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The Fate of Newspapers: Farm It, Milk It, Or Feed It
Hugh Pickens writes "According to Alan D. Mutter, after a 50% drop in newspaper advertising since 2005, the old ways of running a newspaper can no longer succeed, so most publishers are faced with choosing the best possible strategy going-forward for their mature but declining businesses: farm it, feed it, or milk it. Warren Buffett is farming it, and recently bucked the widespread pessimism about the future of newspapers by buying 63 titles from Media General. He is concentrating on small and medium papers in defensible markets, while steering clear of metro markets, where costs are high and competition is fierce. 'I do not have any secret sauce,' says Buffett. 'There are still 1,400 daily papers in the United States. The nice thing about it is that somebody can think about the best answer and we can copy him. Two or three years from now, you'll see a much better-defined pattern of operations online and in print by papers.' Advance Publications is milking it by cutting staff and reducing print publication to three days a week at the New Orleans Times-Picayune, thus making the Crescent City the largest American metropolis to be deprived of a daily dose of wood fiber in its news diet. Once dismantled, the local reporting infrastructure in communities like New Orleans will almost certainly never be rebuilt. 'By cutting staff to a bare minimum and printing only on the days it is profitable to do so, publishers can milk considerable sums from their franchises until the day these once-indomitable cash cows go dry.' Rupert Murdoch is feeding it as he spins his newspapers out of News Corp. and into a separate company empowered to innovate the traditional publishing businesses into the future. In various interviews after announcing the planned spinoff, Murdoch promised to launch the new company with no debt and ample cash to aggressively pursue digital publishing opportunities across a variety of platforms. 'If the spinoff materializes in anywhere near the way Murdoch is spinning it, however, it could turn out to be a model for iterating the way forward for newspapers.'"
my local paper i only want on sunday. in attempting to subscribe for sunday only, they say "no, you have to take it friday/saturday/sunday". i say "sunday only, or i don't subscribe". they wouldn't budge. guess what i decided :)
on the occasion i want a sunday paper, i go to the local gas station which is not far from my place and pick up a paper. i won't be shedding any tears when they fold (ha!)
As of recently, because private newspapers have been shutting down, going digital only, or otherwise withering on the vine, there is another type that is waiting in the wings to take over mainstream news:
Newspapers from governments and causes. The whole government of Qatar is paid for because of Al Jazeera. I'm sure other governments will be happy to step in to provide "news" that is slanted their way.
I'm amazed people like Rush Limbaugh have not stepped in to have their own newspaper printed in a region.
Sometimes, I hope for a "people's paper". Journalism is like the music industry -- completely and utterly dead, but there are some experienced reporters. Combine that with someone who can do basic paper layout, it might be possible for a local paper to be run on a shoestring and still provide reasonably accurate coverage on news topic. No, they may not have the cool Associated Press articles, but it is far better than nothing.
Where I live (Vancouver, Canada) both dailies are run by the same company. They print the same stories and have the same pro-corporation slant. One of them uses smaller words and dumbs things down a bit, but they are basically exactly the same. As a cost saving measure and as an ultimate sign of cheapness and laziness, these papers reprint, annually, the exact same stories word for word. The editors are told what their opinions are and quietly promotes whatever rubbish the owner tells them to. There are so many "special information supplements", info-marketing inserts, infomercials, and advertisements disguised as news articles that it just has to be illegal.
Tell me why I should care if these papers die. As far as I'm concerned it can't happen soon enough.
People still read newspapers. E-ink or LCD newspapers. If the newspaper can't find a way to convert from wood to electronic, then it probably deserves to die since it's being inefficient.
That's how the market operates... give the customer what he/she wants or else don't get purchased & go out of business. BTW my two local papers were owned by the same company. They cut costs by merging the two papers since they were basically redundant.
My AC stalker: " I personally agree with your posts most of the time, but that won't keep me from modding you troll"
Most notable the San Francisco Examiner. Several of his papers are distributed as free dailies in major cities.
Anshultz media group also owns about a third of US movie theaters (Regal) and show production company that was putting on Michael Jacksons final tour.
