A beholden press is a bad press
Here’s how bad things are in the newspaper industry these days: A journalism professor (and former New York Times reporter) is making a straight-faced suggestion that newspaper owners be allowed to engage in anti-competitive practices so that consumers can be forced to pay for access to newspaper web sites.
That move, of course, would require the sort of collusion among competitors that has long been illegal, not to mention unethical and — depending on your level of stridency — immoral. No matter. The newspaper business is too important to be hampered by such minor considerations. The author actually said that. His exact words:
[A] healthy newspaper industry could not be more central to the public interest. A democracy cannot function without an assertive news media.
A cynic might point out that protecting Americans from terrorism is likewise “central to the public interest,” but that hasn’t stopped newspapers from condemning the Bush administration’s extra-legal efforts to do so. Good thing I’m not a cynic. Otherwise I might spot all kinds of hypocrisy in this proposal.
Instead, I’ll cite two other points to make the case against this wretched idea. First, asking the federal government to grant newspaper owners an antitrust exemption so that it can collude to set prices for online access only makes the industry even more beholden to the very people it’s supposed to cover. (Remember, the industry has for years enjoyed joint operating agreements in some cities, which allows “competing” newspapers to collude financially to lock up their markets.) No newspaper operating under a federally bestowed gift of antitrust immunity would have the moral standing to comment on issues like the much-debated federal bailout of the auto industry. Newspapers need to be apart from government, not dependent on it.
Second, propping up the newspaper industry through legal price-fixing only forestalls the inevitable. Yes, times are bad right now for newspapers. But a new business model eventually will emerge, and anything which delays its arrival will only extend the pain — not end it. Besides, welfare is as hard to shake as any addiction. Even after the hard times pass, I can’t see newspapers willingly giving up their government-approved monopolies.
If the industry doesn’t have the backbone and integrity to refuse ill-gotten gain today, why would it do so later?
December 23rd, 2008 at 8:28 am
If you are making and selling a product, the basic form of which has not changed since it was delivered by horse-drawn wagon, you should count yourself lucky to have been in business that long.
The biggest newspaper expense is printing on and physical delivery of dead trees. By continuing to do this they are their own worst competition for their web sites. The first paper to figure this out and go entirely on line will rule the world. Let’s face it, a lot of people get the paper for the Sunday coupons. Put those on line and your web ad revenue will skyrocket.
Also, they should quit trying to cover the national news. That’s available in too many places. Stick to local coverage that no other outlet will provide. I suppose it might hurt their image of self importance to be a “local” but so will going out of business.
Of course the N&O botched the two biggest local stories in years. They spent a considerable amount of time as a cheerleader for Mike Nifong before they FINALLY got Joe Neff on the story to straighten it out. But the damage was done. I still meet people who believed the hysterical early coverage and think the three accused lacrosse players got away with something. More recently, they ignored the John Edwards infidelity story until everyone was laughing at them for sticking their fingers in their ears and going “la la la la”. If they could actually get the news right, they might have more subscribers.
Finally, I’ll add that the newspaper business is an ecological disaster. Think of the number of trees sacrificed for newsprint and the amount of gas required to ship around the various forms of those dead trees. I wonder how much the City of Raleigh recycling trucks cost to operate? I’m sure it’s more than the value of the newsprint they’re collecting. I snicker every time the N&O runs articles about the bad ecological practices of OTHER industries.
December 23rd, 2008 at 10:17 am
Sorry Dan, this is a bit off topic. But, I just slogged through some of the past comments that got pretty personal and ugly and I just want to say “I love you Debrah, Will you marry me?”
Merry Christmas to all!
December 23rd, 2008 at 10:27 am
Although I, too, cringe at not choosing the best way to be green while reading local news, I’ll be one of the last hold-outs in getting my paper at home. There’s just something comforting about curling up on the couch at the end of the day with my newspaper. I don’t get that same lovey-dovey feeling from my laptop.
While Joel Brinkley’s solution may have its issues, you can’t fault him for sharing it. Like any brainstorm, there will be bad ideas, but that’s how we weed them out to get to the good. Maybe his column will spark an idea for the next person and THAT idea could be better, etc.
This reminds me of renewing my N&O subscription this year: I usually do it at the fair, and this year while talking to the sales guy, he kept asking if my husband or I were students or in some way related to academia. We said no, and decided to hold off on renewing that day. A few weeks ago at Kroger I finally got around to doing it when they had a salesman in the store, and he was pushing the academia link, as well. I finally realized that maybe I do fit that description as a freelancer for N.C. State–he jumped on it. I got my subscription for half price! Long story short (too late?): it seems like they’re looking for any loophole to get subscribers. I can’t say I blame them. And I definitely appreciate the half-price rate.
