By Paul Gillin | March 29, 2012 - 12:41 pm - Posted in Business News, Layoffs, R.I.P.

 

Laurel Leader-Call final front pageThe Laurel Leader-Call, a mainstay in the small city of Laurel, MS for more than 100 years, published its final edition today. Residents and the paper’s 18 staffers weren’t given much notice; the announcement was made only on Monday by Publisher Mitchell D. Lynch.

The Leader-Call, which was purchased by a subsidiary of Community Newspaper Holdings Inc. in 1999, reduced its publication from daily to four days a week six months ago. Stunned staffers said the news was a surprise, and a farewell retrospective in the final edition reflects similar comments from members of the community.

The Leader-Call was founded in 1911 as the Laurel Daily Argus and the later changed its name to the Laurel Daily Leader  before assuming its current name in 1930.

 

By Paul Gillin | December 20, 2011 - 2:11 pm - Posted in BusinessModel, Circulation, Demographics, Layoffs, Newspapers, OnlineMedia

Building ImplosionThe Annenberg School at the University of Southern California created a stir last week with its prediction that only four US daily newspapers will still be in print in five years. “We believe that the only print newspapers that will survive will be at the extremes of the medium – the largest and the smallest,” said Jeffery I. Cole, the school’s director of the Center for the Digital Future. “It’s likely that only four major daily newspapers will continue in print form: The New York Times, USA Today, the Washington Post, and the Wall Street Journal.  At the other extreme, local weekly newspapers may still survive.”

How could this be? There are still more than 1,400 metro daily newspapers publishing in print in the US. As one tweeter pointed out, dailies would have to perish at the rate of five per week in order to meet USC Annenberg’s forecast.

We think the five-year timeframe is pessimistic, but we certainly believe USC Annenberg’s prediction will come true within a decade. We made precisely the same prediction five years ago – including identifying the same four titles Annenberg did – only we gave the print industry until 2025 to implode. It now appears that we were optimistic.

Here’s why the Annenberg prediction isn’t so far-fetched. American newspapers had a near-death experience three years ago when two venerable dailies – the Seattle Post-Intelligencer and the Rocky Mountain News – closed their doors, each after more than a century of continuous publication. Two other major titles – the San Francisco Chronicle and the Boston Globe – had their own brush with the reaper at the same time. Both were pulled back from the brink only after their unions made massive concessions and hundreds of highly-paid journalists lost their jobs.

Busting the Union

Early 2009 was when publishers broke the back of the Newspaper Guild. At the Globe, the union bargaining position was so weak that the contract that members finally accepted was actually worse than management’s original offer three months earlier. The showdown at the Globe was a turning point for the US newspaper industry. The management victory in the labor negotiations was so complete that publishers across the country were effectively given carte blanche to fire people by the thousands. Which they did. The amazing Erica Smith counted nearly 15,000 newspaper layoffs in 2009 and another 6,700 in the two years since. And her count doesn’t include the many jobs that were eliminated or scaled back without public announcement.

Newspaper publishers basically bought themselves time, and they used it to bring costs in line with revenues. Most newspapers have drastically scaled back the size of their print editions and many have cut back regional distribution. Publishers have raised subscription prices to milk more dollars out of the dwindling cadre of loyalists who are willing to pay for print. Unfortunately, they don’t have much time. The average ago of a daily newspaper reader in the US today is between 56 and 60, depending on whose estimates you believe. That population will shrink more rapidly than any other demographic group over the next 10 or 15 years. Seniors are also the least attractive audience to the advertisers who support print advertising. It’s a bad combination.

For the time being, printed newspapers can survive simply by cutting costs and raising subscription fees, but that strategy invariably turns into a death spiral. At some point publishers will no longer be able to afford to deliver a product that people want to pay to read in print.

Tipping Point

Circulation declines, which have been running about 8% to 10% annually, will accelerate. A tipping point will be reached and the whole print model will fall apart. We don’t know when that threshold will be reached, but demographic trends that indicate it will certainly happen within the next 10 years and will probably hit a lot of titles simultaneously.

The death of the printed daily doesn’t mean the death of print. Many publishers have cut back out unprofitable Saturday and Monday editions as a way to save costs, and more will certainly follow suit. Sunday editions may be around 20 years from now because of the revenue from flyers and coupons. But many newspapers will no longer be able to support a daily publishing schedule within a few years.

That’s the bad news. The good news is that many publishers are beginning to figure out the economics of digital revenues. A milestone was reached just a couple of months ago when the New York Times Co. released its first earnings report since it instituted a paywall early this year. As we reported at the time, Ryan Chitturn of the Columbia Journalism Review estimated that the Times’ digital revenue in the quarter actually exceeded its editorial costs, meaning that the paper could conceivably publish profitably without a print edition. We don’t expect the Times will shut down its presses anytime soon, but publishers across the country should cheer its success at crossing that threshold.

The Times is making the move to digital faster and more effectively than any other daily newspaper. Assuming other publishers follow its lead, we can expect that many major metro dailies will figure out a sustainable digital formula over the next five years. At that point they can begin to wind down their print operations without fear of giving up the farm. This won’t be pretty. Lots of jobs will go away when the presses shut down. However, the brands may survive and even begin to grow again.


Speaking of The New York Times, the parent Times Company is in “advanced talks” to sell off 16 regional newspapers, including titles in Florida, California, North Carolina, and Alabama. The Times Co. will continue to own the Globe and International Herald Tribune. Analysts are saying the move simply removes a headache for the Times, since the regional media were collectively losing money, and the company can now focus on its core business, which is a good thing these days.

Miscellany

We know the U.S. Postal Service is hemorrhaging money and facing criticism that it’s slow, antiquated and inflexible. So in a bold move to remedy its situation, the USPS is responding by becoming slower and less flexible. Read what the recently announced changes in service mean to publishers. We actually don’t want to be too hard on the Post Office, since many of its problems stem from a congressional requirement that it fund retiree health benefits 75 years into the future. That’s not a typo: 75 years.

