Clay Shirky on the Collapse of Complex Business Models – Media & Newspapers

…Diller, Brill, and Murdoch seem be stating a simple fact—we will have to pay them—but this fact is not in fact a fact. Instead, it is a choice, one its proponents often decline to spell out in full, because, spelled out in full, it would read something like this:

“Web users will have to pay for what they watch and use, or else we will have to stop making content in the costly and complex way we have grown accustomed to making it. And we don’t know how to do that.”

-CShirky read the entire post on Shirky’s blog.

Newspaper Association of America Reports Ad Revenue Fell 27.2% in 2009

Newspaper print ad revenue fell 28.6% from last year (which fell 17.7% the year before).  Even more alarming is the fact that newspaper Online advertising revenue fell 11.8% (which fell 1.8% the year before).

Total ad spending in the U.S. fell 12.3% to $125.3 billion in 2009, according to a report from Kantar Media (formerly TNS Media Intelligence).

Internet display advertising was up 7.3%, and free-standing inserts, up 3.0%.

While the economy had an impact in the numbers, clearly, the business model is not working.

Everyone is Going Nuts about NYTimes.com Charging for Content in 2011

I heard through Twitter that NYtimes.com was going to start charging for access to their content if you read too many articles on their site… what?

Forbes is calling it “Meter Madness At The Times” and goes on to report-

Greg Mitchell, E&P’s former editor, termed the plan “vague.” Content Bridges’ Ken Doctor called it “a big bet.” Social media critic Mathew Ingram, blogger at GigaOm, wrote, “Why is the NYT waiting until 2011? This isn’t exactly rocket science to implement.” Reuters’ media blogger Felix Salmon minced no words, calling it “a sad day for online journalism.”

I confirmed it by doing a Google News search and then reading an article about it from the Free site Paidcontent.org where they also published the entire NYT memo to the staff.

I wish NYTimes.com all best I’m curious to see how this grand experiment (Round 2) works out. Remember Times Select was a failure, I’ve said it before and I’ll say it again, you can’t charge for general interest news in the internet paradigm.

BREAKING! Buggy Whip Manufacturers Have Not Hit Bottom!

“Despite some tentative optimism from Washington, Wall Street and Madison Avenue, people who monitor the newspaper business for a living say it has not yet hit bottom.” 9/20/2009 -NYTimes.com (yeah that’s right, the FREE site)

“Sen. Ben Cardin (D-Md.) has introduced S. 673, the so-called “Newspaper Revitalization Act,” that would give outlets tax deals if they were to restructure as 501(c)(3) corporations.” 9/20/2009 -TheHill.com

So if going out of business and/or seeking a bailout from the Federal Government is not the bottom then hey, the Buggy Whip industry hasn’t hit bottom either.  The Buggy Whip makers have seen a stabilization and even increase in sales in the last few years… yep, things are fine.

Most Redditors Find Newspaper Website Page Jumps Annoying

Dear Washington Post and every other internet newspaper: if you have a long article, PUT IT ON ONE PAGE. My browser isn’t paper, you don’t need to break it up into 6 pages

As the title of above Reddit thread implies many newspaper news sites spread their longer articles over several pages.  It’s my opinion that they do it to drive up pageviews and advertising impressions, but in the process annoy the hell out of the reader.  While the Newspaper Association of America continues to triumphantly announce record pageviews on newspaper sites, the newspapers themselves are going bankrupt.   Hmmm… It’s time for a new strategy fellas.

My suggestion to these newspaper sites is put the articles on ONE page and increase CPM’s by reducing the total number of advertising spots on their webpages.  In other words, don’t have 12 ad spots on every damn page.   Look at Kottke.org he has ONE ad on that site (via The Deck) and it generates something like $80k year!

In the meantime people are developing workarounds for crappy user experiences by:

1. reading the article in print page view which usually puts the article on one continuous scrolling screen.

2. using the Auto Pager firefox plugin which automatically loads the next page at the bottom of the screen to create one continuous scrolling screen.

3. using ARC 90 Labs Readability tool which eliminates all ads from the screen

4. using Ad Block Plus to eliminate ALL on site advertising

5. using this GreaseMonkey Script make a multi column page

The online experience is totally different then the print reading experience.  Newspapers need to get it in their heads that what works in print does not work online.  Print best serves a Geographic Community.  The web best serves Communities of Interest.  If newspapers are selling “brand awareness” type ads, they won’t sell enough to become economically sustainable.  If they sell ads that result in conversions (sales) then they will realize higher CPM’s.  Newspapers however, must dismantle their behemoth catch all news sites and create community of interest news sites to best position such conversion ads.  The advertiser and newspaper will both benefit.  The current online advertising and user experience strategies cannot go on.

