Save Newspapers

Rupert Murdoch: Right and Wrong

2009-11-13T00:39:00.000-08:00

Rupert Murdoch riled up the internet this week by suggesting that Google is stealing the work of his News Corp. newspapers. Of course, he's wrong. The mass-psychosis about Google ripping off newspapers is a relatively recent phenomenon, driven by the simple fact that Google is making money hand over foot while newspapers are bleeding cash. All Google is doing with its Google News service is providing links to freely accessible articles, accompanied by very brief excerpts. If that's stealing, so is Itunes posting album cover art and 30 second snippets of songs. News execs should focus their energies on finding real solutions to their financial woes instead of attacking Google for no good reason.

Uncle Rupert did have some prescient comments, though. He said that printed newspapers will be around for at least another 20 years, if not more. I agree that there's no reason to stop printing newspapers as long as people still want to read them (read: as long as baby boomers are still alive). Print advertising will remain profitable.

However, Murdoch acknowledged that newspapers stand little chance of ultimately surviving in their present form if they have to rely solely on the current web advertising paradigm.

"There's not enough advertising in the world to go around and make every [newspaper] web site profitable," he said. Indeed, the vast expanse of the internet has created an overabundance of advertising space. The supply-and-demand fundamentals point to display advertising being a game of scale -- a game that newspapers, especially local newspapers, won't be able to win.

Victory for Newspaper Editorial Boards?

2009-06-09T23:32:00.001-07:00

Creigh Deeds won the democratic primary for governor in Virginia. Many are crediting his surge of popularity in the polls to the endorsement he received from the Washington Post.

The expense of having an editorial board seems a bit extravagant while reporters are being laid off by the score, but Deeds' victory is proof positive that newspapers, and their editorials, are still hugely influential, even in this crowded media landscape.

The For-Profit/Non-Profit Hybrid Model

2009-05-30T16:47:00.000-07:00

This is a long one, so bear with me.

For local newspaper web sites, paywalls make sense. Local news will never be able to be conducted on the scale of local newspapers circa 2005 if they continue to offer free content online. Local interactive advertising will pick up, but it will only provide a fraction of the revenues of print ads. In most medium- to smaller-sized markets, there is only one entity providing in-depth local news and sports coverage: the newspaper. People in cities like Pittsburgh, Kansas City, and Milwaukee, which aren’t very transient and have stable populations that care about local issues, would be willing to pony up for good local coverage.

Major market newspapers very likely do not have that option. Papers like the Washington Post and Los Angeles Times are primarily regional as print newspapers, but have a large national and international web following. It is their national, political, and international coverage that makes them players on the web. But there is such an abundance of this kind of news available for free on the internet that efforts to charge for it may, in fact, cost more money in lost advertising than it makes up for in subscriptions. And efforts to charge just for local coverage may result in a big yawn from the less locally-focused populations of their respective regions. Likewise, in these markets television stations may have the resources to do an adequate job of covering local news on the web (and many cities have more than one newspaper, the smaller of which would certainly be willing to pick up the slack).

So paywalls are out of the question. What about the non-profit model that some are pushing for? Simply put, I don’t think a non-profit model would scale for organizations of this size. There are just not enough individuals and corporations willing to entirely fund the operations of a large newspaper that was making 30% profit margins less than 10 years ago. The comparison to NPR doesn’t work, either, because NPR is largely funded through donations to local stations, which are in turn passed along to NPR through programming fees. These papers do not have the luxury of having a national network of local affiliates. Not to mention the fact that a non-profit model also probably wouldn’t fly with the papers’ profit-minded owners. And a word to those who think Google or internet service providers could, should and would pay to give users access to newspaper web sites: this is a pipe dream. Get real. Not only is this never going to happen, but it would never work to begin with. I won’t waste the words to explain why.

What I propose as a solution is a for-profit/non-profit hybrid model. Newspapers would remain for-profit entities (which I believe is preferable because non-profit newspapers run the risk of becoming lethargic and dull). The web site would still be free for all. And there would still be a printed daily paper (perhaps not on Saturday). What would be added is “memberships” to various areas of coverage. People would be encouraged to “subscribe” to a particular topic that they’re interested in, the main incentive being similar to public radio and television pitches: that the money would be used directly to bolster coverage in these areas.

Let’s take the Washington Post as an example. There could be monthly memberships for: Politics, Local, World, Sports, Business, Outlook/Editorials and Style. As an added incentive of joining, members could participate in members-only online chats or in-person events, and would have exclusive access to a “wire” for their section. Journalists could post interesting and forward-looking tidbits to the wire: either actionable, bite-sized info that will be part of a later article, or fascinating stuff that might otherwise not make it into a story. This would all be very Twitter-like in its chronological and frequently-updated nature, but it would have to be done through a proprietary system. The key is that the wire be – as stated – actionable, forward-looking, and interesting (thus, habit-forming). Also, members would be able to comment on the wire, and suggest stories for coverage in a more direct way than the current Wild West-style comment sections.

One last incentive for subscribing, which many people cite as one reason they subscribe to the print edition on Sunday: all members get the Sunday insert ads and money-saving coupons delivered to their door, perhaps within a small, display ad-filled weekly “subscribes guide.”

