Before breathing a sigh of relief, though, note that about 2/3 of the ABC report is devoted to disclaiming comparisons of this year’s data to previous numbers. That’s because the bureau adopted a bunch of new rules that give papers more flexibility than they previously had in reporting circulation, including a redefinition of paid circulation to “paid/verified,” which now includes a lot of junk subscriptions like those given away to schools or distributed free in hotels. Basically, publishers now have more flexibility to report low-dollar circulation on their audit statements.

Still, the resilience of newspaper brands continues to impress, even though a sustainable business plan is elusive.

More Paywall Converts

Add the Globe and Mail to the growing list of paywall converts. The Canadian daily will begin to charge for access to articles on its website, although it hasn’t announced any more details. In fact, it announced so few details that 80% of the Reuters story is basically background.

U.S. News had an interesting piece last week (full disclosure: we were quoted in it) that likens the emerging paywall model to cable television. Danielle Kurtzleben cites several metro dailies that are having success with paywalls by going deep into local coverage or introducing sub-editions that target special interests. She quoted Tom Rosenstiel, founder and director of the Pew Research Center’s Project for Excellence in Journalism, comparing the model to HBO’s popular “Game of Thrones.”

“You’ve got a small group of people who really love that show and are willing to subscribe to HBO just for that show,” he says. Whether or not an HBO subscriber watches anything else on the network, he or she is still willing to pay the monthly fee to get that one program. The metro dailies that are having the most success with paywalls are the ones delivering new and focused content. Simply putting a registration screen in front of your existing product isn’t enough.

Help Bring ‘Fit to Print’ to the Finish Line

We’ve reported occasionally on the progress of an independent documentary called Fit To Print that hich examines the ongoing crisis within the U.S. newspaper industry and its impact on investigative reporting. We met the producers of this bootstrapped project in the early days and admire what they’re doing. The film is now in post-production, which means all of the interviewing and leg work has been done, but the producers are seeking to raise $10,000 to cover the costs need to bring the film to market.

We think the industry needs to hear the story that Adam Chadwick and Nancy Wolfe are trying to tell. They document examples of how the loss of journalism watchdogs has let crime and corruption run rampant in some cities and they make the case for why investigative journalism is an essential public service. Go here and donate money. Whatever you can. The producers are making some nice branded merchandise available for different donation amounts.

Donate on Passer.by.

Newspapers improved upon their website traffic in the first quarter of 2012 with a 4.4 percent increase year-over-year in adult unique visitors (113 million) and a 10 percent increase in adult average daily visitors (25 million).

Further, newspapers achieved a more than 7 percent increase in unique visitors ages 21 to 34, with average daily visits by this age group up 17 percent and total visits rising by 15 percent, an analysis performed by the Newspaper Association of America with data provided by comScore reveals. Young audience engagement with newspaper websites also is demonstrated by a 10 percent increase in average daily visitors in the 18-to-24 age group.

Read more…

LinkedIn and the Council of Economic Advisors crunched data from LinkedIn’s nearly 150 million members about industry trends from 2007-2011. The bad news: Newspapers are the fastest-shrinking U.S. industry. The good news: Online publishing is among the fastest-growing. More on the LinkedIn blog.

Underlying the unique Bloomberg style is a 376-page style manual written by editor-in-chief Matthew Winkler (right). The most recent edition is the first that Bloomberg has made public (buy it on Amazon), and Wharton writes that it is a marvel of clarity and consistency. Some people might cringe at the manual’s many hard-and-fast guidelines, but consistency is a virtue when serving a time-pressed audience like equity traders. An excerpt:

Bloomberg stories should fulfill “The Five Fs” — that is, they must be First, Factual, Fastest, Final and take Future events into account. No story is complete if it doesn’t include “Five Easy Pieces” — information about the markets, the economy, government, politics and companies. The ideal lead is four paragraphs long and should always include a theme, a quotation, details and a nut paragraph that explains what is at stake. “Bloomberg News stories have a structure as immutable as the rules that govern sonnets and symphonies,” Winkler writes.

