USA Today said Friday it will stop publishing its international edition on Feb. 6 but will look for partners in Europe and South America to continue operating it.
Under such an arrangement, similar to one USA Today recently launched in the Caribbean, USA Today would produce the articles, photos and other content, and the partners would print the newspaper locally and sell ads themselves. USA Today would get an unspecified per-copy licensing fee.
"This allows us to continue our international presence under more favorable financial conditions," USA Today said in a statement to The Associated Press.
The paper said discussions were continuing, but it gave no timetable or word on prospects.
USA Today, published by McLean, Va.-based Gannett Co., is the nation's top-selling newspaper with an average daily circulation of 2.3 million. About 60,000 is for the international edition.
USA Today, like most other newspapers, has seen advertising revenue drop as the recession compounds declines from the ongoing migration of readers and advertisers to the Internet. This week, the paper announced a one-year wage freeze and joined other Gannett properties in imposing one-week unpaid furloughs for most U.S. employees.
The decision to pull back abroad comes as its national rivals, The New York Times and The Wall Street Journal, are both expanding, particularly online.
The Journal, under News Corp., already has European and Asian editions in print and is looking to gain readers by developing a Web site and content tailored to readers there, not simply stories about those regions written for a U.S. audience. The Times, meanwhile, has combined forces online with a sister paper, the International Herald Tribune.
Ken Doctor, a media analyst with research firm Outsell Inc., said all papers are having to focus on what they do best, and as an American-focused product, USA Today may be deciding that the costs of publishing abroad weren't worthwhile.
USA Today's Web site would remain available to visitors abroad.
Source: AP
Tuesday, January 20, 2009
Tuesday, January 13, 2009
UK: Sales woe continues for quality dailies
ALL the national quality daily newspapers recorded month-on-month and year-on-year sales falls in December.
The Independent simultaneously recorded the smallest month-on-month decline and the biggest year-on-year fall in the quality daily market last month, according to the latest Audit Bureau of Circulations figures published today.
In December its headline circulation included 43,854 copies on average each day distributed overseas.
The paper's circulation was 200,242, down 12.33% year on year, but only 0.43% down compared with November. Just 115,496 copies of the Independent – 58% of total circulation – were sold at full rate in the UK.
The Times remained just above the 600,000 mark – by 962 copies – with a 3.36% fall from November and a 2.33% decline year on year.
News International's quality daily distributed 23,301 copies overseas and had a full-rate UK circulation of 398,031, 66% of its headlines December sales figure.
The Daily Telegraph fell just 1.35% compared with November, from 835,497 to 824,244 copies sold each day on average. But this was a 5.64% decline year on year from 873,523 in December 2007.
The Daily Telegraph's full rate circulation in the UK was 355,394 in December – just 43% of its total sale. The paper's overseas distribution was 40,081.
The Guardian, which is published along with MediaGuardian.co.uk by Guardian News & Media, had a circulation of 343,010 in December.
This was 4.29% down compared with November and 2.95% less than December 2007. 81% of the Guardian's circulation was at full-price, the highest in the quality daily market.
The Guardian distributed 38,510 copies overseas and had a full rate circulation in the UK of 273,885.
The Financial Times recorded a circulation of 435,319 in December, 2.94% down compared with November and 2.23% down year on year.
Last month the Financial Times had a full-rate circulation in the UK of 77,205. 134,318 copies were circulated in the US, 126,071 in Europe and 39,756 in Asia.
Last month, the Guardian distributed 14,372 bulk copies – copies sold to hotels, airlines and gyms for a nominal fee and given away to customers.
The Independent's bulk sales were 35,575 in December, the Daily Telegraph distributed 98,336 across the month with the Times distributing 55,569.
Source: The Guardiaon
The Independent simultaneously recorded the smallest month-on-month decline and the biggest year-on-year fall in the quality daily market last month, according to the latest Audit Bureau of Circulations figures published today.
In December its headline circulation included 43,854 copies on average each day distributed overseas.
The paper's circulation was 200,242, down 12.33% year on year, but only 0.43% down compared with November. Just 115,496 copies of the Independent – 58% of total circulation – were sold at full rate in the UK.
The Times remained just above the 600,000 mark – by 962 copies – with a 3.36% fall from November and a 2.33% decline year on year.
News International's quality daily distributed 23,301 copies overseas and had a full-rate UK circulation of 398,031, 66% of its headlines December sales figure.
The Daily Telegraph fell just 1.35% compared with November, from 835,497 to 824,244 copies sold each day on average. But this was a 5.64% decline year on year from 873,523 in December 2007.
The Daily Telegraph's full rate circulation in the UK was 355,394 in December – just 43% of its total sale. The paper's overseas distribution was 40,081.
The Guardian, which is published along with MediaGuardian.co.uk by Guardian News & Media, had a circulation of 343,010 in December.
This was 4.29% down compared with November and 2.95% less than December 2007. 81% of the Guardian's circulation was at full-price, the highest in the quality daily market.
The Guardian distributed 38,510 copies overseas and had a full rate circulation in the UK of 273,885.
The Financial Times recorded a circulation of 435,319 in December, 2.94% down compared with November and 2.23% down year on year.
Last month the Financial Times had a full-rate circulation in the UK of 77,205. 134,318 copies were circulated in the US, 126,071 in Europe and 39,756 in Asia.
Last month, the Guardian distributed 14,372 bulk copies – copies sold to hotels, airlines and gyms for a nominal fee and given away to customers.
The Independent's bulk sales were 35,575 in December, the Daily Telegraph distributed 98,336 across the month with the Times distributing 55,569.
Source: The Guardiaon
The Profitable Strategy of Newsroom Integration
The Editors Weblog has been following the Integrated Newsroom trend for several years. Major papers around the world from the Guardian to the New York Times to Kuwait's Awan, and the Hindustan Times of India have merged print and online operations. But there are plenty of papers that haven't taken the integrated route. In the following article, Espen Egil Hansen, Editor-in-Chief of Verdens Gang (VG) Multimedia, Norway, shows that keeping print and digital teams separate at his paper have led to steady profits for both newsrooms.
I am generally sceptical of the idea of one media house, one newsroom. When was the last time anyone won both the 100 meter dash and marathon during an Olympic game?
There are two fundamental issues that call for a greater degree of separation and specialization - what I like to call the model of focus.
First and foremost; newspaper and internet are by nature so diverse that they demand completely different working methods and organizations in order to succeed. This applies at all levels: in the editorial department, sales, distribution and management. To argue that "newspaper" and "online news" are the same because both are news, makes as much sense as saying that a roaring river and a glass of water are the same because both are water.
"The newspaper and the internet are by nature so diverse that they demand completely different working methods and organizations in order to succeed."
The strength of the online journalism is the possibility to develop the product minute by minute, interacting with the readers. Their experience and presence (the readers are where we aren't, they know what we don't) becomes an integrated part of the continuous journalistic working process. An article does not have a deadline, the readers submits comments, we ad links and so on.
The strengths of the newspaper are opposite. Towards deadline one search for the most exclusive story and the best possible angle on another story. These stories are then being thoroughly edited and presented on a limited space.
While internet by nature has its strength in that the users themselves can choose from a stream of information (the roaring river), the strength of the newspaper is its well edited presentations (the glass of water with a twist of lemon).
"The idea of integration is a threat both to the printed product and for the online news site."
Furthermore, the basic differences in business models, rate of development, distribution and so on are also so substantial that they in my opinion demands specialized organizations in order to succeed.
The second fundamental issue that calls for a greater degree of separation is that we are living in the middle of a media climate change! The glaciers (the traditional publishing houses) are melting, the storms (the competitors) are getting violent and coming from unexpected places, and the changing circumstances for life are such that ancient species must succumb to new ones (goodbye Tribune - hello Facebook)
Where we earlier had to cope with a certain number of newspaper and channels on TV and radio, we are now exposed to an infinite offer of information wherever we are. As I am writing this, on one of the first days of 2009, I am simultaneously following one of many Twitter-feeds reporting a new round of bombing in Gaza. The news agencies will report the same stories during the next hour, but without the nerve and credibility of someone who are in the midst of the falling bombs...
