By Anne Nelson
If you spend much time in U.S. newsrooms these days, you might contract a serious case of gloom and doom. Talk is still focused on declining circulations, aging readerships, and the absence of new business models to pay for the production of quality content.
But it would be a mistake to assume that this is the case for the rest of the world. In fact, in many regions, the newspaper business is booming. Some countries’ newspapers are pulling in record advertising and those double-digit profit margins that were common in 1990s America.
I recently had the chance to observe this phenomenon firsthand at the Bogota, Colombia, conference of the World Association of Newspapers and News Publishers (WAN-IFRA), where there was little gloom or doom to be found.
Instead, newspapers were reporting extraordinary growth in advertising sales from 2005 to 2009: 62 percent in Argentina, 70 percent in Brazil, and 57 percent in Colombia itself. (These figures, drawn from a ZenithOptimedia forecast, contrasted with 34 percent drops in the U.S. and the U.K. over the same period.)
Newspaper circulation is growing sharply in Brazil (29 percent), modestly in Argentina and Bolivia, and holding steady in Colombia and Chile. (It was down more than 12 percent in the U.S.)
But what’s most striking about the Latin American news industry is the sense of dynamism. The digital revolution is coming to Latin America — but it’s arriving hand-in-hand with the news organizations, and that makes all the difference.
That point was reinforced with a visit to the newsrooms of El Tiempo, Colombia’s leading daily. The newspaper understandably prides itself on the way it has implemented newsroom convergence. Its expansive headquarters are a few decades old, but look freshly minted, refitted top to bottom with new technology. They include the daily paper, two television channels (CityTV and Canal El Tiempo), as well as a vast array of online products.
In El Tiempo’s model, information is endlessly produced and recirculated across platforms. Pieces that air on the television channels are recut by a team of young online editors into two- and three-minute pieces that can circulate online. Breaking news goes out on Twitter, leading traffic back to the website and the newspaper. Each platform is carefully monitored for editorial quality.
According to newspaper director Roberto Pombo, “We had to appoint a journalist to be our Twitter editor because we had a report that went out on Twitter that diverged from the story on ElTiempo.com. It was a garden-variety error, but it convinced us we needed editors to be responsible for social networks.”
Pombo has shaped the paper’s news to be platform neutral. “We’re going with everything in every medium, and the audience can stay where they are,” he said. Pombo said the newspaper El Tiempo, whose staff create much of the core content, generates about a 9 percent profit, which is augmented by profits from the television and online operations. “Our newspaper readers are not diminishing, our online audience is growing, and the ads are holding,” he said.
Online earnings are smaller but are growing more rapidly. The company has no plans to charge for online content, but goes to great lengths to leverage cross-promotion.
“You can’t carry out convergence as a cost-cutting measure — but you save money in the long run,” Pombo said. “All I care about is that if somebody gets a news update on Twitter and somebody asks, ‘Where did you get that,’ they answer ‘Tiempo.’ It’s all about the brand.”
El Tiempo was founded in 1911 and long operated under the leadership of the Santos family. In 2007 the paper was sold to Planeta, a Spanish publishing group, which had to readjust to the Colombian market.
“The owners are living two realities. There’s an economic crisis in Spain, but things are fine here, so we have to explain it to them,” Pombo said. Spain’s newspapers are suffering worse than those in the U.S.
El Tiempo is not alone in its prosperity. Sebastian Hiller, director of La Vanguardia Liberal in the city of Bucaramanga, said, “Most of the major Colombian papers are making 15-20 percent profits, and some of them 30 percent, especially if they’ve been investing in convergence.” (One exception is the venerable Bogota paper El Espectador, which has recently struggled back from the brink of extinction.)
Slow, Steady Economic Growth Good for News
What explains the robust health of these Latin American news organizations? The first answer is the local market. The Andean nations have largely dodged the 2008 economic downturn, and have been experiencing steady growth in recent years.
Second, this growth has been more evenly distributed than in the past. Many Latin American countries are seeing incomes rise among the urban poor, and with them disposable income. This is a sweet spot for newspaper sales, since there may be discretionary spending for a daily newspaper, but not enough for a computer and an Internet connection.
In Colombia, as in other Latin American countries, there has been a boom in new tabloids and glossy consumer magazines, many of which subsidize quality broadsheets in the same company. Some of these tabloids have reached circulations of 2 million to 3 million within two years of their launch.
Capturing Digital Sales
Third, and perhaps most intriguing, digital is arriving in Latin America, but more slowly than in the U.S. and Europe. This has allowed news organizations to learn from other markets’ mistakes, and claim larger shares of the online advertising space before the search engines and aggregators can dominate it. The managers don’t care whether the advertising ends up on paper or online — as long as it ends up with them.
One of the side benefits of this development is a dramatic rise in quality. A number of papers in the region have expanded their foreign coverage and investigative journalism, and have won the prizes to prove it. (For a striking example, look to Costa Rica’s La Nacion, where exemplary reporting in 2004 landed two past presidents in jail.)
This is not to say that everything’s rosy south of the border. Mexican newspapers are under attack from narco traffickers and corrupt government officials, while Argentina’s leading newspaper, Clarin, is locked in a bitter contest with the government. On the other hand, news media are playing a stronger role in Latin American society than ever before, and their business models may buy them precious time to forge a path into the future.
Anne Nelson is an educator, consultant and author in the field of international media strategy. She created and teaches New Media and Development Communications at Columbia’s School of International and Public Affairs (SIPA) and teaches an international teleconference course at Bard College. She is a senior consultant on media, education and philanthropy for Anthony Knerr & Associates. She is on Twitter as @anelsona, was a 2005 Guggenheim Fellow, and is a member of the Council on Foreign Relations.