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Newspapers vs. Online news January 31, 2007

Posted by Stephanie in allances, Internet, media.
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In the January 29, 2007 edition of Business Week, an article titled Yahoo’s Unlikely Amigos reported that many newspapers are considering joining the online world through an association with Yahoo. As “the world’s most visited home page,” Yahoo clearly has a lot to offer other companies who desire and more or less need the public’s attention on a daily basis. The nine companies involved represent 215 U.S. daily papers that hope to increase stock prices which have been sharply declining as more readers use online sources for news.

 

This raised my interest in the change of how people receive daily news. Just as the television revolutionized the 1960’s, online news seems to be taking great strides on traditional printed papers. Although “local TV news remains the most accessed source of news” according to a study reported by Rupert Murdoch , younger consumers prefer and are using the internet far more often. Of the study,

“44 percent of the study’s respondents said they use a portal at least once a day for news, as compared to just 19 percent who use a printed newspaper on a daily basis.”

 

Still some people are not as concerned with the possibility of the demise of printed newspapers. Just as the threat of television news occurred, some say that newspapers will remain in circulation. http://news.bbc.co.uk/2/hi/programmes/click_online/6220424.stm

 

Do you prefer reading news online or have a physical paper in front of you? Would you pay to view news online?

 

The original article about Yahoo refers to the association between the companies and Yahoo as a consortium. This interested me as the textbook in Chapter 3 talked about alliances, mergers and takeovers. The article interchanged “consortium” and “partnership.” I was not sure the exact differences and how to categorize the situation of Yahoo and the newspaper companies.

According to Wikipedia, “a consortium is an association of two or more individuals, companies, organizations or governments (or any combination of these entities) with the objective of participating in a common activity or pooling their resources for achieving a common goal. Each participant retains its separate legal status and the consortium’s control over each participant is generally limited to activities involving the joint endeavor, particularly the division of profits. A consortium is formed by contract, which delineates the rights and obligations of each member.” http://en.wikipedia.org/wiki/Consortium

With that in mind, I believe that the agreement would be considered a strategic alliance as they are still mutually benefiting from the relationship to achieve a common goal while still remaining independent. What do you think? Should they merge instead? Do you think Yahoo will eventually takeover newspapers companies?

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Comments»

1. Jordi - January 31, 2007

I get the Daily Item because the headlines are very funny (unintentionally) every so often.

I like print as it invites more leisurely browsing. Like, on a Sunday morning, I will read more eclectic things than I do on-line. On-line, I tend to be more mercenary, and rely on blogs or other filtering mechanisms to deal with info glut.

Plus, through BU, I have access to anything if I really want it.

I do kind of covet a print subscription to “the Economist.” But I would not have time to read it.


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