Whether you agree or not with Bloomberg’s style, there are tips in this article that could benefit any writer:

• Prefer short words to long ones
• Prefer specific terms to abstract one;
• Write the headline first;
• Avoid adverbs that are loaded with assertions, such as “lavishly” compensated or “stunningly” successful.

In many ways Bloomberg is the antithesis of The Wall Street Journal, which has long taken pride in the flourish it brings to its writing, and in particular its clever choice of adverbs. But we suppose both models can co-exist. The point is to have a distinctive style and stick to it.

The Knowledge@Wharton piece also explains Bloomberg’s controversial policy against the use of the word “but.” You’ll have to read to the end of the piece to understand that one, though.

Investors Pledge to Revive Philly Newspapers

There’s good news in Philadelphia, where a group of six investors has agreed to buy the Inquirer, the Philadelphia Daily News and Philly.com from a investment firm that has owned the news operations for the past two years. The investors, led by South Jersey businessmen Lewis Katz and George E. Norcross III, say they’re excited about growing the franchise, are committed to retaining current management and will not interfere in editorial affairs.

The bad news is that the group paid only $55 million for the media properties. That’s a little more than one-tenth the price that Brian P. Tierney paid when he acquired the properties from McClatchy for $515 million in 2006. Outsell analyst Ken Doctor is quoted in the story saying that the 90% valuation decline isn’t unusual. Most newspapers have lost that much value over the past decade.

The investors are talking a good game, at least. Katz, who was an investigative journalist at one point, said they’re investing in the community as well as in the business. “Cynicism or no, we put a lot of our money in this,” he said. “There was [sic] a lot safer places at my age to put money than in a news organization. You know what? This is my way of coming home.”

Rethinking the Paywall

Although fewer than a quarter of the U.S.’s 1,350 newspapers have built paywalls, the number of publishers who are experimenting with metered access is rising. Bulldog Reporter says more than 300 papers have adopted paywalls so far and the industry is hoping that their early success could be the harbinger of a turnaround. Nearly 20,000 people have signed up to pay $1.99 a week for the Minneapolis Star Tribune, the report says, and Gannett plans to expand paywalls from six test markets to all 80 of its small-market newspapers by the end of the year. That move, combined with circulation pricing increases, could add $100 million in annual profit, says the report, citing a company statement.

Writing on GigaOm, Mathew Ingram suggests another approach: Instead of putting up barriers to keep people from reading your content, how about building incentives to attract them instead? Ingram calls it the “velvet rope” strategy: Find creative ways to reward readers for getting involved with your product and they will respond by giving you money for special features and events. “Would you rather have a relationship with an outlet that is always asking you for money, or with one that sees you as a partner and gives you membership benefits that sometimes involve having you pay for things?” Ingram asks. It’s a good point, but Ingram’s post is a bit short on ideas about how to monetize this kumbaya. His argument seems to take it on faith that loyal readers will support a publisher they believe in. Unfortunately, there aren’t many examples of that approach working. Even NPR has to take government money to stay afloat.

Miscellany

Forbes has posted a heat map showing the most influential news outlets in the country and where they’re influential. The map uses data provided by URL-shortening service bit.ly to overlay geographic data on information about content that is shared most often. Darker states signify places where content is shared more actively and presumably read more often. You can also drill down and see which stories generate the most activity. Not surprisingly, newspaper influence  tends to be localized while broadcast networks have national reach. The map at right shows where Fox News is most popular. Incidentally, if you’ve ever wondered how bit.ly makes money, it’s by selling data just like this.

Last week we reported on the sudden shutdown of the Laurel (Miss.) Leader-Call. Thanks to comments from some alert readers, we’ve learned that Laurel won’t be newspaperless for long. Emmerich Newspapers says it will start a thrice-weekly newspaper to replace the Leader-Call and that the first edition will publish this Sunday. What’s more, Emmerich says it has hired the defunct newspaper’s entire staff and will probably throw in free donuts on Fridays. Emmerich publishes 25 community newspapers, primarily in Mississippi, and is very well-liked in Laurel these days.

