More papers are dropping the Associated Press. The Columbus Dispatch becomes the latest media entity to just say no to the wire service, following by just days Tribune Co.’s blockbuster announcement that it would exit the consortium. The AP’s costs are a sore spot with budget-challenged publishers, as are its tendency to compete with them online.  Editors are frustrated by new rules that require them to insert tags on stories they contribute to the wire service, which the AP then publishes through its numerous Internet channels.  The editors complain that revenue-generating traffic is thus diverted to the AP from their own web sites.

The AP claims new pricing will cut newspapers costs by about 10% beginning next year and that it will share ad revenues with members.  Publishers, though, say the lower prices aren’t enough. The AP’s fees can exceed $1 million annually at some newsrooms, which is about the same cost as 12 to 15 salaries.  In light of the need to cut costs, newspapers are coming up with creative alternatives, including regional consortia and citizen contributions. The New York Times account says defectors will also turn to less expensive newswires to cover the void left by the AP.

Pundits Disagree on Media’s Future

The director of digital at the UK’s Guardian Media Group forecast two years of “carnage” in the traditional media industry.  Emily Bell said she could see five national newspapers in Britain going under during the next two years as well as “the regional press heading for complete market failure.”  Even successful media companies will have to prepare for a long period of losses, she said.  The culprit is undifferentiated content driven by the traditional role of media as representatives of their customers, rather than participants in a conversation.  The only way to avoid irrelevance is to change this mindset, Bell believes.

However, the global leader for entertainment and media practice at PriceWaterhouseCoopers in Hong Kong begs to differ. “Traditional media isn’t dead yet and won’t be for the next five years, ” Marcel Fenez told the World Association of Newspapers readership conference, Despite its rapid growth, digital advertising will represent just 10 per cent of total advertising for newspapers by 2012, he said. He forecast that global newspaper advertising (including digital) will grow 2.9 percent to $136.8 billion during that time.  Part of traditional media’s advantage is its willingness to collaborate, he noted.  By not trying to “gouge the other guy’s eyes out,” media companies can come up with the kind of creative partnerships that stymie other industries.

Another speaker at the same conference danced on the hyper-local theme. Randy Bennett, vice president for business development at the Newspaper Association of America, said newspapers need to fight back against stagnant readership growth by becoming the destination of choice for local activity. “We must be a trusted source for all relevant content created by us, or others – professionals or amateurs,” Bennett said. “We must give users a tool for extracting the content they need and create a platform for interactive conversation.” Is there a business model in all this?  Bennett admitted he was unaware of one but expected that large sites would come up with something

When Bad News is Good News

Publishers know that bad news sells, and new data from Nielsen Online proves that point. The service’s tally of unique visitors at the nation’s top newspaper Web sites in September showed that all but one (the Village Voice) were up by double- or even triple- digit percentages. The big winner was the Anchorage Daily News, which enjoyed a 928% spike in unique visitors, presumably due to interest in native daughter and Vice Presidential candidate Sarah Palin.

The irony of the financial crisis is that it has also been good for some segments of the publishing business. Reuters says business media are enjoying a short-term lift in readership and ad dollars, thanks to all the attention being drawn by Wall Street’s financial crisis. The question is what happens after reader interest cools? The long-term slowdown in advertising in conventional media is likely to continue and perhaps worsen beginning in the first quarter of 2009, experts predict.

Miscellany

News Corp. Chairman Rupert Murdoch says the unprecedented global financial crisis presents a buying opportunity for his company. Speaking at the company’s annual meeting on Friday, Murdoch said News Corp. just turned in its sixth straight year of record earnings and is sitting on $5 billion in cash, making it well prepared for further downturns in credit markets. The company has also renegotiated its credit lines to allow for longer payback periods.

No one, including News Corp. has been left untouched by the mess on Wall St., Murdoch said.  ”It has weakened advertising markets and beaten down our share price,” the 77-year-old CEO said. “We have prepared ourself well for this day.” With next year presenting “unprecedented challenges,”  News Corp. will look for acquisitions in growth businesses. India, eastern Europe and Asia have the most promise, Murdoch said. He also expressed “great confidence in our future,” apparently referring to News Corp.’s future, not necessarily everybody else’s.

A team of enterprising publishers in the UK has produced a four-page newspaper created entirely by hand. “Every word and every image and every mark of any kind in The Manual was drawn by a team of volunteers – mostly illustrators,” a blog entry says. “Each copy of the paper has been numbered in a limited edition of around 100.” The experiment foresees a day when “handmade qualities can transform newspapers from ‘junk’ to collectable.” Sounds like a neat idea.

Just two months after Puerto Rico lost its only daily English-language newspaper, a new suitor has stepped in. The Puerto Rico Daily Sun will be available starting this Wednesday by subscription and at newsstands. The paper will be staffed largely by members of the now-defunct San Juan Star. Few details were released. The publisher said an upcoming press conference would reveal more.

The Seattle Times Co. may be close to selling its newspapers in Maine, but that probably won’t save it from having to make deep cuts early in the new year.  Al Diamon, Maine’s most widely-read media critic, reports that “two informed sources in the newspaper industry” says a company called Maine Media Investments could buy the Blethen Maine Newspapers by the end of the month. The chain has been an albatross for the Seattle Times, which has enough of its own problems on the opposite coast. Diamon quotes sources as saying more deep cuts are expected in January.

The new executive editor of the Merced Sun-Star in California’s heartland mixes metaphors and crows about his performance at the free throw line in one of the more delightfully clueless homespun essays we’ve seen by a scribe in a while. Our favorite line is this drug reference (emphasis added): “The newsroom…is down to seeds and stems in terms of numbers of reporters, photographers, copy editors and sports writers.” Someone should put Mike Tharp in touch with the Merced County Sheriff’s department, which destroyed about six tons of marijuana plants the previous day.

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