Here’s one way for newspapers to adapt, by Ted Rall. Enjoy…
Here’s one way for newspapers to adapt, by Ted Rall. Enjoy…
Periodically I hear from retired management consultant Frank Pecarich, who has for the last few years watched with dismay as the newspaper industry follows the path of what he terms the classic industry death-spiral, failing to act and change course based on the data that its leaders are presented with about their changing market and disruptive technology’s effect on it.
I received an e-mail from him today, commenting on my most recent Editor & Publisher Online column, an interview with persuasive technology psychology professor B.J. Fogg of Stanford University. Fogg dismissed the idea that newspapers can get very many people to pay for news on the web, but suggested that making money from high-value online niche content and/or services that are attractive to enthusiast or specialized audiences could be a user-payment-driven business for newspaper companies, supporting online news that’s paid for by advertising and other revenue streams that don’t defy consumer psychology.
Pecarich’s observations of late have led him to believe that newspaper leaders continue to flounder in the classic death spiral without making the necessary harsh adjustments to pull out before hitting the ground. He looked at my career (analyzing and consulting the newspaper industry since the birth of the web around 1994) and wrote:
“As time passes, you can see how the (newspaper) industry is following that classic route toward virtual organizational extinction. One thing that can be said about your experience is that you will have seen the whole theory play out from start to finish and most people don’t have that opportunity. In other words, you will have a good idea of the answer to the ‘Whatever happened to “X” industry?’ question.”
I guess that means there’s a history-book project in my future. Of course, the newspaper industry can squelch my forthcoming book (I really don’t want to write it) if it starts making strategic decisions that put the consumer first, recognizes the massive shift taking place in how people consume and interact with the news, and acts accordingly. Unfortunately, we instead see much of the industry act in what it thinks is its self interest, never mind the market trends and clear changes in consumer behavior. (The Associated Press currently leads the way with industry-first, consumer-second strategy.)
Here’s the video promised by Cleveland Plain Dealer Impact Editor John Kroll (representing the paper’s online/digital side) having a follow-up debate with Reader Representative Ted Diadiun about some disparaging comments Diadiun made toward bloggers and Internet news sites during a previous video chat, which generated quite a bit of heat. (Original link on Cleveland.com.)
This is not one of Diadiun’s normal video web chats, but rather a debate between an Internet-savvy Kroll and Diadiun (appearing on his day off!), who while contrite about some of the things he said previously, still strikes me as in need of some education about the media transformation we’re experiencing. Since Diadiun didn’t exactly back off his use of the word “pipsqueaks,” I’ll refrain from backing off my earlier blog-item description of him as a news “curmudgeon” in need of some further education.
See for yourself. (BTW, the headline below in the embedded video is part of the video; I didn’t write it, a Cleveland.com staff member did.)
|Two pipsqueaks sitting around talking|
Kroll makes the point that Diadiun’s rant last week represents only one opinion of many in the Plain Dealer’s newsroom of 240, and that many other staffers there have opinions that differ from either of the two men in this video. I’m glad he emphasized that.
However, from my point of view, the Plain Dealer can’t afford to have too many people on staff with views similar to Diadiun’s. For newspapers to get through the transition to profiting in the digital world, they need to pull together as a team and figure out how best to play in the digital landscape. If there are too many folks in that newsroom with views like Diadiun’s that the newspaper is best and other media are inconsequential in comparison, the Plain Dealer doesn’t have a rosy future.
I won’t go so far as to opine that Diadiun or any other “curmudgeons” in the newsroom need to be removed, but they do need some remedial education on what’s actually happening to modern media.
My May Editor & Publisher Online column was published today — “Getting Money from Readers Who Won’t Pay for Online News” — and it’s mostly getting positive reviews so far. I make the case against daily newspapers’ shift toward charging for local news on their websites, and suggest an alternative: newspaper.com paid memberships that work with the paper’s advertisers and offer significant value, so it’s not just a “tin cup,” “please support local journalism” strategy.
As I note in the column, this is one option being considered by the New York Times. Also, today I heard from a couple other newspaper folks who say they’re either discussing or working on such a membership program.
Over on the Media Nation blog, Dan Kennedy mentioned my column, and one of his commenters suggested:
“Outing’s assessment No. 3 needs a touch of adjustment. The REAL monetary value of a newspaper is in its subscriber/readership base, and the access to that base that it can provide. This is what advertisers pay for. Content is the benefit that the subscriber/reader gets for allowing the publisher into their lives. …
“Those who cut content risk the alienation of the very constituency that enables them to charge the advertising rates on which their very survival depends.”
