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Rupert Murdoch has added to the gloom surrounding the US newspaper industry, saying that the business model of most titles is under threat as classified advertising moves online and circulations fall further.
The News Corporation chairman, who once decribed classified revenues as “rivers of gold”, said: “Sometimes rivers dry up.”
Interviewed by Press Gazette, a UK trade publication part-owned by his son-in-law, he added: “I don’t know anybody under 30 who has ever looked at a classified advertisement in a newspaper.”
His comments came as Knight Ridder, the US’s second-largest newspaper group, yielded to shareholder pressure and retained advisers to explore “strategic alternatives”, including a possible sale, in response to rising newsprint costs, declining circulation and more competition from the internet.
Mr Murdoch, who owns the New York Post, indicated that US newspapers’ editorial strategies were to blame for their financial problems. “Outside New York, it’s all monopoly newspapers. Some have good work in them, but it tends to be overwritten, boring and elitist, not a reflection of the general mood in the public.”
After spending $1.5bn so far this year on acquisitions such as MySpace.com, a fast-growing online community, and IGN Entertainment, a games and content site, Mr Murdoch disputed the recent claim by Sir Martin Sorrell, chief executive of WPP, that some traditional media owners were panic buying new media assets.
“There’s no panic, and there’s certainly no overpayment,” he said. “It was a very careful strategy to go for the two biggest community sites for people under 30. If you take the number of page views in the US, we are the third biggest presence already.”
He admitted that News Corp was not the most profitable online media group, and said it had “a huge amount of work ahead to get that whole thing right”.
Mr Murdoch also criticised newspapers in the UK, where he owns titles including The Sun and the Sunday Times. Recent attempts to boost circulation by giving away a DVD with each copy must stop, he insisted.