Sunday, December 21, 2008
Friday, December 19, 2008
Much attention was drawn this week to a report by Lauren Rich Fine -- yes, that Lauren Rich Fine, the former leading analyst of newspaper stocks -- on how much Web traffic it would take for news Web sites to survive as Web-only news sites. As Advertising Age reported, "'Based on our research, the conversation [with advertisers] gets interesting at 200 million page views plus a month, but much more so around 800 million,' Ms. Fine writes. Those ambitious numbers, she continues, show how hard it is for local news sites to be really profitable, and underscore 'why local papers will have trouble offsetting traditional media declines' with revenue from their websites."
Yes, these are national news-oriented sites, not the Wyoming Tribune-Eagle, so we're not talking about what it would take for a typical American newspaper to survive as a Web-oriented operation; that's problem 1. Yes, her mix was of sites such as the Drudge Report and Daily Kos as well as CNN and Google News. Thus problem 2: What is the definition of a news Web site? Daily Kos does not link to or comment on train wrecks -- well, except for the McCain-Palin campaign. Lauren's definition seems to be "any site that comments or reports on national public affairs."
This is what drew attention, of course: "The report also looks at whether the Times could ever succeed as a web-only product, and concludes that it could -- once NYT.com starts generating 1.3 billion page views a month. By Ms. Fine's back-of-the-envelope calculations, that kind of traffic would bring in $300 million in quarterly advertising revenues, about what the flagship paper is expected to generate in the fourth quarter."
The story then notes: "The Times' site had 173 million page views in October, according to ComScore Media Metrix."
Yes, that would be 1.1 billion page views short. Billions and billions of views, as Carl Sagan would have said. I know nothing about blogger Randall C. Bennett other than his response:
"Apparently AOL News and Yahoo News get over a billion pageviews. A billion. That’s simply insane. I can’t imagine a billion page views. Not to mention that at that sort of scale, your audience had gotta be largely international, so global brands would only be interested."
By the way, in September 2007, which was not the month before the most-followed election in recent American history but was directly after the end of the pay-for-opinion Times Select program, the Times reported 181 million monthly page views. That would be 8 million more than a year later. That would be problem 3.
"If anyone's positioned to have online [growth] offset pressure on print advertising, it's the New York Times or the Wall Street Journal," said Mike Simonton, a media analyst at Fitch Ratings, to Ad Age. "But they're years behind that pace."
Clearly that 1.1. billion goal is within each reach once we can develop a method of counting every page view 10 times. Perhaps, as with circulation, every page view can be assumed to have 10 passalong readers. "I was in McDonald's and I saw the Times Web page lying on a table, so I read it." That pot of gold is out there, though, and Prester John has it, and once we find him...
But wait, the L.A. Times editor says LAT website revenue now exceeds paper's editorial payroll costs, according to the Romenesko headline. Wow! We're saved. Wait. Russ Stanton actually said: "Stanton said the Times' Web site revenue now exceeds its editorial payroll costs." OK, copy editors: What is the antecedent of "its"? This was posted by David Westphal at the Annenberg School of Communication, who is a careful enough writer that I assume he simply needed a copy editor to make it "Times' Web site's" to show that this is the editorial payroll costs of the Web site of the Los Angeles Times, not the editorial payroll of the Los Angeles Times. Otherwise, of course, you would kill the print Times tomorrow. According to an online staff roster of the Los Angeles Times, this unit consists of 46 people. The total surviving editorial staff of the Los Angeles Times would be somewhere around 650 to 700 people. In other words, the ratio of online staff to total editorial staff in the same order of magnitude as the current page views of the New York Times vs. the number of page views the New York Times would have to have to support the editorial staff of the New York Times.
But that Internet pot of gold... It's out there! El Dorado!
Wednesday, December 17, 2008
The problem with blogging is that it becomes permanent. You think, will I be disappointing my one consistent reader? Will I cease to exist? If I do not have a voice in the electronic conversation, do I even matter anymore?
It ends up not being a matter of whether anyone pays attention or whether you have anything to say. You end up scared that without it you will simply be -- well, nobody.