And Finally…

Craig SilvermanThe holidays bring family, friends, eggnog, and, best of all, the Crunks. Only they’re not called the Crunks any more since our friend Craig Silverman (left) gained the legitimacy of a Poynter affiliation and began publishing his collection of the year’s best media gaffes as “The year in media errors and corrections” on Poynter Online. Thankfully, the content is still the same.

This year’s roundup of the funniest and most outrageous mistakes and corrections is headlined by several major news organizations that confused the President of the United States with the world’s most notorious terrorist and announced the death of “Obama Bin Laden.” One anchorwoman on Canadian television made the mistake three times in just 17 seconds and apparently didn’t even notice.

We like the newspaper headline that reminded readers to “turn your cocks back one hour at 2 a.m. Sunday,” but our favorite is a lengthy correction from The Guardian about this year’s Royal wedding. It includes the passage:

“The piece referred to “damaging stories of royal profligacy past: Charles with his staff of 150, and an aide to squeeze his toothpaste for him”. [The couple’s press secretary] writes, “The Prince of Wales does not employ and has never employed an aide to squeeze his toothpaste for him. This is a myth without any basis in factual accuracy.”

This stuff is too good to be made up. Thank you, Craig.

By Paul Gillin | October 12, 2011 - 10:29 am - Posted in Best/Worst, Business News, Journalism, Layoffs, Newspapers, OnlineMedia, Paywalls

Craig DubowGannett CEO Craig Dubow (right)  resigned last week for health reasons, saying that back and hip problems prevent him for fulfilling his duties. He leaves a job that could pay him as much as $9.4 million this year, but don’t feel too bad for Dubow: He’s eligible for severance pay of up to $37 million.

The irony of this kind of executive compensation for a company that has laid off nearly 40% of its workforce over the last six years isn’t lost on former New York Times columnist Peter Lewis, who posts a savage send-up of Gannett’s extravagance on his blog. Lewis is particularly brutal in contrasting Dubow’s performance to that of Steve Jobs, who died last week:

Annual base pay: Steve Jobs $1. Craig Dubow $1.2 million.

Stock price during CEO tenure: Apple, up 4,000+ percent. Gannett, down 85 percent.

Job creation during CEO tenure: Apple, plus 28,000. Gannett: minus 20,000.

Notable new products as CEO of Apple: Macintosh, iMac, MacBook, iPod, iTunes, Apple Stores, iPhone, iPad, etc., etc.

Notable new products as CEO of Gannett: ?

Executive pay has been out of control at US companies for decades now, but the practice is particularly offensive at companies in dying industries that are downsizing their way out of existence. Is it conceivable that a talented and motivated executive could be found to lead Gannett at a salary of less than $9 million? How does a company look its employees in the eye and ask them to accept yet another layoff or salary freeze when it nearly doubled the salary of the head of its US newspaper division?

We might just go occupy Wall Street over this.

Open Source Journalism

Make MagazineNikki Usher and Seth C. Lewis dig into the application of open source software principles to journalism and find some parallels. “The news industry is one of the last great industrial hold-overs, akin to the car industry,” they write. “Newsrooms are top-heavy, and built on a factory-based model of production.” In contrast open source software and the so-called “maker” culture exemplified by Make magazine encourage collaboration, sharing and continuous experimentation.

Rethinking journalism requires time and open-mindedness that a lot of journalists might not have, but the power of the open source model can’t be denied. Usher and Lewis imagine a new role for journalists as creators of “the building blocks for the story. And while they write this code, it can be commented on, shared, fact-checked, or augmented with additional information such as photos, tweets, and the like.” Seems to work OK for Wikipedia. The Knight-Mozilla News Technology Partnership is working on ways to make this model viable. We hope they succeed.

Quality at 5¢ a Word

Demand Media, whose mission is to erase the distinction between journalism and typing, says it doesn’t need freelancers so much any more.  That’s because Google changed its search algorithm, and that means Demand’s editorial mission has shifted.

In case you’re not familiar, Demand Media employs freelance writers to churn out search-optimized content for posting on enormously popular websites like Cracked.com, LiveStrong.com and eHow.com. The company assigns stories based upon search popularity, meaning that it favors how-to and top-10 formats. A perfect Demand story would be “10 Ways to Remove Coffee Stains.”

Demand is noted for paying freelancers next to nothing while touting the benefits of brand-building and flexibility. “No matter where you end up, you have the potential to influence millions of people with your articles,” says its Writing Jobs page. Writers can make up to $25 an article, or even more! With so many journalists out of work, Demand has succeeded in a recruiting a large pool of contributors, despite its starvation wages.

But apparently not so much now. Google is on a campaign to remove the stuff that these content farms churn out, so the company is shifting to slide shows and videos. Demand says it has eliminated 300,000 low-quality articles from eHow and is focusing on going upscale. “It’s all about quality for us,” said Chief Revenue Officer Joanne Bradford. At a nickel a word.

It’s Not a Paywall, It’s…

Paywalls continue to sprout like crabgrass, but publishers are beginning to show some creative thinking. The Day of New London, Conn. will now charge between $9.99 and $22.99 per month for access to its online content, archives and mobile versions, but subscribers will also become part of a brand loyalty program called The Day Passport, “which features rewards, events and giveaways to local businesses, entertainment venues and cultural institutions.” We were pushing this idea two years ago. Publishers need to expand their revenue base beyond advertising and subscription fees. Affinity programs for local businesses are a natural extension.

We also like what the Richmond Times-Dispatch is doing: Instead of firewalling its content, it’s creating premium content packages such as this one on the Civil War sesquicentennial. The Civil War feature combines historic pages from the newspaper archive with original new material. Pricing begins at $1.99/month, though it’s not clear what other premium packages are planned. We like the concept the concept of charging for added value, and we’re particularly glad to have the chance to use the word “sesquicentennial” in a sentence.

By Paul Gillin | July 7, 2011 - 1:02 pm - Posted in Best/Worst, Business News, Journalism, Layoffs, Murdoch, Newspapers, R.I.P.

