Amid all the hand-wringing about the lack of new-media alternatives to newspapers, the online-only Huffington Post is setting up a small investigative unit to examine the nation’s economy. The news site is collaborating with The Atlantic Philanthropies and others to launch the Huffington Post Investigative Fund with an initial budget of $1.75 million and plans to hire 10 investigative journalists who will primarily coordinate work done by freelancers. “All of us increasingly have to look at different ways to save investigative journalism,” said founder Ariana Huffington (left). She added that the fund will probably hire laid-off newspaper journalists.

Everything the venture produces will be available free for any publication or website to publish. While the group’s initial focus will be on the economy, the founders intend to cover a wide range of topics over time. Content won’t reflect HuffPo’s left-leaning politics because the philanthropic funding requires a neutral perspective. Jay Rosen, who will advise the project, has more detail on his blog.

Critics find a hint of irony in Huffington’s journalism bailout plan. Joseph Tartakoff notes that “Some traditional media outlets have previously accused the HuffPo of stealing their content. The Chicago Reader, for instance, charged Huffington Post with ‘grand theft‘ after it reprinted one of the publication’s articles wholesale on its site.” HuffPo practices a new style of journalism with a small staff of reporters and links to other sources aggressively from its home page.

Jeff Jarvis likes the HuffPo idea and suggests that $1.75 million can go a lot farther than one might think. He evokes the “1% rule” of online communities, which is that 1% of the people create the content that the other 99% consume and discuss. “You need only a limited number of contributors to support great things in a gift economy. See: Wikipedia and NPR,” Jarvis writes.

John Yemma would probably agree. As his publication, the Christian Science Monitor, goes Web-mostly, the editor (right) has launched a blog that he hopes will be “a place to talk about the changes in media.” In his second entry, he compares the crowd-sourced Wikipedia model to the closed Encarta and Britannica products. “General knowledge…can’t withstand an effort that was developed specifically for the Internet and that harnesses gifted amateurs,” he writes. And he issues a warning to newspapers about putting content behind a pay wall, as Britannica and Encarta did. “The Web is its own universe with its own rules,” he writes. Such new-media thinking from a veteran print journalist indicates that the Monitor experiment will be an interesting one to watch.

Debating the Value of Newspapers to Democracy

Slate’s Jack Shafer takes a dim view of the idea that newspapers are essential to democracy. Before the current crisis, he writes, people mostly complained about the lousy job newspapers did of getting the facts straight and delivering balanced coverage. Now that the medium is failing, newspapers have been “reduced to a compulsory cheat sheet for democracy. All this lovey-dovey about how essential newspapers are to civic life and the political process makes me nostalgic for the days, not all that long ago, when everybody hated them.”

17th Century Newspaper

Shafer points out that when Thomas Jefferson said he preferred newspapers without government to government without newspapers, he wasn’t talking about the broadsheets we know today. Newspapers in Jefferson’s time were baldly partisan and often skewed the facts to suit their views. How did people figure out the truth when each journal had its own version of the truth? They triangulated, they checked other sources and they figured it out. This worked okay up until about 50 years ago, when newspapers decided to become the arbiters of truth. That’s convenient, but it doesn’t mean we can’t go back to a form that the founding fathers believed was essential to democracy.

The idea that many small contributions can out-produce a few big ones is nicely articulated by Timothy Lee on TechDirt. In order to understand how journalism can be reinvented, you need to discard the notion that only monolithic, vertically integrated organizations can cover the news. “The Internet makes possible a much more decentralized model, in which lots of different people, most of them volunteers, participate in the process of gathering and filtering the news,” he writes. “If millions of people each contribute small amounts of time to this kind of decentralized information-gathering, they can collectively do much of the work that used to be done by professional reporters and editors.”

