After 125 years as the “bible” of the newspaper business, Editor & Publisher magazine announced yesterday that it would shut its doors at the end of the year.
One hundred and twenty five years and pffft. E&P goes down with the newspaper ship.
Where will Google be in 125 years? What will Google mean in 125 years to media students and consumers? I heard Google CEO, Eric Schmidt, say once that after careful figuring the company estimates it will take approximately 300 years for them to catalogue all the world’s information, which they aim to do. He had a good chuckle about that along with everyone else in the audience.
What will information even look like in 300 years?
Truly when you’re young you expect to live forever.
One hundred and twenty five years is a pretty good run. The best thing I can think of saying to everyone at Editor & Publisher is congratulations. It is an extraordinary record of accomplishment, and we salute you.
For whatever reason, while at the Toronto International Film FestivalMichael Moore departed briefly from promoting his new film, “Capitalism: A Love Story”, to hold forth on the demise of newspapers in the U.S. Elsewhere in the world, he said, newspapers are supported first by the readers, then by advertising. Not in the U.S. Here, he complained, newspapers have allowed their greed for advertising revenue to trump quality journalism dedicated to a core audience willing to pay. The result: inflated newspaper enterprises with unsustainable distribution and too many customers that don’t care. And, then, the death spiral that starts with chopping-off reporting arms and legs, which leads to newspapers that are less relevant and valuable, etc, etc.
Says Michael Moore, “Anytime you say that the people who read your newspaper are secondary to the business community, you’ve lost.”
“Good riddance”, he says.
Well, minus the “Good riddance”, I’d have to agree, at least with the proposition that newspapers lost track of their core customer. But don’t stop with newspapers. It’s true about most media, which have permitted the substitution of advertisers for consumers as the most important customer in their business model. It has led, in turn, to the steady erosion of relevancy in pursuit of lower common denominators in order to maximize reach.
There is something about all businesses that compels them to want to grow and that almost always, eventually, leads them away from core competencies and over the edge. That’s for another time and place. Media-wise, while I’m not in love with his stuff as a film maker, Michael Moore cuts close to the truth: fundamentally, newspapers (I’d say, all media) have lost track of their most important customer: the audience.
Moore goes on about Republicans and the Department of Education and I glaze over. We all must recognize that illiteracy is a serious problem, but newspapers aren’t suffering because of an illiterate population. There are still plenty of people to buy, read and comprehend newspapers. Newspapers and media are suffering from a habitual desire to stuff themselves. They are, simply, overweight – another greedy, cultural phenomenon of America to which Mr. Moore could have drawn parallels, but did not.
Never mind. His point is well-taken. Please watch Mr. Moore’s press conference and before his arguments fade please then point to TechCrunch.com to catch-up on the discussions that went on at the Tech Crunch 50 Conference (TC50) in San Francisco this week, specifically the panel called, “‘Creating scarcity, value and brand protection as we face limitless ad inventory”.
Nearly a continent away, panelist Ross Levinsohn of 5 to 1 channels the thoughts of Michael Moore and connects the dots: “In many ways”, he is quoted as saying on the panel, “I think the Internet has killed itself to a degree because there was a notion that I will just add another page without maximizing the premium spots.”
Newspapers have been getting a lot of attention in this blog because the arc of their business has traced a path to guide companies in a new media world. The path leads to this: remain relevant at the expense of size. More audience for the sake of audience (for the sake of selling more advertising) eventually undermines the structural integrity of the proposition. Never mind that more audience is expensive.
Newspapers are not guilty of being old. In the brief history of the Internet plenty of new media turks have collapsed under the weight of their own audience ambitions. “Portals” dotted the landscape until most of them keeled over. The ones that remain do not make the living look easy. Now it’s social networks. Also overstuffed. Also red in the face from exertion. The irony of new media is the extent to which it tries to become like old media – simply big - which is a bad plan.
With all this in mind, a colleague refers us to this piece in the Wall Street Journal today: “Investors Bet on Small-Market Papers.” It’s probably not true of this story that investors have had an Ah-Ha! moment and are making bets based on strategic, new media kinds of reasons. It’s simply a flight of capital away from the troubled big-market newspapers that offer very few (none?) investor prospects near-term. But, markets can be perfect even when they are running away, and the rationale for investing in small, relevant media is a good one for the long-term. Of course, the Internet doesn’t feel that kind of fear yet. It’s too young. Big Internet media propositions wobble and fail and people organize to erect new ones.
In the meantime, the Internet is saturated with small, relevant publishers. Which is why it’s hoped that spending time thinking about newspapers can lead us to view the New Media forest amongst the trees.
Jason Klein, CEO of the Newspaper National Network, was in Ad Age yesterday with a thoughtful piece about the torments of the newspaper business today. Jason has a great vantage point from which to comment, given the NNN’s close working relationship with virtually every newspaper in the country.
