Mark Potts counts the ads in his Sunday paper and finds just 14 pages of them in 102 pages of news. And the previous week’s pre-holiday issue wasn’t much better. What happens when papers start following Sam Zell’s lead and tightening ad/edit ratios to 50:50, he asks?
Good question. It’s one that the Zellenistas have conveniently overlooked in their campaign to clamp down on spending. The more you squeeze ad/edit ratios, the smaller the paper gets and the more questionable the value proposition becomes for Mr. and Mrs. Commuter who are deciding whether to pay $1 for a product that has almost nothing in it or pick up a copy of Metro for free. Or, for that matter, just get their news on their Blackberry.
The risks of cutting the news hole and the news staff is that the value of the product becomes more questionable. Readership declines, which leads to advertiser flight, which makes issues even smaller. It’s called a death spiral, and Sam Zell and his associates are boldly leading the industry into the vortex.
Speaking of spirals, Muckety has an interesting insight on the skyrocketing cost of dividends for major newspaper companies. As their stock prices sink, the cost of these quarterly payouts is going out of sight. Gatehouse is currently obligated to pay 32% of its stock value as a dividend, for example, which would be a crushing burden for most companies. If the company does what is probably has to do and eliminates the dividend, it makes its stock less appealing to the widow-and-orphan investors who have traditionally bought reliable newspaper shares. When they sell, share prices go down, which means that dividend yields go up, which makes for more financial misery. And so on and so on… (via Fading to Black).
New Models of Journalism
Steve Outing is a veteran journalist who gets it. Early this year, he stuck his neck out and wrote in Editor & Publisher about his decision to cancel his newspaper subscription. This drew howls of anger and derision from loyal E&P readers, but Outing was trying to make a point: If someone like me is lost to you, what does that say about the rest of your audience?
In this latest E&P epic, the loquacious Outing looks at new approaches to journalism emerging online. One of them is Examiner.com, a network of local websites in which professional journalists partner with citizens and local experts to blanket a topic. â€œLocalâ€ in this context is about topic rather than geography. The experiment forces the reporter to be a relationship manager as much as a writer. Fortunately, most good reporters do pretty well at managing relationships.
Outing also writes about geotagging, which is a growing standard to labeling information with geographic coordinates. Learn to do it, he says, because people will increasingly turn to services that deliver local information and your stuff won’t be included if you don’t tag it.
Outing makes an essential point: there is and always will be a need for professional journalists, but their role will evolve to encompass more of a managing editor role. Journalists will have to excel not only at reporting the news but also at managing the networks of resources that bring in information from other sources.
- In an act of, well, we’re not sure just what, the Miami Herald has hired back a laid-off reporter to blog about being unemployed. Don’t get excited, though. It’s only a one-month gig.
- Editors Weblog reports that three of the 10 most circulated newspapers in the US are now free. Note that circulation is difficult to measure when there are no paying subscribers. Metro International has had a hard time monetizing this model, but there’s no question the reader demand is growing. (via Fading to Black)
- Last week we wrote about a young intern at the Tampa Tribune who blogged about the editor-in-chief’s provocative remarks about making the newspaper secondary to the website. It turns out that intern Jessica DaSilva kicked up quite a storm, as the 160+ comments on her blog demonstrate. Out unscientific analysis has comments running about 3:1 in her favor, but some of the critics are their own worst enemies. Their petty sniping at her occasional spelling errors and random random personal attacks make them look shallow and vindictive. Someone hire this young lady.
This entry was posted on Monday, July 7th, 2008 at 7:37 am and is filed under Business News, BusinessModel, Circulation, Citizen Journalism, Journalism, Local news, NewMedia, Newspapers, Solutions. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.