If you’re geeky enough, you’ll recognize the open-source software model in this thinking. The most powerful force ever to come along in software development depends upon teams of loosely-organized developers each contributing a little bit of their time to building software that anyone can use for free. No, journalism isn’t software development, and there are certain practices of journalism that can’t be duplicated by a person sitting at a desk in India. However, Lee suggests that if the gadflies who already hang around city council meetings start reporting upon them on their blogs, then the community effect can take over to turn that amateur reportage into real journalism. You don’t need professional reporters for everything.

Jon Talton begs to differ. In an angry and resentful blog entry, he derides the idea that grass-roots efforts can ever replace the depth and credibility of what professional journalism organizations produce. Special interests, “will all have stronger voices for their agendas. Manias, rumors and groupthink will be more prevelant. In many localities, people will be particularly ill-informed about their government and major economic powers, pluralism will decrease and corruption will rise,” he writes. After that, we suppose, come the locusts.

Miscellany

Media General is cutting back again in Florida, saying there are no signs yet that the economy is picking up. Its Florida Communications Group cut 53 jobs, eliminated 12 vacant positions, closed two niche publications and added three more days of unpaid furlough to the 10 that employees were already required to take.

Back in the early days of the Web, some newspapers were criticized for withholding information from their websites until the stories had already appeared in print. Now that times have changed, the Minneapolis Star Tribune is being labeled a visionary for doing the same thing. The Strib has enjoyed good success online despite its small-market roots, so the paper is gambling that it can entice readers to become print subscribers by withholding some deep investigative reporting from the website. “The best of our deep, exclusive content will be available online later in the week, unless we have a compelling reason to post it sooner,” wrote editor Nancy Barnes in a letter to readers.

The Boston Herald laid off 12 people, or 6% of its workforce.

The Associated Press has a great list of “daily newspapers that have reduced publication days since last year.” In reality, many of the papers on the list were not technically dailies to begin with, but all publish at least five days a week.  It looks like Mondays, Tuesdays and Saturdays are the most popular days to cut.

Courtesy of our friends at the Christian Science Monitor, here’s an image of the final front page of the daily newspaper. Beginning this week, the Monitor moves most of its news operations online with a weekly wrap-up in print. The Monitor was the first major daily to shift the bulk of its operations from print to the Web, and its success will be watched closely. Click the image to download a PDF.

Asserting that the collapse of mainstream media demands the same urgency as “the threat of terrorism, pandemic, financial collapse or climate change,” two authors of a forthcoming book called Saving Journalism propose massive government intervention in the journalism crisis. Writing in the liberal journal The Nation, John Nichols and Robert McChesney say the recent debates over micro-payments and nonprofit funding is all well-intentioned, but these rescue scenarios don’t address the serious structural problems the US media faces. In essence, the public watchdog function is vanishing with nothing to replace it.

Media Post chart

This trend isn’t new; cost-cutting in the newsroom began in the 1970s when media tycoons began to form quasi-monopolies under the umbrella of government protection. Today, the media is a pathetic shadow of its former self, doing “almost no investigation into where the trillions of public dollars being spent by the Federal Reserve and Treasury are going but spar[ing] not a moment to update us on the ‘Octomom,'” the authors write.

Government already subsidizes media to the tune of tens of billions of dollars annually through mailing discounts, government advertising, monopoly broadcast, cable and satellite licenses and copyright protection. However, private interests have taken advantage of those subsidies to create wealth, and in the process are destroying the services they provide the public, Nichols and McChesney assert.

And they get specific about what needs to be done:

• Eliminate postage for periodicals that get less than 20% of their revenues from advertising;
• Give all Americans an annual tax credit for the first $200 they spend on daily newspapers or online sources that meet certain quality criteria;
• Allocate funds to enable every middle school, high school and college to have a well-funded student newspaper, a low-power FM radio station and accompanying substantial websites.

Face it: The old system is collapsing and won’t be resurrected, they say. We are entering a world in which government abuse and corporate greed will run rampant because no one is watching over the abusers. The business media completely misled the public about what was happening in Iraq and completely missed signs of financial disaster. And that was before 20,000 more journalists lost their jobs.