Users would be able to pay a bit more for a “universal subscription” that gives them access to the members-only features of all coverage areas. Universal members would still be able to direct their subscription fees to particular coverage areas. And a print subscription would also include all the web members-only features.

Here’s a possible pricing model:

Section membership: $9.99/mo
Universal membership: $15.99/mo
Print subscription: $19.99/mo

In addition to the subscription revenue, and the Sunday insert ad revenue, newspapers would be able to make more money online by using the demographic info gleaned from members to enhance online ad targeting.

Part of the reason why I think people would pay for this, and why it could be very successful, is that the “membership” is very participatory and democratic. Each section becomes its own community. Newspaper companies have tried doing web chats and meet-ups and other participatory things, but it never quite works. Part of this is because over-worked, multi-tasking journalists simply don’t have the time to devote themselves to this kind of stuff. The added revenue can help ease some of the burdens that make active participation prohibitory for working journalists. The other reason it will work is that, by joining one particular section (which I imagine most people will do), it helps give people a sense of ownership in the paper. Right now most people have an almost adversarial relationship with their newspapers; the division of “us” and “the media” is extremely pronounced. This would help break that down. It helps that the process of choosing which section to support is itself very democratic, as does the ability to interact more directly with that section, through the comments/suggestions area of each section wire. Again, the NPR model comes to mind as one where people feel a connection to the journalistic product.

The model I just laid out could probably also work for the New York Times, despite the fact that it’s even less of a local brand. I don’t think it would work for USA Today. The paper is too mainstream, has too few original elements to make it stand out, and doesn’t seem to have the same kind of connection to its readers that a Washington Post has. USA Today, in the long run, is screwed. I could be mistaken, but I think it will ultimately be a relic. People won’t pay for short and generic. They’ll pay for unique and specific.

I’ll exclude the Wall Street Journal from this discussion. WSJ has a uniquely-successful web site subscription model. Financial journalism is actionable in a way that mainstream journalism will never be able to match (but it should probably try to, for good measure). The Journal has a relatively steady subscriber base and an enthusiastic owner. It’s not going anywhere.

Newspaper Journalism's Yalta Conference

2009-05-28T14:50:00.000-07:00

According to the fantastic James Warren, top executives from some 25 newspaper companies have gathered outside Chicago to discuss the future of newspapers. Specifically, Jim says the secretive confab is all about "Models to Monetize Content." That, of course, has led some to theorize that the execs may be hashing out plans to erect industry-wide paywalls.

Anti-trust liability? Maybe. But as I've said before, charging for access to online content may be the only way newspapers can stop the print circulation bleed, and thus achieve some degree of stability with their main source of revenue. It would be refreshing to see a bunch of newspaper honchos get together and find the cojones to actually take some meaningful, bold actions.

MediaNews Memo Announces Paywall Plans

2009-05-21T14:56:00.000-07:00

So it looks like MediaNews Group will be joining the paywall brigade. Again, of all the ideas for saving newspapers out there, charging for content is not a bad one. Will it be the answer to newspapers' prayers? Maybe, maybe not.

But MediaNews has other stated plans, including building separate sites for news and local community info/discussions. Why do they have to be seperate? Who knows. Seems like a boneheaded idea that will dilute their established local brands, but we'll wait to see how it's executed before a final judgement is made.

Overall, however, this is another instance where we must commend the company for doing something meaningful.

Of course, MediaNews is not exactly known as a model of corporate efficiency or innovation. Quality has been sliding at its papers as layoffs continue to erode its reporting corps. People aren't going to pay for content if they don't think the content is worth paying for. That means that the content must be relevant and original (not available elsewhere). And that means bolstering local coverage. It doesn't have to be hyperlocal, it just needs to be local, extensive and high-quality. That's the strength of local papers, and that's what people will pay for. Local TV and various web start-ups may try to poach the audience that wants local headlines but isn't necessarily interested enough in local goings-on to pay for it. But as long as those entities remain small players, breadth-of-coverage wise, there will be a sizable population willing to pay for something better.

The Politico Model

2009-05-14T19:24:00.001-07:00

The Politico offers a unique model for newspapers to follow:

It is essentially a national web brand, although a significant portion of its revenue is derived from a printed newspaper delivered to power brokers in Washington, DC.
Insiders and outsiders alike consume its niche political coverage.
Since its launch in 2007, it has largely escaped any accusations of bias.
Despite its youthful snappiness, Politico is staffed mostly by veteran reporters.
It is expected to reach profitability this year, well ahead of schedule.
It quickly gained brand recognition after its launch by breaking stories, and by its reporters' frequent appearances on cable news programs.

Newspapers looking to reinvent themselves as web-only entities should take a hard look at the roots of Politico's success as a brand. Those papers should also consider that Politico is still making money off print.

Politico co-founder Jim VandeHei does not like the prospects for the survival of local newspapers, however. In a discussion at the National Press Club this week, VandeHei said he expects that 18 months from now most papers will have closed or shrank beyond recognition. Larger papers like the New York Times, Wall Street Journal and Washington Post have a much greater chance of surviving, VandeHei said.