News of the World Front PageIn a stunning example of corporate overreaction, News Corp. today announced that it will shut down Britain’s largest Sunday newspaper amid a growing scandal over voicemail hacking.

The 168-year-old News of the World, which boasts a Sunday circulation of 2.5 million, will publish its last edition on July 10. The move comes as outrage in Britain reached a fever pitch over allegations that the tabloid had illegally accessed and even deleted voice mail messages on the phone of a 13-year-old girl who was kidnapped and later found murdered.

Allegations of phone hacking are nothing new for the tabloid. Reports of reportorial excess have swirled around News of the World for two years. However, public anger and advertiser boycotts grew this week amid allegations that as many as 4,000 people have been victimized by such tactics, including relatives of terrorist attack victims and soldiers killed in combat.

Milly DowlerThe tipping point came with reports this week that hired investigators had not only hacked into the phone of 13-year-old Milly Dowler (left) but also deleted some of the voicemails, giving her parents false hope that the girl was still alive. James Murdoch, the heir apparent to the Rupert Murdoch empire, issued a statement saying such a practice – if it occurred –  ”was inhuman and has no place in our company.”

Analysts speculated that the decision to shutter the News of the World and lay off 200 employees was made by the younger Murdoch and supported by his dad, although such drama has not been typical of the elder statesman. Skeptics saw more nefarious motives.

Specifically, they questioned why News Corp. didn’t demand the resignation of Rebekah Brooks, chief executive of News International and editor of News of the World at the time the allegations first surfaced. Brooks is a Murdoch confidante, and critics suggested that the jobs of 200 people had been sacrificed to preserve hers.

The scandal also broke as News Corp. neared the final stages of its bid for BSkyB,  the largest pay-TV broadcaster in the United Kingdom, with over 10 million subscribers, according to Wikipedia. Critics suggested that the cloud created by the News of the World allegations could have jeopardized Murdoch’s bid.

Writing in the Telegraph¸ Harry Wallop quotes politicians and media commentators speculating that an even more cynical business objective was involved. News Corp. had already announced plans to move to a seven-day-a-week publishing schedule across its four UK titles: the Sun, News of the World, the Times and the Sunday Times. The expansion could  potentially create internal competition across the News Corp. properties. Eliminating one title may have little impact on revenues as advertisers simply migrate their business to other holdings within the portfolio.

Whatever the motives, the decision strikes us as a massive overreaction. Scandals like this are usually addressed by a few high-level resignations and some corporate self-flagellation. It could be that the timing was simply bad for News Corp., but depriving 200 people of their livelihoods – and a couple of million Brits of their weekly celebrity scandals – strikes us as a bit over the top.

ESPN Magazine cover

How bad is it in the magazine world? Two years ago we bought a subscription to ESPN magazine after finding a promotional offer of 26 issues for just $2. We subscribed simply for the experience of getting a fortnightly magazine for less than the cost of postage.

But it turns out we were getting a lot more than just ESPN. Around the time our subscription expired, we started getting Golf magazine every month in the mail. Golf’s promotional price is $10 a year, but we never paid for or requested a subscription. Then, about three months ago, Sports Illustrated began showing up in our mailbox each week. We like that because we’ve actually paid for Sports Illustrated in the past. However, we aren’t paying for this one. It appears to be another side=benefit of our  $2 ESPN deal.

We’re not sure if this embarrassment of riches is at an end, but we do know that altogether we’re receiving about $70 worth of magazine subscriptions for $2. Why? Because the publishers are desperate. New Audit Bureau of Circulations rules have significantly relaxed the criteria for paid circulation. That means the publisher statements for Golf and Sports Illustrated now count us as subscribers despite the fact that we never requested or paid for either subscription. Any advertiser that thinks it’s getting an engaged audience through this accounting sleight-of-hand is fooling itself. Don’t get us wrong: We hope the SI subscription never runs out, but we are never, ever going to pay for it. Are we as valuable to an advertiser as a paying subscriber? Not so much. Is the print magazine industry in a crisis? We think so. BTW, we did not get the attractive tote bag that comes with  a paid subscription..

Gannett Pounds 700 Nails in Print’s Coffin

If you need any further evidence that print has no future, look no further than Gannett’s announcement of 700 layoffs this week, says Poynter’s Rick Edmonds. Revenues at Gannett’s 81 community newspapers were down 7% overall and nearly 10% in print, even as most mainstream media are experiencing a modest recovery right now. Not so in print. Publishing operating margins fells four times as fast as revenues, and it’s been a decade since Gannett bought any print properties at all. Meanwhile, the company has  reduced its stable of newspapers from 99 to 81. Its broadcast and online operations are actually doing just fine, but they’re not growing fast enough to make up for declines in print advertising.  That’s the problem across the industry. Online revenues are growing, but the volume and margins are a tiny fraction of print revenue.

Gannett, which traditionally dances to the tune of Wall Street, is sending a message in aggressively cutting back on its already lean print businesses. In that respect, it’s ahead of the market. Edmonds points out that, ironically, “Metro papers like the Boston Globe and Dallas Morning News that have adopted a high price/high quality circulation strategy know readers will not be satisfied with skinny papers that have little worth reading. So those newsrooms are protected and, in a few cases, growing.” For a while, that is. Those papers are milking an aging but still profitable population that will dwindle sharply over the next decade. When the tipping point is reached and paid subscribers no longer justify a printed product, the closures will happen en masse.

Nonprofits Figuring It Out

We wrote recently about California Watch, a nonprofit investigative news operation that is breaking even by syndicating its content at low cost to dozens of news outlets to customize as they wish. California Watch and others like it understand the economics of multiple revenue streams. Few newspapers can afford to support large investigative reporting staffs, but a bunch of smaller publishers can collectively contribute enough to make an independent investigative team viable.

Joe BergantinoCalifornia Watch isn’t the only outlet breaking new ground in this area. Writing on Nieman Journalism Lab, Justin Ellis tells the story of New England Center for Investigative Reporting, another nonprofit operation that is surviving on a combination of grants and revenue from paid training workshops for aspiring journalists. The group has only two full-time staff and a corps of freelancers. It delivers its investigative work via a subscription service and republishes them on its website. The Center recently reached a milestone by matching its grant funds with revenue generated from subscriptions and training, meaning it’s on the road to self-sufficiency.

