Reported in the NYT this morning:
The Seattle Post-Intelligencer will produce its last printed edition on Tuesday and become an Internet-only news source, the Hearst Corporation said on Monday, making it by far the largest American newspaper to take that leap.
We will see more of this, and in other media formats as well. We already have download only releases of songs (e.g. the UK hit from Gnarls Barkley in 2006) and 100% digital movie studios and I would hazard a guess it is only a matter of time before a minor label goes 100% digital or a major film eschews DVD distribution entirely.
In another sign of things to come the P-I, as it is known, will be much smaller as a pure web outfit – 20 people rather than 165. Obviously there is a natural reduction as there is no longer a requirement for physical production and distribution, but these cuts go further as the P-I is also changing the nature of it’s offering. Going forward there will be a greater focus on commentary, advice and links to other news sites at the expense of original reporting (although some of this will remain).
I have said it before but when media markets go digital they shrink. The removal of the physical side of the business means there is less cost and market forces will eventually bring revenues down to a level where there is a sensible but not excessive profit on that reduced cost.
In the case of the P-I going 100% web also means they are better able to share third party content (they can link where they probably couldn’t reprint) which means lower costs still. This was probably a necessity given that in their case the revenue adjustment has probably largely already happened as their income from local classifieds has gone away and they lose the cover price of the hard copy newspaper.