News UK chief operating officer and News Media Association vice chairman David Dinsmore has discussed the challenges faced by the news media industry and the importance of a "fair exchange" with the digital aggregators.
Discussing Facebook and Google’s online advertising dominance for a Digiday for a podcast at Cannes Lions Festival, Mr Dinsmore said: “A fair exchange - that’s all we’re asking for. We are providing an awful lot of content and we’re not getting the value back for it."
In conversation with US journalist, Brian Morrissey, Mr Dinsmore said: “Advertising is quite challenging. We’ve tried a lot of things and the industry has tried a lot of things and nothing is really changing that downward trajectory of print advertising. And digital advertising as well is beginning to flatten out and that is not surprising when 95-100 per cent of the growth is going to two of our largest friends from your part of the world.
“The best way to describe it and if I look at The Times in particular with regard to this, they have increased their sale in the last 12 months, so there are more Times’ being sold than 12 months ago. The same is true for another daily paper called the i, which has a much smaller circulation, but it has also increased its circulation over the past 12 months.
"Then we have two big free papers in the UK - The Metro and The London Evening Standard — they have also both increased volumes. All four of those titles, if they are not enduring double digit advertising declines, it will be near as damn it double digit declines.
"So the connection between the audiences are growing but their advertising revenues are falling and that’s the first time in history that has ever happened! So you’ve got this situation where the customer is going I really like this and I want to read more of this and the advertiser is saying the customers really like this but I’m not going to advertise against it.”
When asked how news media publishers are looking to tackle the advertising decline Mr Dinsmore said: “The easy way to say it is multiple revenue streams, but it is really hard to execute.
“But we’ve made some considerable strides, particularly on The Sun, to do that. We were helped about 10 years ago by launching a thing called Sun Bingo, which is a gambling product, and that has been very successful. Last year we launched Sun Bets which is more of a sports- book -type product which we are making good head with but it is hard yards to build these businesses.
“You have to integrate it into your products. You have to say ‘right we understand our customers, we understand how to integrate this transactional opportunity’ – whether that be read this story, click this link, pre- populate a betting slip, one click through to place the bet- it’s that kind of level of integration that you need to do.”
Discussing Facebook and Google’s online advertising dominance Mr Dinsmore said: “A fair exchange - that’s all we’re asking for. We are providing an awful lot of content and we’re not getting the value back for it.
“The interesting thing we are now finding is where publishing companies historically would just throw their content out there and the money would follow, now I think people are giving a bit of pause to it and thinking actually we need to have a stronger conversation up front on this before we actually say you can have our content.
“So I think we have a really important part to play in that ecosystem but it’s pointless us doing it [providing content without reward from online platforms] as we won’t be able to afford to do it long term. We just won’t have the revenues to sustain the 1,500 journalists that we employ at News UK.”
Mr Dinsmore discussed The Times exposé on national brands’ adverts being placed on Jihadi videos and the steps Brussels and the UK are taking to stop this.
“We come back to the quality media matters piece and actually particularly if you live in London just now or indeed Paris or Brussels and you experience first-hand terrorism- the London Bridge attack happened literally outside our office window – 200 of our staff were locked down in the office over night while that horrific situation was unfolding- and then you see platforms allowing brands we know and love, who have been our advertisers all along, to sit on jihadi videos then it is no wonder that there is a backlash of that scale. It is also at that point where the legislators start going enough is enough.
“The Europeans - Brussels in particular - have been leading the charge in this. I have also noticed in the last twelve months the Westminster politicians have also begun to wake up to this and realise that there is a real issue here.”
Major advertisers such as Vodafone and Unilever have been pulling their advertising from the tech platforms because of fears over ad fraud and brand safety. Marc Pritchard, Procter & Gamble global chief brand officer, was one of the first senior marketing figures to urge the industry to come together to tackle media transparency.
UK digital advertising growth forecasts have been cut because of the brand safety backlash, according to a recent forecast from GroupM. A recent study published by Newsworks showed that the safe environment provided by newsbrands for advertisers gives businesses a powerful boost.