Newspapers will eventually have to charge for content, VandeHei added, because internet ads are ineffective and will never provide the kind of revenue that print ads provided. Politico earns approximately 40 percent of its revenue from internet ads, according to VandeHei.

Does Chicago Now = The Future?

2009-05-05T08:26:00.000-07:00

As an addendum to the post about Chicago Now... the ideal goal for newspaper web sites going forward is to be the go-to place for people to learn about and discuss news and issues going on in their communities. It's also to be the go-to place for local companies to connect with consumers. This goes above and beyond just being the number one local news site in their respective markets (which most are already). It's about leveraging that dominance to be the hub of everything local. Whether the content is produced in-house, by individual bloggers, or by third-party companies, it should be monetized by a newspaper company. We'll see if Chicago Now succeeds at this.

While we're on the topic, let's get our terminology straight here. The definition of a newspaper is no longer just the printed product that gets ink on your fingers. A newspaper is the collective work of a primarily words-on-the-page-based news organization (both in print and on the web). Print and web refer to the medium in which those words are delivered but, in the case of most articles, the words stay the same regardless of medium. Arbitrary divisions between the print and web in the newsroom don't make much sense. Let's agree that "newspaper," "newspaper web site" and "news organization" mean essentially the same thing.

Tribune to Launch "Chicago Now"

2009-05-05T03:27:00.000-07:00

Tribune is gearing up for the launch of a new web site called "Chicago Now." Tribune is billing this as "Huffington Post meets Facebook for Chicago." It will feature the "best bloggers in Chicago" and, apparently, some sort of social networking platform. It "will not rely on traditional display advertising," but will generate revenue through e-commerce, "sponsorships," "advertorials" and "other creative advertising solutions."

Tribune is saying that there's "nothing like" Chicago Now, which was "first conceived" in December 2008, but the idea of a blog network is not exactly new. Tribune says that, to date, "no other media company has created anything like Chicago Now," but that's apparently not counting the Huffington Post as a media company for its local news effort in Chicago. It's also not clear what Tribune means by saying that the site will "steal [market] share from the likes of Yahoo and Google."

In all, however, this is a very promising experiment. I've been supporting the idea of newspapers hosting blog networks, and this appears to be the first large-scale implementation of that. Trying to generate revenue outside of display ads is an inspired plan, since it's clear that web display ads will not support local newsgathering for the foreseeable future. And adding a dynamic community (a.k.a.: social networking) component to the site could help multiply its page views several fold, and keep readers from retreating to sites like digg and Fark to discuss articles.

There are several important unanswered questions here:

What sort of e-commerce will the site engage in? What's being sold? Will it try to act as a middleman between readers and local merchants?
How are the contributors being paid? Sharing revenue generated by their blogs? A negotiated fee? Or not at all (perhaps giving bloggers the option of hosting Google ads)?
Will contributors receive enough compensation to keep them blogging? Will the site generate enough revenue to sustain itself?

Government Cancels Subscriptions

2009-04-23T21:10:00.000-07:00

You know your business model is in trouble when entire cabinet-level agencies in a Democratic administration are canceling their newspaper subscriptions. Homeland Security has instructed its employees to access articles online instead. After all, "most publications can be found online on an in-house Web site," the agency said (via the Associated Press). Newspapers that are relying on print for the vast majority of revenue, yet are giving content away online without getting much in return, are absolutely in trouble. Perhaps there should be a reprise of the morning/evening paper model, except with a paid print entity and a free internet entity in each city. At the very least it would be interesting to see if readers would pay for higher quality.

Free Fall on Eighth Avenue

2009-04-21T05:54:00.001-07:00

The New York Times Company's advertising revenue fell 27 percent in the first quarter. The company lost $74.5 million dollars. NYT Co. is blaming most of the troubles on the perpetually underperforming Boston Globe. The company's overall ad revenue dropped by $124 million year over year. Internet advertising was not immune, declining 8 percent to just over $40 million.

Once again, we see evidence that newspapers' pain is nowhere near letting up. We also see more evidence that internet advertising is not going to come to the rescue of ailing media companies. On the contrary, it's becoming clear that a gross oversupply of ad inventory on the web has the potential to drag down revenues for all advertising-dependent traditional media companies for years to come.

Local papers will have the best chance of surviving going forward. The key will be to build a large network of local web sites and sell ads across the network (a la Google); in essence, to be the dominant player in each local advertising market. It's anybody's guess how a national paper like the Times will be able to survive in its current form if print continues to bleed.

Hyperlocal Dreams, Fiscal Realities

2009-04-20T19:58:00.000-07:00

As established news companies and entrepreneurs dip their toes in the hyperlocal waters, there are increasing doubts that such ventures will be self-sustaining. Traditional local ad spending is in the dumps, and local ad dollars aren't making the leap to the web. Billions of dollars are potentially at stake, but it's a steep climb to hyperlocal Valhalla.