That brings up a point I missed in the column: A high-value membership program could attract paying members who don’t use the core product (newspaper and/or website). Here’s my response to the commenter:
“Hmmm. What I advocated in my column (the part you refer to as No. 3) is that a ‘membership program’ become a new addition to a newspaper company’s ad program that would be appealing to advertisers and enticing enough that consumers would clamor to pay for the benefits in great enough numbers that they support the newspaper’s reporting. It’s similar to commercials supporting ABC World News Tonight, or ads supporting the free alternative weekly in your town, but the newspaper membership doesn’t require you to read the paper’s website content.
“You make a good point. Perhaps the editorial content shouldn’t be completely detached from the revenue source, so that people don’t just buy the membership because of all the great deals but then don’t read the news, which then hurts the newspaper website’s ad revenues. So yes, perhaps a ‘touch of adjustment’ is in order.
“I often like to flip things on their heads to get a different perspective. One possibility might be to have a base membership price (say $20/month), but offer discounts based on the member’s pageviews during the previous month. … Or let them take a news quiz at the end of each week and if they score above a set level, they get $5 off that month. … Sounds a bit crazy, but we’re not only interested in making money to support news gathering; we’re also interested in an informed public and a better functioning democracy.
“I’d most like to see newspaper publishers get more creative. ‘Let’s put up a pay wall’ demonstrates the lack of creativity and innovation at the highest levels of the industry.”
Yeah, I’ve been playing hooky quite a bit lately. In the previous couple weeks I’ve mountain biked 4 days on Utah’s famed White Rim Trail, then succumbed to an invitation from a friend to drive to southwestern Colorado and ride some great trails near Cortez and Durango for 2 days. (Fellow mountain bikers: You have got to check out the Phil’s World trail system which is near the entrance to Mesa Verde National Park. Stellar!) It’s a “benefit” of being temporarily underemployed to take time off, but my legs are feeling tired.
While I was away, Colorado Public Radio current affairs program “Colorado Matters” aired a 13-minute interview with me by host Ryan Warner. Here’s the archived version if you care to listen to the discussion about the future of news in an era when the newspaper industry is falling apart.
Newspapers’ Digital Future
What goes around, comes around. … Sometimes when you’re having trouble coming up with a solution to a difficult problem, it helps to turn things upside down and get a new perspective.
I’d like to see the newspaper industry, especially the big metro dailies which are in the most trouble and closest to collapse, look at things differently. Stand on their heads. Ditto for the Associated Press, which has been saber-rattling lately about closing off some of its content, even some headlines and blurbs that most reasonable people would consider to be “fair use.” (See this video exchange on the Charlie Rose show between AP CEO Tom Curley and HuffingtonPost.com’s Arianna Huffington, where Huffington makes a strong case that AP and other saber-rattlers (Walter Isaacson, Rupert Murdoch, et al) are trying to go back to old times of walled gardens for media content, which are destined to fail today.)
So here’s an idea for newspapers, the AP, et al: Think through how you can help Google make more money! Figure out how to spread your content much more widely instead of focusing on how to restrict its flow.
Stop looking to the Recording Industry Association of America’s beyond-belief-stupid approach to the spread of music on the Internet (“Hey, I know! Let’s sue our customers!”) as a role model. Stop pointing the gun at your own head!
There’s a hint of why I say this in my previous blog post about Google’s Google News, the popular news link aggregator. The search giant just recently began dipping its toe in the water in terms of adding contextual ads on searches via Google News, but it’s held back on opening the ad spigot fully. You can guess why: It would cause even more of an uproar among news providers, some of whom would block their content from Google and likely get pushed toward putting price tags on their content (hello, again, walled gardens!).
What the AP and newspaper publishers really want is money from Google (their “fair share”). As the new middleman between the consumer and the news provider, Google is able to handily scoop up so much ad money for its role that there’s not enough left over to support the type of strong news media we’ve been used to. Ergo, newspapers are being cut back in size and quality, journalists are laid off, and investigative reporting can no longer be afforded by the institutions who used to do the bulk of it.
In my last blog item, I urged Google to come up with a revenue-share plan using Google News as a platform and opening the ad spigot. It would benefit itself by turning on another revenue source, and help news publishers by paying them according to the number of clicks through to their content by Google News users. Everybody (not just newspapers, but any website publisher that produces news and is tracked by Google News) wins, and publishers have less reason to saber-rattle and threaten to commit hari-kari by walling off some of their content.
