Thursday, September 27, 2007

Confessions of an ex-publisher

The following email from a disheartened former newspaper publisher is the most candid and sobering reaction I got to my post on what the traditional media companies must do to respond to the challenges posed by future technological changes.
I don’t subscribe to the newspaper my family sold to a chain in the mid-1990s. While I miss the New York Times crossword puzzle, I finally stopped my subscription, because I really wasn’t interested in reading the generic news that has replaced the community coverage we used to provide.

In more than 30 years of newspaper management, I experienced the transformation described in your white paper on Media 3.0, as we faced increasing competition from direct mail, segmented cable and the myriad of other choices served to advertisers.

But there is one underlying reason why newspapers will not be able to take advantage of the opportunities so well presented in your paper: They simply lack the intellectual capacity.

In the past, they’ve fumbled every opportunity to harness their resources and address the opportunities. There is no empirical evidence that they have changed their ways in the last 15 or 20 years.

In the early 1990s, our newspaper partnered with a small Internet company and began offering our classified ads online. As you can imagine, it was archaic by today’s standards, but it was welcomed by early adopters. A small management team was established to meet with other suburban newspapers in our market to ascertain their interest in aggregating all of our classified ads and offering a market-wide buy.

I’ll always remember the meeting, because the publishers from the other newspapers looked at us as if we were aliens from some other planet. Simply put, they didn’t get it. One of the publishers present at that meeting is now a top executive of the same chain that bought our paper!

While newspapers continue to experience positive cash flow, the current model, as you well know, is imploding. Furthermore, I would question your assertion that they continue to enjoy large audiences.

When we sold our newspaper in 1996, circulation was in excess of 40,000. Today ABC figures indicate that paid circulation is somewhere in the neighborhood of 21,000. Factor in NIE copies given away for free to schools; 24/7 rack sales, gimmicky aggregation (adding a paid weekly as one-seventh “daily” circulation), and offering subscriptions for less than $20 per year and you can extrapolate the real readership as much less than claimed.

I also question the industry’s marketing capability and its commitment to content-creation resources. In regard to the latter, market forces are redirecting content providers away from newspapers. One only has to look at the pay scale of entry-level reporters to see why qualified journalists are shunning newspapers.

Our family sold our newspaper to the chain, because we were wall-to-wall union; the unions were intransigent and we could not see how we could compete with the lower-cost media competing for the same business. I knew the chain could “get the deal done” when it came to reducing costs. Parenthetically, my family doesn’t miss the death threats I received from disgruntled union activists when we attempted on our own to reduce force (legally, through the contracts, I might add).

Threats aside, cost-cutting is no particular challenge. It’s easy to reduce the workforce, trim back on the roll width, cut outlying circulation, and so forth. I did it several times and I didn’t find it intellectually taxing. The challenge is to make the transition to thinking about content, not newspapers.

Now, we have a situation where an entire new generation is growing up with little, or no, interest in newspapers. Here’s an interesting vignette to prove the point:

Over the years, I have served on several non-profit boards. During a meeting yesterday, a marketing consultant mentioned that traditional media wasn’t driving traffic. . . advertising was placed in all local newspapers but results were disappointing. He suggested to the board that traditional media be cut back and that dollars should be allocated to online venues.

While he wasn’t sure what channels should be used, he knew a change was necessary – especially after he asked his 24-year-old son whether he saw a particular column in our neighboring metro. “Dad,” his son responded, “I don’t read the paper.”

Now, I don’t read my old paper, either. When the boiler-room crew calls to attempt to lure me back by offering a full year’s subscription for $15.99, I respond by saying that’s still too much for what their product has become. If I don’t read the paper, who will?

You can get a copy of the white paper mentioned in the above article via email. Don't forget to change the [at] to @.

5 Comments:

Anonymous Anonymous said...

This is from another former editor and publisher:

I agree with almost everything you said in your post about 3.0 -- all but the last sentence. I'm about 99% sure that the newspaper business already had had its last chance.

The turning point for me was the day a company lawyer called and asked what the hell I was doing running a web site out of the newsroom. I had launched one of the first sites in the company and was pretty proud of myself and was eager to get on with the work of inventing digital journalism. The lawyer's concern was the newsroom union. "It's a new business," he said, "and it might be worth something someday. We don't want those bastards to have a piece of it." I blew him off, but the next call was from someone I couldn't ignore. The web site moved to marketing.