The first challenge is attracting an actively-participating audience. Hyperlocal promises to deliver relevant local information to consumers (see Patch for a well-executed example) who, in theory, would welcome such a resource. In practice, though, we have only seen a relatively small group utilizing such sites. Building an audience is a slow and uneven process and it's not clear how much time consumers will devote to contributing such sites on a regular basis.

The bigger challenge here is monetizing hyperlocal. As mentioned above, local advertisers often just don't have the know-how or cash to invest in online ads. Self-serve ad solutions show promise but, again, it's hard to convince a small business owner to throw money at such an unproven, unestablished ad medium. A look through Patch will reveal very few ads from local businesses.

Hyperlocal sites provide a valuable service to local communities, but it looks like they will remain unprofitable works-in-progress for the foreseeable future. Also, such sites will probably never produce the kind of big-picture journalism found in city dailies, so forget the argument that such sites can be a newspaper replacement.

Local governments may consider funding their own hyperlocal sites as a value-added service to residents. I'm reminded of my suburban hometown's monthly magazine. It was officially a government entity, but it was well-produced, editorially independent, and mostly self-sustaining through advertising revenue. Government-supported hyperlocal sites that follow a similar model may not be totally self-sustaining, but they could be quite successful in other ways.

Debut of South Florida Live

2009-04-12T21:47:00.000-07:00

As of this writing, it's roughly three hours until "South Florida Live" debuts on the web and on the Miami-area airwaves. It's essentially a joint production of Tribune-owned WSFL-TV and the South Florida Sun-Sentinel. Give Sam Zell credit for conducting the boldest TV/print "synergy" experiment so far, after witnessing a long line of synergistic non-starters and outright failures.

The idea here is to create an unconventional newscast using the newsgathering resources of the Sun-Sentinel paper, as opposed to an independent assignment desk. It's also to look as flashy as possible for as cheaply as possible.

A "SFL" rehearsal was released on the web. Of course, it's a work in progress, and it's easy to criticize any venture like this when it's in such a nascent stage. Inauspicious debuts are quite normal for TV, although Tribune set a high bar for on-air disasters during the hurried launch of Fox5 San Diego's "unconventional" newscast (huge map of San Diego in the parking lot, anybody?).

There are several things to like about SFL. The graphics actually manage to be (somewhat) innovative, informative, and (yes) flashy at the same time. The hosts have personality and appear perfectly comfortable on camera. The set in the center of the Sun-Sentinel newsroom seems to work. There's a feature reporter who was actually live somewhere. The Zellian dream of doing the weather using the newspaper's weather map was apparently scrapped in favor of modern, conventional weather graphics.

For all the flash and relative polish, there was one thing conspicuously missing: news. Sure there was a bunch of yapping. And some actual weather forecasting (no traffic, but that's not a mortal sin). But where was the news? Where was the point where they actually presented topical information of interest to their specific local viewing audience? Perhaps that detail is being left out of the rehearsals, but if not I forecast stormy seas for SFL.

Okay, there was a lengthy feature about US-Cuba relations. Presented with the ultra-compelling visual accompaniment of a small image of a web story. The story was introduced in a lackadaisical, time-consuming manner that reverses the conventional wisdom that viewers want more information, faster. Other than the shaky camera work during the sound bite, this is the antithesis of MTV (so much for Lee Abrams' rock n' roll thinking).

Contrary to brain-dead media management belief, people don't want to watch a bunch of people sitting around talking about nothing. The key to maintaining (and even building) a broadcast news audience in the internet age is to present relevant content in a timely manner. This isn't rocket science.

The bottom line is that this could work. Relying on a newspaper for broadcast newsgathering is certainly unconventional, in that it potentially de-emphasizes crashes, shootings and other shallow "breaking" news. This could result in smarter, more enterprise-driven stories making it to air (think: NPR on TV). But in this format, an ounce of smart news will likely be lost in a gallon of meaningless drivel.

Bad News Bears

2009-04-02T16:59:00.000-07:00

The Great Newspaper Meltdown shows no sign of slowing down.

Chicago's Sun-Times Media Group has filed for Chapter 11 bankruptcy, a probable prelude to a liquidation when credit market conditions improve.

Meanwhile, Belo continues to ride the roller coaster straight down towards bankruptcy with $10 million in salary reductions. Hey, it makes more sense than paying people to stop writing.

WaPo committs resources to weddings

2009-03-23T21:47:00.000-07:00

Earlier I said that newspapers were missing out on some lucrative areas of niche local coverage, like weddings. Has the Washington Post been reading this blog? FishbowlDC has an internal memo where the eds look for a local wedding reporter.

Of course, the Post just decided to cut the business section, which I promoted as another under-served area of local coverage, so we'll call the score even for now.

Reinvention by arbitrary distinctions

2009-03-23T20:59:00.001-07:00

Today Advance Publications announced that the Ann Arbor News will cease to be in July. In its place, a company called AnnArbor.com LLC will take over, printing a twice-daily paper and a weekly "total market" printed product. The News made a sad announcement of the "difficult" news to its readers. It's as if General Mills decided to discontinue production of Honey Nut and Frosted Cheerios, and therefore decided to rename Cheerios "WholeGrainCereal.com" amid much melancholy fanfare.