Isn't this the genius of social networking? You exist for others to see you. Because I did not know if anyone was paying attention, I figured people were paying attention. Occasionally a reader engaged in conversation, but mostly it was: Here's what I think. I did not need an excuse. I could simply tell anyone what I thought, because I wanted to. There was no need for a nut graf.
I thought I knew a good bit about the history of newspapers, and the history of the department-store business, and it might be entertaining to write about how they were joined at the hip. And I thought that a lot being said about the Web was like tracts for the Harmony Society in the 1800s; through this, we will free humanity from shackles and change its nature. And I thought that people who believed in the Web were more apt to write on the Web than print people were. And I felt that Americans, who pay little attention to the rest of the world, would be unaware of what print newspapers were doing to succeed in other countries. And I just found Jeff Jarvis annoying.
And I thought that maybe I could give someone else's voice a little more strength, and at least the argument could be more balanced, and possibly more courteous. I read the blogs of many online journalism prophets and wondered how they kept from exploding from their own disdain for the larger fraction of humanity that didn't get it. And so I wrote, as a person who loves print newspapers, who wanted them to have a future. No matter what you think, on the Web there's someone like you. You need never feel alone. And feeling alone is feeling disempowered. There were others. So I hoped, and I wrote.
And then, like many a blogger before me, I am sure, I fell in love with my own thoughts. I came pretty near exploding myself. I stopped thinking about clever comparisons with department stores and started thinking about how everyone else had made mistakes. But I was on a roll. I had lunch with Juan Antonio Giner. Jay Rosen trashed me. Jay Rosen took the freaking time to trash ME? Life was good.
And then came the economic collapse of 2008, and it suddenly no longer mattered what the future might have been or what had happened in the past. The present was here like the water at Johnstown, and it was sweeping away anything that it encountered that was not built like the Methodist Church, which withstood the great flood. And all you could do was figure out how you would survive in the world it left behind.
Ward Bushee of the San Francisco Chronicle gave a long and educational interview with KQED in which he said, the ad money is not there on the Internet and it is no longer there in print and some of the answer has to be to charge the readers more of what it actually costs, not to deliver the newspaper, but to produce the news -- both in print and online. He is hopeful for print newspapers, saying the demographic in San Francisco is suited for what they offer. Peter Osnos at the Century Foundation is among those who don't see that future, but his view of providing news lines up with Bushee's in many ways: "Reestablish the principle that news has to be paid for by someone: the consumer, the advertiser, or the distributor." And so the era of everything-free online is probably going to come to a close.
But the news from Detroit and the Gannassacre indicate to me: The towel is being thrown in on print, that malnourished cow now on its way to the stockyard. Life magazine had millions of readers when it closed in 1976 (CORRECTION: 1972, thanks). Many department stores had thousands of loyal shoppers when they closed. The cost of producing and maintaining the product exceeds what people are willing to pay for it. That is clearly the point of the Detroit cuts. So you butcher it.
At the same time, despite the opprobrium heaped on them, most leaders in the newspaper business have been loyal until now to their print products. Even Gannett. They may have been incompetent, they may have ignored what their customers wanted, or been huge disappointments to their staffs, but few were actually malign, out to purposefully destroy what they had been given. (Let us not speak ill of the dead, the recently departed Journal Register chairman.) Some have indeed damaged their businesses for the long term to maintain that wonderful product we call the newspaper. They tried poorly, but they did try. And given a few more years of graceful decline they might have figured out how to give it a real future. The financial collapse has taken that away. Now is panic. Now is the realization that the customers who love your product don't love it enough to pay the actual cost of producing it, and no one seems interested in underwriting it anymore. Well, screw them, then.
One thing blogging teaches you, alas, is how little you know. Newspapers and department stores, up until the 1960s, did well because many of their customers believed that institutions knew more than individuals did. Department stores didn't stop being "the first with the best" overnight; but the categories of things to be first in kept multiplying beyond every boundary, until no one could claim that title; and once the department store was no better than Old Navy, why put up with its hassles?
Newspapers and department stores have conventions they can't overcome; the newspaper, by its nature, has to make everything a story, but a "news story" worked when there was a start and an end to the news, and it has to have certain phrases ("although statistics are hard to come by, it seems clear that more and more...") to justify itself and its placement, as opposed to simply: I wanted to write about this. The Daily Beast has no such requirement. It does not speak for what it sees as the interest of its community; it creates its own community. And both it and the department store bundle together lots of items; a useful strategy when things are hard to get, a financial drag when things are overabundant.