Newspaper Association of America Abandons Its Members

 

NAA sent me a letter with this month’s Presstime magazine letting me know that this is the last print edition I will be receiving.  They are moving online only.  Truth be told, it was probably the last print edition I would be getting anyway you see I graduated from NYU in January and NAA wants proof that I still qualify for their student rate. I do, but you know what NAA, I’m not wasting my time to send you the appropriate paperwork. 

Why is NAA, the NEWSPAPER Association of America, eliminating their print publication and moving online only?  The reason they cite in the letter is “to adapt our organization to the realities of today’s newspaper business”.  I’m calling bullshit on their reasoning.  The real reason I suspect is because NAA is too big a coward to try something innovative and instead is hoping to just hang in there a little longer like everyone else and hope for the best.

According to NAA’s website, here is the association’s purpose:

Today, NAA serves the newspaper industry in strategic efforts to:

. Serve as a catalyst for industry growth
. Identify and disseminate examples of industry innovation
. Provide tools to exchange information and ideas
. Advocate and communicate industry views and interests to the Federal Government and to third-party standards and measurement bodies
. Communicate the vitality of newspaper media to external constituencies including the advertising community, Wall Street and the news media.

    Did you read the first and last bullet points?  What an awful message eliminating print sends to NAA’s advertisers, NAA’s members, and to the advertisers who spent roughly 34 Billion dollars in PRINT advertising last year. Continue reading

    What Google Maps and Everyblock’s iPhone App means for Established News Media

    EveryBlock’s iPhone app -from Everyblock

    If you live in an EveryBlock city and have an iPhone you can now have more news access than you ever thought you needed.  The app is available for free at the App Store.

    Here’s how Everyblock explains the features of the app:  The EveryBlock iPhone app lets you explore news that’s happened recently in your immediate area.  We publish dozens of different categories of local news, drawing from hundreds of sources. Much of it is updated every single day. Examples of the information we publish: Continue reading

    For a Guy Who Writes About Newspapers, Scoble sure is a Good Photographer

    “In general, I have very little time for Scoble, and true to form there are about six things in the first half of this alone that make me want to beat the stupid out of him with a shovel. But there’s also food for thought in there this time.” -lifted from a delicious note

    Here is the offending article: The newspaper industry just gave away another free meal, er Twitter: do they have any left? -from scobleizer.com

    What isn’t explored in Robert Scoble’s article, or maybe what isn’t understood by the author of that article, is that when a disruptive technology comes along, The Internet, in this case, little to nothing can be done to prevent seismic changes in business practices.  Mark Federman sums this up way better than I can.  Here he is talking about Marshall McLuhan’s famous line “the medium is the message”. Continue reading

    How Scott Adams Saved Newspapers – I’ll Pretend I Didn’t Read This

    Dilbert creator Scott Adams writes a blog post, How I Saved Newspapers.

    Normally I like Dilbert comics.  They are witty and fun and relevant and I imagine the creator of those comics sometimes has a window into my world.  When I read Scott Adams blog post about saving newspaper though I couldn’t help but think that Bottleneck Bill or some other minor character wrote the piece.  Adams solution for a failing newspaper industry is called “super-local news” and relies on volunteers submitting content to newspapers… “the super-local news has to have lots of content about classrooms, Cub Scout meetings, local movies listings rated less then R, and that sort of thing.” Sounds like the internet only useless.

    Adams states that this new newspaper will of course feature Dilbert comics.  *sigh* I’ll just pretend I didn’t read this Scott.

    NAA Looks Foolish on National TV

    Tuesday March 31, 2009 Steven Colbert had on John Sturm, president of the Newspaper Association of America.  Typical of all his guests, he made them look out of touch and stupid.  As Advertising Age wrote in their blog, “it was hilarous and depressing”.  Why on earth would the NAA send anyone to speak with Colbert for his program?  You know the saying, “all publicity is good publicity” well, it’s not.

    Steven Colbert is an influencer watched by millions and he just pronounced the floundering newspaper industry dead.  It’s impossible for Strum to come up with a single retort to “why buy the cow when you can get the milk for free?” and “if you’re serious about competing on the internet, why don’t newspapers have a huge porn section?”

    The Colbert Report Mon – Thurs 11:30pm / 10:30c
    Stephen’s Namesakes
    comedycentral.com
    Colbert Report Full Episodes Political Humor NASA Name Contest

    Steve Greenberg’s Farewell to The Seattle P-I

    Editorial cartoonist and graphic artist Steve Greenberg says goodbye to the Seattle Post Intelligencer, a newspaper he called home for 14 years.