That sort of thing went on lots of places in the early 90s. The ad departments saw the new toy as a value-added that they could toss into print packages, and marketing saw it as a cute little puppy that could promote the newspaper. Nobody did any reinventing.

Ten years later, on 9-11, I reaped some of the result. I was working at corporate HQ then and had to wake up webmasters all over the country and tell them to get off their butts and start updating their sites. I also had to tell one geek to get the damn Star Trek quote off his index page.

The hole already was pretty deep, pretty hard to climb out of.

Your ex-publisher correspondent says newspaper leaders lack the intellectual capacity to save themselves. I agree that they lack the capacity, but I wouldn't use the word "intellectual" because I don't think it would take extraordinary brainpower. What it takes to walk away from 25%-plus margins and restructure the financial model is vision and guts. Those also are the main qualities needed to reinvent a change-resistant culture.

The tag line on your blog title says you fear that the mainstream media are stumbling toward extinction.

It's time to think about recasting those tenses, Alan. It's over -- and that's for the best. Once the imploding financial structure is rubble, something new can emerge. I have some sketchy ideas about what it might look like, but one thing is clear to me:

The human need for community runs deep. Some information/connection/news business will emerge to help meet that need. And it will prosper.

6:18 PM  
Blogger Tish Grier said...

Very interesting post, Alan (esp. in light of your Media 3.0 post) Yet I'd caution this individual who wrote this from making broad assumptions about young people based on one vignette. If young people were so dis-interested in newspapers, why is it that so many journalism students are still thinking they'll go to work for newspapers once they graduate? (I'm thinking of this article from Inside Higher Ed)

Further, having a good memory of my own 20-something years back in the 1980's, quite honestly, not many of us were all that interested in newspapers either. If it weren't for movie listings, the horoscopes, and local club listings, most of us didn't need the paper. So, I wonder if young people today really are any different from *all* pre-internet young people. Maybe they're different from young people of 40 years ago--during the VietNam era--but certainly not 20 years ago, that's for sure. Perhaps, then, youthful dis-interest in newspapers isn't just because of the Internet. Maybe the Internet is a convenient scapegoat for other social factors in the lives of young people. Just a thought.

8:52 PM  
Anonymous Mary Specht said...

Tish, you're right that young people, almost by definition, aren't necessarily interested in the things local newspapers cover.

The college and recent-grad set, of course, doesn't own property, have kids or pay many taxes (relatively). So naturally they have little interest in the coverage of related issues--local government, property taxes, schools, etc.-- that's vital to older audiences that makes local papers valuable.

I think everyone can more or less agree on that. But does this mean when my generation grows up, newspapers will see a surge in circulation? No--we're too used to getting up-to-the-second information, getting it instantly, and searching for exactly what we want. Newspapers can never offer that.

So while the fact that young people traditionally don't read local newspapers should provide an excuse for falling circulation and make the newspaper industry feel better about itself, it would be a false sense of security. (Tish, not saying you were necessarily implying this!)

But I wouldn't rule out a surge of interest in news--and other information--on local newspaper websites, in whatever Media 3.0 style is fastest, easiest and most interesting.

11:16 AM  
Blogger The Writers Fancy said...

I could not agree with this article any more. I have experienced all of the same things as a newspaper executive and - as I enter my the final three weeks of my newspaper career after 31 years - I know newspapers don't have the vision, the will or the intellect to do anything than what they are doing now.

It's all too late. Newspapers will fade into oblivion

3:05 PM  
Blogger path4play said...

He come all the “I told them so 10 years ago, if they would have listened to me” stories. I’ve worked for two top 50 market newspapers, and yet was an original signer of the cluetrain manifesto in ‘99. I witnessed a small start up online employment site with the backing of the local chamber seek to be bought by a newspaper who effectively laughed them out of the building. A few years later the little start up was expanding to other markets, and beyond its IT niche. Folks in the paper were now asking what can we do? Raise rates was basically the answer. Whether we choose reinvent our past wisdom or were actually a minority voice, powerless to alter the continuous and repetitive crashing of the oncoming waves of a cultural shift, the end results have been the same. I read today about Sam Zell’s new reorganization plan for Tribune I came to the realization (which prompted me to drop by this site) that I can live without a newspaper. In fact, I have been doing so for the past six months….

7:30 PM  

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