The Ann Arbor News is a 174-year-old brand. Everybody in the town knows about it and has an opinion on it. Why mothball the brand when you can reinvent it? A change to the printed publication and a retrenchment of the web site can be done within the context of "The Ann Arbor News."

If there's anything that media companies possess, it's brand equity. Newspaper companies may be facing difficult times, but now is not the time to burn the house down to build a shack on the lot.

Kudos to Advance for trying out a new model; every time someone tries something different, we learn more about what works and what doesn't. But distinguishing between your established print brand and web site remains a terrible idea (in related news, the Washington Post has, apparently, finally decided that locating their web staff in Virginia was a mistake). A hybrid, platform-agnostic approach to the news is the way to go.

DC Bureau, Unfocused Web Site Closing

2009-03-16T22:06:00.000-07:00

Sadly, Media General is closing its DC bureau. Along with it goes another unfocused, poorly thought-out web site, mgwashington.com.

Years from now, people chronicling the downfall of the newspaper giants will wonder: who could possibly have thought a site like that a prudent use of scarce resources? What business does a local newspaper company have trying to compete in the already-crowded national news landscape? Who thinks a struggling corporate parent company, like Media General or McClatchy, would make a good brand? Why create a seperate brand, rather than promoting your already established local brands?

Sure, there's something to be said for throwing shit at the wall and seeing what sticks. But if you're making most of your money selling local newspaper ads, why are you creating a web site to sell national web ads? It boggles the mind. I question whether these sites are profitable, even if you don't factor in the salaries of the reporters generating the content.

Newspaper companies, take note: original national reporting adds value and brand prestige. Reporting on local politicians and legislative issues from Washington adds relevance. Unfocused, quixotic web strategies add nothing.

Simon: City Journalism Already Dead in Baltimore

2009-03-02T11:16:00.000-08:00

"The Wire" creator David Simon weighed in on the demise of newspapers in this Sunday's Washington Post. He argues that the Baltimore Sun gave a one-over treatment to a police-involved shooting that would have been a much bigger deal back in the day when reporters actually put shoe-to-pavement to report on local crime. Furthermore, Simon said he "didn't trip over any blogger[s]" or citizen journalists on the way to the police department to check out the story.

City dailies would do well to take notice of The Wire's popularity with 20- and 30-somethings. The future currency of local papers will be purely local reporting. If papers made more of an effort to flesh out local crime stories, local police departments, and the city's underworld figures, it could help attract younger readers (and may produce some nostalgia for the print product).

Hearst to Charge for Digital Content (finally?)

2009-02-28T17:46:00.000-08:00

Prepare for the pay wall wave. First Newsday, then Hearst newspapers. Here's the Hearst memo (hat tip):

Dear Colleague:

We are at the halfway point in our “100 Days of Change” program and I want to share with you the progress that we’ve made on ideas that fundamentally change the way we do business. Many of you have taken the time to write to me or to the various task force leaders with your thoughts and suggestions, and I’m extremely pleased by the level of energy and cooperation I’ve seen across our newspaper company.

One inescapable conclusion of our study is that our cost base is significantly out of line with the revenue available in our business today. It is equally inescapable that
during good times our industry developed business practices that were at best inefficient. For example, all newspapers look pretty much alike, and yet they are not similar enough to allow for efficient production or common content sharing. This must and will change. Another example is that while we have a tremendous opportunity to continue growing our advertising business with small customers, we cannot afford to do so by calling on every advertiser in person every other week and then having a team of artists build and rebuild their ads. We must and will learn to use outbound telemarketing and self-service ad platforms more effectively. I’m confident we can move to rationalize our costs without impairing our ability to give our readers and advertisers the best news and information products in our markets. Even with the cost reductions we are making we have far more resources devoted to reporting local news and information than any other local media outlet. Thus, each of our management teams is at work to complete a fundamental restructuring so we can turn our full attention to product innovation and revenue growth.

Next, we have a revenue and business model problem as opposed to an audience problem. Yes, it is true that fewer people read a newspaper on any given day today than they did in the past, but with the proliferation of media options, consumption of individual media types isn’t what it once was and probably never will be again. Our audience is still the largest of any local news and information media outlet. And when combined with newspapers’ Internet audience, our audience has actually been growing in recent years while our revenue has been declining. So it is our business model that must change in several ways.
We believe we must begin to provide greater differentiation between the content of our free Web sites and the content of our paid product, be that paid product read in print, on a digital device like Amazon’s Kindle, or online. This doesn’t mean we wall
off our Web sites behind a paid barrier. Our sites must continue to be the superior and dominant free Web sites in their markets. This means they must offer the best in breaking news, staff and reader blogs, community databases and photo galleries. In fact, we need to expand the number of reporters, editors and photographers who are running a truly great blog, creating a rich dialogue of opinion and data sharing. We must do a far better job of reaching out to prominent citizens in our communities, those who already have a blog and those who don’t, and providing them a prominent platform to state their views. We must develop a rich network of correspondents to help us grow the deepest hyper-local community microsites in our markets. We must do a better job of linking to other great sources of content in our communities. And we must put staff resources behind building those channels of interest that have the greatest potential: those built around pro sports teams, moms and high school sports, to name a few.
Exactly how much paid content to hold back from our free sites will be a judgment call made daily by our management, whose mission should be to run the best free Web sites in our markets without compromising our ability to get a fair price from consumers for the expensive, unique reporting and writing that we produce each day.

