EdCone.com

What definition of "news" justifies today's N&R front-pager on the availability of tickets to the upcoming Paul McCartney concert at the Coliseum?

Here's the hard-hitting lede:

Haven’t snapped up tickets yet to Paul McCartney’s Oct. 30 first-ever concert at the Greensboro Coliseum?

With a little luck and a lot of cash, it’s not too late.

Tickets still are available but are going fast — even with a top price of $250 plus fees at Ticketmaster.com [N&R web story includes live link to Ticketmaster website].

And seat choices are narrowing, particularly for the least-expensive $59.50 seats.

There are some tidbits about the concert biz that would fit into an article on that topic, but this is mostly a breathless gush of advertising.

Concerns about the relationship between the paper and the local arts community (see previous post and comments) are looking all the more reasonable today.

Previously: Front-page advertiser fluffing, retail division. 

I asked John Robinson how widespread the changes to the N&R website noted here yesterday will be.

He wrote me a thoughtful email, which he then posted to his own blog.

A key excerpt:

We're going to try to create a news site, rather than a newspaper site. That means that the website will emphasize breaking news, "commodity" news, news that people need to know as soon as possible, interactivity, and the stuff that historically draws traffic — stories about crime, consumer news, dining and retail news, photo slideshows, etc. Information that is exclusive to the newspaper — enterprise and feature stories, for instance — will not be on the site. That's a generality. We have all kinds of exceptions that are still under consideration and discussion. So, if you write about this, my request is that you emphasize that this is all very much a work in progress...

...don't confuse it with a paywall because it's not close to what that terminology commonly refers to.

So they're talking about taking a meaningful chunk of their original content off the website, and putting it online only in unlinkable and, to this reader at least, incredibly unfriendly format. Imagine trying to navigate an entire newspaper in PDF form, and you'll get a rough idea; if the medium is the message, this medium says "go away."

Whether it also says, "go read the print edition" is the question. There may be some value as well in registrations for the "e-edition," but it's hard to imagine many people using this clunky interface.

Print circulation still drives a lot of ad revenue, and rethinking the website makes a lot of sense, but the technology element alone makes this look like a doomed rearguard attack on the free-content problem. 

Standard disclaimer: I contribute a column to the N&R but have never been an employee; I'm a paid subscriber to the print edition.

Previously, previously.

AJR on what Warren Buffett calls the eroding fundamentals of the newspaper business.

Most newspaper executives now are banking on a successful transfer of their business online...Unfortunately, they came late to the realization of how important this is and did not invest enough capital in the early years of the Internet...[They] concentrated on shoring up the profitability of their traditional newsprint-oriented business, chiefly through laying off employees, downsizing their newspapers and cutting back on circulation...It was a classic defensive strategy that undermined the very things--standing, reputation, influence--that are crucial to success on the Internet.

...The newspaper industry remains highly profitable by comparison with most other businesses...But no industry can cut its way to future success. At some point, the business must improve.

Whether newspapers will be able to meld a combination of print and online into a sustainable and thriving business model is a large question.

My take this summer on the News & Record and its corporate owner:

[I]t underinvested in new media and product quality as the market began to change...I haven't seen the kind of game-changing investments that show long-term emphasis and a deep understanding of the ways the business will continue to be transformed. Where's the meaningful local answer to Google and Craigslist? Where's the local online ad market, and the new-media counterattack on TV and radio?

...It would make no huge difference in Landmark's overall numbers to cut profit margins for a while to merely solid rates of return, and to reinvest a few million bucks per year in product and product development,  but it would make a huge difference to the News & Record, and Greensboro, and the future of local journalism.

Too bad that ain't happening.

I guess it's time to give up on my critiques of the N&R's front page.

Beyond the reality of staff cuts that reduce the reporting and editing capabilities over on Market Street, there is just a philosophical difference over what constitutes front-page news on a weekday morning for a good-sized regional daily (an alternative here.)

They honestly seem to think good-sized chunks of A-1 should go to fluffy features -- this morning, it's a festival at Temple Emanuel, which belongs on B-1 at best.