    Hearst has pulled the plug on the paper, which had a circulation of about 200,000 and was the biggest morning paper in Washington when I started there in August 1985. It had clunked along as the junior parter in a JOA, surrendering its printing, advertising sales. marketing and circulation to the larger Seattle Times. But having agreed, for a bigger split of the profits, to let the Times move into its morning monopoly, Hearst saw the paper’s circulation plummet to about 117,000 and its finances go down the toilet between the recession, a strike in 2000 (shortly after I’d left) and the bleeding of newspapers in general.

    The Seattle Times was richer, more elite, centrist-to-conservative, and smugly superior, selling far better in the well-to-do suburbs. The P-I was looser, more liberal, more blue collar, less-esteemed but generally a match for the Times in quality, and had the feel of being the more historic “voice of the Northwest.” It gave itself a wonderful symbol of a giant rooftop globe straight out of Superman and the Daily Planet, with the words “It’s in the P-I” cranking around its equator.

    Read the entire article on his blog.  Below is the front page from today’s Seattle P-I printed newspaper.  It is the last one you will ever see as the operation moves to online only. The move is being closely watched as it is the first time a large daily newspaper has switched with no transition to online only.  I can guarantee that if the operation turns profitable (even marginally so), there will be a stampede of newspapers following suit. Continue reading

    The Newspaper Industry, The Dip, Seth Godin

    Seth Godin‘s book, The Dip, is all about quitting.  It’s about learning WHEN to quit and WHEN not to quit.  It’s also about learning WHAT to quit, and WHAT not to quit.  As one of the many examples he gives for quitting, he gives the following common scenario currently unfolding in the American newspaper industry.

    If you work at a big city newspaper, you can see that there’s no light at the end of that career-choice tunnel. Circulation is dropping, and it’s going to drop ever faster. Most papers have little chance of replacing their traditional business with an online alternative.  As a result, every day at most papers is going to be just a little bit worse than the day before. Every day you stay is a bad strategic decision for your career because every day you get better at something that isn’t that useful-and you are another day behind others who are learning something more useful. The only reason to stay is the short-term pain associated with quitting.  Winners understand that taking that pain now prevents a lot more pain later.

    I was reminded of the above passage while flying home after covering NAA’s mediaXchange in Las Vegas.  I won’t be back.  There were maybe 4 good speakers at the event.  Perhaps worse though was the crowd, a listless mob staring into a dark tunnel hoping to see the light at the end (but was there even a light to see?).  People weren’t asking good, tough questions, they were just kind of.. there.  The annual convention used to be a place where equipment manufacturers showcased their new products and where newspaper execs. came to make sweet deals.  That pretty much fell apart in 2008 because of cost cutting in the industry (and finally a realization that equipment doesn’t manufacture customers) and so this year the name was changed to something more EXTREME! like mediaXchange and a more digital spin was put on the entire proceedings.  They should have served Brawndo.

    How the hell does NAA get away with scheduling Lee Abrams to talk about redesigns for the closing session?  And how the hell does no one in the audience ask him a tough question, like “why is a redesign so good if your papers are still failing”?  or “is it any bellwether that your only growing print product is the FREE METRO TABLOID, Redeye”? or “do you see a fundamental problem with the newspaper industry operating in an internet paradigm”?   Lee Abrams by the way is a retired old man/ radio executive who helped drive XM Radio into the ground and is now the Chief Innovation Officer for the Tribune Company.  Are you kidding me Tribune?  Employees and stakeholders in that company should be livid at his appointment.  Are you kidding me newspaper industry?  This is what you “gathered” everyone up for?  I wish I had the ability to print out Clay Shirky’s latest blog post Newspapers and Thinking the Unthinkableand stuff it in everyone’s free tote bag.  WTF?!

    For all the time and money I spent on attending mediaXchange, I leaned a minimum amount of good, new information.  I hoped to see sessions on paradigm shifts and accepting new realities, but instead heard mostly product pitches.  Hell, I should have been there TALKING to these people.  I wanted to bum rush the stage at the closing session and say, “WAKE UP.  NEWSPAPER REDESIGNS ARE DEAD.  LETS TALK ABOUT NEW MEDIA”.  But the problem was that the audience seemed fine and even INTERESTED!!!! in hearing about redesigns from Lee Abrams.  Jeez!!!   As social media session speaker Kurt Greenbaum (one of the good speakers) followed up on his blog, “5.8% of NAA attendees cared about social media“.

    I should have skipped mediaXchange, I should have quit, I should have went to SXSW.  That’s where the innovation is happening, and that’s where you’ll find me next year.  I hope to find news media execs. there too but I doubt it.  Godin says quit a loser, well I just quit mediaXchange.

