Going forward, there is also the issue facing the entire industry regarding its perception by society and employment trends. If the newspaper industry continues to appear as though it is a dying industry this will unfortunately have the impact of discouraging potential of employees entering the industry leading to a shortage of educated individuals specialised in areas such as printing. In the short to medium term this is likely to have any effect as demand for individuals with these skills is decreasing far faster than the supply and hence the large reduction in employment across the sector. On the other hand, in the long run, after the industry has been consolidated and necessary reductions in costs made it would be feasible to predict that the average salary accords the industry may begin to increase.

8. Suggestions for UK-based newspapers

If the success of these newspapers requires them to move online whilst also using an online subscription based system then it stands to reason that they should market themselves to a niche market. In the case of The Sun newspaper, many individuals enjoy reading the newspaper based on its sports commentary, particularly in the case of football. Many consumers also purchase The Sun because of its sensational coverage of celebrity scandal and events. It is the view of this senior project that The Sun should focus predominantly on these two areas of journalism in the hope that they can identify themselves as a brand with these areas in the eyes of the consumer.

Similarly, The Telegraph would also need to adopt a more niche standpoint, as it has been progressively doing for some years. As previously stated, this newspaper is a right leaning middle class newspaper that is predominantly bought by the elderly, the average age

35 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET being 61. It would be the recommendation of this paper that The Telegraph should move even more so to the right in its reporting to solidify itself as the newspaper for middle-class elderly right-wingers.

9. Conclusion

It is important to stress that the issues facing the newspaper industry are major, profound and severe. During the canal industry during the industrial revolution there was a period of time where canals were one of the primary forms of infrastructure particularly for the transport of goods. That was until the adoption of the railway which effectively killed the canal industry in its prime. It is clear to see how this analogy can apply to the newspaper industry which has been devastated by what is by many measures a more efficient and effective technology. Since Johannes Gutenberg, the newspaper industry has been the most popular form of information distribution until very recently. There are not many other forms of technology or indeed businesses which can claim to have been at the forefront of their industry for such a large amount of time. The Walkman for example or VHS, both were born and died in a matter of decades. Even the internet itself will most likely not resemble its current form in a hundred years to come. No business has a god given right to rule forever.

Having said this, it is hoped that the strategies suggested in this paper can not only slow the decline of these businesses, but also realign them in a new position within the market where hopefully they can continue to operate for many years to come.

36 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET

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41 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET

Appendices

Appendix A

Table 1 - Test for normality of global Google advertisement revenue

Table 2 - Test for normality of newspaper advertisement revenue in the USA

Table 3 - Correlation Matrix between USA newspaper advertisement revenue and global Google advertisement revenue

42 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET

Table 4 - An OLS model of USA newspaper advertisement revenue and global Google advertisement revenue

Table 5 - Test for normality of UK newspaper advertisement revenue

Table 6 - Correlation Matrix between UK newspaper advertisement revenue and global Google advertisement revenue

Table 7 - An OLS model of UK newspaper advertisement revenue and global Google advertisement revenue

43 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET Appendix B

Newspaper_advertisement_ revenue_USA Google_advertisement_revenue

120000000000

90000000000

60000000000 USdollars

30000000000

0 2001 2003 2005 2007 2009 2011 2013 2015 2017 Year

Figure 1 - A graph demonstrating the increase in global Google advertising revenue over time and the decrease in newspaper advertising revenue in the USA over time

44 THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET

Figure 2 - Newspaper advertisement revenue in the USA

45

Figure 3 - Global Google advertisement revenue THE RELATIONSHIP BETWEEN NEWSPAPER DECLINE AND THE RISE OF THE INTERNET

Figure 4 - UK newspaper advertisement revenue

UK newspaper ad revenue Google Global ad revenue

14000000000

10500000000

7000000000 USdollars 3500000000

0 2011 2012 2013 2014 2015 2016 2017 2018 2019 Year

Figure 5 - A graph demonstrating the relationship between UK newspaper advertisement revenue and Google global advertising revenue

46