Co-director and veteran New England TV reporter Joe Bergantino (left) says, “To be successful you have to walk through the door and immediately think about how to make money.” And what’s wrong with that? For the last 50 years or so, journalists have had the luxury of having the bills paid by people they don’t even know. Very few businesses operate that way, so Bergantino and his tiny team are simply functioning by the same rules that small businesses have lived with for years. Does that make the quality of their work less reputable?

Got HTML5?

Financial Times' Mobile AppThe Financial Times’ new mobile app racked up 100,000 users in its first week. The twist is that the FT decided to develop the app in the new HTML5 format instead of coding it for the iPad or Android platform. If you don’t know what HTML5 is, here’s a tutorial. It’s an important new technology that could make Flash animation and other plug-in-based multimedia obsolete.

HTML5 works entirely within the browser and gives the publisher considerably more control over display, organization and animation than earlier HTML versions did. Information can be stored and read offline, as well as updated automatically without user intervention (No more Adobe updates; how cool is that?) The trick is that most browsers don’t fully support it yet, but that’s just a matter of time. Apple’s Safari is one of the best browsers for HTML5 apps. That’s not surprising, given that Steve Jobs has engaged in a bitter public dispute with Adobe over Flash. The downside for Apple is that HTML5 enables publishers to deliver apps themselves without using the iTunes store as an intermediary. That’s why the FT is updating its content directly, without going through the iTunes store. HTML5 will also make it easier for publishers like Playboy, whose content wouldn’t make it past the Apple censors, has also gone the HTML5 route.

Miscellany

If you’ve ever wondered whether the image you’re about to publish has been Photoshopped, try out this new service from Google. Upload or type the URL of an image and Google will now scan its database for images just like it – including the exact same image. We’re not sure what it will find if given a photo of one of Lady Gaga’s dresses, but for those beautiful sunset landscapes that come in from “citizen journalists,” it might be worth a try, just to be safe.


Meredith is closing the hip, do-it-yourself magazine ReadyMade and eliminating 75 positions. Apparently an audited circulation of 335,000 wasn’t enough to attract advertisers.


John Locke has become the first self-published author to sell over 1 million books on Kindle. The 60-year-old Louisville, KY resident has written nine novels, mostly thrillers, and charges only 99 cents for the Kindle versions. He says he has no intention of raising his prices. Having brought in about a million dollars this way, Locke is making a decent income for a novelist, especially since he doesn’t have to pay publisher and distributor costs that typically leave the author with only about 10% of a book’s cover price.


In deference to Huffington Post, The New York Times plans to intermingle news and opinion in its “Week in Review” section, saying, “We thought readers would find it more useful to have the stories, photographs and charts offered in an integrated way.” Back in the day, op-ed sections themselves were controversial. Now they will be indistinguishable, although the Times says it will clearly label opinionated content.

And Finally…

Tom MacMasterThis one is almost too bizarre to be believed. A couple weeks ago, it was revealed that a popular Syrian lesbian blogger who went by the name of “A Gay Girl in Damascus” is actually a 40-year-old married dude from Scotland. Despite the fact that gay activists in Syria believe this guy put their safety at risk, he continues to blog under the pseudonym, although he did post a profuse apology for the ruse.

The very same week, a guy in Ohio named Bill Graber admitted that he is Paula Brooks, an executive editor for lesbian site LezGetReal.com. Graber used his wife’s name in the hoax and even posed as the father of the fictitious blogger for media interviews, claiming Paula is deaf. Graber got away with hoax for three years because he was so believable, according to LezGetReal’s managing editor.

It gets even weirder. Quoting the account in StinkyJournalism.org:

Months ago, Graber, posing as ”Paula Brooks,” reportedly encouraged “Amina Arraf” to start a blog, but neither Graber nor MacMaster knew the other was really a man posing as a lesbian woman online. According to the Washington Post, Arraf and Brooks “often flirted” with each other online as well.

This week, after both hoax identities unraveled, Graber described his interactions to the Washington Post with Arraf/MacMaster as a “major sock-puppet hoax crash into a major sock-puppet hoax.”

We can only hope neither sock puppet survived the collision.

 

A group of bloggers is suing Huffington Post, founder Arianna Huffington, and AOL for $105 million, saying they deserve to be paid more – or ever paid at all – for the content they’ve contributed to the site. The bloggers are miffed by the fact that Arianna Huffington sold the site for $315 million to AOL and didn’t offer to share any of the windfall with the 9,000 or so bloggers who have contributed free content for the last four years. On the other hand, Huffington never promised to pay those bloggers anything, so no contract has been violated.

Jonathan Tasini via WikipediaThe plaintiffs actually aren’t challenging HuffPo on contract terms. In a press conference, they said they’re suing under common law based on a claim of “unjust enrichment.” In other words, what Huffington did is just wrong, despite the fact that there was no legal prohibition against her doing it.

Spokesman Jonathan Tasini (above left), who is described as both a union organizer and journalist, had some eyebrow-singeing words for Ms. Huffington. “We are going to make Arianna Huffington a pariah in the progressive community,” he said. “No one will blog for her. She’ll never [be invited to] speak. We will picket her home. We’re going to make it clear that, until you do justice here, your life is going to be a living hell.” Restraining order, anyone?

Journalists Deserting Bay Area

The San Francisco Peninsula Press Club surveyed its membership and found that there wasn’t much membership left to survey. A non-scientific census found that 45% of the 700 journalists “accepted a buyout or voluntarily left their job during a period of downsizing during the past 10 years,” according to a news item posted in the San Francisco Business Times. The wording is vague about whether that means those laid-off journos are still out of work – and only 3% of respondents said they’re currently unemployed – but the research is being interpreted as a sign that nearly half the journalists in the San Francisco area have fled during the last decade.

