Newspaper Industry Is Running Out of Time to Adapt to Digital Future

My mom would always bring home things for me to test as "threats" to the paper rather than opportunities. Delphi, Prodigy, Aol, compuserve, eworld, Microsoft blackbird, cd-I and finally a BRI ISDN PPP account.

Threats. Not opportunities. When they finally put the entire newspaper online it was in PDF. I left in 2001.

And then went into the music business in 2005. Hah.

Let me explain.

The value proposition of most newspapers for both readers and advertisers pales in comparison to many new media options. For instance, who here gets their technology or sports news from a national or local newspaper? Who looks to newspapers for the latest stock market performance, restaurant reviews, or movie showtimes?

Since their value proposition is depressed, newspapers are attracting fewer readers (and subscription dollars) and, in turn, fewer advertising dollars.

And then you have typical newspapers' unwieldy cost structures. Many newspapers are still operating with staff levels that are multiples greater than their new media counterparts. I don't have any current examples, but during the 2008 elections the Huffington Post was driving as much online traffic as the Washington Post, with a headcount of about 6.25% (50 employees versus 800).

In short, lower value begets lower revenue, and if we assume a high cost structure, it's a downward spiral to oblivion.

But they also like to wax about the old times... and make no mistake, the old times was just a big boys club. Alcoholism was rampant, misogyny was par. A big story or scoop would take weeks if not months to develop and it might get buried on some fucked up principle (see Caro's excerpt in the New Yorker this year on LBJ's impending downfall until JFK and Dallas... a scoop, if not buried, alters the history of a million young American men and American foreign policy in profound ways), and then, once ready for the presses, after the editor trimmed it down, they'd all go celebrate their Pulitzer chances at a pub. It was a culture of exclusion and entitlement; your entree was "J-School" pedigree, or worse, your ability to kowtow to as a junior to an established writer until you got your chance, because that was your only path to being heard.

It was a time where accountability was proportional to distribution, which is to say, tightly controlled at all levels and, for better or for worse, self regulated. It was also a culture of self-congratulation. The only redeeming quality of the old school is that self-control over distribution gave them stupendous levels of access and leverage, something that doesn't seemingly exist anymore.

Journalism has always been subsidized."

From Clay Shirky's essay, "Newspapers and Thinking the Unthinkable"

http://www.shirky.com/weblog/2009/03/newspapers-and-thinking...

So that would be "defined benefit" pension plans then. The markets have no obligation to meet absurdly optimistic forecasts of returns on investment.

If you're looking for someone to blame, consider that 10-year Treasury yields are under 2%, of which the single biggest buyer is the Federal Reserve.

> The bread and butter for most of the [newspaper] industry is local information.

No, the bread and butter of the newspaper industry is celebrity gossip, which is the very opposite of local information, and is a commodity product, which is why people are unwilling to pay for local newspapers.

Target a specific area, get local readers and you're an advertising option for local businesses.

My local paper (in Australia) has cut back its basketball reporting (for example) over the years and instead covered some pretty generic stories. e.g., instead of covering a domestic league, the writer has instead covered the US college Final Four. A few points:

  - their contacts and history are in covering local sport
  - why would I read this generic coverage over ESPN and American sources who have writers in the thick of the action?
  - in covering domestic basketball, the audience might be smaller, but the paper would have virtually no competition in covering it
  - cover local teams and you at least have a shot of building suburb-level audiences and hit up small businesses as a result

But online is a different case. If your writer is getting paid a fixed rate, why wouldn't you have them at capacity whenever possible, generating unique, local content for your online version? They could be creating the Final Four fluff-piece for the print version, plus writing up online-only previews and quick opinion pieces on the domestic league. Categorise them by area (North, South, etc) and then find sponsors and advertisers for each. Small-fry ads maybe, but it wouldn't be shotgun advertising.

Whilst digging around on one of their servers, I've found a few sites which are "virtual shopping malls" with multiple levels and numerous "shops" that you can "buy" (i.e. advertise your site on). I think that they're not too sure what to make of this "Internet thing" so are just trying to port concepts from offline to online and it's not working too well.

Last time I visited, nearly everyone I knew was gone, usually for a job working in PR. And even the young idealistic reporters who were my age were all secretly interviewing for PR jobs. There really is little hope of turning things around. It's not just the lack of technical innovation...it's the constant downhill slide...it's hard enough to do good work on an average reporters pay...but to do it as your pay gets constantly cut and your hours constantly extended because other colleagues are let go is psychologically draining.

And newspapers need more than just good work, or even Pulitzer level work...they need groundbreaking innovation that changes/streamlines the very core of what they do...from the reporters to the editors to the ad people. But there's no capacity or motivation for such entrepreneurship

http://wsetchell.blogspot.com/2012/07/local-newspapers.html

To me this whole rant about running out of newspaper business is like a rant of messenger going out of business. No, you don't have to ride your bicycle through entire city to deliver message from Mr. X to Mr. Y; we have email and internet now. At the end of the day, the consumption of news will not change -- people will still want to know whats going on in the wild world, whether it is economy, politics, science or celeb gossips. Sure the medium will change, but lets stop crying over the fact that 99.999% of population is not using an electrical telegraph anymore (if most never did).