News sustainability: investing in the future of Asia-Pacific’s info-ecosystem is a report by Economist Impact. The report reflects the findings of two surveys, one of over 2,000 consumers and another of 500 executives, conducted across 12 of Asia-Pacific’s markets. The executive respondents work in organisations that span over 20 industries, with 145 respondents from government, 55 from non-government organisations (NGOs), 150 from the media and publishing industries, and 150 from corporates.
The report includes context and additional insight from in-depth interviews conducted with eight news media industry experts. The report was commissioned by The Society of Publishers in Asia (SOPA), and supported by the Google News Initiative. The report was edited by Naka Kondo and written by Georgia McCafferty and Jessica Mudditt.
The digital transformation heralded by the Fourth Industrial Revolution, and its acceleration during the covid-19 pandemic, has dramatically altered business models globally. That change has been especially acute for the news media industry. Trusted mastheads had to upend their traditional models to embrace an entirely new digital landscape; consumers ditched news sourced from television and newspapers for that found on their digital devices; and myriad innovative social media and digital news competitors emerged.
News and information are vital for all aspects of societies to function. These keep people informed and connected, engender empathy and understanding, and alert people to impending danger. Free market economies require easily accessible, reliable information to function efficiently, and societies rely on credible information to inform decisions in vital areas like health, public safety, investment, leadership and politics.
Conversely, news and information presented in silos can cause significant societal schisms. The covid-19 pandemic underscored the importance of access to reliable news and information and simultaneously highlighted fundamental issues that the news media industry faces as it grapples with new technologies and changing business models in an era of misinformation.
The results from these surveys and in-depth interviews aim to provide insights that may help news media industry executives, investors and policymakers build more sustainable news media companies. The report includes an examination of the perceived value of the news media industry, the ways that transformed consumer behaviour has impacted the industry, the role of technology as both a disrupter and an enabler of news and information, and potential future business models that may help secure the future of Asia-Pacific’s news media publishing industry.
- Market sentiment is bullish.
Rapid digitalisation caused by the covid-19 pandemic had a significant impact on news media companies in the region, but many organisations are rebounding. A large majority of executive respondents (82%) surveyed agree that profitability in the news media industry is healthy and sustainable, with news media executives (88%) especially positive. A further 83% of media and publishing executives surveyed expect healthy demand growth in their primary markets in the coming year.
- Value can be difficult to convert into revenue.
Quality journalism is valued highly by consumers and executives. But fundamental changes in consumer behaviour in Asia-Pacific and the emergence of new digital media competitors have left the old model of advert driven revenue redundant. Innovative models are required to drive growth.
- It’s clear that change is needed.
Fifty three percent of news media and publishing executives agree that their organisation’s current business model will not be viable in the next five years and 62% believe their organisation under-invested in digital strategies over the previous five years. Companies need to adopt innovative, technology-led business models that can grow revenue beyond advertising and subscriptions and enable news industry organisations to better adapt to the changed consumer behaviour and competitor landscape.
- Technology is a disrupter but also a vital enabler for the future.
Technology has created wholesale change in the news media industry, but consumers and executives agree that the adoption of new technology will be critical to long-term sustainability. While 87% of all executive respondents—and 84% of news media executives—believe digital technologies have helped increase the profitability of news media companies, 53% of executives also agree that digital technologies represent a threat to the business viability of the news media industry.
- Misinformation is costly to individuals and businesses and a serious threat to the news media industry.
It causes financial harm to people and businesses. Our survey found that 76% of consumers say they worry a lot about misinformation. Over three quarters (81%) of executives surveyed believe that misinformation is a significant threat to the long-term sustainability of the news media industry.
- A sustainable news media industry in Asia-Pacific requires creative, targeted content and innovative technology to further the news experience.
There is a dichotomy between the 54% of executives who believe that news media companies need to create new revenue sources or business models and the 46% who believe companies should intensify efforts to expand advertising sales or subscriptions. In comparison, experts are unified in their advice that news media companies will need to diversify into areas like events, podcasts and videos, online classifieds, or even cooking or game verticals, to build loyalty and revenue in the future.