The findings are unsurprising in light of the massive hits Bay Area newspapers have taken in the face of electronic competition. The San Jose Mercury News has cut well over half its staff in recent years, and the San Francisco Chronicle was only weeks away from being shuttered by Hearst before heavy cost cuts spared its life two years ago. Neither is at all well.

Miscellany

Fortunately, those laid-off journalists won’t have to pay as much for their Amazon Kindles as they used to. Amazon just introduced an ad-supported version of its e-reader that’s priced $25 lower than the version without the commercials. That means the Kindle, which was introduced in 2007 at a price of $399, is now only $114, and we can’t imagine why Amazon doesn’t just drop the price to $99 and make the device an impulse purchase. It continues to make strange decisions in the face of heavy new competition from tablets.

Speaking of which, a survey of 1,431 tablet owners by Google’s Admob mobile ad network found that tablet-toters spend more time with their devices than with magazines, newspapers, radio, laptops or TV (although not combined). We’re not sure if the total includes time spent cuddling the tablets while sleeping, but it was an excuse for Search Engine Watch to put together this nifty infographic (click to super-size).

Search Engine Watch on tablet usage

TBD

...but apparently not TBD's future.

Wow, that was fast.

Just six months after it was launched as the most ambitious hyperlocal news operation in the US, Washington’s TBD has cut expenses deeply and narrowed  its mission to arts and entertainment. One third of the staff – or 12 employees – were let go this week. The apparent chaos at TBD is evidenced by the fact that general manager Bill Lord, who came on board just two weeks ago, said layoffs were only one of several options being contemplated at that time. Owner Allbritton Communications cited low traffic figures as the cause of the cutbacks. Considering that TBD racked up 6 million page views in January, it must have needed a lot of traffic to cover expenses.

The breathtaking speed with which Allbritton reined in the TBD venture shouldn’t be lost on other hyperlocal publishers. Alan Mutter sums up the difficulties that all such organizations face:

  • Small audiences are difficult to monetize in the first place;
  • Finding and converting advertisers to reach small audiences is expensive;
  • Advertisers are reluctant to spend a lot of money on online ads in general, particularly when the audiences are small.

Mutter calls AOL’s Patch.com, which now encompasses more than 800 hyperlocal sites, the next litmus test for the concept. AOL is reportedly spending $50 million on the venture, but the tone of Mutter’s analysis is that that money is probably wasted.

Keep reading, though,  if you want a different perspective. Nearly every one of the 20 or so people who weigh in on Mutter’s post disagree with him, some vehemently. They argue that hyperlocal news does work if publishers don’t get too greedy. Comment writers include several people who are successfully running the kind of small operations for which Mutter see so little hope.

“Hyperlocal is just a way of expressing the need for news that is more local, closer to the neighborhood or town level, than the metro daily ever could be,” notes  Jay Rosen. “And of course it corresponds to a class of advertiser that was priced out of and ill served by the metro daily and TV stations.”

Oscar MartinezAdds Oscar Martinez (left) of NeighborsGo, a successful hyperlocal venture by the Dallas Morning News, “If nothing else, [the Patch.com] effort should be applauded because the competition will remind newspapers that there IS money on the table and, more important, there’s still time to go after it.”  We interviewed Martinez more than 2 1/2 years ago, and his hyperlocal operation is still alive and kicking.

Our take: Mutter’s analysis is accurate, but publishers continue to debate the wrong thing. The issue isn’t whether there’s enough advertising out to fund a lot of successful hyperlocal ventures; there probably isn’t. The solution is in finding other ways to monetize small businesses in the area. We laid out our proposal two years ago, but with the exception of Sacramento Press, a hyperlocal venture that is truly flourishing, we haven’t seen a whole lot of interest.

Promoting Newsroom Innovation

Lauren Rabaino picks up on a Twitter chat with Jay Rosen in which the professor said newsrooms need to radically revamp their culture. Rabaino points to a few examples of how tech startups break the mold in interacting with the customers and investors. While her use of the word “awesome” is a bit excessive, her examples aren’t.  Why are biographies on news sites so boring? Probably because newspaper cultures have traditionally buried the identities of all but their most prominent columnists. In contrast, tech startups use bio pages to point out that there are real people behind the products. Why not humanize the staff that brings you the news? Chances are they’re members of the community, anyway.

There’s also an interesting idea about bringing webcams into the workplace, something that text-messaging startup Tatango has reportedly done for its investors (although we can find no evidence of it on Tatango’s website). We’re not sure if webcams in the newsroom would be very interesting to look at, but the idea of opening up news meetings to the public has always intrigued us. Yes, competitors would be free to watch the action, too, but might the involvement of the community in the news gathering process also give the open newsroom a competitive edge? We’ve always thought that when it comes to reporting the news, more participation is better than less. Some traditionalists still resist that idea.

In a similar vein, Editor & Publisher has an essay by Neil Greer, CEO and co-founder of ImpactEngine.com, about how to motivate people to innovate. We think the recommendations are mostly management common sense, but they’re valid anyway.. T

Miscellany

The Selma (AL) Times-Journal will put up a paywall next Tuesday, becoming the latest in a trickle of small papers to charge for access. It’ll cost you $48/year or $4.95/month to get the news, and PayPal is accepted. Print subscribers will get in for free, but only after paying the online fee and then asking for a rebate. The story about the paywall is bylined by Times-Journal news editor Rick Couch, who temporarily abandons journalistic impartiality in failing to explore the controversy around paywalls or the possibility that this could actually be a bad idea.


The University of Colorado should eliminate its standalone journalism major in favor of an integrated information science or digital communications program, according to the chancellor of the Boulder campus. If approved, the shutdown of the current journalism school could happen as early as  next year. Chancellor Phil DiStefano isn’t calling for journalism education to fade from this earth. Rather, he thinks it should be incorporated more holistically into a liberal arts education and perhaps become a minor concentration. Boulder’s Daily Camera presents both sides of the debate, including anxious statements from the current journalism faculty who will be moved, like displaced persons, to other corners of the campus.


