The newspaper business is in trouble, and that may be the best thing to happen to it in a long time.

Thus beginneth this morning's newspaper column, which continues below.

Saving the newspaper business from itself

By Edward Cone
News & Record
12-11-05

The newspaper business is in trouble, and that may be the best thing to happen to it in a long time.

As long as publishers were able to see big profits extending to the horizon, they could live with looming problems like aging readership and stagnant circulation. They might have kept on making money right until they fell off the cliff.

Newspapers still make good margins, but now they are faced with immediate threats that should shock them into action. The result, for the smart and the bold, may be a rebirth of the industry.

The new threats are by now well known. One of the most serious challenges comes from a new breed of competitor: web-based companies that skip the journalism and go straight for the advertising dollar.

Papers make big bucks on little ads, but the classifieds are moving online, to sites like CraigsList and Monster.com. Google’s targeted-search ads, along with web ads that target specific audiences, threaten to undo the conventional wisdom that half of all advertising dollars are wasted -- you just don’t know which half. And now Microsoft has announced plans to ramp up its own ad-sales effort.

The web also introduces a host of new competitors on the news and information side of the business. Up-to-the-minute headlines, sports scores, stock data, even comics are available for free online, undercutting the value of tomorrow morning’s paper. Blogs provide a global op-ed page and portals into news coverage and analysis. And with just about every paper available in an online version, competition from within the industry is fiercer than ever as well.

It sounds grim, and if papers keep responding by cutting their newsroom staffs in an attempt to preserve profit margins from another era, it will be grim.

What they need to do instead is invest in improving their product, online and off. A well-run paper should be able to compete effectively on the web, and to turn its print presence into a competitive advantage. Print isn’t going away. It’s too convenient a platform -- portable, disposable, easy to share – but it’s no longer the tail that wags the dog.

(The News & Record, owned by Landmark Corp. of Norfolk, VA, has not seen the big cuts that have hit papers including The New York Times, both Philadelphia dailies, and many others; it did economize by dropping the New York Times news service, including opinion columnists such as Thomas Friedman, to the consternation of many readers. I am not an employee of this newspaper, and don’t know much about its inner workings; the nice people on Market St. may have in mind some of the things I suggest.)

First things first: papers should erase any remaining distinctions between the web and print staffs. A paper is producing a 24-hour information product, of which the print edition just one key component.

Next, it should equip all reporters with inexpensive video cameras, and outfit photographers with higher-end video gear. Suddenly, the website is alive with audio and moving pictures; as the quality improves and high-speed Internet access becomes pervasive, papers may even begin to reverse 50 years of audience attrition to television.

A lot of online content will probably have to remain free in the future, especially commodified information like stock quotes and sports scores, and basic products like local news. But a paper like this one has access to deep wells of information that it can package in different forms. For instance, a blog that leverages a beat writer’s access to ACC locker rooms or NASCAR’s pit row might attract paid subscribers and national advertisers. Or, a particularly interesting series of articles or columns could be packaged with graphics as a PDF document and sold over the web.

Ad sales will remain critical to this new-model publication, and that will mean training the sales force to think about the online market as an integral part of their job, and educating advertisers too. Local papers need to get ahead of the curve in selling online ads, or the national services will eat their lunch. This is an area where a print edition should give newspapers a big advantage over their rivals.

The ability to drive traffic from one medium to another, and to cross-promote online and in print, will be a powerful tool. Why not put all print ads online and open them up to search engines? Syndicating ads across blogs and other websites could also create a decent revenue stream over time.

Finally, papers should fire their consultants and quit asking focus groups how to do journalism, and work on putting out a quality product in print and on the web. They might also figure out ways to compensate staffers for value they add on the web.

All of this will cost money, which is contrary to much of the prevailing wisdom in the newspaper business. Of course, if you look at the numbers in this business, going against the prevailing wisdom doesn’t look like such a bad idea.

Comments

[Roch101]

"Blogs provide a global op-ed page and portals into news coverage and analysis."

But no original news?

[Ed Cone]

Sure, original news, too.

[Ken Doctor]

You're on track. Funny thing is that as newspapers have dallied in doing the right things -- and your list is to the point -- others are starting to step around them. Let's think about, what is it that we as journalists want:

1) an audience to read -- and use -- our work;

2) a reasonable living from doing it.

Traditional publishers aren't the only ones who can provide those two ingredients. We're starting to see new Local companies (www.backfence.com), new local city guide search company (www.yelp.com) and soon we'll see more blog aggregators ( http://www.newstexblog.com/blog/2005/11/newstex_launche.html. ) All of these blur the distinctions between traditional local publishing operations and new ones.

Either the legacy companies will work through the checklist you've provided, or continue to see their margins shrink and staffs shrink to the point that new new media rising will begin to supplant them.

All kinds of questions about what that means to readers and writers, but those are for other days soon to come.

[Karl]

Great piece Ed. Ment to comment here on it.

Roch... I emailed you to catch up :)