Although you need to take the left-wing source into account, this article is a pretty compelling argument for government intervention.  It is particularly chilling in its description of the impact that media cutbacks have already had on the public’s ability to understand the financial crisis and its own legislators’ actions.  The authors maintain that the estimated $20 billion cost of their proposal is a drop in the bucket compared to the amount being spent on the financial bailout.  The stretch may be in equating the urgency of the two problems.

Uphill Climb

Stewart: Millennials' Cronkite?

The Nation will have a battle convincing a skeptical American public that government support is the answer. Recent data from Rasmussen Reports paints a picture of a public that is largely disengaged from traditional media institutions while increasingly deriving its news from entertainment. A telephone survey of 1,000 Americans early this month found that 30% overall read a daily newspaper, but among respondents under 40, that percentage was only half as large. The survey also showed that newspaper websites have less “stickiness” than a product that arrives at the front door each day. Only 8% of US adults say they read their local paper’s website every day.

Meanwhile, one-third of Americans under 40 say Comedy Central’s Daily Show and Colbert Report are replacing traditional news outlets, which is slightly more than the 24% of Americans overall who think this is true. And there’s a popular opinion that this is a  good thing. “Thirty-nine percent of adults say programs of this nature are making Americans more informed about news events, while 21% believe they make people less informed,” the report says. Interestingly, Democrats are much more inclined to share this positive view than Republicans, by a margin of 48% to 28%.

Miscellany

The New York Times Co. imposed temporary 5% pay cuts for most employees in hopes of avoiding cuts to the newsroom staff.  Nevertheless, the Times also laid off 100 people in its business operations and said it would reduce freelancer spending and possibly consolidate some sections.  The pay cuts are subject to union agreement. Times management threatened to lay off 60 to 70 people out of its 1,300-person news staff if the union doesn’t concur.  The Times Co. cited an overall drop in advertising revenue of 13.1% in 2008 and 17.6% in the fourth quarter.  The pay reductions were described as temporary.  Salaries will revert to their previous level next year unless economic conditions improve fail to improve.  The company has already laid off more than 500 people this year.

The recession has clearly taken hold in the advertising business and the result is likely to be “the closing of more big regional daily newspapers and bankruptcy declarations from even more big publishers,” according to Media Post. Fourth-quarter 2008 results were a disaster, and that’s coming on top of two years of declines that seemed to get worse with each quarter. Newspaper classified advertising fell 39.2% overall in the quarter, with job-recruitment advertising plunging nearly 52%. Perhaps more ominous is that online revenue at newspaper sites was off  8% in the quarter, although online advertising is weak across the board right now.

The Rockingham News of southern New Hampshire has just published its final edition, and the weekly that has served the region for more than 40 years offers quite a lesson in its own history. Aubrey Bracco must have interviewed a couple of dozen local residents to get their recollections of what the paper meant to them, and he pens a loving and informative farewell.

Mike Hughes, president and creative director at the Martin Agency, pens an impassioned plea to his colleagues to support newspapers with their advertising dollars. “Our industry needs newspapers — but just as important, so does humankind,” he writes.  So stop following the latest trend and putting your advertising in the trendiest places.  “How many agencies aren’t selling newspaper advertising to their clients as hard as they should? It’s time for a wake-up call.” It’s an invigorating argument until you read the bio and see that Hughes’ employer is the “agency of record for the Newspaper Association of America.”

Writing on Mashable, Woody Lewis lists five ways newspapers can embrace social media more effectively. He notes that The New York Times now has an application programming interface that third parties can use to access its content from their programs. This is a cool idea. He also says partnerships with strong technology partners are a good idea.

Jay Rosen lists a dozen articles about journalism that he really thinks you should read, although we can’t fathom his top pick: Paul Starr’s laborious New Republic epic. Many of the others are excellent, though, and a few we hadn’t seen before.