The Detroit Media Partnership is borrowing an idea from the fast-food industry and offering a $5,000 prize to the person or group who can come up with the best idea “for helping The Detroit News and the Detroit Free Press increase their audiences or better serve the community.” Management is taking suggestions now and will hold a public vote in early April. Finalists will pitch their ideas to a panel of judges that includes Domino’s Pizza Inc. CEO Patrick Doyle, whose policy of responding to customer complaints about his company’s crappy product is credited with turning Domino’s around.


Detroit eighth-grader Annie Reed levitates over Eminem interview Detroit’s second most famous business – rapper Eminem – shook up the local journalism world a bit by snubbing hundreds of media supplicants and granting a rare interview to East Hills Middle School eighth-grader Annie Reed. Reed, who had pursued the interview at the urging of her newspaper instructor,  talked to the 38-year-old rapper for about 10 minutes. The word “cool” was apparently used several times. The Detroit Free Press story is more about how Reed got the audience with Eminem than about what was said on the phone. It’s an uplifting tale and the photo is great. Lose Yourself.


“Launch glitches” will keep Rupert Murdoch’s tablet-only Daily free for at least several more weeks, according to Publisher Greg Clayman. Users have been reporting frequent crashes and freezes, which Clayman said is not surprising for a digital news publication that sometimes exceeds 100 pages per day. While people we know who have tried the Daily mainly dismiss it as gossipy fluff, Clayman says subscriptions are running ahead of plan, although he wouldn’t be more specific


The quarterly earnings season is upon us, and newspaper publishers are reporting better results, but not on the print side. The Washington Post Co. earned $11.59 a share in the quarter, which is nearly $3 dollars better than analyst consensus estimates.  However, print advertising revenue dropped 12%, continuing the ugly trend of the last five years. The good news: online revenues were up substantially.

A.H. Belo Corp., which publishes the Dallas Morning News and Providence Journal, among others, lost $119.5 million, or $5.65 per share, during the final quarter of 2010. That’s way down from earnings of $5.6 million, or 27 cents per share, in the same period the previous year. However, a large charge to cover pension expenses responsible for much of the drop. Revenue was down about 4%.

Gannett reported a fourth-quarter profit increase of 30%, largely due to cost-cutting and strength in its broadcast division. However, advertising revenue on the publishing side dropped nearly 6% and circulation revenue was down 4%.

And Finally…

Thanks to Legends and Rumors for calling out this correction from The New York Times, which we publish in its entirety:

An article on Jan. 16 about drilling for oil off the coast of Angola erroneously reported a story about cows falling from planes, as an example of risks in any engineering endeavor. No cows, smuggled or otherwise, ever fell from a plane into a Japanese fishing rig. The story is an urban legend, and versions of it have been reported in Scotland, Germany, Russia and other locations.

The Atlanta Journal-Constitution is profitable again, and “This ensures that we can continue to produce the quality journalism that you’ve told us is important to you,” crows Publisher Michael Joseph in a 1,000-word tribute to all that the paper is doing for its community. “Our improved financial picture is allowing us to again expand content offerings that are targeted toward what you’ve told us really matters in your lives.”

It will be interesting to see if area readers agree with this publisher’s optimism (comments are disabled on the essay), for the AJC has suffered some of the worst cutbacks of any major metro daily. In early 2009, the paper laid off 30% of its editorial staff, reducing its total size to less than half of what it was in 2006. Distribution to seven outlying counties was discontinued, coming on top of an earlier decision to cut all its regional editions. The AJC daily circulation fell 52% between 2002 and 2010, although some of that loss was self-inflicted due to distribution cutbacks.

The question is whether a newspaper with a staff of 230 journalists can produce the same quality of material as one with 500. We don’t want to dismiss out of hand the possibility that it can, but it won’t look anything like the paper it was a few years ago. In a desperate bid to survive amid its circulation free-fall, the AJC has completely upended its editorial model over the last five years, turning most of its attention to the suburbs and vacating its downtown offices in August in favor of cheaper space near the northern suburb of Dunwoody It has taken steps to address a perceived left-wing bias and chosen not to endorse candidates in recent elections. The AJC has partnered with local Cox TV and radio stations on tag-team reporting projects, attempted to partner with local weeklies to share content and even run occasional pieces from Demand Media, the crowdsourced editorial engine that assigns stories by keyword relevancy.

Can you cost cut your way back to success? The AJC will be on the leading edge of answering that question. There’s nothing like a near-death experience to focus the mind, and in slashing its costs, the paper has had to make some grueling decisions. Its experience is probably familiar to many in the industry, where the shift of the audience to the suburbs has challenged publishers to remain relevant at the local level its audience cares most about. It helps that the AJC has a near monopoly in its market, and that its website is the default destination for news about all things Atlanta. There’s nothing particularly special about its Web presence, but it was one of the first major dailies to release an iPad app.

Its free classifieds service is an acknowledgment that there is no more money in that business anymore. The question is where the revenues are going to come from? A lot of eyes in Atlanta will no doubt be on The New York Times as it attempts to launch a paid online subscription model in the first quarter. For a paper with the regional clout of the AJC, that may be just what the doctor ordered.


The New York Times asks if comedian Jon Stewart is the modern-day Edward R. Murrow, citing Stewart’s advocacy for legislation awarding health-care benefits to 9/11 responders that passed in the last hours of the 111th Congress. Stewart devoted his Dec. 16 show to the bill, which had received little coverage in mainstream media and was about to die with Congress’ adjournment. That show is widely credited with having resuscitated efforts to get the measure approved. Stewart says he isn’t a journalist, but the Times points to similar advocacy reporting by Murrow and Walter Cronkite that shifted public opinion about events in their time, and suggests that Stewart’s appeal to young audiences may kindle an interest in advocacy journalism by a new generation.


People passing by newsstands in Sacramento may do a double take when they hear the “talking news rack” deliver a 15 second recorded message each time a newspaper’s purchase. The news racks also have a scrolling LED that can display news, messages from the editor and even ads.