It was when the sportswriters, after Buzz Bissinger attacked bloggers, responded by saying that unlike bloggers they had access to the coaches and athletes and could ask them questions, and many sports fans responded: "Who cares? I don't care what the coaches and athletes think. I care what other fans think of them" -- that it really struck me that the journalistic problem (as opposed to the ad problem) is that a newspaper is an institution in an individual age. A newspaper spoke to and quoted and explained the voices of authority, it was a voice of authority itself, trying to set rules under which authority could legitimately operate; and we live in a world where authority is always understood to be simply covering its own ass, the same as all the rest of us. Yes, there is still authority, but I will pick my own.
Authority is the programming directors of the networks; perhaps the 21st century role will be whoever decides what is promoted on Hulu. Between them lies the chaos of YouTube. Newspapers have no idea how to write about what appears on YouTube because there is no one person to talk to, no Fred Silverman or Grant Tinker. There is no strategy such as Appointment Television. It all just is. So newspapers write one more time about the network news shows, which they understand. They have spokesmen. Newspapers don't know how to write about Achmed the Dead Terrorist, because he isn't introduced on a press junket. Is he significant? Is he puerile? He just is. But there is no thesis and antithesis to report, so there is no story, and the world newspapers cover becomes increasingly detached from the worlds people live in. Fifty years ago, the world newspapers covered was the world most people lived in. There were fewer worlds. Gene Roberts famously said newspapers should cover stories that ooze out instead of being announced; but that was before everyone could ooze.
This blog has kept me up nights; it has made me obsessive; it has led me to neglect other responsibilities. I truly love few things in life: My wife, our son, my mother, my in-laws and their family; modern architecture of the 1890s through 1930s; the lore of department stores; the memories of time with people who were my friends and lovers when I was young; and print newspapers. After my wife, son and mother, newspapers take pride of place.
I consider myself a good journalist, but I love working in the newspaper business. What I wanted to do in life was to put together newspapers. I care about the placement of folio lines and lift markers. I love the nuance of a headline that conveys in four words the subtlety of a 20-inch story. I have always drooled over newspapers that did the typography of the masthead with panache and held in contempt those that clearly had just kicked something out. Let others tell stories; I would start the presses. When I held that product in my hands, whether it was the New York Times or the wonderfully named Cadillac Evening News when it was a morning newspaper, I felt: Here is what I know. Here is what I understand. Here is what I can make better. This is a weird, wonderful world, and it is what I do. Boy, am I lucky.
But I have become a sounding brass or a tinkling cymbal. It is time to be quieter, to write about department store history -- which I actually have original research on. To write about copy editing, probably. But to raise a voice to say that the print newspaper is not simply paper on which to publish stories, but is a product that carries its own meaning, that creates and binds a community, that gives it a history and a direction, that says that the real world is bigger than the worlds we build for ourselves? Given time and money, we could find a future for it. But time is not on its side when there is no revenue.
I have been looking at a copy of the 1976 Editor & Publisher Market Guide. It is the newspaper world that I entered nearly 35 years ago. "An Offset Newspaper With Over 25,000 Circulation!" That was in Olean, N.Y. "The Money Tree: Looking for choice pickings? Look no further than Bristol. ... Make your sale in Bristol with The Bristol Press." That in Connecticut, at a paper that will probably close next month. "Hawaii Has Many Faces... And One Advertising Buy Reaches Them All." The former Honolulu JOA. It was a great world that I was fortunate to be part of, and it is ending too soon for me. But I expect people said the same thing about vaudeville.
