70% of newspaper costs tied up in print

Jun 6, 2009 by dirkthecow

I know the whole future of media debate is something I go on about a fair bit, but this stat reported in Reuters MediaFile really put things into perspective:

Moody’s debt analyst John Puchalla looked at the cost structure of the newspaper industry. His conclusion?

“Just 14% of cash operating costs, on average, are devoted to content creation — the primary value creation activity — while about 70% of costs support the print distribution model and corporate functions.”

The conclusion?

“Newspapers must “monetize” their online content.” Sounds good in theory, though in practice it’s maybe easier said than done.