    Newsvine CEO Reflects as Seattle Post-Intelligencer Fails

    Mike Davidson is founder and CEO of Newsvine, which was recently acquired by msnbc.com, invented sIFR, a technology which has enabled tens of thousands of designers to beautify the web with tens of thousands of typefaces, led the redesign of the first major media site to support web standards, ESPN.com in 2003, has no tolerance for the intolerance of imperfection on the web, and went to school with Leonardo DiCaprio and appears adjacent to him in their 3rd grade yearbook!

    That’s one hell of a resume.  In his blog, MikeIndustries, Mr. Davidson recently recounted the akward situation where, “while we were toiling away, our friends upstairs at the Seattle Post-Intelligencer received their unemployment orientation in advance of being laid off two weeks from now”.  Newsvine and the Seattle P-I apparantly shared the same building.  This interesting blog post also touches on Mr. Davidson’s personal belief that he’s “not super optimistic about the future of a lot of these newspaper companies, but I really would love to see them at least replaced with something better”.

    Mr. Davidson also offers tips on saving, not newspapers, but long-form journalism and local reporting.  Check out the entire post entitled Last-Rites on his site.

    A Change in Media Economics 1991 letter to the Shareholders of Berkshire Hathaway

    Excerpt from 1991 letter to the Shareholders of Berkshire Hathaway
    http://www.berkshirehathaway.com/letters/1991.html

    A Change in Media Economics and Some Valuation Math

    In last year’s report, I stated my opinion that the decline in
    the profitability of media companies reflected secular as well as
    cyclical factors. The events of 1991 have fortified that case: The
    economic strength of once-mighty media enterprises continues to
    erode as retailing patterns change and advertising and
    entertainment choices proliferate. In the business world,
    unfortunately, the rear-view mirror is always clearer than the
    windshield: A few years back no one linked to the media business -
    neither lenders, owners nor financial analysts – saw the economic
    deterioration that was in store for the industry. (But give me a
    few years and I’ll probably convince myself that I did.)

    The fact is that newspaper, television, and magazine
    properties have begun to resemble businesses more than franchises
    in their economic behavior. Let’s take a quick look at the
    characteristics separating these two classes of enterprise, keeping
    in mind, however, that many operations fall in some middle ground
    and can best be described as weak franchises or strong businesses. Continue reading

    Newsday Ending Free Online Content and other newspaper news

    Newsday plans to charge for online news -from Reuters

    * Cablevision plans to charge for Newsday website

    * Writes down Newsday value by $402 mln

    Analyst Ken Doctor on his blog wonders what someone would be willing to pay for 4.5 minutes a month (the average site usage for unique visitors) for access.

    Rocky Mountain News to close, publish final edition Friday -from RMN

    The Rocky Mountain News publishes its last paper tomorrow.  “Denver can’t support two newspapers any longer,” Scripps CEO Boehne told staffers, some of whom cried at the news. “It’s certainly not good news for you, and it’s certainly not good news for Denver.”

    What a crazy day in newspaper land.  No one expected the Newsday news.  I half jokingly tweeted that the NY Post and NY Daily News sites are expecting a bounce in visitors.  I’m curious to see what happens at Newsday, I suppose the alternative of them going bankrupt was unacceptable.

    One daily voice per metro – Closing the SF Chronicle

     

    One daily voice per metro?!?

     

    The latest in the never-ending bad newspaper industry news: the Hearst Corp. is considering closing the San Francisco Chronicle if it can’t cut costs sufficiently to stem its ongoing heavy losses.

    Hearst has reportedly lost about a BILLION dollars since 2000, with never a profit, since acquiring the Chron in a complicated deal that saw Hearst get rid of its flagship San Francisco Examiner. Continue reading

    Chicago Journalism Town Hall Newspaper Industry Panel Discussion

    Chicago Journalism Town Hall Newspaper Industry Panel Discussion February 22, 2009

    Chicago Public Radio recorded the THREE HOUR event.  listen via these links:

    Here’s Part One…

    And here’s Part Two

    Steve Rhodes of the Beachwood Reporter has an ebullient follow up:

    So when I looked at the folks scheduled to appear on the town hall panel, I shuddered. Now, bear in mind, I know almost all of them and like almost all of them. Some I admire greatly, in fact. But someone please tell me, how is Rob Feder going to help us save Chicago journalism? Mancow.com?