And Finally…

We were thrilled to be included among the “Death of Newspapers” bloggers cited by Paul Dailing in Huffington Post. We agree with him that our self-absorbed, righteously indignant, told-you-so attitude is crap and that we have no answers to the problems facing the industry. We encourage you to boycott our book (available in fine bookstores everywhere) in support of his position. We should be ashamed of ourselves.

The Houston Chronicle joins the long string of newspapers that assert their commitment to “strong watchdog journalism” while covering news of their own troubles with e.e. cummings-like simplicity. The newspaper devotes just 208 words to news that it is laying off 12% of its staff, or nearly 200 people. That’s about one word per victim. In fact, the Chronicle doesn’t even mention a body count. You have to read The Wall Street Journal account to find that number. Even the AP devotes more space to the story than the Chronicle.

We have to wonder if this is some kind of Enron hangover. Are Houston media so tired of covering bad news that they just pass along the press release without comment or question? To be fair, the Chronicle does invite reader comments on a blog and posts a single response to the many questions people submit about who exactly was let go. Still, one response from one ombudsman to news of the loss of 90 newsroom employees hardly satisfies the public’s right to know. Nor will that information be passed along to the paper’s 448,271 print readers. How do we know there are 448,271 print readers? We read the AP story. That information wasn’t in the Chronicle.

We don’t know what went on inside the walls of the newspaper yesterday, but an entry on Houston Press Blogs makes it sound positively eerie. Without citing sources, Steve Olafson reports that no upper managers were laid off but the only two women on the editorial board were. So going forward, the editorial charter of the leading newspaper serving the great and diverse city of Houston will be directed by five white guys. The paper now has practically no suburban news coverage and it laid off the reporter who’s covered NASA since the 1986 Challenger disaster.

Olafson’s most damning anecdote: “Chronicle Vice-President and Editor Jeff Cohen never came out of his office to address the staff during the day-long process of buttonholing employees to deliver the bad news. Instead, he issued a memo.”

Boston Globe Battles Rival Herald for Irrelevance

How long will the Boston Globe be around? Bloomberg says layoffs will be needed to meet the goal of a 12% newsroom staff reduction. But it’s more than that. The Globe has become an anchor around the neck of New York Times Co., which paid $1.1 billion for it and its Worcester, Mass. sister paper in 1993. Circulation and revenue losses at the Globe have far outstripped those of the Times and the only bright spot in the business is the Boston.com website. Barclay’s recently valued the Globe at just $20 million, or more than 98% less than what the Times paid for it. And it’s clear that resistance to change is a powerful force in the newsroom. We attended a meeting of the Social Media Club in Cambridge, Mass. this week at which a young Globe reporter talked about the news staff’s focus on scooping the rival Boston Herald, a newspaper that has fallen so far that a lot of people outside of downtown Boston don’t even know it’s still around. The Globe‘s issues aren’t beating the Herald, but rather staying relevant to readers who could care less about either of them.

Publisher Fights Back at Newspaper Critics

Remember Time magazine’s list of the 10 Most Endangered Newspapers in America from earlier this month?  It’s a load of hooey, says Randy Siegel, president of Parade Publications in a biting commentary in Editor & Publisher. Siegel assumes that most people didn’t notice the byline on the list, which was not a Time reporter but rather Douglas McIntyre. He’s an editor at 24/7 Wall St., a website whose parent also runs a site called Volume Spike Investor, which recommends stocks that are undergoing extreme short-term volume fluctuations. “It’s a sad day when Time magazine…runs an unsubstantiated article on its website, without a single disclaimer, from Wall Street speculators who make their living peddling tips to…day-traders,” writes Siegel, who is co-founder of the Newspaper Project, a booster site for mainstream media.