"As I am writing this I am simultaneously following one of many Twitter-feeds reporting a new round of bombing in Gaza."
In this entirely new media landscape, I believe the specialists will win. The ones that are best adapted and that are able to change fast enough. What until now has been regarded as the power of publishing houses - tradition, position, stability and financial security - is now turning to become a weakness.
The idea of integration is in my opinion a threat both to the printed product and for the online news site. To the printed product because the integration in a way conceals a level of costs and way of working that is not sustainable in the long run. And the threat to the online site is that it will inherit the way of working, organizing and a level of cost that is not competitive in this market.
In the publishing house of VG we have, with success, chosen the model of focus. We have two companies, two boards, to editorial departments, to chief editors, two managing directors and so on. We cooperate where appropriate for both organizations (which means a lot), but at the same time we are free to choose whatever necessary in order to succeed on our own platform. We've made some tough choices. While down-sizing by 100 people in the print organization we hired 40 more online. No one was moved from print to online. With this model of focus we've achieved the number one position online and in the print market. Both editions have for the last couple of years been very profitable.
Our success is obviously not a guarantee for this model of focus being the best one in the years to come. Neither is our success with the model a guarantee that it will work in all other media houses, and markets. It makes greater sense to integrate if you're at a number two position (or lower), than if you are leading in the market. The current financial turmoil is accelerating the media climate change, and we must constantly evaluate whether our organization is optimal.
Source: Editorsweblog.org
Monday, January 12, 2009
What this year holds for newspapers
IF 2008 was a bad year for newspapers, 2009 could be worse. Analysts expect ad revenue to decline even further before perhaps starting to come back in 2010, as the classified woes that have plagued the industry show no signs of abating and Detroit further slims its ad budgets. Newspapers will begin experimenting with new forms of delivery, such as eliminating print editions in favor of the web, and further cut back on outlying circulation that’s unimportant to advertisers. More jobs, too, will be eliminated, though that’s a strategy that will not continue indefinitely as papers reach a point where they can no longer cut back. In order to keep advertisers, newspapers are expected to further simplify the ad buying process, hoping to curry favor with harried print media buyers. Ed Strapagiel, executive vice president of Toronto-based market research and consulting firm Kubas Consultants, talks to Media Life about the coming year in newspapers. This is the first in a series of 2009 previews with experts in different fields of media.
What was the biggest story in newspapers in 2008?
From a newspapers point of view it would be the decline of classified advertising due to continued poor automobile sales and the real estate bust in the U.S.
And now, with a weakened economy, this affects newspapers in print classifieds and secondly in online revenue.
What is the single most important thing for media buyers and planners to know about newspapers in 2009?
I bet they already know this, but right now they can drive some pretty favorable deals. Secondly, they can do especially well if they can increase their newspaper spend. The rate of return on any additional spend can pay off huge.
How will the recession affect newspapers?
In the last two or three recessions, newspapers were the first to suffer and the last to recover. So I don’t see why that pattern should change.
The other issue is that the last couple recessions, particularly 2000 and 2001, newspapers came back at a significantly lower ratio versus GDP. Not only was there cyclical downturn but also permanent downturn.
In a recession, advertisers forget about business as usual and reevaluate on a clean-slate basis. The past couple of recessions, when newspapers did recover, it was at a level lower in relation to the economy than previously.
What are three trends to watch for in 2009 in newspapers?
Format reduction--newspapers saving some money on newsprint. If you’re an ad agency type you know a half page in smaller format isn’t as effective as a larger format, and so there will be some issues there.
Newspapers are rationalizing some of the more expensive distribution, including out-of-town copies, and that will appear to reduce circulation. But a lot of that circulation was ineffective in the first place, so we have to be careful of overreacting.
Also, a number of newspapers will try to simplify their approach to the marketplace. Buying newspapers can be very complicated, there are different sections and peripheral publications, and certainly newspapers have a reputation of being difficult to buy. I expect some work in that area but it will take a long time to completely change.
And newspapers will still work on their online offerings, both in terms of content and appeal to web surfers and usefulness and programs for advertisers.
What will be the single biggest change in the industry over the next few years?
Unfortunately newspapers haven’t really figured out the online model yet; some homepages have 100 links on them. There’s an issue of if they should have a dedicated online sales force. So there are still a whole lot of questions.
I think longer term, probably what we’ll see is a far simpler, streamlined approach to advertising selling. A smaller, better, faster, smarter and cheaper sort of thing, with much less emphasis on sales reps and custom deals and much more on online and automated pricing.
There are a few papers out there doing this now, but if you look at Google AdWords, which handles print and TV and radio, they do it all without human interaction. So looking down the road, that will have to become the way to sell. The old system where you have to talk to four different reps to get everything done just won’t work.
Having said all that, newspapers as a product will still remain very viable for a long time.
How is new technology influencing newspapers?
In some ways newspapers are seeing local classified advertising and other local advertising being eroded by all sorts of local classified sites and community sites.
Some are owned by newspapers, some are competitors, and it’s not just Craigslist. In every city there’s probably dozens of others. Some are free listing sites, but they will sell an enhanced listing. No one of these has a particularly large market share, but the sheer quantity is taking money from the marketplace.
Having said that, newspapers are trying to understand how to cope and deal with them. They’ve focused on Craigslist but they haven’t been able to exploit its weaknesses. They’re still trying to figure them out.
How many more newspapers will go to online-only at least one day a week?
That’s certainly starting to happen already. There are a couple of papers in the U.S. that have done some cutback things on Mondays, a typically low newspaper day. Also, some are cutting classifieds on certain days of the week.
So that’s all a part of pulling back, but it’s a slippery slope because one of the things about a daily newspaper is, it’s a daily newspaper. You have to be out there and consistent, as soon as you start playing with that and pulling back, you can lose your top of mind.
When will we see an end to the massive layoffs in the industry?
Particularly in the U.S. but also around the world, one expected the fourth quarter to be very poor. But what happened is retailers had already geared up for Christmas, so fourth quarter may be a little soft but not a disaster.
But going into the start of 2009, retailers have basically prepared themselves for a lower level of sales. When you get that, you don’t spend a lot on advertising. So the first two quarters of this year could be pretty terrible.
Looking ahead for this year, the industry’s expectations are at rock bottom.
We do a manual survey every November and ask what to expect for next year, and the news is very grim indeed. Going forward we expect newspapers to bring in about 10 to 15 percent less revenue than last year, or that’s the scenario they’re planning for.
And knowing that, they’re going to have to cut costs. The only way they can make significant cuts is by reducing staff, but even that process can go so far.
Will classifieds begin to turn around anytime soon, or is that going to be dwindling from here out?
I would expect them to start turning around in the second half of this year, but the recovery process will be very slow. A lot of it depends on the economy and various push-pull cycles. People will eventually have to get a new car, etc.
I do expect a bit of an upturn in the second half of this year, but in all likelihood it won’t be a sharp turnaround at all.
When will we start to see newspaper ad revenue recover?
I think it will be up in 2010 over 2009. This year could be the bottom.
Do you expect circulation declines to begin to plateau anytime soon and why?
I expect circulation to keep declining slightly. Part of it will be due to loss of newspapers in competitive markets, such as Denver.
In other cases newspapers are finding ways of crawling back and becoming more local. A lot of job losses in the business have been on the editorial staff, so you might say, “Gee, the quality of the product is going to diminish.”
But on the other hand, in the immediate past, all those journalists hadn’t made much progress in reversing the decline of readership, so what are we really we talking about here?
Source: Medialife
What was the biggest story in newspapers in 2008?
