"We’re testing digital delivery in a couple different methods in counties remote from Central Arkansas," Hamilton said. "We picked those regions because they’re the furthest from Little Rock and the most expensive for us to deliver a printed paper."
Its distribution in the rest of the state, including Northwest Arkansas, will remain unchanged.
Hamilton said the company doesn't know which "test model" will be most effective, which is why it's experimenting with multiple approaches. "We know digital publication is the future. ... [but] we don’t really have an answer and we don’t know what comes next," he said. In both models, the company gives iPads to its subscribers, though it retains ownership of the devices. It also has a trained team of employees in its circulation department that teaches subscribers — many of whom are older people — how to use the tablets.
"We’re literally going into their homes, hooking up their iPads, sitting with people who are 90 years old and teaching them to use an iPad," Hamilton said. He said it's an "intensive process," but the early results are promising, especially in larger towns such as Jonesboro.
"We’re converting from 50
In the 20 east and north Arkansas counties in which home delivery has already stopped, the newspaper has so far distributed about 2,500 tablets, Hamilton said. It hasn't had a problem so far with people unsubscribing from the digital edition and not giving the iPads back. "It’s got to be less than five that we’ve lost … some people accidentally drop them or break them, but we haven’t had a problem with [theft]," he said.
Across the U.S., daily newspapers continue to shrink, struggle and close as their ad revenue flow to tech giants like Facebook and Google. The Magnolia Reporter quoted Hussman's description of the decline:
“As recently as 1980, newspapers took in 31 percent of all (United States) advertising revenue,” Hussman said. By 2000, newspapers had 22 percent of the ad market.
“They still had enough revenues to have a good, robust news staff to report news and provide lots of opinions, to serve a watchdog function over government and business and labor, and also enough money to provide a profit and return for the owners,” Hussman said.
Revenues began collapsing when the Associated Press, the world’s leading news-gathering and distribution cooperative, started to sell content to Yahoo, Google and other Internet services, Hussman said. Those services began providing news to their users without charge. Many newspapers followed, he said.
“Despite all of these changes, newspapers continued to increase their revenues – not quite as much as other mediums did, but still increasing. All of that happened until 2006. That was the first year in the United States when newspapers’ total ad revenue declined for the first time in a non-recession year,” Hussman said.
Newspaper revenues have fallen annually every year since 2006. Nationally, newspapers now receive less than 5 percent of all advertising revenues.
Newspapers have responded to the newspaper revenue decline in several ways, Hussman said. The first has been to raise subscription prices. An Arkansas Democrat-Gazette subscription is $432 a year. The Banner-News is $180 a year. (magnoliareporter.com, which is NOT affiliated with either newspaper, offers free access to its exclusively online platform).
“But that’s not been enough,” Hussman said.