Postmedia and its Digital Reinvention

Postmedia is one of the largest newspaper companies in Canada, housing many well-known and widely-read papers, such as The Calgary Herald, The National Post, and The Ottawa Citizen. The current CEO, Paul Godfrey, brought together the publishing rights of the bankrupt Canwest to form the new company in 2010. One of the major initiatives that has been announced by Postmedia is the Digital First Strategy, which attempts to digitally reinvent the company by developing digital editions of the newspapers. Smartphone and tablet applications, social networking integration and online newspapers are some of the innovations that have been implemented so far. Also, the company announced organizational changes which involved the expanding of a Chief Financial Officer's responsibilities to include Postmedia’s Business Technology Group, and the Chief Transformation and Revenue Officer's to include all revenue generating areas of business operations including digital operations, sales and business ventures. Similarly, a Digital Board Advisory Board has been established in the company to better develop digital strategies. These initiatives reflect on the extent of the digitalization efforts that are occurring in the company, ensuring that employees have specific tasks to improve the uses of digital technology. To further emphasize that fact, Paul Godfrey comments, “As we accelerate our business strategy, the continued focus for this fiscal year is on transformation and revenue development. This year our success is linked to ensuring that our product and sales teams work more closely than ever so that we maximize returns on our digital investments." On a broader note, online revenues in Canada rose 16% in 2010, as opposed to the 8% increase in the United States. These numbers demonstrate that Canadian newspapers are doing well, as John Hinds, CEO of Newspapers Canada, comments, contrary to popular belief. Although the numbers tell of the improving situation of Postmedia's financial situation, there is still more work to be done.
Furthermore, Postmedia's digital strategies are incorporating the idea of technology transfer, the process of transferring technology and knowledge among institutions to make it accessible to a wider range of users and develop them into maturity. It is being applied in a narrower setting than it would be traditionally, moving knowledge and technology within the company's various newspapers to make them available to more people and further develop the technology. There is much debate on the new direction of the newspapers, as some view the digitalization as a threat, but there are also increasingly more people believing that the "idea of journalism isn't changing," but just the tools, arguing that historical transformations have always involved a long period of evolution before the acceptance of change. The process of the digitalization of newspapers is still in a transitory stage, as proven by the varying number of successes and obstacles that Postmedia is facing. However, the underlying idea in Postmedia's digital initiatives is contributing to the increasing possibility of the breakthrough of digital newspapers by testing and improving new strategies, although there are inevitably some weaknesses due to the technology use being relatively new and unexplored. As Phillip Crawley, The Globe and Mail's publisher, comments, "At the moment, nobody could be sure what's the winning formula." suggesting that most of the audiences are buying and reading them for specific needs and the associated values, such as prestige or exclusivity. According to data compiled by NADbank, about 85% of Canadians read newspapers in print, and of the 15% online readers, most of them are also still reading print versions, as well. moving away from the traditionally private and closed method of information gathering; more emphasis is being placed on citizen journalism and interactive content. Some, like Alan Rusbridger, believe that the idea of digitalization is to reconfigure print for the current circumstances, and that it is "the next natural step all newspapers will eventually have to take.” Most major newspapers have introduced smartphone apps to suit the increasingly interactive community, and tablets have been promising for the industry. The iPad, for instance, has been referred to as the "pioneer of the next level of digital journalism," Martin Nisenholtz of the New York Times comments, "It's something you can really immerse yourself in, lean back and enjoy," as it combines portability with readability. An estimated three million e-readers were sold in the U.S. in 2009 and research firm Forrester expects sales of these devices to double in 2010, The sense of news having to be available whenever and wherever the reader desires it is strong and effective, and is supported by the recent influx for the markets of smartphones, laptops and tablet PCs. There are incentives that set it apart from the print version, such as portability, the ability to zoom in on the text, and having it read by a digital voice. The Herald was the dominant print newspaper in the local market before the Web, and has managed its resources to maintain the leading position in the highly competitive networked environment. According to comScore, the market reach of calgaryherald.com, measured in the number of unique visitors per month, is more than twice the nearest competitor: 636,000 uniques in October 2011, compared to 244,000 for the calgarysun.com, and 212,000 for CTV Calgary, during the same month. Localization relates the news more strongly to the reader, allowing the filtering of desired information and creating a stronger sense of connectivity to a specific community. Incorporations of social networking media on the websites also allow the reader to easily share with others, reflecting on the social nature of humans and their desire to share information. The strategy reflects on the realities of technological changes in the present day society, as the uses of such social networking sites have increased tremendously over the last few years and is where the bulk of the reading market is. The use of digital technology is thus redefining the purpose of the newspaper embracing the idea of the open newsroom. David Hedley, the Digital Producer of the Herald's website, describes a situation that powerfully illustrates Godfrey's vision and its advantages:
:"About 11:30 Monday evening, just after the main newspaper was put to bed as it turns out, Calgary police and bylaw officers swooped in on the Occupy Calgary encampment in the downtown core and began removing empty tents. The reporter, Deb Tetley, and photographer/videographer, Colleen De Neve, were there to cover the event. Scott Crowson, one of the assistant city editors, uploaded Deb’s text and several of Colleen’s photos around 1 a.m. Scott also produced an email alert, while several writers in the newsroom including Deb tweeted about the developing story. When I awoke Tuesday morning about 3:30 a.m. - I’m the early-morning web editor - I fired up my laptop from home and logged into the website. I added the rest of Colleen’s late photos, uploaded the video Colleen had edited from home about 4 a.m., added a poll to the story, reworked the headline to improve searchability, and posted it to secondary pages on our website. I would later post a conversation-starter on our Facebook page and also retweet the story with a new angle. By 7 a.m., the beginning of our peak website traffic period for the day, we had a full multimedia package on our website’s homepage about the overnight news event. In this example, you see a multiplatform newsroom in full flight: decentralized and team focused; not bound to the hard constraints of a daily press run and the printed newspaper page; and serving multiple networks in multiple media." The loss of profits illustrate the struggles arising while experimenting with new and different methods of generating more income for the digital and print newspapers. Also, it is notable that Postmedia already had a rough financial start, due to its origins being in a bankrupt company; while still under Canwest, the company wrestled with financial difficulties and lost digital momentum. These apps, while gaining audience, are not attracting a large one. Another encouraging sign for the industry is the increasing flexibility from newspaper publishers and printers, recognizing the need for increased creativity in product development and adding value. The industry is beginning to repair itself from its losses, with ad declines lessening and fewer publications closing. Next Issue Media predicts that US newspaper and magazine companies could earn $3 billion in consumer revenue by 2014 from sales of interactive publications on iPad devices, Although it is a very young, Postmedia has been experimenting extensively with different initiatives and heading towards the development and improvement of digital technology, such as tablets, smartphones and the internet. The company is taking advantage of the unique interactions that websites, Twitter, Facebook and other mobile platforms offer, transferring knowledge and technology within its setting and making their news available to a wider range of users. As more people test and use the technology, becoming familiar with the new form of delivery and seeking ways to improve it, there will be an increased possibility of a breakthrough method of digital newspapers. Pam Laycock, Interim VP of Digital for Star Media Group, states, "When you've got first movers in an environment, they can set the initial rules of the game - but the rules keep changing. As things evolve, everything rightsizes itself."<ref name=Powell /> In this transitory stage of trial and error, no firm conclusions can be made about what is the right method for the newspapers of Postmedia, but experimenting, testing and developing different digital initiatives through the application of technology transfer is crucial for the company's success.

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