For much of the 90s the future prospects for Europe's newspapers looked bleak. Circulation levels appeared to be in steady decline and there were genuine concerns that the rapid growth of the internet would lure readers away to such an extent that traditional media owners were going to see their advertising revenues dwindle.
Several years ago, Microsoft's founder Bill Gates went so far as to prophesie that the year 2000 would signal the end for newspaper and magazine publishers.
But today the outlook is much rosier. And it is Microsoft rather then the newspaper industry that appears to be facing troubled times ahead.
Over the past five years, newspaper sales in the European Union have fallen 2.2 per cent. This equates to the loss of 1.85 million newspaper buyers in the EU between 1995 and 1999. However, the fall over the 10 years from 1989 was even more severe - a drop of 9 per cent, which represents 5.5 million readers.
These figures show clearly that the rate of circulation decline is slowing.
Indeed, according to the World Association of Newspapers, the circulation fall in the EU last year was a negligible 0.1 per cent. This is only one fifth of the loss in 1998 and a tenth of the loss in 1997. At the same time, newspaper readership in Western Europe actually increased last year by more than one percentage point: 62.1 per cent of all European adults now read a daily newspaper.
'The global press industry, far from approaching any end, is alive and robust and clearly in renaissance,' says WAN's director general Timothy Balding. 'Daily circulation continues to increase or stabilise in many countries; where decline has been sharpest over the past decade it has generally begun to slow down, often quite radically. Newspaper advertising income again shows very good growth and in many countries the press is even winning back market share.'
Seven EU countries saw overall sales growth in 1999: Austria, Portugal, Ireland, the UK, Italy, Luxembourg and France. In the case of the UK it was the first time circulations had risen since 1989. Circulation levels were static in Spain and Belgium, while only six of the 15 EU member states posted a decline in circulations: Greece, Denmark, Sweden, Germany, the Netherlands and Finland. With Germany it is worth noting that although the overall circulation fell, its national dailies increased their circulation by 1.8 per cent.
The number of daily titles published in the EU has fallen in the past five years, but only very slightly - from 1,147 to 1,133 . But average circulation per title remains stable at about 75,000.
The much-feared rise of the internet appears to be having a greater impact on TV than newspapers. Forrester Research says that as many as 78 per cent of internet users sacrifice time watching television, but only 12 per cent reduce their consumption of newspapers. Moreover, a recent study in Sweden showed that young people with access to PCs and the internet at home read more newspapers than the ones without.
Although the internet no longer terrifies newspaper executives, it is clear that the owners of Europe's top newspaper brands have been slow to build on their print heritage in the digital space. None of the top ten internet portals in Europe's three biggest markets - the UK, Germany and France - is a newspaper brand. The Next Media Revolution: Reinventing Newspapers for a Wireless, Broadband World published earlier this year by the management consultancy McKinsey & Company slams newspapers for missing opportunities to exploit the impact of the internet.
More positively, the report concludes that newspapers will continue to thrive and that there is time for a second bite at the internet cherry.
'We believe the next five years will effectively reset the clock for newspapers on the net, giving you another chance to build winning online businesses. The key to success in this communications landscape will be to leverage your unique content, packaging skills, customer relationships and marketing muscle to seal deals with the likely winners in wireless communications and broadband services.'
One emerging trend across Europe is an increase in the number of free newspapers that are handed out to commuters in big cities. These are considered a genuine threat to revenue streams by some established paid-for titles.
'Free commuter newspapers such as Metro are really the talk of the town, they are a hot topic,' the International Newspaper Marketing Association's European coordinator, Inge van Gaal, says. 'Some newspapers have lost more circulation to these than they have to the internet.' Other industry figures argue that the vast majority of those reading these new free dailies did not previously buy or read newspapers. Yet a small amount of cannibalisation is inevitable.
Growth in advertising revenue is strong throughout most of Europe, buoyed by general economic health, although the prognosis for classified space is not as bullish as it is for display on the internet. That phenomenon is likely to have some impact on classified revenue in the coming years.
Zenith Media says that the UK newspaper advertising market grew 4.5 per cent in 1999, while in France the lift in spend was 7 per cent. In Germany, national newspapers grew advertising volumes by 14 per cent, compared to an increase of just 3 per cent among regional titles.
The amount of news-print bought in Europe is up, says van Gaal, reflecting the fact that many newspapers are bulking up and introducing new supplements.
It's a far cry from the post-mortem predicted just a few years ago.