I agree with almost all of his points - including, most importantly, the enduring value and ability of newspapers to survive as print properties. But, I don’t agree that the path to survival is fewer newspapers, and/or that the economics of the business favors one large newspaper per city.
To the contrary, the economics of the media business today favors the small. The Internet is only the most recent and obvious example of how the business of producing and distributing content has fundamentally been fragmenting into smaller and smaller units for decades, beginning with Cable TV. Nevermind how fragmentation has perplexed advertisers and media buyers. They will catch-up on their own to the new, narrower nature of things. The business of providing content that audiences find valuable, and for which they may even be willing to pay, favors the discreet. It favors the targeted.
Accordingly, the economics of newspapers going forward favor a return to multi-paper cities. Not one newspaper per city, but more-than-one, smaller newspaper per city probably divided along unique demographic, social or political interests. One-section newspapers, easily distributed, with carrying costs subsidized largely by subscriptions.
There may be a place for the consolidation of distribution and content at a national or broadcast kind of level, but it will be a battle to perpetuate: Ask any company trying to sustain those sort of franchises today, such as Yahoo! or even the New York Times.
Again, we should pay careful attention to the plight of newspapers (and traditional media, generally) lest history repeat itself in too short a time. As Jason Klein says, the bell is tolling for newspapers. But, it tolls for all of us.
More about how to save newspapers today in Jon Freidman’s Marketwatch column. Pundits Larry Kramer, Laura Rich Fine and Nathan Richardson, all credentialed new media-types, argue collectively that newspapers need to have the gumption to charge readers for their products. Historically, they have not had that gumption. This is true. But, what should they charge? Today it is a token. If it is to be financially relevant to the business it means the cost of a newspaper will skyrocket. And/or, the newspaper product will shrink to fit a cost that is perhaps only modestly more than what people pay now. I paid $2.00 for the Wall Street Journal yesterday in the Boston airport. The New York Times, delivered free to my hotel room do0r this morning, has a cover price of $1.50. It is four sections and 90 pages deep, which just has to be (ridicuously) expensive. What could we expect if these properties assigned a more realistic price to their daily products, one that covered all the costs of ink and paper and distribution, for instance? $4.00? $5.00? $10?
One thing that would drop as a result of a price increase is the free hotel distribution, which can add up to a substantial portion of a newspaper’s daily circulation. But the fear – and reality – has always been, of course, that raising newstand prices on newspapers would cause the circulation to crumble, which would starve the advertising side. Okay, but so what? Newspapers need to act very quickly to find their core audience – that constituency that will pay almost any price for the product. A pack of cigarettes today, I am informed, costs over $10. Plenty of people still smoke. It’s helps that cigarettes are addicting, but so are newspapers to some. A small, deeply dedicated audience is a marketers dream – or ought to be. If they want to charge more, newspapers need to retreat to within those dedicated audience boundaries and make a big deal to advertisers of the fact that people are willing to pay a lot for the privilege of receiving their newspaper.
Or not. Michael Kinsley, writing a couple of weeks ago in the Washington Post, talked about life after newspapers arguing that, sad as it may be, their time may have come and gone. Quoting Joseph Shumpeter he wrote, ”Capitalism is a ‘perennial gale of creative destruction.’ Industries come and go.” Newspapers, he suggests - not unreasonably - are in the “go” part of the cycle.
Yes, but there are vital lessons in the plight of newspapers for all media, including online. The conditions of newspapers, after all, have been wrought by the same media intelligentsia that has dominated online. Their thoughts and actions online have been driven by the sames thoughts and actions that drove newspapers (and magazines and television) for years: a desire for too much audience.
Which leads us back to comments made in this space earlier this week: less is more.
The irony is really quite thick in the above-the-fold picture of Alex Rodriguez on the cover of The Wall Street Journal today. President Barack Obama gave his first prime-time press conference last night, using it to address the economic crisis and his proposed stimulus package costing billions, and the nation’s financial newspaper of record ran a picture of A-Rod on the cover. If newspapers were suspected of taking drugs to enhance performance A-Rod on the cover of the Journal today is how you’d know.
I remember hearing John Quinn, USA Today’s founding editor, respond to a question about which cover photos drove more single copy sales of the newspaper than anything else. “Elvis,” he answered, without missing a beat. If you ask the editors of People Magazine I expect the answer to that question would be Lady Diana.
Today, the Journal ran a photo of A-Rod on its cover but, remembering itself, followed-up with only a few column inches about the story in the gutter of page A4. In the process, we got a lesson on why consumers (and, thereby, marketers) need the Internet, which is the rescuer of relevance.
Posted by Jarvis Coffin 
Posted by Jarvis Coffin 
Posted by Jarvis Coffin 
