Newspaper Turmoil

In Criticism, Culture, Financial, Personal on March 21, 2009 at 1:53 PM

Growing up, I thoroughly enjoyed the newspaper experience. I remember reading hockey and baseball box scores so carefully that I could recite the previous day’s stats to my friends at school. Reading the funnies on the weekend was a ritual; It started with Beetle Bailey, and it always ended with Family Circus. I surrounded myself with newspapers, especially when I didn’t know what to believe. When kids were getting tear-gassed at the Quebec City Summit, or when the Twin Towers collapsed in New York, I carefully read every single account of what happened from every newspaper I could find. Newspapers take the time to struggle with tough questions like: why is this happening? TV often jumps to the conclusion.

But newspapers are dying. I’m not exaggerating; they’re disappearing at an alarming rate. There’s a website tracking the death count.

The problem is the business model. Traditionally, newspapers made the bulk of their money through selling ad space. The big papers were widely distributed, which meant they could command a good price for ad space. The $0.50 on the face of the paper covered the delivery cost. Remember, before TV there was no other place where a single ad would reach the entire nation. Another thing that the large newspapers did to make money was they maximized the use of their printing press. They provided printing services to other newspapers, magazines and book publishers.
The local papers had a modest version of the same business model. With a local circulation, people in that community kept the local paper thriving by listing their companies or personal belongings in the classified ads.
But by posting the exact same content online for free, the National papers lost a big chunk of their circulation. And with the emergence of Craigslist and Ebay, the local papers are failing to collect the classified ad revenue that used to hold them up.
There’s not really much to add from a business standpoint. Local papers are going to disappear without local people wanting to advertise. Municipalities can make a conscious decision to fund some regular local medium, for the sake of keeping a sense of togetherness in the community.
As for the larger news organizations, it’s unclear whether they have a vision of how to reinvent themselves for the new media world. Perhaps they’ve got the right ideas, but they’re not close solving their financial issues. Here’s the financial situation of one of my favourite newspapers, the New York Times. To quote the conclusion of this analysis:
The bottom line is that the New York Times will find it very difficult and/or expensive to borrow more money to meet its upcoming liabilities, even over the short term. Now that the stock has collapsed, moreover, it is not in a strong position to issue equity.
That means they need money fast and they don’t have very many options available to them. Not good. David Carr of the NY Times proposes some excellent solutions, while going over some of the mistakes the industry made along the way. In the future, we can expect quality news publications to ask you for money if you want to continue reading them online.
I want to leave you with this article. It’s a reminder that although reading a newspaper is a very private experience, reading the same news article as everyone else brings clarity and community together. Gary Kamiya is quite pessimistic about a future without newspapers, but it’s important that someone highlight all the potential problems with the new online media regime. A lot of things “die,” during a recession, but the death of newspapers is a rare event that will leave a gaping void in our experiences with each other.

  1. This is very sad. I love a good newspaper, there really is nothing more enjoyable than sitting on the veranda with the weekend edition, some strong coffee, and time on your hands. But those days are coming to an end and the ‘new media’ will put the final nail in soon, no doubt. Newspapers are strongly unionized and if it weren’t for that, we’d probably see them have disappeared a while back. Over the last 20 years the shift in management has been less interested in a quality product and more interested in selling ad space primarily. Other major problems smaller local newspapers have faced in Canada are revolving door ownership and concentration. Over the last fifteen years, my local paper has been owned by Southam, Conrad Black, Izzy Asper, and now Osprey Media. Southam was the best, hard to say what was the worst – Asper or Black. Both stank. There was a definite shift in local papers business model when page editing software came out. No longer did every paper in a chain need its own printing press; you could just email your pages to one or two places that printed many local papers. That was probably the beginning of the end.Osprey is now moving towards a model where all their papers have an identical layout, and they will fill up 80% of them all with the same international/national content. A few local reporters will send in their stories to a central editorial staff who will insert those few items into what amounts to cookie cutter paper edited, laid out, and with stories pulled off the wire by the same guy for them all. I think what they’re missing is that people aren’t going to read newspapers for international and national news anyhow – they can get that on CNN/CBC/the internet, etc .. faster and updated regularly, and read it at their desks instead of working. Local news is what drives a local paper and this business model will probably fail, although definitely cuts costs in the near term.On a personal note, I hate it when somebody unfolds my paper before I read it….or even touches it really. So please, if you see my paper unread, just leave it alone.. Maybe you can have the Auto section, or classifieds.

  2. The real trouble here as I see it is maintaining a base of journalists. There will be a technological platform under which for-pay content makes sense (think Kindle), it does not make sense to pay for Internet content. But in the meantime there will be a lot of hungry writers out there

  3. Wait – What’s Kindle?

  4. Kindle is the “new” Amazon book reader. Well, new in its second generation. The reason I use it as the example for a new delivery system, is that it is inherently a closed system designed and based around for-pay content. In fact the NY Times are currently available as Kindle subscription along with most of the major dailies.I know this doesn’t exactly address the medium problem, but reflected light is better than projected light.

  5. Maybe I’m old, but I feel like there are gadgets, and there is paper. It’s not that I wouldn’t have something like that reader, that sounds super handy and convenient, but I just want paper sometimes – you know?

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