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This Section will review the implications of greater use of e-commerce for
cost savings, new costs, new business modes and international and other
issues for the following subsectors of activity:
• newspapers and magazines;
• television;
• radio and recorded music;
• film and video production and distribution;
• books; and
• gambling
7.2 Newspapers and magazines
The sector
The newspaper and magazine industry employs approximately
30 000 people directly and turns over about $5.9 billion a year. Its
revenue has traditionally come from three sources: unit sales, display
advertising and classified advertising.
The decline in circulations of newspapers is a global trend. The 1998
Media Usage Study by the Newspaper Association of America found that
over 20 years, the proportion of the population reading a daily paper fell
from 67 per cent to 51 per cent. (The Economist, 17 July 1999)
In Australia, the industry is highly concentrated, with two publishers,
News Corporation and Fairfax, dominating newspaper production, and
PBL and PMP dominating magazines. Magazine circulation has been
fragmenting, with the mass circulation titles like Women’s Weekly, New
Idea and TV Week, falling sharply, while a proliferation of new titles has
kept total sales steady.
Cost savings
The supply of online news and magazines reduces the massive overhead
of printing and paper and makes it much easier to publish information,
with opportunities for small and medium businesses, and community
groups to publish their own special interest journals.
The newspaper and magazine industry is presently the largest consumer of
printed paper, followed by retail catalogues and directories. The printing
industry’s annual sales (including services to printing and the manufacture
of paper stationary) is $6.8 billion. The National Accounts data suggest
that the books and newspaper sector consumes $886 million in paper,
printing and ink. These costs may be substantially avoided by the
electronic publishing of news.
Database driven direct marketing, such as telemarketing, direct mail and
household distribution may be considered forms of e-commerce. The
development of direct marketing, as a much more efficient means of
reaching consumers than mass media, is also resulting in cost savings.
New costs
It would be reasonable to anticipate a two per cent decline in newspaper
circulations over the next five years and a four per cent to ten per cent
decline over the next ten years. The larger number would be due to a
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