    Ridiculous Debt to Cash Flow Ratio Dooms Journal Register Company

    Journal Register, Publisher, Files for Bankruptcy -Bloomberg

    The publisher of the New Haven Register would cancel its stock and become a closely held company, owned by its lenders under a proposed reorganization plan filed in U.S. Bankruptcy Court in New York. It listed debt of as much as $1 billion and assets of between $100 million and $500 million in Chapter 11 documents.

    Journal Register Company Files for Chapter 11 to Implement Pre-Negotiated Debt Restructuring; Expects Normal Operations to Continue Uninterupted -Journal Register Company Website

    Saturday, 21 February 2009

    Yardley, PA, February 21, 2009 – Journal Register Company (the “Company”) (PINKSHEETS: JRCO) today announced that the Company and its subsidiaries have filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York to implement a pre-negotiated plan of reorganization (the “Plan”) with certain of its secured lenders designed to substantially reduce the Company’s debt.  The Company intends to continue to operate as usual, and does not anticipate any business interruption during the restructuring. -continue reading at the above link

    There are many debt ratios which one can apply to measure a company’s ability to service debt, I’ll Just do the Cash Flow to Debt Ratio here.  This is more Alan Mutter‘s turf so ask him for those numbers (or verify mine).

    JRCO’s operating cash flow for the year ended December 2007 was $54million

    JRCO’s Total Debt for the year ended December 2007 was  $624.8million (Short/Current Long Term Debt + Long Term Debt)

    Giving the company a Cash Flow to Debt Ratio of 0.086 or 8.6%

    As investopedia states: Under more typical circumstances, a high double-digit percentage ratio would be a sign of financial strength, while a low percentage ratio could be a negative sign that indicates too much debt or weak cash flow generation.

    As a comparison: Lee Enterprises (LEE)

    LEE’s operating cash flow for the year ended September 2008 was $128million

    LEE’s Total Debt for the year ended September 2008 was  $1337million (Short/Current Long Term Debt + Long Term Debt)

    Giving the company a Cash Flow to Debt Ratio of 0.095 or 9.5%

    As a comparison: The Washington Post (WPO)

    WPO’s operating cash flow for the year ended December 2007 was $581million

    WPO’s Total Debt for the year ended December 2007 was  $490million (Short/Current Long Term Debt + Long Term Debt)

    Giving the company a Cash Flow to Debt Ratio of 1.185 or 119% – ample cash flow to service debt.   Oh Journal Register, where did you go wrong?  How does a company with one tenth the cash flow of The Washington Post have over one and a quarter times its debt? Lee, you are next.

    Alan Mutter Jumps The Shark – Getting Over Newspapers

    This post is in response to Why newspapers can’t stop the presses from Newsosaur by Alan Mutter.  It is a series and at the time of this writing he was on installment 3.  Please help me explain why he thinks newspapers should focus on newspapers because I can’t make any sense of this.

    Because newspapers on average derive approximately 90% of their sales from print advertising, the only ink-on-paper newspapers that can afford to attempt digital-only publishing are the ones that are irreversibly losing money. -Alan Mutter

    So we have newspaper companies that are irreversibly losing money.  These companies have discovered that in the internet paradigm, their value proposition is valueless or near valueless. Continue reading

    New York Times Super Bowl Commercial? – What Would It Say?

    This commercial for The New York Times is from 1986. Replace the newspaper that the family is holding with an iPhone and / or Blackberry. Does the newspaper’s value proposition still hold true? What is my incentive now to buy a print subscription? How does The New York Times add to my self actualization?

    In 1986 I would read the comics and flip through the entire newspaper “window shopping”. Now I can do this more effectively online. So what ‘need’ is The New York Times now filling and what is the value of that need? Is the it valueless?

    Chris Anderson, author of  The Long Tail: Why the Future of Business is Selling Less of More and Free: The Past and Future of a Radical Price, has an excellent article in this weekend’s Wall Street Journal entitled The Economics of Giving It Away. In it he give a great simple example of the economics affecting the pricing power of newspaper content.

    Digital goods — from music and video to Wikipedia — can be produced and distributed at virtually no marginal cost, and so, by the laws of economics, price has gone the same way, to $0.00.

    If The New York Times had the money, what would their Super Bowl commercial say? Would it say, “Please bail us out. You NEED US!” Has the value proposition changed since 1986?

    Steve Schwarzman’s Blackstone Group Caught Stealing FT.com Subscription

    The Financial Times is suing the Blackstone Group for multiple use of a single online subscription.  Since 2002 the suit alleges!!  Come on, seriously?  A subscription is like $179 and Schwarzman is worth about $6billion!