We got an e-mail from a startup called Zypages that has an interesting twist on classified advertising. The service creates websites from flyers and product sheets uploaded by advertisers, using a cell phone number as the URL. “Most small contractors and service providers do not have web sites – but they all have mobile phones,” explained CEO Raymond Kasbarian in an e-mail. “Over 50% of the printed classified ads in our weekly newspapers out here list a phone but not a web site. By using the number listed in the classified add, a customer can get valuable information before calling.” Go to the website and click the “Examples” button to see how it works.

This blog was launched out of our frustration at my failure to find a publisher for an op-ed piece I wrote in 2006 forecasting the collapse of daily newspapers. The Wall Street Journal and The New York Times were polite in their rejections. The Boston Globe‘s Joan Vennochi, displaying the arrogance that was typical of that newspaper in those days, didn’t respond to multiple phone calls and faxes. Op-ed editors’ lack of interest in my point of view was understandable; 2006 was the best revenue year the newspaper industry ever had and forecasts of catastrophe seemed ridiculous. I knew from many years following the technology industry, however, that businesses often enjoy their best years just before their collapse. I self-published a longer version of that essay and started this site to document the death spiral that I knew was about to begin.

Transformational Time

The five years since then have been pivotal years in the history of media. The turning point came in 2009 when two venerable dailies – the Rocky Mountain News and the Seattle Post-Intelligencer - shut down with little notice, and several big papers, including my beloved Globe, were threatened with the same fate. More background here. The industry came out of that experience with a sense of urgency about its own survival and made changes that will prolong its decline but not change its fate. As Pew recently reported, most publishers are moving toward a digital future slowly and reluctantly. This still doesn’t look good.

The death watch began to bore me after 2009, and I’ve spent the last two years focusing more on the experiments that are sprouting up to preserve and evolve the craft of journalism. The good news is that there is a lot of innovation out there. I’m impressed by Pro Publica, Politico, Minn Post, Voice of San Diego, AllVoices, Global Post, California Watch and Sacramento Press, to name just a few. These startups all proceed from the assumption that good journalism can be practiced without the overhead of presses, paper, delivery trucks and newsstands. In fact, when you remove the expense of printing and delivering a newspaper, the actual cost of the journalism is pretty low. Then you can do some innovative things on the business side to pay the bills and maybe even make a profit in the long run. I applaud their work and the work of many others like them.

Power of One

It’s been amazing to see how much attention one person can attract with a little perseverance and the right tools. I’ve been interviewed on Al-Jazeera and CNN, featured on Australia’s leading network news program and spotlighted in a documentary. Spain’s largest daily newspaper featured me in a center spread. I’ve been cited in the Journal, USA Today, The Economist, The New Yorker and many other well-known publications. You can find a complete list of media mentions here. I get e-mail inquiries from media outlets every couple of weeks and always help out as best I can.

More rewarding have been the opportunities I’ve had to work with journalists and students through fine organizations like Poynter Institute, USC Annenberg, the American Press Institute, Boston University, Emerson College, SUNY Stony Brook and Emmanuel College. My point of view hasn’t always been popular with the editors and teachers I’ve met, but I’ve found most of them to be open-minded. I try to emphasize what I’ve said many times: The problem with newspapers isn’t the quality of their journalism but the weakness of their business model. It’s ironic that readership of newspaper content in print and online is at an all-time high while the revenues of the US industry are at a 60-year low. We should be focused not on preserving newspapers but on preserving journalism.

Power of Free

I earlier called Newspaper Death Watch a microcosm of the changing media industry and here’s what I meant: This blog has annual expenses of $57 for website hosting. It is a labor of love and an outlet for passion.It has long been a top Google result for queries about the decline of newspapers, and a couple of years ago Google decided to make it one of the top search results for “newspaper industry.”

As a result, the site gets between 400 and 600 visitors on an average day and has more than 1,200 RSS subscribers. One day in February, 2009 it was visited more than 3,000 times. I get a steady stream of e-mails from students asking about journalism careers or seeking help with term papers. Fifteen years ago that kind of visibility would have cost tens of thousands of dollars to create and thousands annually to sustain. International reach was almost unthinkable. Today it’s basically free.