There's also an NYT article that was linked here two days ago, an AP story on medical devices, copy off the wire about a mass killing in Wisconsin, and good old Jim Schlosser with another column about the good old days.

The target demographic would seem to reside at Well-Spring.

Over time, the web will make paper pagination increasingly irrelevant. The web would seem important to the future of the enterprise. But when web-friendly readers write about what they'd like to see, they're told that paper readers have already spoken.

Message received.

I've thought for some time that video of high school sports, or even youth sports, could be an online sweet spot for local newspapers -- or new-wave competitors. In fact, I recommended it earlier this week to a propsective new online publication in Guilford County.

Inksniffer follows up the post I cited earlier with an attack plan for papers, including a HS video component. He says, "My point is that it's possible to take an internet innovation, understand its strength, see its vulnerability, attack it with its own tools and use the ones that we already have (our powerful geographically limited brand and print distribution channels) to start new businesses that make internet rivals worry about us for a change and can radically alter how sections of society regard what print is and can do."

If I may reiterate a point from an earlier post about our own local paper: It would make no huge difference in Landmark's overall numbers to cut profit margins for a while to merely solid rates of return, and to reinvest a few million bucks per year in product and product development,  but it would make a huge difference to the News & Record, and Greensboro, and the future of local journalism.

Too bad that ain't happening.

Fec's better half purchases a local online ad. Not with a newspaper. That's part of the reality facing the N&R.

Here's an argument that newspapers are making a mistake by going online; the post would be more compelling if it didn't ignore reader behavior.

One small good thing about the N&R debacle: I heard from Bill Morris, bon vivant and former columnist. He's holed up in a top-secret location, working on another novel...

Register here for "An Inside Look at the News & Record."

Scheduled to appear:

Robin Saul, President & Publisher

John Robinson, Editor

Doug Clark, Editorial Writer

Catherine Kernels, Advertising Director

Regina Howard-Glaspie, Circulation Director

This Friday at 11:30. Wish I could be there. Hope you will be.

JR writes his newspaper column about N&R layoffs and what's to come.

Jeff Jarvis lauds JR (prior to this column) for dealing with "the issues and emotion" around the layoffs.

Emotions, yes. Issues? Not so much.

Gerald Witt has some thoughts.

Related: DigiDave says journalists need to broaden their skillsets; Beau Dure wonders if it's worthwhile.

The Parent Company

The News & Record is owned by Landmark Communications of Norfolk, VA, a privately-held company.

According to Forbes, Landmark had 2005 revenues of $1.72 billion and well over 11,000 employees. In addition to the N&R, Landmark owns daily papers in Hampton Roads and Roanoke, VA, and more than 50 community papers in 15 states. In recent years, it hit a gusher with The Weather Channel, a very successful cable television venture, and related businesses.

Frank Batten Sr, head of the company's founding family (his son, Frank Jr, is now chairman and CEO) is listed on the Forbes 400 with net worth of $1.4 billion; he has reportedly given away some $220 million to educational institutions, including a recent gift of $100 million to UVA to found a public policy school with his name on it.

Local Operations

According to the S&P Register of Corporations, the News & Record had sales of $62 million for the latest year recorded, which year is not specified in the report.

The business operations of the News & Record, like any typical publishing operations, are run by the publisher -- NOT the editor. The publisher of the N&R is Robin Saul, who came to Greensboro in 2004 after serving in a similar role at one of Landmark's community papers in Maryland. He's a company man, sent by headquarters to run a local operation; the local operation seems to have enjoyed considerable autonomy over the years, as long as it continued sending rail-cars full of cash to Virginia on a regular basis, and there's the rub.

The newspaper business is under enormous pressure. The problems facing the N&R are not unique -- this is not about indviduals or editorial content and decision-making -- and until this week the N&R had seemed healthier in recent years than many of its peers across the country, in terms of employment and circulation.

Yet even with the very real challenges to the business model, newspaper industry profit margins have remained healthy when compared to margins for American businesses in general, which have averaged about 8.3% over the last quarter-century, with somewhat higher returns in the last couple of years. 