    Read on:
    Schwarzman: Too Cheap to Pay for a FT Subscription! -from CityFile

    FT Accuses Blackstone of Login Abuse -from WSJ.com

    Steve Schwarzman -from forbes

    UK Newspaper For Sale, The Independent

    Not long ago I wrote fondly of the Independent.co.uk’s move to incorporate Reddit into their website to allow multiple entry points to their content.  The headline in the image I used could not have been more accurate.

    In three months The Independent’s Debt caught up with it.  It now needs $260 million by May of this year to pay off loans or go into default.  Too excited indeed.

    How’s the site doing?  Not too bad actually.  If the debt can be eliminated and costs from the print side controlled, maybe they’ll make it!  But don’t get too excited. Continue reading

    Why Are Newspapers Paying A Dividend?

    The news-wire services were all abuzz today with the news that McClatchy (MNI) would suspend its dividend indefinitely following 2009 Q1.

    The purpose of paying a dividend it to reward shareholders by telling them something like, “our company is so mature and profitable that in lieu of retaining our earnings for growth, reinvestment, or acquisitions we are going to give it to you”.  Some companies have never paid a dividend.  They feel that they can better grow the money for stockholders better than the stockholders themselves.  Berkshire Hathaway, for example, has never payed a dividend and will most likely never pay a dividend.

    Why did it take MNI until 2009 to realize the money in their coffers would most likely be better used to pay down crippling debt?  Why is NYT still paying a dividend?  Is it only because the Sulzberger family needs income?  What about GCI?  Why do they think their company is better off shedding cash than using the money to pay down debt and restructure?

    I don’t get it.  Paying a dividend is not fooling anyone into thinking your newspaper is strong.  Do everyone a favor, retain those earnings and pay down debt until you figure out how to become economically sustainable.

    Want to learn more about dividends?  Here is an intro from Investopedia:

    One of the simplest ways for companies to communicate financial well-being and shareholder value is to say “the dividend check is in the mail.” Dividends, those cash distributions that many companies pay out regularly to shareholders from earnings, send a clear, powerful message about future prospects and performance. A company’s willingness and ability to pay steady dividends over time–and its power to increase them–provide good clues about its fundamentals.

    Continue reading at Investopedia.com

    Recently Overheard, “Newspapers will never die, you can’t make a scrap book out of interactive products…”

    There’s a pretty good Newspaper Thread going on right now at Ask.Metafilter.com see below.

    As a back story, the quote “Newspapers will never die, you can’t make a scrap book out of interactive products…” came from one newspaper person after another newspaper person was gloating about how many newspapers they sold for the Obama Inauguration.

    I don’t want to name names because in this case it would just be mean, you see I went and posed the statement on ask.metafilter.com as a question. Here is my post:

    I’m looking for smart ways to refute the following illogical statement: “Newspapers will never die, you can’t make a scrap book out of interactive products…”

    Lets pretend that scrapbooking is the lifeblood of newspapers. How are interactive products (i’m guessing the person means websites, social networks, blogs, etc.) now used for “scrapbooking”?

    or… Deconstruct the original statement any way you think is better. Thanks!

    Here are the responses, 37 at last count.

    UPDATE: Jan. 21, 2009
    “newspapers covering yesterday’s inauguration ceremony will fly off the shelves as readers seek out their trusted newspaper brand for comprehensive coverage of this historic event.” -John F. Sturm NAA President and CEO 

    Really John?  Is that why they are being sold in “mint”, “unopened” condition on ebay by the pallet full?  Because people wanted to read them?  Dream on…

    The Day The Newspaper Died – From The New Yorker

    The day the newspaper died -from The New Yorker

    James Franklin’s New-England Courant, launched in 1721 and its editorial policy:

    “I hereby invite all Men, who have Leisure, Inclination and Ability, to speak their Minds with Freedom, Sense and Moderation, and their Pieces shall be welcome to a Place in my Paper.”

    This sounds like the policy of any blog, no?

    The New York Times – The Future Looks Slim

    New York Times Co. in Talks With Carlos Slim on Preferred Stock Investment -from WSJ.com
    “The talks are ongoing and may yet fall apart but one of the options being discussed is a preferred-stock issue.”

    A set up like this would make the Mexican Billionaire one of the largest shareholders of NYT stock.  He already own 6.4% of the common stock.  The preferred stock would make Slim more than just a common shareholder, but a stakeholder with leverage.   MXTimes.com here we come?

    Which begs the question: Why are Americans investors not interested in The Grey Lady?   Why is Slim the only one seeing opportunity here?

    UPDATES:

    Will Carlos Slim Save The New York Times? -from BusinessWeek.com
    How independent will these publications remain?  KGB? WTF?