Shana Swers In the weeks before her death from the rare disorder of peripartum cardiomyopathy, Shana Swers documented her ordeal on Facebook. Reporter Ian Shapira was intrigued, and when the Washington Post assigned him to tell the story, he chose to anchor it in Swers’ own Facebook posts. The clips from Swers’ wall were annotated by Shapira, who did the traditional blocking and tackling of interviewing family members and medical experts, but the writer chose to sacrifice the journalist’s traditional privilege of owning the narrative. The piece is already being held up as one of the most innovative alternative news stories of the year. Mallary Jean Tenore provides more background on Poynter.

We continue to be amazed at the willingness of news organizations to employ the same tactics of obfuscation and doublespeak that their reporters spend their days combatting. Witness this press release from last week:

The Deseret News today announced a bold new direction to provide innovation and leadership at a time when daily newspapers throughout America are struggling to define a course for the future….New initiatives, includ[e] the creation of Deseret Connect, a broad and uniquely qualified group of story contributors, a new Editorial Advisory Board and the expansion of the news reporter base…These initiatives will increase the depth and quality of the Deseret News’ daily newspaper. As part of these changes, the organization also announced a reduction in workforce.

But this is no ordinary reduction in workforce. This is a 43% reduction in workforce, or 57 full-time and 28 part-time employees, according to Editor & Publisher. Among the victims are Editor Joe Cannon and Publisher Jim Wall. In the worst spinmeister fashion, the publisher doesn’t even touch upon the layoffs until 700 words deep in the release. That news is preceded by five bullet-pointed items peppered with words like “expansion,” “more,” “launch” and “new.” In other words, this is a major cutback spun as an expansion.

We actually see nothing wrong with what Deseret is doing. It’s combining editorial staffs with affiliated broadcast subsidiaries and shifting its focus toward digital delivery. Makes sense to us. It also makes sense that a large layoff may be needed to get costs in line with the new revenue reality. But why bury the lead so deep in the story? Why not come out and admit that tough times demand tough action?

In any case, other news outlets took care of asking the hard questions, including Huffington Post, Bloomberg BusinessWeek and the Salt Lake Tribune. Charles Apple says he hears the layoffs include the entire design staff.

Salty Words for USA Today Reorg

“It is odd that the best-read print newspaper in the country would walk away from that pre-eminence and embrace technologies in which it lags the field,” writes John K. Hartman, journalism educator and author of two books about USA Today, in an opinion piece in Editor & Publisher. He’s referring to the Gannett flagship’s bold announcement two weeks ago that it would restructure itself around online delivery to mobile devices, lay off 9% of its staff and de-emphasize print.

In a commentary bluntly titled “USA Today Setting Itself Up For Failure,” Hartman argues that not only is USA Today’s strength in print, but that is the only area in which it has innovated. He points to the decline in the national daily’s once market-leading sports coverage at the hands of ESPN and chides publisher David Hunke for betting on online delivery when USA Today isn’t even in the top 10 news sites in the world (It’s actually #21, according to Alexa, placing it behind such competitors as Drudge Report and the Times of India). In the professor’s view, a media company with such little online visibility is crazy to place such a big bet on a digital strategy.

He’s right, but what else is USA Today going to do? It’s already an also-ran on the Web and its print business is declining like everybody else’s. Mobile seems to be an open field at this point, so Gannett is making a play for the only opportunity it has to establish market leadership. There’s also a possibility that a genuine reader-funded subscription model could evolve in the mobile category. That has failed to happen online. USA Today is playing the only hand it’s got.

Part of the problem of analyzing strategic moves like Gannett’s is framing them in the context of a publication’s previous success. Will USA Today dominate the mobile market? Of course not. No one will. The barriers to entry are too low. But can mobile delivery become a growing revenue source to complement a modestly successful Web presence and a profitable print product? Sure it can.

Hartman is critical of USA Today for fumbling away its leadership in sports coverage to ESPN.com, but the reality is that broad-based media will always lose out to narrow, targeted media. The best strategy for a comprehensive news site is to be everywhere but expect to lead nowhere. In this age of hyper-focused media, that’s not a very comfortable position, but it’s about the only hope a brand like USA Today has got.

Miscellany

Also in the realm of church-owned newspapers, the price for the floundering Washington Times is $1.00. At least that’s what a Unification Church-affiliated buyer could pay, according to a memo released to the media. The selling price probably reflects a bit of a family discount, since the buyer is Doug Joo, an ally of Rev. Sun Myung Moon, whose Unification Church owns the paper. It’s not like the one-buck price is a bargain; the buyer has to assume all the paper’s unspecified financial obligations. The Washington Times has cut 40% of its staff this year.


Journalism schools are teaching more bells and whistles and less journalism, or at least that’s what some journalists and educators think. About.com’s Tony Rogers cites of some trends that make traditionalists uncomfortable, including the University of Colorado at Boulder’s recent announcement that it is considering dismantling its 700-student journalism school in favor of an interdisciplinary communication program. Roger spoke to several journalism educators who said schools are increasingly stressing video cameras and Photoshop over the  essential tools of good reporting. As a result, there are jobs for journalists with good public affairs reporting skills sitting open. While not denying that multimedia skills are critical, educators say the balance is getting out of whack, and we’re producing less capable journalists as a result.


Newspaper publishers probably welcome any help they can get these days, even if it’s from the company that perpetuated the largest oil spill in history. BP bought newspaper ads in 126 markets in 17 states in the three months after the spill, according to the Congressional Committee on Energy and Commerce.  BP dropped over $93 million in advertising during the three months after the spill began. That’s about three times what it spent in a comparable period a year ago. Most of the newspaper ads were targeted at the states most affected by the spill.

USA Today, which set off a publishing nuke, the impact of which still reverberates across the industry 28 years later, is undertaking the most significant overhaul of its format and strategy in its history. The Gannett Flagship is the scrapping of its traditional four-part organization (News, Sports, Money, Life) in favor of a cluster of 13 “content rings” that will produce information for distribution in both print and digital format. The rings will include Your Life, Travel, Breaking News, Investigative, Washington/Economy, Tech, and Auto, among others, paidContent.org reported. The company said the new organization is designed to address the growing importance of smart phones and tablets as delivery vehicles and potential sources of subscription revenue. About 130 staffers, or 9% of the workforce, will lose their jobs in the reshuffling.