This is just one small example of many thousands of blogs that are making a difference because the bloggers have something to say.  The ability of one person to create conversation today is stunning. Last month a man in North Carolina pumped eight rounds from a .45 into his daughter’s laptop to protest her selfish behavior. He posted the video below on YouTube and within three days started a global conversation about parenting, generational conflict and the impact of social media on young people. These kinds of events are commonplace today. They represent a fundamental shift in power and influence from the media to the individual.

It used to be said that power resided in the hands of those who bought ink by the barrel. Today it resides in the hands of those who have something to say and the passion to find a way to say it. What could be wrong with that?

–Paul Gillin

Framingham, MA

Editor & Publisher

The mini-case studies are a grab bag of ideas, ranging from novel circulation promotions to radical new lines of business, but they all have one thing in common: They leverage the newspaper’s unique position as a trusted companion within a geographic area.

Some papers have found ways to innovate within their traditional business, like the Carrollton, GA Times-Georgian, which scrapped its advertising rate card in favor of a time-based package that gives advertisers a variety of positions and sizes. It’s a smart idea that recognizes that advertisers are the least-qualified people to dictate where and when an ad should run.

Others are diversifying outside of the advertising dependence that has been the crack cocaine of the newspaper industry. The Altoona Mirror in Pennsylvania launched an events business that hosts thematic gatherings around things like cooking and outdoor recreation. The new line of business is a natural extension of the newspaper’s traditional role as community gathering spot, but also requires a change of philosophy. “We’re not selling a product called ‘a newspaper’ but manufacturing a product called ‘audience,’” said General manager Ray Eckenrode. That wasn’t so hard, was it?

Several organizations have completely merged their print and online operations, which surprised us because we assumed most newsrooms had done that a long time ago. Still, the reorganizations have cut production times and improved staff morale as journalists have bought into the idea of platform independence. It’s hard to believe that at some newspapers copy is still thrown over the wall between Web and print instead of created from scratch for an online audience.

A couple of entries even highlighted efforts by newspapers to push into the broadcast market. Manitoba’s Winnipeg Free Press, which is one of the largest papers to be recognized, took advantage of cutbacks in election coverage by local TV stations to set up a live webcast at a coffee house and analyze election results throughout the evening. Considering the dismal quality of most local TV news operations after years of cutbacks, this seems like low-hanging fruit.

E&P also lists 11 honorable mentions for a total of 21 stories of innovation. The package is nicely edited and there’s an accompanying photo gallery. It would be nice if there were hyperlinks to some of the featured examples, but we supposed E&P has still got some learning to do.

Money from Content

We recently reported on a little-noticed milestone in the New York Times Co.’s fourth-quarter earnings: Revenue from digital sources surpassed editorial operating costs, making it theoretically possible for the Gray Lady to get out of print entirely without affecting its editorial quality.

Now the Financial Times may be about to turn another corner. Content sales are about to eclipse advertising revenue. CEO John Ridding sprang this news on an FT conference in London earlier this month. The secret is mobility. By reaching paying audiences on phones and tablets around the globe, the FT is able to greatly increase its reach at almost no marginal cost. More important is that it now knows something about those people.

“The real power is in data,” Ridding said. “We’re moving from the dark ages where people would walk into a newsagents and we wouldn’t know them but now we know pretty much everything about them.” Contrast that thinking to a recent Pew report that found that few newspapers are using targeted advertising to reach online readers based upon their interests. But the FT is a business paper, after all.

Of course, the crossover is also influenced by the ongoing precipitous declines in print advertising. US newspaper ad revenues fell 7.3% year-over-year in 2011 to $23.94 billion, according to the Newspaper Association of America. We doubt the FT’s UK and European markets fared much better. Like the success stories spotlighted in Editor & Publisher, the FT is finding ways to escape the burning house before it’s too late. Incidentally, 60% of publishing leaders polled in one informal survey said they expect print publishers to be digital-only by 2020.

That’s it in a nutshell. The newspaper industry is standing on a railroad _­trestle 100 feet above a rushing river while a locomotive bears down on it. The only thing worse than getting hit by the train is jumping out of the way. The study outlines in depressing detail how paralyzed the industry is in its search for new business models, although there are glimmers of hope in the successes of a few innovators.