Tuesday, December 16, 2008
The Detroit newspapers' decision to limit home delivery to three days a week -- well, someone had to test it. Read the link above to Alan Mutter's comments first, and then:
The decision is presented as a way to keep both newspapers. Obviously that consideration does not apply as much in Denver. And Detroit is not the most obvious test market for revolutionary ideas; the area is in semi-permanent depression and is not, say, Seattle or San Francisco in terms of income or educational levels. Did Dean Singleton, owner of the smaller of the two papers, refuse to blink when Gannett wanted, the way Scripps blinked for him in Denver? (Or did he assume Gannett would blink as well?) Is there a provision of the Detroit JOA -- which was, I think, the last one ever created -- that says that both papers have to actually publish in some relationship to each other, to avoid a situation like the St. Louis JOA where Newhouse continued to take its share of the profits for years even though the Globe-Democrat was long gone? Or a tie-in to the legal fiction of the time that the Free Press was the "failing" newspaper? In other words, why not simply publish a joint masthead product seven days a week, or close the News? There has to be more than just a way to cut costs; there are simpler ways to do so.
When Knight Ridder did its famous Boca Raton project, it was in part because the Boca News was so small it made no material difference if the paper lived or died. No one would have risked the franchise in Macon or Duluth on a risky makeover. Is this both companies saying, so what if it doesn't work, we don't care about Detroit anyway, we're stuck with a losing hand?
Did the value of Journal Register's three suburban dailies -- the Oakland Press, Royal Oak Tribune and Macomb Daily -- just go up, after being blamed for basically bankrupting the company? People who want a daily paper on paper can go elsewhere in Macomb, Oakland, Livingston, Washtenaw and Monroe Counties -- at least for now. The only county without a daily print home-delivered newspaper will be Wayne County -- Detroit itself, Dearborn, the Pointes, and the autoworker suburbs known as Western Wayne. Of these, it's only hard to imagine the people in the Pointes having enough clout and money to make someone want to serve that market. But that may be outdated thinking.
Things doubtless aren't what they once were at the Free Press, but the paper once was famous for having half of its circulation outside metro Detroit. It was the morning paper for all of Michigan, all the way up to Marquette. As Mutter noted, the papers still have a large outstate circulation. This has to be good news for the Flint Journal and the Lansing State Journal and the Port Huron Times Herald as well. Oh, gee, Gannett owns Lansing and Port Huron and Howell.
The definition of a daily newspaper has long been "printed four or more days a week." What does this do to the entry classifications of local and regional journalism contests? Since the Grand Rapids Press will continue to publish in print seven days a week, at least for today, does this mean the Press can argue that the Detroit papers no longer qualify for the state press association and SPJ awards? (CLARIFICATION: Yes, I knew the Detroit papers say they will still print for newsstand sales only. How long will that last or be sustainable? In any event, if you average circulation across seven days, it won't be the same size category.)
What now qualifies one to be included in the Editor & Publisher International Year Book? If it is simply "a news site updated daily," then Talking Points Memo should be included. This probably means there is no longer any point to the Editor & Publisher International Year Book, but that in a way would mean there was no longer any such thing as the newspaper industry as separate from the information business -- but yet, there is such a thing. Talking Points Memo doesn't even run the press three times a week. Is the qualification going to be "distributes something in print at least once a week"?
As Mutter quotes newspaper production analyst Alan Flaherty: "I wonder if there's some kind of a tug-of-war between Gannett and MediaNews playing out behind the scenes.” Yeah, I do too. Good cases make bad law.
Monday, December 15, 2008
The Zeltdown leads Jon Fine to speculate on a newspaper industry with concentrated ownership. Quoting an unnamed executive: "You're going to see a big wave of consolidation that will be forced on the industry." Said another: "We're going to end up with one big, giant merger, facilitated in bank negotiations."
In other words, Associated+Allied+Federated+May+Carter Hawley Hale+Dayton Hudson+Marshall Field=Macy's Everywhere, but in newspaper terms? "Fill-in-the-blank Today" as your local newspaper, with lots of centralized back-office operations and some local reporters as the equivalent of your local manager and sales staff?
The department store industry started as the newspaper industry did: Mostly locally owned stores, but with the occasional national chain (a la Hearst and Scripps-Howard) or local tandem. As families got tired of running stores that required ever-increasing amounts of capital to compete, once you got out of the late 1930s-to-late-1960s world of enforced stability followed by incredible prosperity, they either closed down or sold -- to the owner of a nearby store they knew, or to a major corporation. Again, like the newspaper business.