Will Google do this? I’ve used my contact network to try to get the idea in front of Google CEO Eric Schmidt; I know at least that his personal PR rep has it and I hope passed it on. I’ve tried unsuccessfully to reach Krishna Bharat, Google’s chief scientist and the original developer of Google News, but he’s ignored me so far (despite that I met him a few weeks ago at Stanford as he and 4 other people interviewed me for a fellowship). Apparently my powers of influence at mighty Google are nil.
The AP and the newspaper industry (still) have power. How about if instead of threatening Google, the news industry joins forces to approach Google with a plan that would allow it to fully turn on the Google News ad spigot; financially support the entire community of news providers, new and old (this is NOT just about newspapers); and provide a way to improve Google News by establishing new methods for identifying the original sources of news so that they can be put at the top of relevant Google News pages and search results?
Newspapers’ and the AP’s approach to Google cannot be adversarial. It must be designed not only to help the news industry, but to benefit Google’s shareholders!
Yeah, I know, AP’s Curley “says,” as he did on the Charlie Rose interview and elsewhere, that the AP is not targeting Google. (Google is a paying AP customer, after all.) But it’s not difficult to read through the lines.
When I read comments by people like AP Chairman Dean Singleton, who told the Newspaper Association of America recently, “We can no longer stand by and watch others walk off with our work under misguided legal theories,” and press baron Rupert Murdoch say, “Should we be allowing Google to steal all our copyrights? Thanks, but no thanks,” visions of the RIAA ring in my head. Those guys need to stand on their heads and look at the situation from a new perspective.
If they can achieve an intelligent dialog with Google and come up with a plan that benefits both sides, then newspapers can follow Huffington’s advice (of which I concur, 100%), and do everything they can to get their content everywhere possible online. Monetize it not just within your walled garden (website), but on every blog or website that your content appears on.
Newspapers and other old-mindset news providers are panicking. They need money! Now! I think they might find it if they stand on their heads.
Take heart, newspaper aficionados and media curmudgeons. You’ll still have the comfort of the printed newspaper as you travel in space in the year 2259! (Well, that assumes you’ll be getting cryogenically frozen and are revived in a couple centuries.)
Credit my friend and colleague Christopher Ryan for spotting this look into the future. Chris was viewing old TV shows on Hulu.com and came across a 1995 episode of the cheesy sci-fi show Babylon 5. In this episode, “Divided Loyalties,” the writers envision newspaper reading onboard spaceships in the distant future.
Who would have guessed? Newsprint is still around, even in space!
Sorry I can’t embed the video here (Hulu.com doesn’t support that; grrrr), but click the image or the link above and watch just the first scene for the 1995 view of news consumption in the centuries ahead.
Oh, there’s advanced technology involved with Babylon 5′s edition of “Universe Today.” You get to tell the computer to personalize your paper with extra news about whatever you want, then it spits out your personalized paper copy.
But won’t the spaceship fill up with stacks of old papers? Of course not, silly. They recycle in the future. Insert your previous edition into the recycling slot and get your updated paper edition. As near as I can tell from this scene, you still have to pay for your newspaper, so I guess they solved that troubling free-web-content issue decades ago.
Ah, won’t the future be wonderful?!
Last night I was reminded of the power that digital media have of bringing people together. My wife and I attended a birthday party for our friend, Bud, who chose the occasion to hold the debut public concert for his basement band, tentatively called “Doc Hollywood.” He rented the Altona Grange Hall north of Boulder and he and the band invited their friends (who brought food and tossed money into a big jar to cover the hall rental).
The band that Craigslist formed.
Now Bud and the band are not exactly spring chickens. (Surely it’s OK to use that cliche when I’m writing about an event in a grange hall. ) The average age of the musicians is in the 50s; Bud is 57, and recently rediscovered his love of playing the drums, which he’d put aside since he was in his teens and early 20s and played with a rock band.
Other than his wife, Cheri, who sings backup vocals, the rest of the 6-person band was introduced via an ad in Craigslist looking for musicians interested in joining a band for fun. There’s no intention of the group to get paid gigs or otherwise make it big; they’re mostly ordinary folk who used to play and perform when they were younger, and just want to have some fun again.