From a newspapers point of view it would be the decline of classified advertising due to continued poor automobile sales and the real estate bust in the U.S.
And now, with a weakened economy, this affects newspapers in print classifieds and secondly in online revenue.
What is the single most important thing for media buyers and planners to know about newspapers in 2009?
I bet they already know this, but right now they can drive some pretty favorable deals. Secondly, they can do especially well if they can increase their newspaper spend. The rate of return on any additional spend can pay off huge.
How will the recession affect newspapers?
In the last two or three recessions, newspapers were the first to suffer and the last to recover. So I don’t see why that pattern should change.
The other issue is that the last couple recessions, particularly 2000 and 2001, newspapers came back at a significantly lower ratio versus GDP. Not only was there cyclical downturn but also permanent downturn.
In a recession, advertisers forget about business as usual and reevaluate on a clean-slate basis. The past couple of recessions, when newspapers did recover, it was at a level lower in relation to the economy than previously.
What are three trends to watch for in 2009 in newspapers?
Format reduction--newspapers saving some money on newsprint. If you’re an ad agency type you know a half page in smaller format isn’t as effective as a larger format, and so there will be some issues there.
Newspapers are rationalizing some of the more expensive distribution, including out-of-town copies, and that will appear to reduce circulation. But a lot of that circulation was ineffective in the first place, so we have to be careful of overreacting.
Also, a number of newspapers will try to simplify their approach to the marketplace. Buying newspapers can be very complicated, there are different sections and peripheral publications, and certainly newspapers have a reputation of being difficult to buy. I expect some work in that area but it will take a long time to completely change.
And newspapers will still work on their online offerings, both in terms of content and appeal to web surfers and usefulness and programs for advertisers.
What will be the single biggest change in the industry over the next few years?
Unfortunately newspapers haven’t really figured out the online model yet; some homepages have 100 links on them. There’s an issue of if they should have a dedicated online sales force. So there are still a whole lot of questions.
I think longer term, probably what we’ll see is a far simpler, streamlined approach to advertising selling. A smaller, better, faster, smarter and cheaper sort of thing, with much less emphasis on sales reps and custom deals and much more on online and automated pricing.
There are a few papers out there doing this now, but if you look at Google AdWords, which handles print and TV and radio, they do it all without human interaction. So looking down the road, that will have to become the way to sell. The old system where you have to talk to four different reps to get everything done just won’t work.
Having said all that, newspapers as a product will still remain very viable for a long time.
How is new technology influencing newspapers?
In some ways newspapers are seeing local classified advertising and other local advertising being eroded by all sorts of local classified sites and community sites.
Some are owned by newspapers, some are competitors, and it’s not just Craigslist. In every city there’s probably dozens of others. Some are free listing sites, but they will sell an enhanced listing. No one of these has a particularly large market share, but the sheer quantity is taking money from the marketplace.
Having said that, newspapers are trying to understand how to cope and deal with them. They’ve focused on Craigslist but they haven’t been able to exploit its weaknesses. They’re still trying to figure them out.
How many more newspapers will go to online-only at least one day a week?
That’s certainly starting to happen already. There are a couple of papers in the U.S. that have done some cutback things on Mondays, a typically low newspaper day. Also, some are cutting classifieds on certain days of the week.
So that’s all a part of pulling back, but it’s a slippery slope because one of the things about a daily newspaper is, it’s a daily newspaper. You have to be out there and consistent, as soon as you start playing with that and pulling back, you can lose your top of mind.
When will we see an end to the massive layoffs in the industry?
Particularly in the U.S. but also around the world, one expected the fourth quarter to be very poor. But what happened is retailers had already geared up for Christmas, so fourth quarter may be a little soft but not a disaster.
But going into the start of 2009, retailers have basically prepared themselves for a lower level of sales. When you get that, you don’t spend a lot on advertising. So the first two quarters of this year could be pretty terrible.
Looking ahead for this year, the industry’s expectations are at rock bottom.
We do a manual survey every November and ask what to expect for next year, and the news is very grim indeed. Going forward we expect newspapers to bring in about 10 to 15 percent less revenue than last year, or that’s the scenario they’re planning for.
And knowing that, they’re going to have to cut costs. The only way they can make significant cuts is by reducing staff, but even that process can go so far.
Will classifieds begin to turn around anytime soon, or is that going to be dwindling from here out?
I would expect them to start turning around in the second half of this year, but the recovery process will be very slow. A lot of it depends on the economy and various push-pull cycles. People will eventually have to get a new car, etc.
I do expect a bit of an upturn in the second half of this year, but in all likelihood it won’t be a sharp turnaround at all.
When will we start to see newspaper ad revenue recover?
I think it will be up in 2010 over 2009. This year could be the bottom.
Do you expect circulation declines to begin to plateau anytime soon and why?
I expect circulation to keep declining slightly. Part of it will be due to loss of newspapers in competitive markets, such as Denver.
In other cases newspapers are finding ways of crawling back and becoming more local. A lot of job losses in the business have been on the editorial staff, so you might say, “Gee, the quality of the product is going to diminish.”
But on the other hand, in the immediate past, all those journalists hadn’t made much progress in reversing the decline of readership, so what are we really we talking about here?
Source: Medialife
Middle East: new media reporting on Gaza
THE current Israeli-Gaza conflict has proved ground-breaking in terms of the way that news is being spread. For a start, Israel has blocked foreign journalists from entering Gaza since launching its air attacks on December 27, so although Al Jazeera has been reporting extensively as it had correspondents already inside, as does the AP, many media organizations have no reliable source of independent information. It is the perfect time for blogs, Twitter, and other forms of citizen journalism to show their merits.
Israel has adopted various alternative methods of spreading information, bypassing traditional news sources and "enlisting an arsenal of Internet tools to take their message directly to a global audience," according to the New York Times.
The Israeli government started to use Twitter last week, the first government to do so. The New York consulate held a Twitter based 'press conference' on December 30 hosted by David Saranga, consul for media and public affairs. The Jerusalem Post reported that thousands of online "attendees" followed the consulate's Twitter page. Saranga explained that Twitter is useful as is "reaches a young generation that does not consume mainstream media" and that due to the anti-Israeli sentiment that was being expressed on Twitter, the consulate felt it was "important to present a voice."
The Israeli army, the IDF, set up its own YouTube channel on December 29, which shows videos with titles such as "weapons in Gaza mosque struck by Israel Air Force 1 Jan 2009" or "IDF artillery and helicopters strike Hamas terrorists involved in Gaza fighting 4 Jan 2009." It has more than 13,500 subscribers and the channel has been viewed over 1 million times.
The PR battle has also targeted Facebook, with rival Facebook groups supporting each side both gaining tens of thousands of members, and an application called 'QassamCount' which allows users to 'donate their status' to show the number of rockets that hit Israel. There have also be protests against the attacks on Second Life.
So it is relatively easy to find out the official Israeli standpoint on matters. But it is much harder to get independent perspectives from inside the Gaza territory. According to the Guardian on December 28, "few bloggers are reporting from Gaza itself because of the lack of electricity." Poynter writer Alan Abbey wrote that what he had found so far on Twitter (in English) was "heated rhetoric from non-Gazans and international observers." He believes that Twitter and blog coverage was more effective during the Mumbai attacks than the present conflict and blames the "technically primitive and politically controlled" situation in Gaza.
However, there are bloggers out there (such as Laila El-Haddad, Jawad Harb, Professor Said Abdelwahed), podcasts (such as those on Mideast Youth), and many news organisations are taking on Palestinian stringers to report from inside Gaza, or publishing alternative sources, such as the BBC's diary of an aid worker. Although these alternative sources and methods of communication cannot replace the professional journalists from established news organisations in the field, they are definitely helping to fill the gaps.
Source: Guardian, Jerusalem Post, New York Times, The Times, Poynter, Channel 4, BoingBoing
Israel has adopted various alternative methods of spreading information, bypassing traditional news sources and "enlisting an arsenal of Internet tools to take their message directly to a global audience," according to the New York Times.