MarketWatch reported in early 2006, "Newspapers have profit margins that average between 20% and 30%."  Broadcasting & Cable reported in April that Tribune Co. papers have profit margins in the 20% range. Columbia Journalism Review writes, "In 2006, supposedly a disastrous year for newspapers, the average profit margins for the newspaper divisions of publicly traded publishing companies was 17.8 percent, according to the Merrill Lynch media analyst Lauren Rich Fine."

Some smart folks still like the business.

What to Do

It appears* that Landmark has chosen to chase its historic profit margins rather than investing in its Greensboro business for sustained product quality and long-term growth. That would seem to be a business decision made in Norfolk, and executed by Robin Saul according to Landmark strategy.   

I think it's a poor choice, and not just because I am pro-Greensboro and pro-quality journalism. As I wrote in late 2005 in the column linked above, "[I]f 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 similar argument is made here: "Twenty years of research have taught me that good journalism is good business, at least in the long run, and that a company can produce good journalism while still producing profit margins much higher than 10%. Perhaps the real myth is that public companies will continue to make 20% to 25% profit margins 25 years from now. But the current managers won't be running the companies in 25 years, which might affect which myths they cling to and which they dismiss."

The decision from Norfolk seems consistent with long-term policy. In my view, the local paper has made two strategic business mistakes in recent years that haunt it today. One, it ceded the free-weekly market to the Rhinoceros Times, starving its own low-budget Triad Style for several years before folding it into the big paper as a listings supplement.

And two, it underinvested in new media and product quality as the market began to change. Yes, it has been smart and forward-looking with blogs, and it made early attempts at becoming an online platform, but I haven't seen the kind of game-changing investments that show long-term emphasis and a deep understanding of the ways the business will continue to be transformed. Where's the meaningful local answer to Google and Craigslist? Where's the local online ad market, and the new-media counterattack on TV and radio?

If the N&R earns at the very low end of industry averages [update: JR says they don't make public-company margins, but I think this math still holds], and that $62 million revenue figure is close to accurate, Greensboro is sending somewhere north of $6 million a year to Norfolk. It would make no huge difference in Landmark's overall numbers to cut profit margins for a while to merely solid rates of return, and to reinvest a few million bucks per year in product and product development,  but it would make a huge difference to the News & Record, and Greensboro, and the future of local journalism.

Too bad that ain't happening.

*I have contributed an opinion column to the N&R for a decade, but have never been an employee, and can count the number of times I've been in the building. I have no inside knowledge of its business. I have no real financial stake in these decisions -- I'm grateful for the space they allot my opinion column, and it's done great things for me as a writer, but beyond any intangible benefits I lose money on it.

Changes ahead at the N&R, according to this post from John Robinson.

"Next week, we'll begin reinventing the paper. I respect the people who left here yesterday too much to suggest that things will be the same. We'll focus on what we can do well and what our audience values, and drop the rest."

NOTE: Numerous updates with details and commentary below.

N&R lays off a bunch of folks. No names or job descriptions in the initial report, which says 41 jobs have been eliminated.

Comments welcome from anyone with info (anonymous comments are possible; email me if you wish).

"The effectiveness of the newspaper's daily operations will not be jeopardized," [publisher Robin] Saul said. "We remain committed to providing both excellent journalism and the highest level of customer satisfaction."

Tough times in this business. Whether you love the local paper or loathe it, remember that the folks who lost their jobs are real people -- your neighbors. Let's show them a little respect and support.

UPDATE: I'm not going to post any names until I cross-check them, but one early email from an N&R staffer says:

There's a pretty sad air about the building right now. They used to always tout Landmark as the company that never lays people off, just gets rid of them through attrition. I guess that's out the window. A lot of people are angry about the way this was handled.

UPDATE II: N&R reporter: "A fucking bloodbath."

The newsroom tally is reportedly 11 fulltimers, 6 parttimers gone.

A well-placed source says, "Some newsroom reporters learned about the layoffs when they got calls from other newsrooms. I'm so angry. There are a lot of really good people that I'm not going to see in this office again."