Siegel doesn’t stop there when naming names.  His next target is Jeff Jarvis, the ubiquitous blogger who has long been a vocal critic of the conventional media.  Siegel credits Jarvis for being smart, but wishes the NYU professor and consultant would disclose more openly his advisory activities on behalf of companies that benefit from the destruction of the institutions he criticizes. Siegel also has some harsh words for CNN.com, which he says has covered the newspaper industry’s troubles with surprising zeal. CNN “probably would like nothing better than to see newspapers and newspaper websites fail, so their biggest competitors for audience and ad revenue would go by the wayside,” he speculates.

Miscellany

The Christian Science Monitor wraps up its 100-year run as a daily newspaper this weekend. Going forward, the thoughtful but lightly circulated journal will focus its efforts online, choosing to rely on journalism rather than video and infographics, according to editor John Yemma. He tells Media News International that the Monitor “intends to increase its page view five-fold by 2013, end its reliance on a Christian Science Church subsidy that now provides 40 percent to 50 percent of its revenues, and achieve financial sustainability by 2015.”The monitor was the first major newspaper to largely abandon the print market in favor of the Web and we wish it well.

We haven’t read any criticism of the hare-brained Newspaper Revitalization Act that’s briefer and more biting than that by Tim Windsor on the Nieman blogs. “I am immediately suspicious of any effort that has as its starting point that newspapers are precious things to be preserved, forever, like some kind of ubiquitous, everlasting Williamsburg of media,” he writes. “The worst thing that could happen would be for newspaper companies to find the means to suddenly become comfortable again.” We couldn’t have said it better and have nothing to add.

Allvoices, the community journalism project that we covered here last July, has added a feature to its website to rate the credibility of contributors. The feature is intended to address the widespread criticism that community journalism has weak quality control. The credibility meter evaluates both the content of a report and the reputation of the author on an ongoing basis as stories move through the Allvoices systems. Criteria include community ratings of the author and content, duplication with other stories and level of supporting content in mainstream media.

The Bakersfield Californian cut 12% of its staff and shook up its management ranks. The 26 positions that were eliminated include 14 in the newsroom and come on top of a 10% workforce cut in December. Management cited a 30% drop in year-over-year revenues as the culprit. The Californian, which has won some attention for its efforts to inspire reader contributions, is also establishing a high-level editorial job called vice president/content. Olivia Garcia, publisher of subsidiary Mercado Nuevo, assumes that role with Californian editor Mike Jenner reporting to her.

Gannett is telling employees to take another unpaid week off in the second quarter on top of the one they had to take off in the first quarter. The company is also temporarily cutting salaries of some high-paid employees.

And Finally…

Nineteen-year-old Dutch college student Marco Kuiper has assembled a collection of weird and wild photos from around the web going back to the middle of last year. He calls it “imagedump,” and the selections range from hysterical to disturbing to borderline obscene. They all have one thing in common: They’re fascinating to look at. Is this citizen journalism?  Who cares?  It’s funny as hell.

This site has received quite a bit of attention for the “R.I.P.” column, which has been a fixture on our sidebar since day one. However, we think the headline for that column may have run its course and we’d like your opinion.
The big problem is that not every title in that column has ceased to exist. The Capital Times, for example, is still plugging away online and even delivers a print publication twice a week. The Ann Arbor News is about to go the same route and the Seattle Post-Intelligencer has abandoned print but is bullishly trying to reinvent itself on the Web.
If we have the Capital Times there, we really should add the Christian Science Monitor, which is about to go weekly in print but stay 24/7 online. Several papers have recently cut back to four or five days a week and more are likely to follow. They aren’t R.I.P. but neither are they really daily newspapers any more. Should they be on the list?
So, your opinions please. Should we:
1. Leave R.I.P. as it is on the assumption that nothing is perfect in this world?
2. Leave the title as R.I.P. but limit the list to papers that are truly defunct? Gone? Pffft?
3. Leave the title R.I.P., list papers that can no longer be considered dailies but may exist in other forms and add a silly disclaimer like this one?
4. Change R.I.P. to “Out of Print” and list papers that can no longer be considered dailies but that may live in other forms?
5. Something else we haven’t thought of?
Sorry for the lengthy explanation, but this kind of thing really does cause us to lose sleep.