We must continue to ask readers to pay more for their subscriptions. Our print subscribers don’t pay us enough today that we can say they are actually paying for content. Rather, we only ask readers to pay for a portion of the cost of printing the paper on newsprint and delivering it to the reader’s doorstep. We must gradually, but persistently, change this practice. We ask our readers to pay for their subscriptions on the Kindle today, and we must begin doing the same thing on the iPhone and other advanced smart phones and reading devices that allow us to create a user experience worth paying for. We also need to make our paid product available through the Internet for those who prefer to read it that way. And we must innovate to constantly enhance the reading and advertising experience on these platforms.

Our sales forces must make a transformation similar in scope to the one that IBM underwent in the 90s when it went from a mainframe selling culture to a strategy of being true IT consultants to their clients, even selling them non-IBM products when warranted. In our case, we must fully make the leap from simply selling pages to selling audiences, and in doing so be able to sell packages of products, some of which won’t be our own. The best of our Hearst Newspapers colleagues are already doing this, combining our offerings with those of Yahoo!, Google, MSN, AOL, Ask.com Yahoo! HotJobs and Zillow and networks of local Web sites that we have assembled. All of these products are in our portfolio today. Our advertising task force has created a three-month course of transformational instruction built around a massive sales contest that each of your markets either has launched or is launching. I’m confident that most of our reps will emerge from this process set on a path to become topflight, consultative sellers of audience.

One final $overarching thought emerges from our look at advertising sales: we must use third-party printers in all of our markets in order to significantly add more color to our products, not so much for our readers’ needs, but to be more competitive in the battle for advertising dollars in a high-definition world.

Finally, while our savviest advertising customers know that our products still work well for them, as do our most passionate readers, we have done a poor job of telling our story. This becomes even more important as we change our business model. Our
communications task force has developed a wonderful new campaign that begins to put us back where we should be—on the offensive about the vital role we play in the politics, social lives and commerce of our communities. We’ll have samples of the campaign available next week on 100DaysofChange.com.

Please discuss these ideas with your colleagues, your managers, our customers and our readers, and let us know what you think. Our goal is to emerge from the “100
Days” with a cost structure we can build our future on and a business model that seeks, by 2011, to get more than 50 percent of our revenue from circulation revenue and digital advertising sales—two areas of our business that we know we can grow and grow consistently as this recession subsides.
I know these are difficult times for those in businesses like ours that are buffeted by
so many forces. Yet I know that we have the wherewithal to emerge from this recession with a changed business, yes, but one that is back on a path of growth. Thank you again for your commitment to see us through this journey.

Best regards,

Steve

Hearst may be the first big newspaper company that "gets" what's going on with their business, and is actually doing something about it. Kudos.

Although I've been promoting various ways to increase digital revenue here, I admit that the pay wall may ultimately be the way to go.

I imagine this will lead to a wave of more pay walls. And why not? What is there to lose? The small and stagnant internet ad revenue? I agree that this may be too late... the dam may have already burst. But better late than never. And the implementation of ideas previously articultated on this blog and others (outsourcing printing, blog networks, sales/marketing revamp, etc.) is certainly a step in the right direction. Looking forward to seeing if it produces results.

Here's a letter I wrote to Romenesko two years ago.

Poynter Forums
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Topic: Letters Sent to Romenesko
Date/Time: 3/16/2007 4:47:31 PM
Title: Lazarus is right
Posted By:
Jim Romenesko

From SCOTT B: I just wanted to say "amen" to David Lazarus' column regarding pay-to-play. I'm a recent college grad working in TV news, and I've been saying for months that the newspaper circulation drain is directly related to those same newspapers giving away their product on the 'net. Of course, my peers think I'm crazy for saying that a local newspaper should charge money for their web site. But as long as news organizations cannot monetize their content on the web as they can in print, people my age are going to find it increasingly difficult to find a good job in this business.

Okay, but let's play devil's advocate for a second. Let's suppose local advertising agencies will become more successful at getting more local advertisers onto the internet... and national advertisers figure out how to make their online ads more effective. Internet advertising rates continue their rapid climb, print rates continue to decline. If more than 50% of a news organization's revenue comes from its web site, will the business side get more involved in story selection? After all, internet revenue is directly connected to the amount of views an article gets. Are newspapers then going to devote more resources into seeking out the human interest and celebrity-driven stories that consistently make it on the "most popular" lists?

I don't think any scenario here is healthy for journalism or our society.

Rocky Mountain News Prints Last Edition

2009-02-26T21:29:00.000-08:00

The Rocky Mountain News is shutting off the presses today after nearly 150 years. As institutions like the Rocky go under, it's becoming harder to shake the feeling of loss and sadness for the way things once were.