    ” London’s 171-year-old Evening Standard is nearing a deal to sell a controlling stake to Alexander Lebedev, one of Russia’s richest men (and a former KGB agent). Lebedev has also discussed the possibility of buying British national newspaper The Independent as well.”

    UPDATE: January 20, 2009
    Slim Lends New York Times $250 Million as Sales Fall -from Bloomberg

    “While it provides some breathing room, this investment doesn’t solve the longer-term issues facing the newspaper industry,” said Fitch Ratings analyst Mike Simonton in Chicago. “It will be even more challenging for the company to generate positive free cash flow in 2009 with this new, heavy interest burden.”

    Why Is Google’s CEO, Eric Schmidt, Worried About the Newspaper Industry?

    Follow Up to Google CEO Eric Schmidt’s Interview With Fortune’s Adam Lashinsky This has all the background information on what is coming to be known as Google’ refusal to bail out the newspaper industry.

    After a Twitter exchange with Jay Rosen he brought it to my attention that perhaps instead of me asking “why should Google help newspapers?”, I should I ask, “why is Schmidt worried”?  Rosen is the man.  He always gives me good jumping off points for further investigation.

    So, why is Eric Schmidt worried about the failing newspaper industry? Here is the final question and response from the Fortune interview. Continue reading

    Online Advertising Prediction for 2009 – It Fails

    This could come back to bite me in the ass but I’m going to make a prediction for 2009 that online display advertising and all that other junk like pop-ups fails big time this year.

    Why Fail?
    1) No one pays any attention to online display advertising. 2) There’s too much of it floating around. CPM’s are dropping 20% quarter over quarter according to Pubmatic data (PDF). 3) The economy stinks. Businesses will cut back on advertising and realize there is little to no change in their business sales because of it. Continue reading

    Cincinnati Enquirer Eliminating Print Classifieds – In Line With 2007 Mission

    According to this Bizjournals.com article The Cincinnati Enquirer “will cut the number of days it runs classified ads” to reduce costs!! For the life of me, I cannot find the original “letter to readers” from the Cincinnati Enquirer. If any has a link please share it.

    Keep the following in mind when considering this announcement from Cincinnati:

    2007 Annual Report • Become the digital destination for local news and information in all our markets. • Create new business opportunities in the digital space through internal innovation, acquisitions or affiliations. • Maintain strong financial discipline throughout our operations. • Strengthen the foundation of the company by finding, developing and retaining the best and brightest employees through a robust Leadership and Diversity program.

    The word ‘paper’ does not appear once, so it’s no secret the direction that Gannett is taking. Continue reading

    December 31, 2008 Reflections On Newspaper News From Metaprinter

    Newspaper News for 2008
    A selection of articles which represent the overall trends for 2008

    January
    Media Stocks Near 52 Week Lows – “The world is going to hell in a hand basket, the economy is in the dumper, movie stars are dying, and there is a heated election process going on in the free world. One would think this is a glorious time to be operating as a news organization, but the market told us otherwise today.”

    February
    Media stock price performance from 2007-2008 – To think McClatchy MNI was down only 61.6% at this time!!!

    March
    I report from the 2008 America East Newspaper Conference – NY Times still had a futurist named Michael Rogers.  He’s since been let go.  The mindset at the Q&A session was telling, no new ideas, contempt for young new ideas. Continue reading

    Paul Mulshine Waxes Romantic About “Real Journalism” and Hates on Stupid Bloggers

    Re: this Wall Street Journal column:

    Paul Mulshine,

    Your professors and the graduate students at Rutgers were right.

    See also: Pros VS Pajamas

    To answer Mr. Mulshine’s question; What is the New Model for generating revenue? The answer for general interest newspapers and news sites is that there is none. NONE. That’s no mystery. Continue reading

    Hyperlocal Disaster – East Iowa Herald Closes After One Year

    You can’t get more “hyperlocal” than a newspaper serving a population of 1000. This is the purest attempt at Hyperlocal that I’ve ever read about, a very small operation covering a very small population. It has been said before that hyperlocal fails because the advertising cannot support it. So what happened in this situation? Something new and unexpected? Nope, from publisher Mitch Traphagen, “It literally came to an end, the ad revenues,”.

    The East Iowa Herald Closes After One Year -from AP/ Chicago Tribune.

    It should be pretty obvious by now that advertising revenues cannot support general interest news operations by now. The Krugman Paradox and Publisher’s Dilemma spell this out pretty clearly.

