• by Erik Sass  @eriksass1, August 24, 2007

Local newspapers' Web sites and cable TV news are losing audience to big online competitors, according to a new study released by the John F. Kennedy School of Government at Harvard University. Although much of the news was bad, the study--based on a survey of 160 news Web sites--also held out some hope for local news organizations.

As indicated by its title, "Creative Destruction," the study's underlying concern is the business disruptions in the news business caused by technological change. Before considering the Internet, the study takes a long historical perspective, tracing the rise and fall of different news media since 1963. That's when broadcast TV networks first entered the news business, devastating once-popular afternoon newspapers. Broadcast news remained dominant until the 1980s, when cable programming--both news and entertainment--began stealing its audience.

Now, the Harvard study sees cable TV news threatened in turn.

"In 2006 its daytime ratings dropped by 11% while its prime-time news audience fell by 12%." And it's clear where the audience is headed: Internet-based news.

Morning newspapers, which weathered earlier disruptions, are not only seeing their print readership decline--they're also failing to gain traction on the Internet versus a host of online competitors.

There are important exceptions to this generalization, the Harvard study concedes--most notably the big national newspapers: The New York Times, The Washington Post, USA Today and The Wall Street Journal. These sites enjoyed "an average gain of nearly a million unique monthly visitors" between April 2006 and April 2007.

However, regional papers aren't sharing their good fortune. "A few newspaper sites are attracting ever larger audiences, while most others are stagnant or losing ground."

Indeed, large-city newspapers are "poor cousins to their brand-name counterparts," the study says. "Their site traffic averages 1.2 million unique individuals a month--only about one-seventh of that of brand-name newspaper sites." Mid-sized-city newspaper sites, the next rung down, are attracting "substantially fewer unique visitors in April 2007 than they did in April 2006."

Finally, the sites of small-city dailies also are not growing. To summarize these results, the average traffic at newspaper Web sites has remained stagnant or declined, with the exception of the national brand-name leaders.

Looking for a ray of hope, the Harvard study points out that local newspaper Web sites still have several key advantages, which they are not exploiting. First, it notes that local news organizations are brand names within their communities, which can be used to their advantage. In a second and related strategy, their offline reach can also be used to drive traffic to their sites. Finally, they still have a local monopoly on the basic news product that few other news organizations can presently challenge.

Unfortunately, many local newspaper sites fail to leverage these advantages, often just updating headlines or sending out email updates.