December 23rd, 2008 at 10:31 am
Locomotive Breath,
I make no excuses, nor present any defense for the practices of the N&O or the newspaper business at large. However, your argument overly simplifies a very complex quandary. The basic product of a newspaper is the news contained within which most should agree remains valuable even today. However, due to the long standing practice of advertisers paying the majority of the cost to provide any form of coverage, most people are less than willing to pay more than 50 cents a day for it. The challenge is to figure out how to produce sufficient revenue to support the news gathering and reporting process. Online coupons are not the answer — why would anyone go to newspaper websites to get coupons?
Not to mention your first point is completely wrong. The biggest newspaper expense is same #1 expense of just about every business — the labor that goes into producing the product (even if you backed out employees who deal with delivery of the printed product).
The fact is that even today most (if not all) in-depth coverage of any substantial matter originates in a newspaper environment. Other media outlets routinely rely on newspaper coverage as a starting point for their reporting. If all papers quit providing national coverage, there would be less national coverage and less eyes on those running our nation (public and private). The loss of a body of professional journalists currently employed by newspapers which still generate the lion’s share of their revenue from print would be harmful to our democracy.
Frankly, I agree with Dan. Eventually, a new, workable and sustainable model will one day emerge and the government should not engage in the business of propping up another losing business plan. In this context, I will concede your point — the first paper (they will also have to figure what to call themselves) that figures out how to derive sufficient revenue to support quality journalism from a totally on-line venture should secure a wealthy future. However, your suggestions will NOT pay the bills. If it were that simple, someone would already be doing it.
December 23rd, 2008 at 10:50 am
As a tech/information services worker for over twenty years I find the Web to be a wonderful method of delivering news, information, and entertainment, assuming the reader is smart enough to weed through the dreck. However, the one thing the Web can’t deliver is the portability and readability of a print newspaper. Yes we now can get the Web via iPhone and ebooks, but they still can’t compare with print for readability. As much of a techie as I am I can’t imagine sitting with an electronic widget to read the news and funnies over morning coffee.
The newspaper industry has largely been its own worst enemy. The 80s and 90s orgy of buying up competitors and creating media empires has come back to bite them on the butt, and the idea that every newspaper needed national and foreign correspondants while largely ignoring local news helped them commit suicide. If the N&O folds I will really miss my morning paper, but it will be satisfying to see some of the hacks, editors, and upper management out looking for jobs. Most of the good people at the N&O were laid off long ago anyway.
December 23rd, 2008 at 11:01 am
“Online coupons are not the answer — why would anyone go to newspaper websites to get coupons?”
For the same reason they subscribe to a print newspaper. I know plenty of people who go for those sale inserts first thing Sunday morning. And the ad revenue for those inserts is a huge fraction of the total ad revenue for the week. They must be working or the advertisers wouldn’t be putting them in there.
“the labor that goes into producing the product (even if you backed out employees who deal with delivery of the printed product)”
It’s not just the delivery cost. Now back out to the employees who deal with making the printed product. And the capital cost of the printing press. And the capital cost of the building to house them. And the capital cost of the energy to run the presses and the building lighting and HVAC. And the cost of ink and newsprint. And so on. Do all that and you’re down to reporters, servers in a closet and some IT people.
“If it were that simple, someone would already be doing it.”
Not necessarily. Let’s face it. Newspapers are in denial and want to stick to their outmoded business model. The one thing that’s sure not to work is what they’re doing now. They will be gone soon unless someone takes the risk.
As far as curling up with the printed newspaper, well, I really enjoy riding a horse too. But it’s no longer practical.
December 23rd, 2008 at 1:46 pm
I know there are people who get the paper for the coupons. My point was that a consumer wouldn’t have a need to go to the paper’s web site to get coupons when they could go (and actually already do) to the coupon manufacturers’ sites.
If you back out all the expenses you mention, you would still be very far underwater with labor costs. Reporters and don’t work for free and all those servers cost money too. Believe it or not but the small amount of revenue that papers get for subscription and single copy sales covers most of what you mention.
Newspapers may be in denial but if it were as simple as you claim, someone else (from outside the traditional news business) would have already eaten their lunch.
December 23rd, 2008 at 4:39 pm
“would have already eaten their lunch”
Err…their lunch has ALREADY been eaten. That’s why they’re going broke.
December 23rd, 2008 at 6:41 pm
I still love my paper delivered. I love walking with my dog each morning to get it from its little box at the end of the driveway. I love sitting up in bed with my coffee and reading it (seems like it used to take longer, but oh well), and I love snuggling down to do the crossword against my pillows and falling asleep with the pen in my fingers and a big ink stain spreading on my pillowcase.
I’m going to miss it when it’s gone.