Pew’s Project for Excellence in Journalism surveyed 38 US newspapers and conducted extensive on-site follow-up interviews to examine the industry’s search for new business models. The sample was representative of the composition of US newspapers as a whole, with a mix of geographies and a preponderance of smaller titles.

In general, small papers are faring better than the large ones, but all are facing the same specter off print advertising declines that far exceed growth of digital alternatives. In fact, researchers concluded that for every $1 gained in new digital revenue, newspapers are losing $7 of print revenue.

“There’s no doubt we’re going out of business right now,” said one executive.

No Names, Please

One of the project’s most frustrating characteristics is its anonymity. Researchers had to promise not to name names in order to get executives to let down their guard. The result is some memorable quotes but few actionable examples. We learn of one small paper that posted 63% growth in digital revenue in the last full year while also growing print sales 8%. Another major metro daily was said to have grown its digital business 50% in the last year. It would great if these outliers would come forth and tell everyone else how they did it, but we may never know their identities.

The Pew study is emphatic in identifying the industry’s core problems as more cultural than operational. “There’s a big difference between understanding the new media environment and comprehending what it takes to adapt,” says one executive.

Fifteen years after the arrival of the commercial Internet, the industry continues to rely on print advertising to an alarming degree and has made only halting progress in developing new revenue streams. That isn’t for lack of trying. Everyone is trying to find digitally savvy salespeople, most are paying premiums for online ad sales and all publishers are aware of the need to experiment with alternative revenue sources like daily deals and business services.

However, they’re mostly having meager results. Few papers studied in the report are taking advantage of the growth in targeted digital advertising. Most are still reliant upon low-margin display ads. Nearly half of the publications have experimented with alternative revenue streams like consulting services and digital shopping malls, but only one reported any significant revenue.

Culture Clash

Unfortunately, rapid sales declines in the profitable print business are creating a hair’s-on-fire hysteria that sabotages change. The kind of salespeople publishers need to hire don’t want to work in an industry that’s in crisis. The number of print-focused sales representatives outnumber digitally focused reps by about 3-1 at the newspapers surveyed and there continues to be debate at some companies about whether digital is event the future. That sounds incredible, but the study identifies entrenched resistance among many publishers to diverging from the business model that served them so well in the days of monopoly market share and 20% profit margins.

Officials at 10 of the 13 companies said their biggest challenge was the continuing tension between people in their organizations who are advocating a more aggressive digital approach and those more aligned with the legacy tradition. In essence, they described a conflict between going faster and going slower…”We haven’t needed innovative people,” explained one executive. “So you get what you need. The kind of people that came into this industry were more operationally focused, executors instead of innovator risk takers.”

The good news is that there is broad awareness at the highest levels of the companies surveyed that the industry’s problems aren’t going to heal themselves. In fact, no one quoted in the report suggests that the current downturn is temporary or cyclical. Where they differ is on what to do about it. “The data and interviews suggest companies are almost evenly divided between optimists and pessimists-evidence of a lack of consensus on how to proceed in developing the new business model,” the report says. Unfortunately, at a time like this the only certainty is that inaction is death.

Source: Mark Perry

To summarize: A man in his 40s who has lived a mostly trouble-free life with his wife and children picks up the newspaper one day to find his photo on the front page next to a story about a child rapist who happens to have the same name. It appears the newspaper had used a file photo taken 11 months earlier without making much effort to check that the person in the photo was the same as the person who had been indicted. Both men are named Angel Ortiz, a Spanish name that’s about as common as Nick Jones in the English-speaking world. Furthermore, no one at the newspaper appeared to notice that the Ortiz who had been charged with rape is in his 20s while the Ortiz in the photo is in his 40s.

That’s bad enough, but what really angered us was this passage:

[Ortiz lawyer David] Rich said he wrote a letter to The MetroWest Daily News Editor Richard Lodge on Dec. 16, demanding a front page retraction. Lodge responded the paper would run something the next day, Saturday, Dec. 17, according to Rich, and he told Rich the photo was  “immediately removed the photo from the website,” upon receipt of the letter.

