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Salient. Victoria University Students' Paper. Vol. 26, No. 7. Tuesday, June 18, 1963

Advertising Rules Newspaper Roost

Advertising Rules Newspaper Roost

The newspaper industry in many Western countries is in a very unhealthy state.

Recently the Manawatu Times, a Palmerston North newspaper, closed down. Certain sections of the Press, particularly the more right wing ones, have been intensely angered by it. But it is not surprising that they should be disturbed. Nor is it surprising that they have not inquired very deeply into the matter.

Newspapers are owned by fewer people today than ever before. They have increasingly assumed the characteristics of big business. The present structure of the Press is a relatively recent event, and its origins worth considering.

Advertising outside the Press developed very rapidly during the nineteenth century in England. Hoardings and posters became so numerous that steps had to be taken to limit them. Sandwich board men had to be confined to the gutters to avoid congestion. This was all part of the development of display advertising, which became very important to industrial England.

Northcliffe and others, such as Newnes and Pearson, saw this new display advertising as the key to a new financial structure of the Press. As an alternative source of revenue, it made a reduction in the price per copy possible, leading to larger circulation, and eventually to larger profits. By about 1930 advertising was the main source of income for many newspapers, which 100 years before had been mostly financed from sales. Those newspapers which could not attract the necessary amount of advertising could not stay in business, and in many cases were closed down.

The profits of the large circulation papers increased, but those of the smaller papers declined. It became easy for the large ones to take over the small ones, and close them down. At the same time, as the growth of literacy created a wider newspaper reading public, the choice of newspapers grew more restricted. London, for instance, had nine evening papers in 1900. It now has only two.

Since the last war the process of amalgamation has accelerated. It was held up a little by the rationing of newsprint in England. This meant that lack of space caused larger papers to reject adverts that went to the smaller ones.

Consequently, when rationing was lifted in the late 1950s, there was a spate of closures. Since 1960, five English papers with a circulation exceeding one million have ceased publication. At least one other is losing heavily.

The introduction of commercial television has made things worse. Some newspapers acquired interests in Television companies, and made large profits. Others saw their advertising disappearing as ITV gained more and more viewers.

The papers that closed did not do so because no one would buy them. Their circulation proves this. They closed because they were not suitable as mass media for advertising.

In New Zealand these trends have not been nearly so pronounced. Many newspapers face little competition.

In many centres there are at most one evening and one morning daily. Advertisers, like readers, have little choice of paper. The process of amalgamation is thus slower, but it still takes place.

The closure of a newspaper in Palmerston North may have little effect on Weilingtonians. But it has a great impact on the people of Palmerston North. It is the smaller centres which are always likely to suffer.

A provincial newspaper has a much more limited circulation than a metropolitan one. It is as a consequence likely to be less secure financially.

Notice, too, that most foreign news comes through the NZPA. The smaller newspaper not serviced by this association is poorly placed to get overseas news. It is therefore not equipped, either editorially or financially, to compete with the larger papers.

It seems unlikely that the range of newspapers available to the New Zealander will Increase. In some cases it will continue to contract, particularly if TV takes a larger share of total advertising revenue in the future, as overseas experience would indicate.