Who buys the paper?

Article summary

The Economist wrote that for newspapers, the cost of paper to print on is soaring and that there is currently a frosty relationship between newspapers and paper mills - however it didn’t use to be that way. When ads were predominantly in the world of print, the two industries enjoyed an amicable relationship. Initially, as newspapers reduced the number of pages in their editions and moved to more digital strategies, paper mills had a rough ride. The mills, fighting for business, would take the prices dictated to them. Mills then started to diversify, many producing packaging for e-commerce. One Russian firm used to count newsprint as 70% of its business, now it’s 50% packaging. As demand continued to fall during the pandemic, many mills reduced capacity - however, with a rapid opening of economies, there has been a price spike for paper, with some mills also looking to pass on energy surcharges. The Economist writes that European papers will have to pay 50%-70% more than last year. One paper consultancy expects a big increase in the number of newspapers that will shut down as a result. The Economist concludes by suggesting that rising prices of paper will just be fuel to the digital fire for news outlets, resulting in further reduced paper demands.

What I thought

It is interesting to see the cooling of relations between the two industries, disrupted by technology, and how they handle an innovate-or-die situation. The Economist’s view that rising paper costs will only increase ‘digital adrenaline’ is fairly uncontroversial, I suspect. One interesting aspect about this battle is the decline in demand for paid sources of news. Social media, newsletters and podcasts all rival traditional newspapers in this regard. However, for those that do continue to pay for their news (myself included as an Economist subscriber), I suspect there will be a fairly large percentage that do value a print edition. One aspect to this, I believe, is actually having something tangible to represent what you are paying for. Of course, I enjoy the convenience of being able to read an edition online but I much prefer to engage with content that I can hold, scribble on and add annotations to. So, yes, it would be foolish to argue that print is not in decline - but I think there's some supportive demand on the way down.