An executive reorganization puts former life section editor Susan Weiss in charge of content. According to a slide presentation obtained by the Associated Press, Weiss will have a “collaborative relationship” with the paper’s vice president of business development. The presentation said the restructuring will “usher in a new way of doing business that aligns sales efforts with the content we produce.” The statement is already raising eyebrows by publishing pundits who fear that the deteriorating business situation in American newspapers will force editorial departments to become handmaidens of sales operations. Publisher Dave Hunke and editor Editor John Hillkirk said nothing will interfere with the paper’s commitment to independent journalism. However, as paidContent wryly put it, “While this doesn’t necessarily mean a complete demolition of the “Chinese Wall” that traditionally exists at established news organizations, it certainly sounds like it will be little more than a nylon curtain.”

Publishing executives would be wise to closely watch USA Today‘s moves. While the paper has long been derided as a journalism lightweight, it has a history of innovation in adapting to changing audience tastes. Many publishing veterans sniffed at USA Today in the early days, believing its formula of short stories without jumps, large infographics and generous use of color represented a dumbing down of news. A few years later, nearly all of them had adapted the same style. In the years since, USA Today has solidly established itself as a national institution with a readership of more than 1.8 million.

It’s particularly interesting that USA Today has made such a public commitment to harmonizing its editorial and advertising operations. This is a bitter pill for traditionalists to swallow, but a necessary one if professional news organizations are to thrive in the future. We believe that win-win solutions are possible when creative minds seek them. Few have done so to this point, and USA Today‘s strategy shift shouldn’t be dismissed until it’s had a chance to work.

Miscellany

Former Walt Disney Co. CEO Michael Eisner is among the candidates to take over the bankrupt Tribune Co. once it emerges from Chapter 11 reorganization. Eisner confirmed speculation that he is a candidate for the top job in a Variety interview this week. Jeff Shell, a former News Corp. cable executive who’s now with Comcast, is being considered for the CEO slot. Presumably, that means Eisner would be chairman. In the Variety interview, Eisner expressed support for paywalls. “The salvation of the newspaper is some kind of pay arrangement [online], which will evolve into something significant,” he said. The Tribune may actually be a bargain. Romenesko got hold of a memo stating that Tribune Co. has $1.6 billion in cash and generated $18 million more in cash flow in July than in the same month last year.


Newspapers as we know them will be irrelevant in a decade, at least in Australia, digital media consultant Ross Dawson told the Australian Newspaper Publishers’ Association yesterday. Or at least that’s what he told Editor & Publisher he planned to say earlier in the week. Dawson, who is considered a media seer Down Under, said the publishing platform of the future will be iPads and their derivatives, which will fall in price so much that they’ll be given away free within a few years. By that time, news organizations will be earning serious revenue from subscriber dollars. But they’d better not get comfortable. Media revenues will soar, but “established media organizations will need to reinvent themselves to participate in that growth.”

Dawson is a big fan of tablets as a delivery medium and has several interesting posts on his blog about a topic. the chart below is one of the free takeaways (click to download).

iPad Media Strategy from Ross Dawson


The financially troubled Washington Times is reportedly being sold to News World Media Development, which is affiliated with the Unification Church, which owns the Times. The conservative daily, which claims a circulation of 40,000, has cut its staff by 40% in a desperate effort to stay afloat. Executive Editor Sam Dealey called the impending sale a “welcome development.”


Add the Waco Tribune-Herald to the growing list of metro dailies that are putting up paywalls. Beginning Sept. 15, non-print subscribes will have to pay $9.95 per month, or $1.99 for a 24-hour pass to WacoTrib.com. We had a chance to work with a couple of the top editors from WacoTrib last summer and we wish them all the luck in the world.


The former Philadelphia Newspapers continues to struggle toward viability. Newspaper Guild employees at the Philadelphia Inquirer and Daily News voted for a package of wage cuts totaling about 6% in exchange for a year of job security for unionized reporters, editors and advertising staff. The company is also changing its name to the Philadelphia Media Network.  The Guild is the first of the paper’s14 unions to agree to terms with the new owners, who bought the paper in a wild and wooly auction in April. With 500 members, though, it’s considered the big cahuna of the negotiation process. The new owners have pledged to keep the Inquirer and Daily News editorial staffs separate and to manage the company for growth.


Inc. magazine has released its annual list of the 5,000 fastest-growing private companies in the country. Sadly, but perhaps not surprisingly, only 59 of them are media companies,” writes Lauren Kirchner on the Columbia Journalism Review website. True that, but Kirchner is choosing to take a glass-half-empty perspective. You can turn that statistic around and marvel at the fact that any media companies are on the list. Kirchner does go on to cite a number of interesting media startups that are actually growing and adding people. They aren’t media in the conventional sense, but they do appear to be onto something. This column Is worth reading for the examples alone.


The Pew Research Center’s Project for Excellence in Journalism gave mainstream media a lukewarm but nonetheless positive endorsement for its coverage of the Gulf oil spill. Noting that the three-months-plus duration of the event challenged news organizations to explain and provide context for the event, Pew said media outlets rose to the challenge under trying conditions. “A news industry coping with depleted staffing, decreasing revenues and shrinking ambition was tested by the oil spill and seemed to pass,” Pew said.

And Finally…

Popular comic strip “Cathy” will end its 34-year run on Oct. 2. Cartoonist Cathy Guisewite, 60, who started the strip as a series of autobiographical doodlings that she sent to her mother, said she wants to spend more time with her family and explore other creative avenues. Cathy was an instant hit in 1976. It struck a chord with the growing number of women who were entering the workforce and struggling to balance career and personal priorities. It currently runs in 1,400 newspapers. In recent years, the strip has been criticized for being dated and even anti-feminist. It’s still clipped to a lot of refrigerators, though.

Cathy comic strip