This site has received quite a bit of attention for the “R.I.P.” column, which has been a fixture on our sidebar since day one. However, we think the headline for that column may have run its course and we’d like your opinion.

The big problem is that not every title in that column has ceased to exist. The Capital Times, for example, is still plugging away online and even delivers a print publication twice a week. The Ann Arbor News is about to go the same route and the Seattle Post-Intelligencer has abandoned print but is bullishly trying to reinvent itself on the Web.

If we have the Capital Times there, we really should add the Christian Science Monitor, which is about to go weekly in print but stay 24/7 online. Several papers have recently cut back to four or five days a week and more are likely to follow. They aren’t R.I.P. but neither are they really daily newspapers any more. Should they be on the list?

So, your opinions please. Should we:

1. Leave R.I.P. as it is on the assumption that nothing is perfect in this world?

2. Leave the title as R.I.P. but limit the list to papers that are truly defunct? Gone? Pffft?

3. Leave the title R.I.P., list papers that can no longer be considered dailies but may exist in other forms and add a silly disclaimer like this one?

4. Change R.I.P. to “Out of Print” and list papers that can no longer be considered dailies but that may live in other forms?

5. Something else we haven’t thought of?

Sorry for the lengthy explanation, but this kind of thing really does cause us to lose sleep.

With this latest and deepest round of layoffs, the Atlanta Journal-Constitution will have cut the population of its newsroom by more than half since 2006.

The newspaper announced today that 30% of its editorial staff will be dismissed through a combination of voluntary buyouts and layoffs. Another 107 full- and part-time jobs will be eliminated because of a reduction in circulation. The move will trim the size of the news group to about 230, from a high of 500 people just three years ago. Distribution to seven outlying counties will be severed, reducing the AJC‘s reach to 20 metro Atlanta counties.

This is the third round of layoffs at the AJC, which can’t be accused of dribbling away staff.  In December, it eliminated 56 full-time and 100 part-time jobs in its circulation unit. Last July, it cut 189 jobs – including 85 in the newsroom – while also spending $30 million on new printing presses. In that move, the paper also discontinued all its regional editions, including the Gwinnett County regional, where its main printing press was located.

The new cutbacks will target people making the most money.  Most of the reductions “will be in production and management, allowing us to keep as many news reporters as possible,” AJC Editor Julia Wallace said.

And this isn’t the end. “Today’s announcements are the first in a series of initiatives we’ll announce over the next 90 days to reduce costs,” said Publisher Doug Franklin, who added that the goal is to regain profitability by 2010.

Remaining editorial staff will be reshuffled to plow more resources into the profitable Sunday edition.  The strategy hints at possible cuts in frequency, which has been a popular cost-saving move for an increasing number of papers in the last few months.

We really like Sen. Ben Cardin’s idea that newspapers should be allowed to operate as nonprofits. We like it so much, in fact, that we’re going to be the first news organization to take the Senator up on the idea. So effective today, we are a nonprofit. Our $87.13 in monthly advertising revenue is tax-exempt and we welcome donations. We agree not to make any political endorsements, which is fine because we don’t like any of the candidates anyway. We do fear, however, that some newspaper companies may find it a tad more difficult to accept the Senator’s plan. They have this tiny problem of a couple or three billion dollars worth of debt to take care of. Maybe Sen. Cardin should attach a rider making the nonprofit option part of the bankruptcy code. That’s an idea we could really support. But for now, heck, keep those donations coming. PayPal preferred.