    What about donations? What about Spot.us? Barring a generous grant or donation, this model will also fail. Spot.us might be a nice niche alternative for the San Francisco Bay area, but I don’t see the model working for small-town USA. There just isn’t enough disposable income floating around for the model to work. Continue reading

    Brave News World – The Detroit Newspaper Experiment

    As reported everywhere The Detroit Free Press (GCI) and The Detroit News are going paperless (somewhat) in their quest to remain a going enterprise. There is a thorough story about the specifics on MarketWatch.

    Here is Dave Hunke, CEO of Detroit Media Partnership and Publisher of the Detroit Free Press:

    “The dynamics of delivering information to audiences has changed forever due to technology. Today, consumers are more empowered than ever before. In order to serve them well, we must find ways to be more nimble. That means we have to change the way we deliver that news – not just in subtle ways, but in fundamental ways.”

    I applaud the effort to innovate their business model. I have some serious reservations about their strategy however. Simply going online will not save the news business. Bragging that you’ve had “50 million pageviews” and “won Pulitzer Prizes”, while not being able to become economically sustainable should raise red flags about how inefficient newspaper websites are. Continue reading

    Detriot Newspapers Going Paperless – you’ll probably read about this in the newspaper tomorrow

    Paul Anger, vice president of news and editor of the Detroit Free …
    Detroit Free Press, United States – 27 minutes ago
    The Detroit Free Press announced today a first-of-its-kind plan in the struggling US newspaper industry — emphasizing more online delivery of news and …

    Detroit dailies curtail home delivery, boost e-editions
    Bizjournals.com, NC – 39 minutes ago
    The Detroit News — owned by Denver-based MediaNews Group Inc. — and another Detroit daily newspaper, the Free Press, faced with one executive called a fight …

    Detroit Newspapers Confirm Plans To Limit Home Delivery
    CNNMoney.com – 1 hour ago
    The publishers of the Detroit Free Press and Detroit News confirmed Tuesday that they will limit home delivery to three days a week in order to shift …

    “Save New York Times” Facebook Group Raises $0

    Some poor misguided soul has taken it upon himself to save the $ulzbergers from a paradigm shift. That the company is still paying a dividend is reason enough not to donate. But I could think of many more. Some other person is trying to “save” the industry one tshirt at a time.

    ————————————————————————–

    There does not exist one general news website that is economically sustainable

    I’ve been looking everywhere but I simply cannot find one single general news site that is economically sustainable.  I’m asking my readers to present me with a verifyable example of the existence of such a site. I’m looking to refute the following claims:

    . No newspaper website can sustain itself

    . NPR cannot sustain itself

    . No general news blog can sustain itself (Huffpo, Politico)

    . No news startup can yet support itself (spot.us is an interesting experiment at this point, grant funded)

    Someone please tell me there is someone somewhere perhaps in a small town, capable of doing journalism for profit.

    Reaching Out to Finance and Law Experts Regarding a Switch to Non-Profit Status

    NEWS ALERT

    from The Wall Street Journal

    Dec. 7, 2008

    Tribune is preparing for a possible bankruptcy-protection filing as soon as=
    this week, according to people familiar with the matter, opening a new fro=
    nt of trouble for the newspaper industry.=20

    As Tribune continues discussions with its lenders to rework its debt load, =
    the newspaper-and-television concern in recent days has hired Lazard as its=
    financial adviser and a legal counsel for a possible trip through bankrupt=
    cy court.

    For more information: http://online.wsj.com

    –The announcement above just gave the post below a greater sense of urgency–

    I’m looking to get information about an idea that is floating around with more and more regularity from the newspaper industry “experts” and “commentators”.  The idea is turning a failing for-profit newspaper into a non-profit news source.  I’m not sure why a newspaper would want to do this. That’s why I’m reaching out to experts in finance and law.
    Continue reading

    Newspaper Publishing Employment Data 2005 to 2008

    Dr. Joe Webb is a very smart guy.  He runs WhatTheyThink.com, a graphic communications resource for analysis and economic forecasting.  Mostly he focuses on commercial printing but his weekly audio chart for December 1, 2008 caught my eyes and ears.

    The chart he has put together using employment data from the Bureau of Labor and Statistics shows that newspapers have lost roughly 15% of their employees since January 2005.  This highlights the fact that those companies were adjusting to a negative market well before any “financial crisis” hit America.

    Simplified Chart by metaprinter.com

    This chart is a simplified one that I whipped up.  The chart on Dr. Joe’s site is much more complex incorporating all print mediums as well as PR and Ad Agency employment.

    Not one to mince words, Dr. Joe states that basically what we are seeing [on his chart] is, “newspapers dying on the vine…  in the long run this is probably an opportunity for commerical printers to move that printing over to the commercial side”.  To hear the dulcet tones of Dr. Joe’s voice visit his site and follow along as he explains the chart.