Are digital news publishers losing mobile traffic?

Digital news publishers in India may have lost 20-40 per cent of their mobile traffic over the past few months due to a range of reasons, even as the AI-enabled chatbots are yet to become mainstream. 

A drop in sales of mobile phones, decline in data consumption, muted internet growth and a drop in news consumption are cited as prime reasons behind the dwindling referral traffic coming to news websites. 

“Many big publishers have lost 20 per cent to 40 per cent of mobile traffic in the past few months. Possible reasons behind this drop could be a 10 per cent decline in smartphone shipments in 2022. Besides, the internet and broadband user base in India is not growing anymore,” head of a digital publication told e4m, requesting anonymity. 

“The drop was significant in the last two months,” says a Hindi news channel head. 

Listed media houses are not willing to come on record.

“They don’t want to talk about it publicly as they have to show to the investors that their digital platforms are doing well,” a regional publisher claimed. The Digital News Publishers Association (DNPA) didn’t respond to queries in this regard despite several requests.  

This has come as a double blow for many media houses, especially the newspapers, which had lost a big share of ad revenue during the pandemic and are yet to bounce back to the pre-Covid levels. The entry of AI-chatbots launched by Microsoft and Google is likely to further dent their referral traffic diverted to them through Search, E4m has reported earlier. 

Depending on the publisher, mobile accounts for 70 to 90 per cent of traffic to news websites. Their share in ad revenue is mostly in the same ratio though desktop traffic gets a bit higher revenue, industry leaders say. 

A senior leader said, “Ad revenue share of the desktop is usually 5 per cent more than the mobile phone. So if desktop has 30 per cent traffic for a given publisher, then it will have about 35 per cent of revenue share.”

While news websites do get direct traffic from dedicated readers, most of it comes via Google Search. Google alone pocketed Rs 25,000 crore of ad revenue in India in FY22, a portion of which is shared with digital publishers. 

Inflation 

India smartphone market declined by 10% in 2022 to 144 million units, according to the International Data Corporation ’s (IDC) Worldwide Quarterly Mobile Phone Tracker. This is the lowest figure since 2019, with a 10% decline YoY (year-over-year). 

The last quarter was particularly bad when shipments declined 27% YoY to 30 million units. Steep rise in the cost of mobile phones due to inflation is being blamed for the dwindling demand. 

“The ASP (average selling price) hit a record US$224, rising 18% YoY in 2022. The entry-level segment (sub-US$150) shrank to 46% of the market, down from 54% a year ago. The dearth of new launches in this critical mass segment was a barrier for new smartphone users, thus limiting the overall market’s growth,” Upasana Joshi, Research Manager, Client Devices, IDC India, said in a statement. 

A TV channel executive said, “While the low income group is not able to buy smartphones due to inflation and economic constraints, those who have the phones are not consuming content the way they used to during the pandemic as businesses and schools are open now.”

Internet growth also appears to have stalled in India which boasts the world's second largest mobile phone market. In October 2022, the country's telecom regulator TRAI counted 790 million wireless broadband subscribers. That was barely a million more subscribers than what it recorded in August 2021. Growth in mobile internet subscribers has now slipped to 4% from scorching double digits between 2016 and 2020.

The fallout -- the number of people using broadband has hovered at the same level for two years now. The numbers using it for social media, video or entertainment has stalled at about 485 million, according to Comscore data. 

News consumption hit

News domain itself is under pressure as news consumption is dwindling gradually. “Cases of horrific crimes and hate dominate the current discourse. Most of the mobile users are fed up with such content and have stopped surfing the news websites leading to over 30 per cent decline in mobile traffic to news sites,” a leading news channel head told e4m. 

Another channel head admitted, “News gets less priority than entertainment and social media now. Besides, OTT and gaming apps consumption growth has accelerated over the past few years which has resulted in more walled garden surfing and hence impacted the web traffic of news sites.”

Availability of Google Search in regional languages also affected the traffic of leading English and Hindi news outlets, a senior executive of a leading media company said. 

Regional push to narrow the losses?

To expand their reach among mobile-first consumers in regional markets, leading publishers like HT and Indian Express have started launching the language editions of their news websites, an industry leader said. 

HT Media Group launched four digital news platforms – HT Bangla, HT Marathi, HT Kannada, HT Tamil and HT Telugu in 2022. Indian Express Group has also launched regional language websites in Gujarati, Bangla, Malayalam and Tamil last year.