A Queensland University professor surveyed 200 first-year journalism students and four that few of them read newspapers. “More than 60 per cent read a printed newspaper once a week or less often. Yet 95 per cent said they enjoyed keeping up with news,” said Alan Knight. Their preferred sources are broadcast TV and the Internet. The survey was conducted online, which means it’s statistically invalid by default, and the brief press release doesn’t say how Prof. Knight limited response to first-year students. Still, it’s interesting and the prof plans parallel studies in other countries.

The New York Times’ Nicholas Kristof last week touched off a debate over the value of personalized news. Kristof asserts that the trend toward filtered and personalized news creates “the reassuring womb of an echo chamber” in which people only listen to the opinions of others who agree with them. 

Eduardo Hauser, CEO and founder of DailyMe.com, begs to differ. His service, which has been around since 2005, co-mingles news filtered by professional editors with headlines self-selected by the reader. In this brief audio interview, he describes why personalized news creates a more informed consumer and creates a base for delivering a well-rounded mix of “need to know” with “want to know.”

Who’s going to provide this information? “It’ still going to be journalists,” says Hauser, who admits to being a “fanatic” about newspapers. But the medium of print is losing its appeal. “The news will still be created by journalists. They will have the ability to create their own audiences. I have faith in the profession of journalism; I have less faith in the traditional media of journalism.”

[audio:http://www.newspaperdeathwatch.com/wp-content/uploads/2009/03/daily_me.mp3] Length: 14:53

If you want an excellent summary of how bad it is in medialand, read Bob Garfield’s excellent overview on Advertising Age before it goes behind the subscription wall (If you’re too late, click here). The sky is falling, folks, and it’s not just for newspapers.

Garfield is the author of the forthcoming book, Chaos Scenario (right), and he’s obviously been doing his homework. Some stats from the story:

• In 2008, magazine newsstand sales fell 12%. They’ve dropped another 22% this year off of that awful base.
• TV Guide, the erstwhile 17 million-circulation goldmine, was sold in October to OpenGate Capital for $1, or $2 less than a copy at the supermarket checkout.
• “Bernstein Research predicts a 20% to 30% drop in 2009 TV station ad revenue.”
• “For the last reporting period, Nielsen Media Research said, CBS’s prime-time audience was down 2.9%, ABC’s down 9.7%, Fox down 17.5% and NBC down 14.3%.”
• “According to Media Dynamics, the average price of reaching 1,000 households with a 30-second spot in prime time, has jumped from $8.28 in 1986 to $22.65 in 2008 — but effectively more like $32, because between 150 and 200 of those 1000 households use DVRs to skip past the ads.”
• NBC Universal CEO Jeff Zucker recently admitted that he’s considering making NBC a cable channel. A CBS executive said much the same thing.

And why is this all happening? Quoting again:

“Today the average 14-year-old can create a global television network with applications that are built into her laptop…you have the ability to create virtually unlimited supply against what has been historically relatively stable demand.”

Economic Shift

And that’s the problem. Also the opportunity. The ad-supported revenue model presumed that advertising space was limited, but today it’s abundant and growing faster than the supply of people to consume it.

If your business is to sell expensive advertising on the theory that you control a narrow channel to the consumer, and then your business is being vaporized by information abundance.  This is the problem for mainstream media in general and it is the one that demands the most creative solutions.

Garfield quotes Philadelphia Newspapers LLC’s Brian Tierney ruing the failure of the free Internet model: “If you build it, they will come — I don’t think is working for media like ours. … I think we’re going to have to start to find a way to charge for it and not just rely on advertising.”

Advertising was a great business for many years when media was scarce and power was concentrated.  The mass democratization of media is sinking all businesses that rely upon that inefficiency.  The solution is not to continue doing more of what we’ve been doing but to deconstruct the centralized media model into something that looks more like the shape of this much flatter market.  The goal should not be to preserve newspapers or television networks or magazines or whatever.  It should be to preserve and enhance the quality of what they have long provided while finding a sustainable business model.