These companies then found themselves running a plethora of regional brands and devoting a huge amount of effort to re-creating the wheel -- separate price tags, separate management structures, separate billing offices -- so they started to consolidate brands -- a concept that has come late to the newspaper business, where re-creating everything city by city has been almost sacrosanct until now. An L.S. Ayres would take over Wolf & Dessauer in Fort Wayne and Kaufman-Straus in Louisville; then you only needed one division manager instead of three, one set of shopping bags, one warehousing department. Shoppers in Fort Wayne and Louisville missed their local store; you lost market share, but you were losing it anyway. The question was whether you had cut your costs enough to compensate for lost market share.
Eventually, you had to do it again and again. The local department-store business -- a Famous-Barr competing with a Stix Baer competing with a Vandervoort's (St. Louis, for those who don't recognize the names) -- became a business of Macy's competing with Penney's competing with Wal-mart competing with Kohl's. There was still a place for the traditional department store as a store; but it was a smaller place for a national brand or a regional chain, a Boscov's or Bon-Ton, maintaining a precarious toehold. In the old days, the department store was the only place that sold everything. Now you could get TVs at the grocery and groceries at Target. Also, the department store business did not attract the entrepreneurial personality as it once had, the larger-than-life figure who had made the local store into part of the city's DNA.
The Internet is a national (or international) distribution model, but taking print as the bricks-and-mortar Barnes & Noble, the Web as Amazon, and assuming that there is room for both to stay in business -- well, there probably is, but not for the traditional local merchant such as Robin's Books in Philadelphia. The cost to compete is too high. And Barnes & Noble will never be as mindlessly profitable as it could have been before the Web enabled Amazon.
Which is to say that part of the reason for the Great Macyization is that the third-generation ownership that characterized many department stores in their later years were quite content to mind the store when things were good, but when things were bad, they cashed in. (Contrast this with Al Boscov, who in his late 70s put his life and fortune on the line to save his family's stores. But then again, it was he who created the modern Boscov's business. He is in many ways the first-generation owner in the manner of Marshall Field, or the inspired enterpreneur such as Fred Lazarus.)
Which leads to a post by Salon cofounder Scott Rosenberg noting that the great newspaper families weren't always everything they were cracked up to be. Newspaper people mythologize the Binghams, Otis Chandler, Jack Knight; yet they were always the exception, just as a Max Hess Jr., who made Hess's in Allentown into a nationally respected store, stood out among the Clelands and Bowmans and Stearnses who operated locally dominant department stores, yet were simply content, once they had the leading store in town, to operate the leading store in town until that became too hard and their own children lost interest in the idea. They did a good job, but they were minders, not creators. The Bancrofts' El Foldo to Rupert Murdoch -- was their ever a family ownership more benign than the Bancrofts at the Journal? Just keep the money coming in, and we'll let you publish whatever you want. Whoops, here's a guy with more money who is going to completely destroy the newspaper you have known (even if he replaces it with something respectable). See ya.
In the Indiana in which I grew up, the Crittenbergers, Rileys, Bradfutes, Bosses, Foellingers, Snyders, Marshalls, Harrises -- all were families that owned local newspapers. People may have fond memories of working for them, but they are not mentioned in the same breadth as William Allen White or Joseph Pulitzer. Other papers were owned by consortiums of local businessmen, as in New Albany, or by chains smallish (the Weils' Federated Publications) or largish (Scripps-Howard, Central Newspapers). Dick Neal in Noblesville published a great smalltown newspaper. Families such as the Nixons, Schurzes and Browns still do honorable work after generations.
But every family gets to the point of saying -- do we run a local institution, or is this a business and we will sell it for what we can get? If we hold on too long, do we just watch it run itself into the ground, and our fortunes with it? The Latzes in Fort Wayne sold W&Ds to City Stores; the Ayres and Block families in Indianapolis found ready buyers in national chains. The other myriad small department store-owning families -- the Levines and Ziesels and Weilers and Carstenses -- held on until the cost of competing with the mall became too high, and there was little point anyway because the grandchildren had no interest in running a department store. At that point they closed down and tried to cash in on the real estate. OK for them, or not; bad for their employees, who believed that the White House or the Boston Store had been there forever and thus would be there forever.