The Israeli government started to use Twitter last week, the first government to do so. The New York consulate held a Twitter based 'press conference' on December 30 hosted by David Saranga, consul for media and public affairs. The Jerusalem Post reported that thousands of online "attendees" followed the consulate's Twitter page. Saranga explained that Twitter is useful as is "reaches a young generation that does not consume mainstream media" and that due to the anti-Israeli sentiment that was being expressed on Twitter, the consulate felt it was "important to present a voice."
The Israeli army, the IDF, set up its own YouTube channel on December 29, which shows videos with titles such as "weapons in Gaza mosque struck by Israel Air Force 1 Jan 2009" or "IDF artillery and helicopters strike Hamas terrorists involved in Gaza fighting 4 Jan 2009." It has more than 13,500 subscribers and the channel has been viewed over 1 million times.
The PR battle has also targeted Facebook, with rival Facebook groups supporting each side both gaining tens of thousands of members, and an application called 'QassamCount' which allows users to 'donate their status' to show the number of rockets that hit Israel. There have also be protests against the attacks on Second Life.
So it is relatively easy to find out the official Israeli standpoint on matters. But it is much harder to get independent perspectives from inside the Gaza territory. According to the Guardian on December 28, "few bloggers are reporting from Gaza itself because of the lack of electricity." Poynter writer Alan Abbey wrote that what he had found so far on Twitter (in English) was "heated rhetoric from non-Gazans and international observers." He believes that Twitter and blog coverage was more effective during the Mumbai attacks than the present conflict and blames the "technically primitive and politically controlled" situation in Gaza.
However, there are bloggers out there (such as Laila El-Haddad, Jawad Harb, Professor Said Abdelwahed), podcasts (such as those on Mideast Youth), and many news organisations are taking on Palestinian stringers to report from inside Gaza, or publishing alternative sources, such as the BBC's diary of an aid worker. Although these alternative sources and methods of communication cannot replace the professional journalists from established news organisations in the field, they are definitely helping to fill the gaps.
Source: Guardian, Jerusalem Post, New York Times, The Times, Poynter, Channel 4, BoingBoing
Urgent Deadline for Newspapers: Find a New Business Plan before You Vanish
IF 2008 were an ordinary year -- one during which iconic American firms like General Motors didn't teeter on the verge of bankruptcy, the stock market didn't lose a third of its value, and foreclosures, hemorrhaging 401(k)s and holiday retail blight weren't in every headline -- the precipitous decline of the nation's newspaper business might have been the biggest financial story.
Positioned at the intersection of commerce and mass culture, big daily newspapers for more than a century could outshine in popular cachet what they lacked in industrial size. Like movies, radio or television, they were part of the rhythm of American life. And like those industries, they have had to grapple over the years with new technologies that complicate their old business models: Radio bulletins made newspaper extras less urgent, for example, while the nightly news hastened the death of the evening paper. Neither of those killed the industry, though. By the mid-1990s, newspapers were fetching unprecedented prices in the string of mergers that created behemoths like the Tribune Company, which in 2000 bought up the Times-Mirror Company for $6.45 billion.
All the while, the various Wall Street darlings of American newspapering were struggling to adapt to the most disruptive technology of all, the Internet. And by this fall, it was clear that this was a challenge of an entirely different magnitude. Tribune, whose holdings include The Los Angeles Times, Chicago Tribune and Baltimore Sun, declared bankruptcy, unable to meet massive debts that owner Sam Zell took on to buy the chain. The venerable New York Times saw its stock value fall by 60% and borrowed against its gleaming new headquarters off Times Square in order to meet its obligations.
Experts predicted that there would be big cities without daily newspapers in the very near future. In December, Detroit's two dailies nearly proved them right, announcing the end of home delivery on all but three days of the week. The Christian Science Monitor had already done the same thing, slashing its print edition to one issue a week while directing readers to its website.
Selling Sacred Real Estate
"It's fair to say that newspapers will disappear and I don't think we should shed that big a tear for them," says Wharton marketing professor Peter Fader, co-director of the Wharton Interactive Media Initiative. And unlike the traumas of automobiles or real estate, the change is fundamental, not cyclical. A down economy may have sped it along, but the business model itself would have been troubled anyway. "My kids can't imagine why anyone would read the newspaper," Fader notes.
To be sure, newspapers have tried to adapt. They were late to the Internet, but have embraced the online environment with multimedia content, blogs and headlines pumped to mobile phones. The New York Times this month swallowed a bitter pill, joining other newspapers in selling ads on its most sacred real estate -- the front page -- in an effort to squeeze more revenue from its traditional product. Says Fader, "I don't think it's the fault of the newspaper; it's just technology moving on."
So does this mean the news business will simply die out? That's unlikely. But according to a number of Wharton faculty who have followed the subject, someone will have to come up with a new business model that pays for the sometimes costly work of gathering news while also squeezing a profit out of a readership whose options include the entire world wide web.
The paradox of the great newspaper crack-up of 2008 is that the nation's appetite for information remains ravenous. Millions more people consume free online reports from The New York Times' global news bureaus than ever paid to do so back when the firm's finances were riding high. Indeed, that very phenomenon has added to the challenges facing smaller metropolitan papers, whose monopoly status once obliged readers to either settle for the attenuated version of the world offered by their local daily, or seek out expensive out-of-town papers.
Of course, the web doesn't simply pit one media firm against another. A number of major stories in the past few years -- from November's Mumbai terror attacks, which featured real-time online updates from eyewitnesses, to the 2007 pet food recall, where a few pet-oriented web sites became the most credible sources about what foods were killing dogs and cats -- demonstrate that trustworthy, independent sources of key information can quickly elbow established brands aside by winning readers who are as eager as ever to follow the story.
The Internet's impact is likewise not limited to global stories: It enables neighborhood-level blogs and web sites that offer a degree of detail no traditional newspaper can offer to every corner of a metropolitan area.
Broccoli vs. Red Meat
The problem, from a business point of view, is that few of today's eager, fickle readers are willing to pay for their online news. So far, consumers have been lucky, getting free of charge the information essentially underwritten by a dwindling number of print subscribers and advertisers. The vertiginous declines of major dailies suggest this won't always be the case, leaving newspaper firms in the dangerous position of having to cut the staff whose reporting attracted readers in the first place. (Online advertising is growing fast, but per-reader revenue on the web remains far smaller than for print.)
So how can a professional, reliable news product turn a profit -- or at least break even -- for its investors? No clear route back from the abyss has emerged. But Wharton's media-watchers offer a few ideas:
* The Philanthropic Route: Wharton business and public policy professor Joel Waldfogel has researched the impact of news media on society and fears that a decline in serious reporting about public affairs will harm our democracy. Of course, that reporting, especially at the local level, is precisely the sort of expensive undertaking that cash-strapped news firms have often slashed as unprofitable. Waldfogel notes that in Minneapolis, San Diego and a number of other cities, laid-off newspaper staffers have turned to charitable sources to underwrite reporting for new online ventures. "We subsidized the healthy vegetables with the red meat," Waldfogel said of the old newspaper model, where many readers would buy the paper for late sports scores, enabling important public interest reporting in the process. "Now there's been this decoupling. It's really hard to support the broccoli at all."
* The Niche Route: Forget Capitol Hill. Forget the State House. Maybe even forget City Hall. Steve Ennen, managing director of the Wharton Interactive Media Initiative, says one key to success is to provide news and information for the most local of levels. "I'm talking block-to-block," says Ennen, citing localized web presences that have proved successful in Europe and Latin America. The problem with devoting your own resources to covering popular topics like Hollywood or national politics is that someone else is also doing so -- in the process, swiping your readers. A news business that gets down to the nitty-gritty, though, can quickly have the field to itself. The same goes for other niches, from ideologies to narrow interests ranging from news about pets to the latest on Pakistan. Waldfogel predicts the online news market will eventually look like the politically polarized newspaper market of a century ago, before monopoly status encouraged most publications to seek middle ground.