Now, last week was an awful one for traditional media. The Rocky Mountain News shut down; there’s talk of the San Francisco Chronicle going down; the newspaper industry overall has proven itself mostly unable to handle a bad recession and the challenges of adapting to the digital revolution. Last night’s concert gives a hint as to why, if you look hard enough.
Craigslist, of course, has hit newspaper classifieds hard. The decline of newspaper classifieds revenue is a huge part of the reason for newspapers’ current troubles. It’s not all Craig’s fault, of course, but he has a lot to do with it. But Craigslist’s ability to bring people together is something that newspapers don’t do well at in the digital age. Perhaps in the old days, Bud’s band might have come together via a newspaper classified ad, but more than likely he would have asked friends, or posted a notice at the local music store. Now there’s a better way. Thanks, once again, Craig.
If newspapers are to pull out of their crisis — indeed, if they are to survive long term — they need to learn to take better advantage of the ability of the Internet and mobile devices to introduce people with common interests and bring them together. Alas, most traditional publishers continue to think more about how to make money from the old model of one-to-many, and pay lip service to serving the qualities of the Internet that make it so important to the individuals who live in 2009: its ability to connect people and form communities.
Bud’s band members might have found themselves thanks to a local newspaper’s online service, had that publisher grasped the potential of the Internet as builder of local sub-communities and relationships — and put more effort into developing as part of its digital strategy ways to help people connect and find each other.
Listening to my friend’s band last night, and realizing that they’re all in the age group that still reads newspapers, it occurred to me that were it not for Craigslist, none of us would be in that grange hall. Newspapers still think big; “how can we reach a larger audience with our great content?” They also need to think small; “what can we do to once again be the institution that not only is at the center of our community, but that also facilitates and helps people in our community to create their own connections and communities?”
It’s probably too late for newspapers. But as they struggle to survive, I urge them to spend a lot more time thinking about the small ways they can become big again.
A poignant video goodbye from Rocky Mountain News staff. If you love(d) newspapers, or grew up reading the Rocky as I did, it’ll bring a tear to your eye. The staff did a great job on it. Personally, I’m feeling a combination of sadness and anger. The latter is because this didn’t have to happen. But management and staff culture couldn’t change fast enough. Perhaps some good will come of the largest U.S. newspaper yet going down. Surviving metro newspapers surely can no longer ignore the need for radical change. Well, they can, but they’ll end up with their own farewell edition and video.
I’m looking forward to Tuesday, when Detroit’s newspaper executives apparently will unveil a bold new plan to save themselves. As the Wall Street Journal reports, “the leading scenario set to be unveiled calls for the Free Press, the 20th largest U.S. newspaper by weekday circulation, and the News to end home delivery on all but the most lucrative days — Thursday, Friday and Sunday. On the other days, the company would sell single copies of abbreviated print editions at newsstands and direct readers to the papers’ expanded digital editions.”
This will be significant, if that’s close to being accurate, in moving daily newspapers toward an era where digital is at the center and print is but one of the spokes on the distribution wheel. Of course, the Christian Science Monitor has already announced that it will do this early next year, publishing a print edition only once per weekend and going digital the rest of the week. But the Monitor is a national/international paper; Detroit would be the first major metro market where this might take place.
Plenty of folks are speculating and analyzing the plan’s chances, but we don’t really know if the scenario above is what’s been decided. I hope not, because I doubt that plan will work. Newsosaurus Alan Mutter seems to agree.
I think the predicted scenario is close to what should happen, but with some major flaws that keep the Detroit papers driving toward oblivion. (With the auto industry’s troubles, the Detroit newspapers are probably in the most perilous position of any major metros in the U.S.)
Here’s my prescription for what should be announced on Tuesday. (Much of this reflects my latest Editor & Publisher Online column, “My ‘Crisis’ Advice to Newspaper Company CEOs: 11 Points to Ponder.”) Specific to the Detroit situation:
There’s much more to a digital-first strategy. (Hey, I’m always open to new consulting gigs. )
But let’s see what gets announced on Tuesday. It’ll either be another stake in the heart of Detroit’s newspapers; a visionary reinvention that stands a chance of altering the rest of the newspaper industry; or somewhere in between: a flawed plan that has some elements of successful strategy that will need to be tweaked.
This will be interesting. Here’s hoping that whatever Detroit newspaper executives have up their sleeves, it doesn’t involve more journalists being laid off. It’s difficult to feel much optimism, however. More on Tuesday.