Newspapers of Tomorrow

Marcus Brauchli, Managing Editor, Wall Street Journal was in India recently to participate in HT leadership Summit. He is said to occupy the most powerful position in business journalism. Here are some excerpts from his interview with HT:

- Indian newspapers are among the truly independent newspapers of the world.

- I think newspaper industry in India is heading towards a consolidation. It will have to be more of a shake-out than mergers or buyouts. You are already feeling pressure from the internet, so the redundant newspapers will have to go.

- TV and internet would leave very little time for newspapers everywhere.

- I have a half baked theory that only one major newspaper will survive and people in influential positions will choose to read fewer papers. In most countries, including the US, there is room for one national paper. It will be like an island of clarity and authority in the vast and undifferentiated ocean of information.

- The dividing line between the business and general interest newspaper is also blurring. Our goal at WSJ is to provide the one newspaper you need to read.

Ref: HT Mumbai, 15 Oct. 07, P10

The views and insights of Mr. Brauchli are interesting and thoughtful. But his theory that there is space for only one national newspaper is questionable. Saying that there would be fewer newspapers is ok, but I don't agree that there would be only one newspaper. This condition would pose more risks than the gains. Competition is good for even the newspaper business. At present there are a great number of players, several of them survive only because they know and serve local readers very well. But as newspapers are going professional, like HT Media Ltd, and Jagran Group expanding, it would be difficult for smaller players to survive. Consolidation is a natural phenomenon in the life cycle of an industry, and then I think market would moves towards oligopoly (having few players). Having one national newspaper is having monopoly. Most of the times, governments don't allow any monopoly to form in critical industries. Though in the case of newspapers the government might like a monopoly, for political reasons, it is highly unlikely that it would actually promote or allow a monopoly newspaper to take shape. As a matter of fact, few monopolies are able to survive the competition unless the governments protect them. And Samuelson says, "In the long run, no monopolist is completely secure from attack by competitors." I think that the newspaper industry will have oligopoly, and not a single player monopoly. Even inside oligopoly, I believe in India we shall have collusive oligopoly, where the few firms in the market actively cooperate with each other.