He has not publicly stated what his goals are. His earlier investments were oil and gas, railroads, and fiber cable.
publishers can milk considerable sums from their franchises until the day these once-indomitable cash cows go dry
What, never? Locally they're milking it. The physical paper version is a spam delivery service with some stereotypical human interest stories that I'm not interested in and some traditional "journalism" that I'm also uninterested in (horoscopes, local event boosterism/complimentary copy, etc), and some AP news items from a couple days ago to fill unsold ad space. They will not stop delivering spam until mailed paper spam stops, maybe even after. The online version I guess delivers spam (I use a ad blocker, I don't even know) but primarily seems to make its money off pageviews of "comments" which are nothing other than paid political sloganeering where paid political operatives sling tired old slogans at each other as a form of spam.
The cash cow is, give us money, and we'll print your spam and deliver it all over our local geographic quasi-monopoly, I'm not seeing that going away any time soon. Their competitors are US postal mail and direct-mail-spam-services using US postal mail to deliver one pitch per envelope/postcard. Also there are aggregator competitors who mail envelopes stuffed full of coupons and spam and flyers in bulk from multiple companies rather than one promo at a time. Finally there are the special interest papers who will never die, the local free entertainment rag full of which band is playing at which bar and which bar has ladies night on which night, and the occasional political axe to grind slant paper.
Here's the formula. Get ad contracts with Best Buy / Verizon ATT whatever / local car dealers / Target / walmart / local stores if any remain in business. Surround with some fishwrap, containing a cute picture of a puppy or some kid, fill empty space with AP news articles from a couple days ago, print a zillion copies, hand deliver the spam and spam-envelope to approximately one third of local homes.
"Science flies us to the moon. Religion flies us into buildings." - Victor Stenger
The problem with news is that the quality is crap. It's biased, the headlines are misleading, and there's often no research done ahead of time. Nothing of value will be lost there. But good journalism, research, unbiased headlines... they're getting screwed too. And that makes me sad, because the news is essential for the proper functioning of a democratic society. If we don't know what's going on, if we don't have people willing to get in there to get the full story, not just the press releases... we're screwed.
#fuckbeta #iamslashdot #dicemustdie
if you become comfortable in a certain business model you will die. you have to follow where technology is going and possibly steer it to your advantage. newspapers ignored technology and now that it's hurting them, they trying to catch up. they should have been the leaders in the internet realm as it's purely a communications medium. hell, they should have been driving the internet to new places but instead they are reactionary and slow at that. blogs have shown up far too late and they strait up shot themselves in the foot with paywalls which were put in AFTER so many other site with free content thrived by using advertising systems that didnt suck.
you need to try a lot of different things. diversify your strategy or your one basket may be in trouble.
Anons need not reply. Questions end with a question mark.
Two of the big Chicago papers- Chicago Tribune and Daily Herald- each make a point to do investigative reporting, finding information on mismanaged government funds, questionable hiring practices, and other political negligence or misconduct (which we have plenty of). We'll always have some form of news source covering events that are geared towards the media, like the presidential elections, sporting events and press releases, but it takes an established newspaper run by people willing to invest in time-consuming research to generate quality investigative reporting. With politicians who have more clout than an average citizen can handle, it takes a newspaper with a weight of its own to fight back. I realize newspapers are going to have to make significant changes to stay in business, and that many won't make it, but I am worried that in the process we may lose one of our best means of keeping the government in check.
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Everyone thinks the news is free since it's all just a click away. There are lots of great aggregators like Google News, Yahoo, Bing, as well as specialty aggregators like Slashdot.
SOME news is free. Flikr and tweets by passers by are free, but a worldwide professional staff of reporters, editors and publishing infrastructure (either print or online) is expensive to maintain and will not survive years of wholesale freeloading.
Longtime newspaper readers have already noticed a substantial drop in the quality of almost every big major newspaper in the country (except for maybe USA Today, which is the exception that proves the rule) over the past ten years or so. They've all had to let go a large part of their staffs.
So just as people are whining that they don't make pop music the way they used to, so we're starting to see that with the reporting of the news. Yes, there will be plenty of news to read, more than you'll have time to read, but the quality has gone down and will go down further.