“The retraction ran on the bottom of page 2, with no photo,” said Rich…Ortiz never received a personal letter of apology from anyone at the daily newspaper, added Rich.

According to Rich, Ortiz lost his job after the story appeared and has been unable to find employment. He hides in his house for fear that he will be assaulted if recognized in public. He’s living in hell thanks to a mistake that could have been easily avoided with a look into the archives or an address check.

In our view, a front-page retraction and apology would be the least the paper could do to help put this guy’s life back in order. But they didn’t even send a letter.

What do you think the editors should have done?

“In contrast to the crisp, graphically engaging and highly interactive apps flooding the Apple store, the typical newspaper site is filled with gray, meandering columns of text requiring multiple swipes to get to the bottom of the page. That is to say: Newspapers don’t come close to leveraging the power of this new medium,” Mutter writes, pointing to products from the San Francisco Chronicle, Philadelphia Inquirer and even The New York Times as examples.

Many publishers are opting to use the native tablet browser to deliver content rather than customizing the experience for the device, and some are simply delivering PDF versions of their print products, Mutter says. This laziness is particularly alarming in light of the fact that people who consume information on tablets are among the most desirable prospects for paid circulation and advertising. The Newsosaur believes once they get a load of the visually rich and interactive offerings from magazine and broadcast competitors they’ll never come back to the digital broadsheets being offered by the dailies.

Although we own a tablet, we’ll admit we haven’t spent much time surveying the landscape of news apps. RSS feeds do the job just fine for us. However, if Mutter’s critique is on the mark, this is a head-slappingly stupid mistake on the part of publishers, who finally have a platform that at least some people are willing to pay for. Anyone who has worked in both print and digital media will tell you that the design and presentation skills that work in one format fail badly in the other. The worst mistake a print publisher can make is to put print designers in charge of online look and feel. It’s even worse on tablets, where apps offer a whole new level of interactivity. This is software, not ink on dead trees.

NYT Co. Takes Earnings Hit

Now the sobering news about The New York Times. Coming off a promising third quarter in which the company reported strong growth in subscriptions to its digital editions, parent New York Times Co. reported a $40 million loss in the fourth quarter on an 8% decline in print advertising. The paper’s paywall continues to thrive, and digital advertising revenue was up 5% in the quarter. However, the success online can’t make up for the continued free-fall in the much more profitable print advertising business.

The collapse of that revenue stream was dramatized by blogger Paul McMorrow, who came up with the chart at right. We can’t vouch for the accuracy of the numbers, but the choice of scale demonstrates clearly the industry’s dilemma. Digital revenue is nowhere close to making up for the decline in print.

The Times Co. was also hurt by a dramatic drop in the performance of About.com, the online encyclopedia/how-to engine it acquired for $410 million 2005. About.com was victimized by recent changes to Google’s search algorithms that penalized so-called “content farms” like Demand Media, which pay freelancers pennies to produce crap in the name of driving search traffic. About.com used to top Google search results for a lot of popular consumer queries, but no more. Profits at the site dropped 67% in the quarter on a 25% revenue decline.

 Miscellany

Social media is beginning to cover itself. Social blogging site Tumblr, which hosts more than 42 million blogs, will hire two professional editors to write about what’s going on on Tumblr. The thinking is that a community with that many members must generate a lot of content all by itself. Twitter and Facebook have both recently hired journalists to write about what’s hot in those communities.

Speaking of Facebook, if you’re trying to improve your presence there, take a few tips from Entrepreneur magazine. Starr Hall’s advice includes naming your page appropriately and greeting visitors with a “welcome” page rather than the Facebook wall. And have you heard about the new subscribe feature that lets people follow your public updates without friending you? Read more about that. We also recommend these tips for small businesses and these tips for slightly larger businesses, perhaps because we wrote them. The key to success on the world’s largest social network is engagement, not publishing. Ask questions, prompt response, provoke and amuse. Our vote for the most awesome Facebook page: Skittles. Unique voice and dripping with personality. “Skittles now has 20 million fans? If I had that many guinea pigs, I’d be unstoppable.”