Among the missing:

• Eric Dyer, a high-profile former Raleigh reporter who is said to have spent his own money to follow the Edwards '04 campaign when the N&R wouldn't pay for travel. My source says, "So much for loyalty."
• Maria Johnson, a well-regarded feature writer.
• Tom Taylor, who just recently began a B1 advice column.
• Monica Chen, a reporter in the High Point bureau who started just days ago.

A reporter says, "The reputation was, we don't do layoffs, we do attrition and hiring freezes. At the end of the day, I thought we were better than publicly-traded companies, but we're not. [Landmark honcho Frank] Batten just made a $100 million gift to UVA, I guess with profit margins down he couldn't afford $200 million."

"There is a lot anger right in this newsroom. [Editor John Robinson] has known this was coming for a long time."

"I don't think anyone believes this is the end of it. [Robinson] said it was, but when pressed he said for now it is. I know what that means -- I'd better polish my resume."

UPDATE III: Other reported layoffs include staffers from the library and copy desk, photo staff, and sports and news designers. Not sure if I should report names of people who were not bylined in the paper, so I'll hold off on that for now.

I'm hearing a lot of anger directed toward JR, and that's inevitable given the situation, but I feel horrible for him, too. This cannot be easy for him, and the nature of the publishing business is that he works for the money guys, and they call the tune on staffing levels.

UPDATE IV: A very brief blog post by John Robinson, who promises more to come.

UPDATE V: A source close to the situation says:

I don't think someone who hasn't worked at the paper every day recently understands how bad things are getting.

I agree with you that today must have sucked for JR. He's a good man, and I feel for him. But most reporters at the paper, or at least my young friends, were demoralized well before today by management's incapability to do the things on the Web site they've been talking about for years. Demoralized by the Wray coverage, which hurt our credibility -- not necessarily because it was wrong, but because Lorraine never should have gotten a single byline on it (appearances, unfortunately, matter). And demoralized by continued attrition, which was really hurting the quality of the paper. Today was just the slathering of a whole hell of a lot of icing on the cake.

There seems to be no game plan from the newsroom bosses on how to make the localized Records publications work. Nor were those publications born out of any real desire for community journalism; they exist entirely to cut costs and to squeeze more ad revenue out of areas the paper hadn't mined in a while. It is a hideous mess.

UPDATE VI: Another name reportedly on the layoff list: Jonelle Davis -- a fairly new reporter in Rockingham.

Don't know what that means for coverage of our neighboring county.

I'm hearing concerns that the layoffs, which seem to have tended toward newer hires, have diminished diversity on the staff.

UPDATE VII: An N&R staffer writes:

As I've had a little more time to think about the effect all of this is going to have on the newsroom, trying to set aside the sadness of losing people I enjoyed working alongside, I can't see a way that we can overcome this. The news staff had already been cut bone-thin from attrition. Now we lose five more boots-on-the-ground people (four writers and a photog) at a time when we're already struggling to fill the paper. Particularly affected are our bureaus. We're left with one main-sheet reporter each in Rockingham and High Point. We'd been limping along in High Point with one reporter for a while and the result hasn't been great. In Rockingham we have a weekly, advertising driven community news pre-print section that must be filled. So if we've only got one reporter up there, can he even have time to do anything substantive? Or do they move someone from an already anemic Greensboro staff to help? Well, you get my point.

I seriously worry that this is the beginning of our suicide spiral. That so far we've been the depressed kid cutting our arms to see what happens while managing to miss our arteries.

UPDATE VIII: Friday June 8. The N&R print edition covers the layoffs at the paper by running the same detail-free press release from the publisher it put on line yesterday.

Lots of emails from staffers and former staffers overnight, into the wee small hours of the morning. Thanks for the info, and for your trust.

A reminder: I have contributed an opinion column to the N&R for a decade, but have never been an employee, and can count the number of times I've been in the building. I know a lot more people there than I used to, in some part because the web has helped open the place up, but my comments are coming from a wide range of staffers and ex-staffers.

UPDATE IX: The view from the sports desk.

UPDATE X: John Robinson writes, "Next week, we'll begin reinventing the paper. I respect the people who left here yesterday too much to suggest that things will be the same. We'll focus on what we can do well and what our audience values, and drop the rest."