What's particularly frustrating is how rapidly time is running out for print journalism. It's becoming more apparent that, in this recession, it may be impossible for debt-ridden newspapers to reinvent themselves. A successful reinvention will require a significant investment, and that doesn't seem to be forthcoming. What would sort of replacement would pop up if a city's last daily disappears?

A number of small, web-only start-ups? A leaner, but more traditional paper?

A number of web-only local news organizations (the most ambitious of which are non-profits) currently exist, and while they put forth an admirable effort, these sites still aren't close to matching the breadth of reporting and the resources of a large daily.

Part of what has made the public service mission of newspapers possible is their mass appeal. It's unclear whether a web replacement would be equally influential.

What if...

2009-02-23T23:21:00.000-08:00

With newspaper bankruptcies spreading, a persistent question is: what if a city's lone daily newspaper goes out of business? Then what? Patch, a start-up company founded by Google ad man Tim Armstrong, is testing the brave new waters to see if it has the answer. The site has set up shop in parts of New Jersey, trying to see if a small nucleus of editors and contributors can be more successful at attracting user contributions than purely crowdsourced sites and other well-intentioned near-failures. Newspaper companies would do well to closely track its progress. The idea of a newspaper/citizen journalism/social network hybrid is appealing, although during a recession newspapers should probably focus on growing internet revenue and maintaining a nominal level of local reporting first and foremost.

If an upstart local news operation like Patch wants to start gaining name recognition and legitimacy, there's a path that has already been blazed by a number of sites on a national level: Offer up exclusive content and editor/reporter interviews to local TV stations, free of charge. Witness how TMZ took off when its videos of celebs behaving badly (Michael Richards, anyone?) were played over and over again (with a TMZ bug burned in) on entertainment TV. Look at how within a year of its launch, Politico had enviable brand recognition because its reporters and editors were appearing on numerous cable news shows (with politico.com below their name in the lower thirds). It's truly a mutually-beneficial relationship. Mr. Armstrong can thank me later for the free advice.

More Local, More Money

2009-02-17T22:52:00.000-08:00

There are some areas of local coverage that have been suffering with the newspaper industry contraction, yet these topics ideally lend themselves to profitable, targeted advertising. Part of the trick to monetizing the web going forward will be creating what we'll call "drivers of commerce" -- content areas where readers are more likely to be interested in ads that answer the question "where can I find...?" For instance:

Weddings (photographers, caterers, wedding venues, etc.)
Editorial obituaries (funeral homes, life insurance, financial advisers, etc.)
School events such as proms, graduations, plays (event photographers, dress/tux rental, limo companies, etc.)
Restaurant reviews (restaurants)

Automotive (car dealerships) and real estate (homes for sale) sections are generally still alive and well. Local business (financial and business services) sections often, ironically enough, lack detailed coverage of actual local businesses, choosing to cede that to Business Journal-type publications. Some day, perhaps, newspapers will be back in a competitive mindset and will try to regain primacy this potentially lucrative coverage area.

The Power of Local

2009-02-17T17:46:00.000-08:00

Great discussion of the future of local advertising on the web:

http://www.buzzmachine.com/2009/02/16/the-local-ad-opportunity-and-the-danger-of-losing-it/

Free Advice for Legislative Press Aides

2009-02-09T17:22:00.000-08:00

The number of regional reporters covering their local congressional delegations in Washington is dwindling, as the Washington Post points out. Even with the Obama presidency pushing interest in Washington politics to an all-time high, the regional press corps is shrinking. Until newspapers can figure out how to better monetize their content, this trend is likely to continue.

In the meantime, many papers are attempting to cover legislators from afar. It's not an ideal situation, but quality of coverage doesn't necessarily have to suffer. To help facilitate better coverage, here are some ideas for legislative press personnel.

Build more contacts among the local press and bloggers. Send out press releases and statements on a regular -- but not overwhelming -- basis. Make sure the releases are engaging, concise, and have a solid, easily-identifiable news hook.
Take style cues from Sen. Chuck Schumer. Witness the subject of a recent Schumer press release: "SCHUMER, PASCRELL REVEAL: BRUCE SPRINGSTEEN TICKET DEBACLE TIP OF THE ICEBERG - IMPENDING TICKETMASTER MERGER COULD LIMIT CONSUMER CHOICE, SEND CONCERT TICKET PRICES AND FEES THROUGH THE ROOF."
Conduct regular press conferences back in your state/district (a la Schumer)
Bring a video camera along to every press conference and public appearance the member attends. Post on YouTube, and grant usage rights to media outlets.
Conduct video conference calls via Skype.
Post news, photos and video in a constituent-oriented blog. This is not necessarily an original idea, but most congressional blogs are either rarely-updated or poorly-executed.
Posting video of floor speeches is great, but make sure the video makes it on the web site on the same day, rather than a week after the fact. A transcript would also be nice.
In addition to bloggers, also try to reach out to student media. The influence of student publications is underrated.

