The Future of Newspapers

I couldn't really get up enough energy to post about the whole Van Jones kerfuffle.  Apparently, as one of Obama's 129 czars, this guy whose job it is to redistribute billions of dollars from one group of individuals to another and issue diktats to be followed by private citizens and businesses, is *gasp* a communist.  Well, no sh*t.  All of these various czars have communist roles so why is it surprising Obama might have picked a communist to hold one of them.  The only surprise was that Van Jones was dumb enough to admit it in print rather than hiding it in leftish double-speak like most of the rest of the administration.

Anyway, all that aside, you gotta love the NY Post, which has no problem dropping any pretense of statesmanship and is perfectly willing to skewer its cross town rival.  This editorial is pretty dang funny.  An excerpt:

Newspaper of record? The Times isn't so much a newspaper as a clique of high school girls sending IMs to like-minded friends about their feuds and faves and raves and rants. OMFG you guys! It's no more objective than Beck is....

The Times continues to treat communism as a cute campus peccadillo like pot smoking or nude streaking. A Times think piece (Sept. 9) worried that Jones' fall was "swift and personal." Being a communist is personal but being the pregnant teen daughter of a vice presidential candidate is public business?

In a quasi-related post, Virginia Postrel says the Washington Post lost $1.10 per copy of their newspaper last quarter.  Wow!

I have to disagree with Ed Driscoll, though.  He like many conservatives argues that this economic problem of newspapers is somehow because the Times has dropped its objectivity.  I am not sure anyone has evidence that is true.  One could make, I think, an equally strong case that the Times should be less objective and go openly partisan.  After all, this notion of politically neutral newspapers is a pretty recent phenomenon in the US.

I actually think the problem with newspapers like the Washington Post is the "Washington" part.  Local business models dominated for decades in fields where technology made national distribution difficult or where technology did not allow for anything but a very local economy of scale.  Newspapers, delivery of television programming, auto sales, beverage bottling and distribution, book selling, etc. were all mainly local businesses.  But you can see with this list that technology is changing everything.  TV can now be delivered via sattelite and does not require local re-distribution via line of sight broadcast towers or cable systems.  Amazon dominated book selling via the Internet.  Many of these businesses (e.g. liquor, auto dealers, TV broadcasting) would have de-localized faster if it had not been for politicians in the pocket of a few powerful companies passing laws to lock in outdated business or technological models.

Newspapers are ripe for a restructuring.  How can one support a great Science page or Book Review section or International Bureau on local circulation?  How much effort do the NY Times, Washington Post, LA Times, SF Chronicle, etc. duplicate every day?  People tell me, "that's what the wire services are for."  Bah.  The AP is 160 years old!  It is a pre-Civil War solution to this problem.  Can it really be that technology and changing markets have not facilitated a better solution?

The future is almost certainly a number of national papers (ala the WSJ and USA Today) printed locally with perhaps local offices to provide some local customization or special local section.  Paradoxically, such a massive consolidation from hundreds of local papers to a few national papers would actually increase competition.  While we might get a few less stories about cats being saved from trees in the local paper, we could well end up not with one paper selection (as we have today in most cities) but five or six different papers to choose from  (just look at Britain).  Some of these papers might choose to sell political neutrality while some might compete on political affiliation.

If I were running the Washington Post, I would think very seriously about creating a national news offering, a USA Today with substance.   If you offered me a Washington Post re-branded as a national paper, with some strong side offerings like the NY Times Science section and a good local sports section and a local news section, I'd toss my Arizona Republic in a second.  Its going to take some good thought as to how to weave together the national offering with locally customized content and to manage local vs. national advertising accounts, but with technology this is doable -- Clear Channel does something similar in radio.

I wonder, in fact, why no one has done this yet -- when you look at the circulation numbers, only the USA Today and WSJ, the two papers pursuing this path, are seeing growth.  My only thought is that news is one of those businesses dominated by passionate people who are tied deeply, emotionally into the industry in a way that makes it impossible to envision or consider new models (aviation is another such business, in my opinion, and the US auto business is probably another).  What we need is for the Post and a few other major papers to fail and then let some really bright, right people from outside the business come and shake it up.  This is, by the way, one of the unsung benefits of bankruptcy, is that it takes assets out of the hands of the people who got the company in the mess to begin with -- a benefit we short-circuited when we spent billions of taxpayer dollars in the auto industry to keep GM and Chrysler assets out of new and potentially more innovative hands.


  1. bob:

    Bravo on the newspaper business, and the auto business. Letting nature take its course is often the best solution.

