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Online news outlets hurt for cash as advertisers prefer print

elecLeaders of Lebanon’s nicheWeb-based news outlets meet to talk about financial viability as online ad sales remain grim.

BEIRUT: More readers are going online to get their news, but advertising money is not migrating at the same speed – a problem for Lebanon, where many news outlets compete to make a profit while staying true to their mission.

At the offices of Alt City in Hamra Saturday, around 30 members of Beirut’s online news community met to discuss ways to make their businesses profitable.

“We’re doing great work, but why aren’t we making money?” asked David Munir Nabti, co-founder of Alt City as well as the youth-oriented magazine Hibr. Hibr moved entirely online due to rising costs but still didn’t manage to earn sufficient funds in ad revenue to sustain itself.

Reasons for Lebanon’s low rate of online advertising range from low Internet penetration combined with a slow connection to relatively underdeveloped business models for advertising throughout the region.

The Middle East and North Africa are home to 70 million Internet users – a number expected to more than double in the next five years, presenting more opportunities than ever before for advertisers to reach consumers via the Web.

Meanwhile, amid the global recession and shift away from print media, advertising budgets have decreased. Real advertising expenditures in Lebanon slipped to $174 million in 2011, declining 3.3 percent from $180 million in 2010, according to a report in ArabAd magazine.

While those in the media industry expect that advertising online will eventually become the norm, they are eager to find solutions to sustain their businesses until that day comes.

Although online media in the Middle East still doesn’t attract the advertising that its print counterparts do, some of the top news outlets in the West have been able to successfully earn revenue from increased online ad budgets, including iPad magazine subscriptions, said Omar Christidis, founder of the regional digital hub for entrepreneurs ArabNet.

But others point out that these oft-cited success stories mainly pertain to the largest publications and Internet platforms such as Google, Facebook and Yahoo. And whereas major publications such as the New York Times are able to attract online subscribers, much smaller media outlets say a paywall would be unrealistic and would cost them readership as they continue to build their brands.

Another important issue faced by small online publications looking to increase ad revenue is trying to maintain their ethical standards.

Dima Saber, who co-founded Hibr in 2009, told participants at Saturday’s meeting that refusing to have advertisements for products such as alcohol or cigarettes, which they felt didn’t fit with their socially conscious message, had hurt their economic sustainability. Other participants agreed, saying they didn’t want to sacrifice their integrity for profit.

Nina Curley, editor-in-chief of the regional technology website Wamda, suggested publications solicit sponsorship for events only after deciding on the themes so as to avoid a conflict of interest. She also suggested that online media outlets could write paid intelligence reports that complement the free content they already provide.

Micheline Tobia, editor of Mashallah news, which focuses on arts and culture in the region and has an all-volunteer staff, says she is hoping that an upcoming book compiled by the site’s contributors will generate some revenue.

For now, Lebanon’s media will continue to build their online presence despite minor financial returns, expecting that the future of their profits is online – even if today’s numbers say otherwise.

 
A version of this article appeared in the print edition of The Daily Star on October 01, 2012, on page 5.

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