A good newspaper that spends time investigating, digging, and has the balls to take on critical issues have been a huge pillar of our civilization. But take my local newspaper in Nova Scotia. Technically it is independent which is great but it is run by one rich family so do you think that it will run exposes on their friends? I can't remember the last time, if ever, they have nailed a slimy car dealership or real-estate agent to the wall as these are some of their biggest remaining advertisers. They did wail away at our current mayor but it was more schoolyard than Watergate. It was a local arts paper that did the gumshoe work that blew him out of office. The Mayor in waiting looks like a putz and I haven't seen them take a single shot at him.
Move one province over and the major newspapers are owned by the richest family there.
But the internet is made up of a bunch of little twerps with nothing to loose and everything to gain(becoming the next Drudge) by blowing up an old boys club or two by exposing truths that our local newspapers are too incestuously invested in.... I Love It!!!
He should apologize: "I'm sorry Mitt Romney outsourced jobs."
A local newspaper owner told me last week that 80% of a newspaper's income is from legal notifications. Cities have legal obligations to publish notifications regarding meetings, sales, and such. State law says they much use a local paper that's existed for more than 3 years and has a subscriber base of a certain number. Of course, these same notifications could easily be included in utility bills or other, much less expensive alternatives. Basically taxpayer money is being used to keep newspapers alive.
He's right -- for community weeklies and even some very small dailies, legal ads are lifeblood.
Much less so for mid-sized-and-larger dailies.
You want to see an incumbent business model act like a pack of pissed-off wolverines? Watch the small-paper lobby go to town when a state legislature suggests that putting legal notices online might -- might! -- be more efficient.
"It was a summer's tale: Just a boy, his Linux, and a head full of dreams..."
Whether we read it on paper on on the screen does not matter. What does matter: "How are we going to support journalism?" . Especially local journalism. Who will cover the zoning board. Who will ferret out corruption? The meetings of the Virginia legislature used to be covered by eight reporters, now it is covered by one. ( From memory, I cannot find the story ).
New Orleans may give us a preview, since there is no shortage of corruption. While the cat's away.....
...and if that don't work, Fuck it.
My brother has worked for some major metro dailies in the Northeast, including as managing editor. He's recently decided to leave the industry at perhaps the peak of his career because he's convinced it's dying.
We discussed it and came to the same conclusion as you. The fundamental problem isn't the business model, it's an apathetic citizenry. If Americans cared deeply about civic issues and governance, rather than American Idol, they would find a way to fund good journalism. But if they don't, there's no business model that can keep good journalism going.
I only hope it takes something less than a national tragedy to re-invigorate the American people's concern for good governance.
It takes a lot more than that to get a slashdot comment deleted.
Help stamp out iliturcy.
It's like watching the end of the horse and buggy, icebox, or gas lamp industries. Only with more copyright/extortion suits.
No website is going to report on stuff that matters to them, because those 1k or 30k people towns don't generally matter to them.
You believe that in a crowd of 1K to 30K people there is not one geek who can set up a LAMP with Joomla? And that there are no willing contributors who can master the simple user interface of Joomla? Life in small towns is not all hard labor, it's also long periods of boredom.
A newspaper is a costly proposition. You have to print it somewhere (your 1K village has no printing press!) and deliver quickly, and distribute. There is no feedback.
An electronic newspaper is free to publish. It supports logins for subscription if you insist on it, but logins are primarily for comments. This makes it interactive. That Fred Smith from a ranch 30 miles down the road does not come to town every day, but he is certain to log in every morning and every evening, read it all and add comments to whatever he finds interesting.
I haven't touched a newspaper in a decade. Probably haven't intentionally seen one either. Why would anyone want one? It's not even ecologically sensible, to kill trees just to deliver a few minutes per day of amusement to a family when the same, or better, can be achieved electronically, at a millionth of cost.
You want to see an incumbent business model act like a pack of pissed-off wolverines? Watch the small-paper lobby go to town when a state legislature suggests that putting legal notices online might -- might! -- be more efficient.
That just happened in Texas. The newspapers won, this time.
In Illinois, there's a real battle. The newspapers have their own lobbying site. Several bills are pending in Virginia and the newspapers there are frantically lobbying.
when they stopped caring about me. When was the last time a story like Watergate broke? When was the last time the papers challenged the powers that be? Sorta hard to do that when the powers that be own you lock stock & barrel. Why would I pay 50 cents/day to read the same corporate drek and propaganda I can get for free in their advertisements?
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