* The Pay Route: The New York Times famously cancelled its policy of keeping parts of its web site off-limits to non-subscribers. But Wharton marketing professor Eric Bradlow, co-director of the Wharton Interactive Media Initiative, says subscriber strategies aren't always doomed. Companies from Dow Jones, which publishes the Wall Street Journal, to any number of small trade magazines that offer highly specialized information to affluent subscribers manage to keep content behind a for-pay firewall, defying the conventional wisdom about an Internet audience that demands freebies. The key is a degree of specialization, whether by locality or by subject matter, that the traditional general-interest paper didn't deliver. Newspapers could, Bradlow suggests, "release partial information or certain stories through e-mail or other media as a way to get traction and then drive people towards the web site, which could be a pay model. It's a classic, 'we're going to give some stuff away for free model.'" Bradlow notes that pay satellite radio has flourished despite the availability of free AM and FM radio and the ubiquity of iPods.
* The Participation Route: One way the Internet differs most dramatically from print is readers' expectations of being able to interact with one another -- and with the source of the information. But this contrasts with the traditional newspaper idea that content, even content that is labeled "opinion," is produced by professionals with specific training and standards. Wharton management professor Lawrence Hrebiniak says that's something news companies are going to have to get over as they transition to an online existence. "Newshounds are looking for interactivity," he says. "Whatever gives him or her a chance to say something, to have an opinion, even if 90% of it is self-serving, it works."
* The Commercial Route: Fader, like most observers of the media business, says survival online will require rethinking basic values about things like bias, opinion and, especially, advertising. As an example, he cites book reviews. At most newspapers, book sections have been killed off for lack of profits. But Americans still consume book reviews in large quantities: It's just that they do so on Amazon.com, where readers' sometimes-withering opinions about books for sale are included on the page. "Where a lot of people go to find 'journalism' is on commercial sites," he says. "They go and read the reviews and ratings on Amazon.... It's going to be a tough struggle and very few newspapers as we knew them yesterday will exist in five years. Those that [survive] will do so by getting off their high horse and doing things that would have been commercial heresy. Imagine a New York Times book review with a link to Amazon."
As their stock values have plummeted, the harshest critics of newspaper firms have compared them to the railroads of a half-century ago -- unable to cater to customer desires, even as technological change threatened to wipe them out. A more charitable comparison, Waldfogel says, might be to the music business, which saw its profits dissolve in the face of free downloading. "It's not exactly piracy that's killing newspapers, but it's something like it."
Of course, there's another parallel: The music business, criticized for bland, generic acts, was flawed in ways that left customers broadly unsympathetic to its plight, just as daily broadsheets, after two decades of cuts and Britney Spears coverage, have lost much of their claim to nobility. The question is whether there's a model that can revive the good pieces -- the investment in people who consider it a professional duty to spread the word about everything from local traffic disruptions to national political chicanery -- while giving customers the whole world of options they now expect.
Either way, Fader predicts, at least some newspapers will remain -- as boutique products for a niche market willing to pay a premium for the charmingly old-fashioned idea of a hand-delivered piece of paper printed with news stories. "The kooky luxury boutique item will exist in a niche form for a long, long, long, time, until our generation fades away," he says. "Some people still like vinyl records."
Source: Knowledge Wharton
Positioned at the intersection of commerce and mass culture, big daily newspapers for more than a century could outshine in popular cachet what they lacked in industrial size. Like movies, radio or television, they were part of the rhythm of American life. And like those industries, they have had to grapple over the years with new technologies that complicate their old business models: Radio bulletins made newspaper extras less urgent, for example, while the nightly news hastened the death of the evening paper. Neither of those killed the industry, though. By the mid-1990s, newspapers were fetching unprecedented prices in the string of mergers that created behemoths like the Tribune Company, which in 2000 bought up the Times-Mirror Company for $6.45 billion.
All the while, the various Wall Street darlings of American newspapering were struggling to adapt to the most disruptive technology of all, the Internet. And by this fall, it was clear that this was a challenge of an entirely different magnitude. Tribune, whose holdings include The Los Angeles Times, Chicago Tribune and Baltimore Sun, declared bankruptcy, unable to meet massive debts that owner Sam Zell took on to buy the chain. The venerable New York Times saw its stock value fall by 60% and borrowed against its gleaming new headquarters off Times Square in order to meet its obligations.
Experts predicted that there would be big cities without daily newspapers in the very near future. In December, Detroit's two dailies nearly proved them right, announcing the end of home delivery on all but three days of the week. The Christian Science Monitor had already done the same thing, slashing its print edition to one issue a week while directing readers to its website.
Selling Sacred Real Estate
"It's fair to say that newspapers will disappear and I don't think we should shed that big a tear for them," says Wharton marketing professor Peter Fader, co-director of the Wharton Interactive Media Initiative. And unlike the traumas of automobiles or real estate, the change is fundamental, not cyclical. A down economy may have sped it along, but the business model itself would have been troubled anyway. "My kids can't imagine why anyone would read the newspaper," Fader notes.
To be sure, newspapers have tried to adapt. They were late to the Internet, but have embraced the online environment with multimedia content, blogs and headlines pumped to mobile phones. The New York Times this month swallowed a bitter pill, joining other newspapers in selling ads on its most sacred real estate -- the front page -- in an effort to squeeze more revenue from its traditional product. Says Fader, "I don't think it's the fault of the newspaper; it's just technology moving on."
So does this mean the news business will simply die out? That's unlikely. But according to a number of Wharton faculty who have followed the subject, someone will have to come up with a new business model that pays for the sometimes costly work of gathering news while also squeezing a profit out of a readership whose options include the entire world wide web.
The paradox of the great newspaper crack-up of 2008 is that the nation's appetite for information remains ravenous. Millions more people consume free online reports from The New York Times' global news bureaus than ever paid to do so back when the firm's finances were riding high. Indeed, that very phenomenon has added to the challenges facing smaller metropolitan papers, whose monopoly status once obliged readers to either settle for the attenuated version of the world offered by their local daily, or seek out expensive out-of-town papers.
Of course, the web doesn't simply pit one media firm against another. A number of major stories in the past few years -- from November's Mumbai terror attacks, which featured real-time online updates from eyewitnesses, to the 2007 pet food recall, where a few pet-oriented web sites became the most credible sources about what foods were killing dogs and cats -- demonstrate that trustworthy, independent sources of key information can quickly elbow established brands aside by winning readers who are as eager as ever to follow the story.
The Internet's impact is likewise not limited to global stories: It enables neighborhood-level blogs and web sites that offer a degree of detail no traditional newspaper can offer to every corner of a metropolitan area.
Broccoli vs. Red Meat
The problem, from a business point of view, is that few of today's eager, fickle readers are willing to pay for their online news. So far, consumers have been lucky, getting free of charge the information essentially underwritten by a dwindling number of print subscribers and advertisers. The vertiginous declines of major dailies suggest this won't always be the case, leaving newspaper firms in the dangerous position of having to cut the staff whose reporting attracted readers in the first place. (Online advertising is growing fast, but per-reader revenue on the web remains far smaller than for print.)
So how can a professional, reliable news product turn a profit -- or at least break even -- for its investors? No clear route back from the abyss has emerged. But Wharton's media-watchers offer a few ideas:
* The Philanthropic Route: Wharton business and public policy professor Joel Waldfogel has researched the impact of news media on society and fears that a decline in serious reporting about public affairs will harm our democracy. Of course, that reporting, especially at the local level, is precisely the sort of expensive undertaking that cash-strapped news firms have often slashed as unprofitable. Waldfogel notes that in Minneapolis, San Diego and a number of other cities, laid-off newspaper staffers have turned to charitable sources to underwrite reporting for new online ventures. "We subsidized the healthy vegetables with the red meat," Waldfogel said of the old newspaper model, where many readers would buy the paper for late sports scores, enabling important public interest reporting in the process. "Now there's been this decoupling. It's really hard to support the broccoli at all."
