Average pretax operating profit as a percentage of revenues is 20 percent and more for newspapers, compared with roughly 13 percent for all industry. And they have an opportunity to succeed greatly on the Internet if they can adapt their content to the new medium. Content is people, specifically the 450,000 newspaper employees who gather information from every city hall, school board, police station, legislative hearing and other activities in town, the state and nation and process the information for the public. Md. To be sure, newspapers will have to adapt their content to the broadband interactive Internet that is coming in the next five or so years. That's when personalized information will come to each individual through combination computer-TV sets.
Online subscribers growing The evidence today is that newspaper content does have a place online.
The Wall Street Journal online edition has more than 400,000 subscribers and is increasing that number by 15,000 a month. Knight Ridder, publisher of the Miami Herald, San Jose Mercury and other papers, reports that its Real Cities Web sites are often first in their local area. Simply put, distributing information through the Internet could be done at dramatically lower costs. To understand, consider that more than 40 percent of the cost of bringing a newspaper to the subscriber or newsstand lies in the paper, ink, printing, bundling, loading on trucks, unloading, delivering to houses, etc. At the very least, the potential for profit in newspapers of the future offers a powerful attraction for smart business people.