Google eats up Newspaper Profits

This may not be good news to newspaper publishing companies if we are to believe the recent report from Outsell. Outsell recently conducted its third annual News Users research which brought to light steep decline in newspaper circulation as readers are becoming increasingly tech savvy and now wish to read news online.

Outsell forecasted that there was a 3.5 percent annual decline in both daily and Sunday circulation. This lead to a huge decrease of newspaper readers and only 43 million would read Sunday newspaper by 2012, compared to more than 62 million in the early 1990s.

The research also unveiled the serious effect news aggregators like Google and Yahoo had on online and print industry. Around 31% of visitors prefer an aggregator while only 8% prefer a newspaper site and 18% prefer other websites.

Outsell analyst Ken Doctor mentions, “Among the aggregators, Google’s effect on the newspaper industry is particularly striking,. He also mentioned that, “Though Google is driving some traffic to newspapers; it’s also taking a significant share away. A full 44 percent of visitors to Google News scan headlines without accessing newspapers’ individual sites.”

This survey was conducted on 2,787 U.S. news customers about their various online and offline preferences. Google with its strategy of earning through another mans hard work may not last longer if all the news industry join hands and come up with stringent guidelines.