IMPACT OF NEW TECHNOLOGIES

Significant changes in printing and production technology in the past three decades have altered the structure and functions of newspaper organiza- tions. The developments of offset printing, phototypesetting, and prepress production by news and advertising personnel using computer-based equipment have altered the industry significantly.

The primary effect of the new technologies was a reduction in the num- ber of personnel needed to produce a paper. Technology has allowed advertising and editorial departments to take the place of typesetters, allowed national and international news and feature agencies to provide material in forms that no longer require typesetting, reduced the activity necessary for

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laying out pages, and simplified the printing process. These changes in technology have made it possible for contemporary newspapers to reduce personnel by one third to one half, depending on their sizes and the technology employed.

Asecond effect of the new technologies has been increased speed in prepar- ing and printing the newspaper. This has been used by managers to make the content of the newspapers “fresher” because it has allowed them to shorten deadline time so that breaking news and information can be placed in a paper closer to the time the paper is distributed, thus increasing the paper’s ability to compete with broadcast media in coverage of breaking news stories.

The impact of new technologies on newspaper costs has been explored and indicates that economies of scale are not created equally across all sizes of newspapers (Dertouzous & Thorpe, 1982). The introduction of offset printing and phototypesetting equipment apparently reduces first-copy costs and minimum efficient scale, particularly for papers in the 10,000 to 100,000 circulation range, but the efficiencies are not equally enjoyed by papers below and above that size (Norton & Norton, 1986). The higher cost of the new technologies makes some older systems more efficient for smaller papers. Larger papers often do not enjoy the same rate of cost savings because the new technologies must be specifically adapted for their require- ments. Because there are fewer large papers that need the adaptations, the cost of the adapted versions is much higher.

Industry observers do not expect huge technological advances during the next decade but look forward to the increasing development of new ap- plications for electronic technology in composition and printing departments. Technological advances expected to be widely accepted include: conversion of plate departments (which transfers layouts onto metal plates for printing) to electronic darkrooms with computer-to-plate composition capabilities; acquisition of equipment for electronic integration and control of multiple press units and functions; computerized control of color printing; and automated folding, inserting, sorting, and labeling of newspaper bundles for carriers and mailed copies.

A result of the increasing reliance on advanced technology has been a rapid increase in equipment costs. Since the 1960s the costs for composition and printing equipment have increased dramatically and today require ex- tensive capital investments and financial planning. The types of equipment expected to enter newspaper plants in the first decades of the 21st century are not expected to result in as significant labor costs as the introduction of offset printing and phototypesetting. Although some reduction in composition, printing, and mailing personnel will occur, a good portion of those salary savings will be redirected to technicians needed to operate and ser- vice the new machinery. In the long run, however, savings from reduced costs for employee benefits, reduced costs for supplies, reduced waste of

5. ECONOMICS OF DAILY NEWSPAPER INDUSTRY

newsprint, and increased desirability of newspaper advertising because of higher quality color printing are expected to result in favorable returns on investments in technology.

The integration of information and communication technologies throughout newspapers increases the opportunities for convergence with other media activities. Today, however, convergence and cross-media activities are primarily limited to moving news, archives, and some advertising onto the Internet, but financial benefits have been elusive.

IMPACT OF NEW TECHNOLOGIES