* The Niche Route: Forget Capitol Hill. Forget the State House. Maybe even forget City Hall. Steve Ennen, managing director of the Wharton Interactive Media Initiative, says one key to success is to provide news and information for the most local of levels. "I'm talking block-to-block," says Ennen, citing localized web presences that have proved successful in Europe and Latin America. The problem with devoting your own resources to covering popular topics like Hollywood or national politics is that someone else is also doing so -- in the process, swiping your readers. A news business that gets down to the nitty-gritty, though, can quickly have the field to itself. The same goes for other niches, from ideologies to narrow interests ranging from news about pets to the latest on Pakistan. Waldfogel predicts the online news market will eventually look like the politically polarized newspaper market of a century ago, before monopoly status encouraged most publications to seek middle ground.
* The Pay Route: The New York Times famously cancelled its policy of keeping parts of its web site off-limits to non-subscribers. But Wharton marketing professor Eric Bradlow, co-director of the Wharton Interactive Media Initiative, says subscriber strategies aren't always doomed. Companies from Dow Jones, which publishes the Wall Street Journal, to any number of small trade magazines that offer highly specialized information to affluent subscribers manage to keep content behind a for-pay firewall, defying the conventional wisdom about an Internet audience that demands freebies. The key is a degree of specialization, whether by locality or by subject matter, that the traditional general-interest paper didn't deliver. Newspapers could, Bradlow suggests, "release partial information or certain stories through e-mail or other media as a way to get traction and then drive people towards the web site, which could be a pay model. It's a classic, 'we're going to give some stuff away for free model.'" Bradlow notes that pay satellite radio has flourished despite the availability of free AM and FM radio and the ubiquity of iPods.
* The Participation Route: One way the Internet differs most dramatically from print is readers' expectations of being able to interact with one another -- and with the source of the information. But this contrasts with the traditional newspaper idea that content, even content that is labeled "opinion," is produced by professionals with specific training and standards. Wharton management professor Lawrence Hrebiniak says that's something news companies are going to have to get over as they transition to an online existence. "Newshounds are looking for interactivity," he says. "Whatever gives him or her a chance to say something, to have an opinion, even if 90% of it is self-serving, it works."
* The Commercial Route: Fader, like most observers of the media business, says survival online will require rethinking basic values about things like bias, opinion and, especially, advertising. As an example, he cites book reviews. At most newspapers, book sections have been killed off for lack of profits. But Americans still consume book reviews in large quantities: It's just that they do so on Amazon.com, where readers' sometimes-withering opinions about books for sale are included on the page. "Where a lot of people go to find 'journalism' is on commercial sites," he says. "They go and read the reviews and ratings on Amazon.... It's going to be a tough struggle and very few newspapers as we knew them yesterday will exist in five years. Those that [survive] will do so by getting off their high horse and doing things that would have been commercial heresy. Imagine a New York Times book review with a link to Amazon."
As their stock values have plummeted, the harshest critics of newspaper firms have compared them to the railroads of a half-century ago -- unable to cater to customer desires, even as technological change threatened to wipe them out. A more charitable comparison, Waldfogel says, might be to the music business, which saw its profits dissolve in the face of free downloading. "It's not exactly piracy that's killing newspapers, but it's something like it."
Of course, there's another parallel: The music business, criticized for bland, generic acts, was flawed in ways that left customers broadly unsympathetic to its plight, just as daily broadsheets, after two decades of cuts and Britney Spears coverage, have lost much of their claim to nobility. The question is whether there's a model that can revive the good pieces -- the investment in people who consider it a professional duty to spread the word about everything from local traffic disruptions to national political chicanery -- while giving customers the whole world of options they now expect.
Either way, Fader predicts, at least some newspapers will remain -- as boutique products for a niche market willing to pay a premium for the charmingly old-fashioned idea of a hand-delivered piece of paper printed with news stories. "The kooky luxury boutique item will exist in a niche form for a long, long, long, time, until our generation fades away," he says. "Some people still like vinyl records."
Source: Knowledge Wharton
Why the New York Times Won't Cease Printing
THE end of the world is nigh! Or the end of the print edition of the NYT, anyway, at least according to Michael Hirschorn, in a piece which has been generally well-received by a blogosphere. For me, however, the article makes very little sense: Hirschorn seems to think that given a choice between defaulting on debt payments and stopping its print presses, the Sulzbergers might choose the latter. But they wouldn't: for one thing that's not a decision the NYT's lenders would actually want, and for another thing the New York Times Company has any number of assets it could sell off, especially in Boston, before taking such a drastic move.
Hirschorn also seems to think that the newspaper might soon be up for sale, if it isn't already, and reels off a familiar list of potential buyers: Geffen, Bloomberg, Slim, Murdoch, Google, Microsoft, CBS. But even they can't save the print edition, he says:
At some point soon--sooner than most of us think--the print edition, and with it The Times as we know it, will no longer exist. And it will likely have plenty of company.
The second part is right: many smaller newspapers will close their print editions, which have lost the classified-advertising bread-and-butter revenue stream upon which they've historically relied.
But the New York Times is not a small newspaper. It has an enormous display-advertisement inventory, and sells most of it at high rates. It's also incredibly well placed to go national, as smaller papers close, and become a replacement for people who've lost their local paper and who shudder at the prospect of ever reading USA Today.
Hirschorn, by contrast, is thinking small: he calls the Huffington Post "the prototype for the future of journalism", and singles out the NYT's DealBook blog as "a cash cow for The Times". I'm not sure what Hirschorn's idea of a cash cow is, but that characterization just looks strange coming, as it does, in the wake of Hirschorn's easy dismissal of the extremely-lucrative T Magazine as "lifestyle fluff". I can assure Hirschorn that DealBook's email ads make a lot less money than T's luxury gloss.
And then, to top it all off, there's this:
As of December, its stock had fallen so far that the entire company could theoretically be had for about $1 billion. The former Times executive editor Abe Rosenthal often said he couldn't imagine a world without The Times. Perhaps we should start.
Er, no. The NYT has two classes of stock, as Hirschorn knows full well: the secondary-market price of the non-voting stock can't simply be extrapolated to get the amount that someone would need to pay for voting control. And in any case, $1 billion is still a lot of money. To put that number in perspective, over the past four quarters, the New York Times Company has lost about $30 million. I think it's pretty safe to say that the NYT is going to continue to exist in its present form for quite a long time yet.
Source: Portfolio.com
Hirschorn also seems to think that the newspaper might soon be up for sale, if it isn't already, and reels off a familiar list of potential buyers: Geffen, Bloomberg, Slim, Murdoch, Google, Microsoft, CBS. But even they can't save the print edition, he says:
At some point soon--sooner than most of us think--the print edition, and with it The Times as we know it, will no longer exist. And it will likely have plenty of company.
The second part is right: many smaller newspapers will close their print editions, which have lost the classified-advertising bread-and-butter revenue stream upon which they've historically relied.
But the New York Times is not a small newspaper. It has an enormous display-advertisement inventory, and sells most of it at high rates. It's also incredibly well placed to go national, as smaller papers close, and become a replacement for people who've lost their local paper and who shudder at the prospect of ever reading USA Today.
Hirschorn, by contrast, is thinking small: he calls the Huffington Post "the prototype for the future of journalism", and singles out the NYT's DealBook blog as "a cash cow for The Times". I'm not sure what Hirschorn's idea of a cash cow is, but that characterization just looks strange coming, as it does, in the wake of Hirschorn's easy dismissal of the extremely-lucrative T Magazine as "lifestyle fluff". I can assure Hirschorn that DealBook's email ads make a lot less money than T's luxury gloss.