Priorities

2009-01-25T14:43:00.000-08:00

Last week Seth Godin asked: "When newspapers are gone, what will you miss?" His conclusion was that most of what's in a newspaper (comics, weather, sports, etc.) can be done "better" online, while newspapers are better-suited to actual local newsgathering, an act that allegedly only makes up 2% of newspapers' budget. While I respectfully disagree with the cost analysis, the question of where a local newspaper's priorities should lie -- during a time of financial peril -- is a fascinating one.

There are two common, competing visions of the future of news. In one, daily newspapers die, and semi-professional bloggers pick up the slack. In another, newspapers survive as shrunken online versions of their print selves. Leaving the online vs. print debate for the next post, let's discuss a middle ground between these two visions.

Bloggers do opinion exceptionally well. Politics, pop culture and celebrities, sports, and so on. You can find a blogger opining on just about any topic if you look hard enough. What bloggers don't do much of is actual original news reporting. How many blogs actually break news or make calls to follow up on a story? Very few. Instead, there is a lot of linking to professional news organizations.

Newspapers also pay professionals to opine. An incomplete list include editorial boards, TV and movie critics, fashion critics, book reviewers, and sports columnists. These individuals provide an authoritative local voice on topics that matter to lots of people, but their public service is no longer unique. On the other hand, a city hall beat reporter may not be writing articles with as much general interest, but he or she providing a service to the community that largely does not exist in the blogosphere.

Newspapers have to make tough decisions. It's inevitable that many more jobs will be lost. When those cuts need to be made, it would be folly to let go of experienced local news reporters. Instead, newspapers should think about creating a branded blog network. Seek out the best local voices on the local arts scene, on local politics, and on national topics like politics and pop culture. Pitch bloggers on the local advertising leverage your newspaper possesses. Host the blog on your server, and sell ad space on it. The Washington Post is doing this, more or less, for the Capital Weather Gang. Split ad revenues 50/50 or 60/40, and offer bonuses (and publicity) for material that makes it to the print edition. Encourage your bloggers to increase their visibility by appearing on local TV and by promoting their blog posts through news aggregators and on other blogs.

Here are some positions that could be outsourced to exceptional local bloggers:

TV critic
Movie critic
Fashion critic
Theater critic
Music critic
Art critic
Book critic
Pop culture commentary
Weather commentary
Sports columnist
Editorial cartoonist
Editorial board (advocated for long ago by Michael Kinsley)
Local politics commentary
National politics commentary
Ombudsman (may be outsourced to a local journalism professor, for instance)

I don't revel in the potential loss of these well-paying jobs within a newspaper. Some of the new pro-am bloggers may be able to make a decent part-time income through their blogs. Through their newly-minted affiliation, they will also be able to gain notoriety and access to screenings, press kits, sporting events, etc. But most will not be able to match the secure living wage and level of expertise of their former professional counterparts. When times are tough, however, tough decisions must be made about how to allocate precious resources.

Here are some topics that local newspapers should continue to cover in-house. In some cases, coverage of these topics has suffered as of late. These are very sparsely covered, if at all, by local bloggers, partially because things like weddings are difficult to cover outside the context of a trusted, centralized news organization. Newspapers may want to consider ramping-up their coverage of these topics.

Local K-12 schools and school sports
Local colleges and college sports
Local pro sports
Local business
Local government
State government
Local U.S. congressional delegation in Washington
Crimes/fires/serious traffic accidents/etc.
Local happenings/events/calendar
Obituaries
Weddings

The mission is simple: focus on providing readers with local content that they can't get anywhere else

Hirschorn, the Times, and blogging

2009-01-19T19:30:00.000-08:00

There's much to be said about Michael Hirschorn's fascinating and controversial Atlanic article about the theoretical end of the New York Times.

The article suggests that the paper could run out of cash by May (not so fast: Mexican billionaire Carlos Slim has come to the Times' rescue.) The bulk of the article reflects on the unsavory possibility that a post-print Times, with 1/5th of the original newsroom, may have to survive with some sort of a content-sharing and aggregation model that may or may not fulfill the Times' newspaper-of-record mission.

Hirschorn writes:

In an optimistic scenario, the remaining reporters—now reporters-cum-bloggers, in many cases—could use their considerable savvy to mix their own reporting with that of others, giving us a more integrative, real-time view of the world unencumbered by the inefficiencies of the traditional journalistic form.

Not a terrible outcome, but is it really necessary for every reporter to be a blogger? The internet blurs the distinctions between news sources. Audiences don't necessarily make the distinction between, say, a newspaper article and a magazine article on the web. So why should newspapers worry about publishing blog posts versus "regular" articles? The answer is: they shouldn't. Newspapers should remain content agnostic on the web: as long as a story meets journalistic standards, it should be presented in whatever form best conveys the story.

There's another issue here. Where would all this blog content go? Would the Times play host to hundreds of reporter blogs? If so, it would risk overwhelming readers with too much content. Remember that internet news aggregators have been successful because they allow people to get all their news in one place. Potential newspaper blogs should be chosen carefully from the niche topics that reporters cover.

UPDATE: Marvel as I partially contradict myself in the post above. To clear up any confusion, I don't think there's anything wrong with blogging or newspapers maintaining blogs. I just think that sometimes newspapers blindly pursue "bloggishness" with little regard to actual reader demand.