Is the handwriting on the Net for the print trade?

As printing gets more expensive, people explore other ways of publishing information
PRINT IS dead. Kaput, finito, outta here. Well, there's a heck of an intro for a newspaper column, but here are the data points:

In Silicon Valley, the printing business is down 40 per cent in the past 24 months

Record numbers of printers are failing, being sold or merging

US magazines' ad pages are off by 50 per cent over the previous decade

America's daily newspapers haven't recorded a circulation gain in 30 years

Pundits have been predicting the demise of printing and print media for the better part of a century. Radio, movie newsreels and television were all supposes to kill ink-on-paper media, and plenty of people have said the Web represented the latest doomsday for print media.

But print has bustled happily along, oblivious of the dire predictions. Rumours of print's demise were greatly exaggerated, it seemed. Until now, that is.

Part of it is just old-fashioned market economics. Everything that goes into printing, at least in Western Europe and the US, is priced at near- record levels. Ink, paper and skilled labour are high, as are the capital costs of the hardware. As printing gets more expensive, people explore other ways of publishing information.

Banks have started to get nervous about making loans on printing presses. Presses cost millions, and take decades to pay off. Can't really blame a banker for wondering what the market for print will look like in 30 years. I'm not sure what the market for anything will look like in 30 years.

Indeed, there are lots of signs, at least in the US, that print is beginning to decline as a medium.

A report in the San Jose Mercury News noted that Silicon Valley printers were in their second straight year of double-digit decline. The same source also pointed to the record number of sales, mergers and failures of printing companies. The amount of used printing equipment on the market is so great it has depressed prices.

The reason is that Valleyites don't write letters on stationery, they send e-mail. They put up websites instead of mailing catalogues. When they do print, it tends to be short-run, custom jobs on digital presses or colour printers close to the point of sale.

E-mailers often sign their missives with their contact information - name, address, phone number etc, reducing the need for business cards. Personal Digital Assistant (PDA) users can beam their business cards to each other via infrared ports, and many e-mail packages support an electronic business card feature that plugs automatically into contact databases. Gone are the days of big runs of printed matter. One computer-maker stopped printing brochures because its products were often off the shelf by the time the stuff came back from the printer.

Intel stopped printing specification sheets and documentation for its microprocessors because the documents were often out of date by the time they were printed and FedExed to computer-makers

Now the chip-maker parks the latest documents in electronic form on servers, where partners can get the latest info within seconds of its release. Silicon Valley may well be a special case, but there are other, broader signs that print is in decline.

The New York Times reported that American magazines have, on average, lost half of their advertising pages in the last 10 years. There are many viable magazines, but the loss of ads means they've cut back on pages, another source of declining demand for print.

American newspapers have had good recent years, and newspapers as businesses have fetched record prices. But that doesn't change the fact that American newspapers, (unlike The Independent, which is recording rises year on year) have had the same circulation level for more than 30 years. The population has grown, but US newspaper sales have not.

The Internet defies efforts to measure its growth. The Net has gone from unknown to nearly 100 million users since 1993. Talk about circulation growth.

And market capitalisation tells a similar tale. In August, the Hearst Corporation announced that it would purchase the 139-year-old San Francisco Chronicle, reportedly for $660m. In June, three-year-old salon.com made an initial public offering, (or stock flotation) that recently valued the company at around $100m. That works out to $264,000 per employee for the Chronicle, but $1.6m a head for salon.com

Ironically, several up-and-coming startups thrive by selling printing over the Web. Hard-pressed printers are grateful for work, meaning they will offer discounts, which allows the websites to broker printing jobs, and make money, without actually having to print anything.

Outside North America, print media are doing just fine. India and China have 15,000 newspapers. Publishing was growing rapidly on the Pacific Rim before the Asian economic crisis. Muslim countries have tremendous growth in print publishing.

Indeed, local venture capitalists are fond of pointing out that less than 2 per cent of the world has Internet access. Only about a third have phones. All of which suggests print has a large and ready market almost everywhere except the wired West.

So: print is dead. Well, it kind of is, anyway.

cg@gulker.com

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