And then, to top it all off, there's this:
As of December, its stock had fallen so far that the entire company could theoretically be had for about $1 billion. The former Times executive editor Abe Rosenthal often said he couldn't imagine a world without The Times. Perhaps we should start.
Er, no. The NYT has two classes of stock, as Hirschorn knows full well: the secondary-market price of the non-voting stock can't simply be extrapolated to get the amount that someone would need to pay for voting control. And in any case, $1 billion is still a lot of money. To put that number in perspective, over the past four quarters, the New York Times Company has lost about $30 million. I think it's pretty safe to say that the NYT is going to continue to exist in its present form for quite a long time yet.
Source: Portfolio.com
Wednesday, January 7, 2009
Online is the future and the future is now
WTH bosses focused on commerce and ratings, papers are falling behind where it really matters, says Roy Greenslade - creating online material and innovations people are prepared to pay for.
If you thought 2008 was bad for the newspaper industry, this year will undoubtedly be worse. I would say that, wouldn't I? I have long been the harbinger of doom and, for reasons I cannot grasp, I am criticised for telling it like it is. But here is what I forecast for 2009, based on a combination of what has happened this year and over the past 30 years.
At least one major regional owner will go under. Even if there is no further consolidation, there will be "accommodations" between rival publishers. More, many more, local titles will be closed or merged. More freesheets will vanish. Needless to say, more journalists will lose their jobs. As for the national newspaper industry, it is probable that a couple of publishers will throw in the towel. I somehow doubt that their titles will vanish altogether, but that must be a possibility too.
At the risk of repeating the "perfect storm" cliche, the combination of a structural and cyclical decline at a time of recession, a continuing credit drought, rising newsprint prices and the flight to the internet is transforming an already grim situation into a perilous one.
Advertising revenue will not recover in time to save companies that, however liquid they want us to believe they are, cannot service their debts. On that front, Johnston Press faces the toughest test, as does its incoming chief executive, John Fry. Trinity Mirror's debts are smaller, but it is challenged on both the regional and national fronts. As with other media stocks in recent weeks, investors have tended to be more positive than throughout the rest of the year. But the next run on low-priced shares could trigger meltdowns.
Though Newsquest, the chain owned by the largest US newspaper publisher, Gannett, is not publicly quoted in Britain, its status is precarious. Gannett's corporate decision-making will surely be influenced by one of its leading US rivals, the giant Tribune conglomerate, having sought protection from creditors and the fact that the New York Times Company has been forced to pawn its headquarters. That's the context in which severe cuts at Newsquest's Scottish papers and in various English regions should be seen. Titles have been closed, and there will be more. However, these desperate measures may not produce enough savings to prevent Gannett demanding more drastic cuts.
By contrast with its three major regional rivals, the Daily Mail & General Trust is in a far better position. It is a diversified media conglomerate with a far greater market capitalisation. I would guess that its board, if not its dynastic chairman, Lord Rothermere, wishes it had dispensed with Northcliffe, its regional arm, but it soldiers on without apparent embarrassment at failing to find a buyer a couple of years back.
Whatever problems it faces in the regions, they are nothing compared with the debilitating freesheet conflict in London. DMGT, with London Lite, and News International, with the London Paper, are making huge losses every week by together distributing 900,000 copies. A truce offer a couple of months ago from DMGT was rejected by Rupert Murdoch's News International, which has never come to terms with DMGT's success with its morning free, Metro. Murdoch still has hopes of winning the contract that allows Metro to be given away exclusively at tube stations.
But can he justify pouring more millions away if advertising declines further? Note that the other London free, City AM, which boasts a 100,000-strong distribution to a well-heeled audience, has made substantial losses in the past year. There must be a possibility that its owners will be struck by the irony of publishing a business paper that makes no business sense.
With every newspaper publisher - regional and national - engaged in a frantic round of cost-cutting, with redundancies, pay freezes and expenditure squeezes, production outsourcing has become the new mantra. Witness the fact that the Telegraph Media Group's supplements are now being subedited in Australia. Other owners will undoubtedly follow suit.
Meanwhile, and here is the rub, necessary online innovation is being stifled. There is a lack of genuine inventiveness about how to forge a new form of journalism, because companies are too focused on dealing with commerce. Many regional and local paper websites are so clunky that they cannot hope to gain new audiences, let alone retain the current ones. Staff required to "service" print and web on a 24-hour basis are not given the time and space to experiment and there is precious little encouragement from managers who are interested only in bottom lines.
Similarly, many national paper websites are chasing ratings rather than innovating - in the long term, building trust and credibility is far more important. The importance of online journalism cannot be stressed too often. It is foolish to call it the future because the future is now.
It is certain that overall newsprint sales will decline further during 2009. It is also sobering to realise that even if a national paper were to close - whether the Independent at one end of the market, or the Daily Star at the other - rivals will not benefit much. When Murdoch pulled the plug on Today in 1995, when it was selling almost 600,000 a day, the majority of readers vanished into thin air. Now, of course, they will vanish into cyberspace.
The fight that counts in 2009 is the one for online eyeballs seeking news and informed comment, not for the passive audience handed a freesheet with the minimum of journalistic merit or public benefit.
Source: Roy Greenslade - Guardian.co.uk
If you thought 2008 was bad for the newspaper industry, this year will undoubtedly be worse. I would say that, wouldn't I? I have long been the harbinger of doom and, for reasons I cannot grasp, I am criticised for telling it like it is. But here is what I forecast for 2009, based on a combination of what has happened this year and over the past 30 years.
At least one major regional owner will go under. Even if there is no further consolidation, there will be "accommodations" between rival publishers. More, many more, local titles will be closed or merged. More freesheets will vanish. Needless to say, more journalists will lose their jobs. As for the national newspaper industry, it is probable that a couple of publishers will throw in the towel. I somehow doubt that their titles will vanish altogether, but that must be a possibility too.
At the risk of repeating the "perfect storm" cliche, the combination of a structural and cyclical decline at a time of recession, a continuing credit drought, rising newsprint prices and the flight to the internet is transforming an already grim situation into a perilous one.
Advertising revenue will not recover in time to save companies that, however liquid they want us to believe they are, cannot service their debts. On that front, Johnston Press faces the toughest test, as does its incoming chief executive, John Fry. Trinity Mirror's debts are smaller, but it is challenged on both the regional and national fronts. As with other media stocks in recent weeks, investors have tended to be more positive than throughout the rest of the year. But the next run on low-priced shares could trigger meltdowns.
Though Newsquest, the chain owned by the largest US newspaper publisher, Gannett, is not publicly quoted in Britain, its status is precarious. Gannett's corporate decision-making will surely be influenced by one of its leading US rivals, the giant Tribune conglomerate, having sought protection from creditors and the fact that the New York Times Company has been forced to pawn its headquarters. That's the context in which severe cuts at Newsquest's Scottish papers and in various English regions should be seen. Titles have been closed, and there will be more. However, these desperate measures may not produce enough savings to prevent Gannett demanding more drastic cuts.
By contrast with its three major regional rivals, the Daily Mail & General Trust is in a far better position. It is a diversified media conglomerate with a far greater market capitalisation. I would guess that its board, if not its dynastic chairman, Lord Rothermere, wishes it had dispensed with Northcliffe, its regional arm, but it soldiers on without apparent embarrassment at failing to find a buyer a couple of years back.
Whatever problems it faces in the regions, they are nothing compared with the debilitating freesheet conflict in London. DMGT, with London Lite, and News International, with the London Paper, are making huge losses every week by together distributing 900,000 copies. A truce offer a couple of months ago from DMGT was rejected by Rupert Murdoch's News International, which has never come to terms with DMGT's success with its morning free, Metro. Murdoch still has hopes of winning the contract that allows Metro to be given away exclusively at tube stations.
