The general trend in Denmark – which both editors described as a country with a small but mature editorial consumption – indicated that in the past few years there had been a sharp drop in the number of adults buying newspapers.
“The paid newspaper is quite simply in big trouble. Even in highly developed markets, people are not as willing to pay for newspapers as they used to be,” said David Trads, editor-in-chief of newly-launched free daily Nyhedsavisen, and the founder of Denmark's oldest first generation free sheet, Metro.
In fact, he added, if the current trend in Denmark continued, 2036 would mark the last year that paid newspapers were printed there. Providing free newspapers also democratised news by making it accessible to the masses who previously would not have been exposed to, or would have been unable to afford, newspapers.
“Free and quality will in the long run guarantee success. It will bring news to the people,” Trads said.
Tøger Seidenfaden, editor-in-chief of one of Denmark's leading paid dailies, Politiken, whose parent company prints a free sheet too, dismissed the free sheet as a “strange business model”.
The free sheet took the same production cost structure as the paid-for newspaper and put a financial loss-making slant on it. “We have to give it away on the net,” he said, but it made no sense not to sell the print edition to a loyal group of readers who were happy to buy it. “All the news is available all the time, even if people don't want to pay for it.”
In Denmark, there were two free national commuter newspapers and two free newspapers distributed nationally to households (a third national household free sheet had already folded). Seidenfaden described the latter group as a “freakish phenomenon” that could not and would not last. The household-distributed free sheet had medium editorial and production costs and high distribution costs. This made it unlikely to be a success in a long-term basis, as there were no compensatory cost-cutting factors.
“You would need a doubling (of circulation) and then another doubling and another doubling for household distributed free sheets to reach profitability.
“With low editorial, production and distribution costs, you can begin to make money, even though it's not a huge success story,” he said, which was why the commuter free sheet would remain on the newspaper landscape. Another factor with non-delivered free sheets that would contribute to their sustainability was that people actively chose to read them.
The Dutch editor and co-founder of Dagblad de Pers, Ben Rogmans, countered: “I don't think we are a freakish phenomenon. We have one million readers already.”
The 24-editorial page newspaper, which was launched in January this year, was presently losing money. They anticipated that situation would last for the initial 18 months to two years, he said. Dagblad de Pers was delivered to homes five days a week. He calculated that seven pages of advertising a day were required to break even in terms of the newspaper's operating costs, which was not an unrealistic advertising expectation.
“Why shouldn't we make a free paper with high quality journalism? Why do publishers think that readers don't want quality?” he said.
Trads estimated a capital investment of €100 – 200 million would be needed before Nyhedsavisen would begin to break even in 2010. Most of the money was used to fund the salaries of 100 writers hired to do breaking news, investigative and lifestyle reporting.
“We don't think it's possible to move into a market with strong competitors and beat them in a second,” he said, likening the growth of the free sheet to a marathon, not a sprint. What readers wanted was a high quality, simply written tabloid format companion to their morning cup of coffee, before they logged on to the Internet – a publication that was not a “catalogue” of the world's problems.
As a result, one third of Nyhedsavisen was devoted to what they described as “the world of power” – politics and foreign affairs; one third to “the world of fascination” – stories that people enjoyed reading on the Internet, such as a python eating a goat, for example; and “the world of yourself”, which was very local content.
Seidenfaden said that in less mature editorial markets, a free publication's advertising presence posed a problem.