    It is interesting that the Wall Street Journal is one of the only newspapers profiting from a pay scheme on the internet. Good products demand good prices.

  2. LorenzofromOz:

    Mark Steyn makes the point that Britain has a national newspaper market with newspapers aiming a niches in opinion and being, therefore, interesting.

    The US has a lot of local monopolies pretending to be the local NYT and thus being boring. The WSJ and USA Today follow the British model.

  3. Ken N:

    It is fascinating trying to work out what the new model for newspapers will be, or if there will be one at all.
    On figures I have seen the business problem is the collapse of advertising in many markets. Advertising pays for the content of the paper - the cover or subscription price barely covers cost of printing and distribution. No-one has discovered a way of selling enough ads online to pay the cost.
    The difficulty of national papers is usually that most press advertising is local - especially retail. When I last looked the NYT had mostly department store ads. The WSJ could be different.

  4. Michael Miller:

    To your first paragraph-I had to chuckle when Fidel Castro and Hugo Chavez both expressed their deep concerns for their friend Barack's personal safety. Hugo even went so far as to call him comrade.

  5. Link:

    When the New York Times bought The Boston Globe I thought they'd be doing a much deeper integration of both papers. My understanding is that they did some back office consolidation but left the papers mostly separate, and so gained little benefit from one company owning both papers.

  6. kelly:

    Oh, you subscribe to the Arizona Republic?

  7. jt:

    Unfortunately, the Times, Globe, and other MSM papers (at l;east the ones I know reasonably well) also do a terrible job of being relevant to their *local* markets. Even we ignore their political agendas, these papers tend to be clueless about what the top issues are for people who live in the suburbs and less-fashionable parts of modern metro areas (hint: an occasional local color story doesn't do the job). I don't think there's an easy answer to this problem, but it's worth noting that the big growth in newspapers in the last few decades has been in the suburbs. And the suburban chain papers mostly seem to be quite healthy. Do some market research, hold focus groups, acquire a few winners for their expertise--all the basic bag of tricks that *real* marketers use to position themselves for new markets. Then the big dailies just might survive.

    However, I don't expect any of them to try this approach.

  8. NormD:

    I have no formal data, but I stopped subscribing to several magazines after they became overtly, annoyingly political. These included Newsweek, Scientific American, New Scientist and Skeptical Inquirer(!). I subscribe to the San Jose Mercury News for local news, and would cancel it in a heartbeat if I had a good alternative. I subscribe the the WSJ, but mostly for the editorial pages, the news sections are biased towards the left.

    It makes no sense to me why any business would go out of its way to insult and annoy its customers. This certainly is part of the reason print media is failing.

    I don't like bias bias of any sort. I want information, facts, discussion, lively debate even heated argument. Biased reporting is just so boring and uninteresting.

    I would love something like the WSJ with a local/state section. Is this possible?

  9. boqueronman:

    The legacy news media's inability to adapt to a rapidly changing news production, delivery and reading environment has a lot to do with the slow but steady hardening of barriers to entry. The news business has been characterized by an ever decreasing number of locally owned and operated news outlets as the older, smaller fish were consumed by the larger fish, and, in many cases, non-news business specialist companies who were just interested in diversification. This made it harder and harder for the news consumer to feel like the "local" news source was actually talking to him or her. The second large barrier to entry was the conversion of the journalist profession from one that often recruited subject matter specialists to one where a "degree" in journalism was required. The result is a plethora of "reporters" who, first, have been trained to seek to "change the world," an inherently utopian leftist concept and, frankly, to find a partisan political and cultural agenda they like and write down why you too should think this way too. All of a sudden the internet came along and almost instantaneously the transmission of information and opinion was radically democratized. The problem that affects the industry is that the big money sees no real investment opportunities in this hyper-competitive environment, at least at ROIs they'd be interested in, and that the formation of organic distributed networks around a broader base will take a long time.

  10. Doug:

    I think you're right on target. Too many papers, like the Orlando Sentinel here, have tried to be national news sources for local markets but can't compete with true, readily available, national sources.

    And the phenomenon of objective media is not just recent, it's ridiculous. These are people, not robots, and while I'm sure many of them try to be neutral I'm equally sure most fail. That's okay. They should should stop pretending they don't have a point of view and instead, tell us what it is.

    Partisan reporting, with ideas that must compete and stand up to hostile attacks, is more informative anyway. If impartial reporting, investigation and analysis really were the best way to get the truth, shouldn't we apply that principle to the court system and eliminate the highly paid, highly partisan lawyers we use now? (I know that could be a popular idea, but I doubt we'd really be better off just letting the DA present his impartial findings to the judge who then renders a decision.)

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