But can he justify pouring more millions away if advertising declines further? Note that the other London free, City AM, which boasts a 100,000-strong distribution to a well-heeled audience, has made substantial losses in the past year. There must be a possibility that its owners will be struck by the irony of publishing a business paper that makes no business sense.
With every newspaper publisher - regional and national - engaged in a frantic round of cost-cutting, with redundancies, pay freezes and expenditure squeezes, production outsourcing has become the new mantra. Witness the fact that the Telegraph Media Group's supplements are now being subedited in Australia. Other owners will undoubtedly follow suit.
Meanwhile, and here is the rub, necessary online innovation is being stifled. There is a lack of genuine inventiveness about how to forge a new form of journalism, because companies are too focused on dealing with commerce. Many regional and local paper websites are so clunky that they cannot hope to gain new audiences, let alone retain the current ones. Staff required to "service" print and web on a 24-hour basis are not given the time and space to experiment and there is precious little encouragement from managers who are interested only in bottom lines.
Similarly, many national paper websites are chasing ratings rather than innovating - in the long term, building trust and credibility is far more important. The importance of online journalism cannot be stressed too often. It is foolish to call it the future because the future is now.
It is certain that overall newsprint sales will decline further during 2009. It is also sobering to realise that even if a national paper were to close - whether the Independent at one end of the market, or the Daily Star at the other - rivals will not benefit much. When Murdoch pulled the plug on Today in 1995, when it was selling almost 600,000 a day, the majority of readers vanished into thin air. Now, of course, they will vanish into cyberspace.
The fight that counts in 2009 is the one for online eyeballs seeking news and informed comment, not for the passive audience handed a freesheet with the minimum of journalistic merit or public benefit.
Source: Roy Greenslade - Guardian.co.uk
Which Dies First? Demand for Newsprint or Production of Newsprint?
There’s a distinct possibility that what may ultimately kill major newspapers will be totally unrelated to anything electronic. It’s a possiblity that a shortage of newsprint may kill more newspapers than a dramatic shift to online.
* The permanent closure by the end of the first quarter of 2009 of the Grand Falls, Newfoundland and Labrador newsprint mill, representing 205,000 metric tons;
* The permanent closure by the end of 2008 of the Covington, Tennessee paper converting facility, representing 70,000 metric tons of coated grades;
* The immediate idling, until further notice, of the Alabama River newsprint mill, in Alabama, representing 265,000 metric tons;
* On a revolving basis, approximately 20,000 metric tons of monthly newsprint downtime at other facilities across the organization until market conditions improve.
Consumption of newsprint in North America will continue to fall. The Far East consumption of newsprint may increase, but that does nothing to help North American mills. As this develops, machines are being changed over to more profitable higher grades of papers.
At the same time, newspapers are shrinking. Not only are pages getting fewer, they are getting smaller.
A price decrease was just announced.
Normally a good thing when newspaper bottom lines are hurting. But for a business that is totally dependent on one raw material - with absolutely no alternative on the horizon - keeping those suppliers healthy is critical.
Like a the automakers, the newsprint makers are looking to liquidate assets. AbitibiBowater will sell it’s hydro-electric plant, for example, in order to free up cash.
If newspapers aren’t careful, they may save so much newsprint, the manufacturers may decide to cut production even more.
I think this is called a esculating downward spiral. Demand down, raise price, demand declines more, reduce production, raise price, demand falls further…
I only hope that more major metro papers follow the Detroit Free Press model. At least it will free up some newsprint for us little guys.
Source: markvanpatten.com
* The permanent closure by the end of the first quarter of 2009 of the Grand Falls, Newfoundland and Labrador newsprint mill, representing 205,000 metric tons;
* The permanent closure by the end of 2008 of the Covington, Tennessee paper converting facility, representing 70,000 metric tons of coated grades;
* The immediate idling, until further notice, of the Alabama River newsprint mill, in Alabama, representing 265,000 metric tons;
* On a revolving basis, approximately 20,000 metric tons of monthly newsprint downtime at other facilities across the organization until market conditions improve.
Consumption of newsprint in North America will continue to fall. The Far East consumption of newsprint may increase, but that does nothing to help North American mills. As this develops, machines are being changed over to more profitable higher grades of papers.
At the same time, newspapers are shrinking. Not only are pages getting fewer, they are getting smaller.
A price decrease was just announced.
Normally a good thing when newspaper bottom lines are hurting. But for a business that is totally dependent on one raw material - with absolutely no alternative on the horizon - keeping those suppliers healthy is critical.
Like a the automakers, the newsprint makers are looking to liquidate assets. AbitibiBowater will sell it’s hydro-electric plant, for example, in order to free up cash.
If newspapers aren’t careful, they may save so much newsprint, the manufacturers may decide to cut production even more.
I think this is called a esculating downward spiral. Demand down, raise price, demand declines more, reduce production, raise price, demand falls further…
I only hope that more major metro papers follow the Detroit Free Press model. At least it will free up some newsprint for us little guys.
Source: markvanpatten.com
US: Internet overtakes print as primary news source
ACCORDING to a report published by the Pew Research Center, the Internet overtook print newspapers as a news source this year in the United States.
The report found that Internet usage surged from 24% to 40% in a year, overtaking the 35% who rely on newspapers, the Guardian reports.
The New York Times reports that the change "does not represent a decline in the popularity of newspapers," but rather a "near-doubling" of the number of people that name the Internet as their primary news source. Newspapers actually gained a percentage point in popularity over the last year.
Michael Dimock, the Pew Center's associate director believes that the US presidential election has a lot to do with the shift because most people prefer to follow their candidate in a way that mainstream media does not allow.
The shift to the Internet has been hard on newspapers because they have been unable to generate the same kind of advertising revenue as they used to. The most recent example was in December when the Tribune Company filed for bankruptcy. Columbia Journalism professor, Sree Sreenivasan believes that "the problem is that advertising dollars from newspapers are being replaced by digital pennies."
The Guardian's Roy Greenslade believes that 2009 will be a rough year for newspapers and he predicts that more freesheets will vanish, more journalists will lose their jobs and more publishers will shut down. Greenslade believes that "rising newsprint prices and the flight to the Internet is transforming an already grim situation into a perilous one."
Greenslade feels that "there is a lack of genuine inventiveness about how to forge a new form of journalism, because companies are too focused on dealing with commerce." Which is the ultimate problem for newspapers - how to retain and gain audiences because as they are trimming costs, they are also cutting content and their ability to innovate.
Source: New York Times, The Guardian, Roy Greenslade, Poynter
The report found that Internet usage surged from 24% to 40% in a year, overtaking the 35% who rely on newspapers, the Guardian reports.
The New York Times reports that the change "does not represent a decline in the popularity of newspapers," but rather a "near-doubling" of the number of people that name the Internet as their primary news source. Newspapers actually gained a percentage point in popularity over the last year.
Michael Dimock, the Pew Center's associate director believes that the US presidential election has a lot to do with the shift because most people prefer to follow their candidate in a way that mainstream media does not allow.
The shift to the Internet has been hard on newspapers because they have been unable to generate the same kind of advertising revenue as they used to. The most recent example was in December when the Tribune Company filed for bankruptcy. Columbia Journalism professor, Sree Sreenivasan believes that "the problem is that advertising dollars from newspapers are being replaced by digital pennies."
The Guardian's Roy Greenslade believes that 2009 will be a rough year for newspapers and he predicts that more freesheets will vanish, more journalists will lose their jobs and more publishers will shut down. Greenslade believes that "rising newsprint prices and the flight to the Internet is transforming an already grim situation into a perilous one."
Greenslade feels that "there is a lack of genuine inventiveness about how to forge a new form of journalism, because companies are too focused on dealing with commerce." Which is the ultimate problem for newspapers - how to retain and gain audiences because as they are trimming costs, they are also cutting content and their ability to innovate.
Source: New York Times, The Guardian, Roy Greenslade, Poynter
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