Management at Work
Newspapers are under tremendous pressure to stay relevant as people increasingly turn to the Internet for news and feature articles. In response, many newspapers have enhanced their websites by adding more content, including podcasts, videos, and reporters’ blogs, and publishing breaking news on their websites well before the next edition of the newspaper goes to press. They then sell advertising on the website, and some put content behind a “paywall,” requiring users to purchase access through a subscription. For the most part, growth in revenues from online advertising and subscriptions has not offset losses of revenues from the print edition.
Ironically, as newspapers join the many other media companies that publish journalism online, there is that much more reason for people to cancel their subscriptions to the hard-copy edition and read the paper online. The newspaper companies are thus fueling the very trend that is leading to their demise.
Over the last year, the Central Times publishing company has invested heavily in its online presence. Its subscriptions manager recently surveyed people who had let their subscription lapse in the previous six months. Of those who responded, 86 percent said they no longer subscribe because they read the paper online. In response to the survey results, the publisher calls the editor in chief into her office and says, “Jax, I want you to pull together a cross-functional team that will prepare the paper to go entirely online within two years. Put them in the wing of the building we don’t use anymore since we had to let a third of our reporting staff go. They’ll report directly to you.”
According to the scenario, which of the following is the primary cause of disruption to Central Times’s business environment?
Establishment of a team to put the newspaper online
Subscribers cancelling their subscriptions
Distribution of content on the Internet
Selling online advertising and subscriptions