But until the 1930s, the history of department stores and newspapers is of businesses opening and closing with great regularity. From the 1930s to the mid-1960s, greater stability prevailed. Since the 1960s, relative decline in both industries -- because of other media or stores opening and closing with great regularity. Is our thinking still held prisoner by the 1940s and 1950s, decades which look increasingly as if they were the exception, and not the rule we still think of them as? Did department stores and newspapers become institutions, rather than simply well-liked businesses, simply because there were two decades (the 1930s and 1940s) when it was nearly impossible for new competitors to challenge them, because of depression and war? It will be interesting to see if the Great Macyization, which has contributed to newspapers' financial hell, will cause a Great Somethingization in newspapers as well. What emerges may well be a viable business; it will probably have little romance, however.
Tuesday, December 9, 2008
Sam Zell couldn't win. People said newspapers were out of date, so he told his editors to try to make them connect better with younger and occasional readers, and for that he was pilloried. People said newspapers were caught up in their past glories, and he told them to stop living in the past, and for that he was pilloried. People who say newspapers are dead sneered at him for saying he could revive them, and people who believe in newspapers sneered at him because he didn't treat them with sufficient respect.
This is a different question than the ethics of Sam's being given Tribune employees' retirement funds by an ownership desperate to cash out, and then using those funds to try to enrich himself. Bankruptcy will probably trim Sam's total profit off this deal, but he'll doubtless walk away with money that his employees in essence forfeited.
But why did Sam's efforts to remake newspapers draw such outsize derision -- more than is given to Gannett's layoff this month of 2,000 people, or the impending destruction of the Minneapolis Star Tribune by people who also overpaid, or the withering away of JRC and Gatehouse, or... or... Let Roger Ebert tell it, parenthetical matter mine:
"At least it can be said that Lord Black [who looted the Sun-Times and many other newspapers around the world to line his own pocket] was a newspaperman with taste, and a gifted writer. ... There is no evidence [Zell] had other than a financial interest in his purchase. He has discussed condos in Tribune Tower, the sale of the name of Wrigley Field as a corporate naming opportunity, and other ways to milk his mortgaged cow. ... Under Zell its current leadership 'team' includes a onetime radio promotion manager [Lee Abrams] who writes memos so badly the staff passes them around for a laugh. Zell recently observed that no paper ever made money because of its Pulitzers. I would add that no paper ever made money because of its putzes, which Zell has proven. The lesson here is that journalists create newspapers, and their owners should be in sympathy with that purpose. Sam Zell made his purchase because he wanted to make money."
As opposed to Avista Capital Partners, or Gannett, or Dean Singleton, or the Alabama public pension fund, or the investors in the Philadelphia papers? Other than his financial missteps, Sam made three mistakes. He openly dissed a journalist in a public meeting when she started talking about the Higher Calling, using a word that we say almost hourly in the newsroom but do not expect our publishers to say to us. He brought in a radio guy (Radio!) to tell newspaper people what to do. And he didn't simply start by buying the Allentown Morning Call and the Newport News Daily Press -- nice papers, but nothing more. He bought two of the most iconic names in the business, papers that had set the standard for the industry -- the Chicago Tribune and the Los Angeles Times -- and treated them as if they were the same as the Allentown Call and the Newport News Press.
Of these, probably his biggest mistake was his creative officer, Lee Abrams, who by newspaper standards simply could not write. He wrote all-caps growling memos in which he had some good ideas, some mediocre ideas, and some pap. He did not write the usual journalistic report or memo which contains some good ideas, some mediocre ideas, and some pap. Few read his ideas, because they COULDN'T GET PAST his WORDS... his punctuation and his HIGH FIVING MANNER... yeah, baby! Admittedly Abrams' lack of understanding of what a foreign dateline meant busted him among journalists. Journalists also should have asked themselves if the typical reader shared Abrams' lack of understanding, or at least of attention. But these guys came across as characters from "Glengarry Glen Ross." We did not want them seated at our table.
Sam probably could have been hailed as the savior of the newspaper business if he had told his newsroom that his aim was to again make the Chicago Tribune "The World's Greatest Newspaper," to restore the L.A. Times of yore, and had turned to an eminence grise -- bringing back a John Carroll, say -- for cover while he did the same things to Orlando, Fort Lauderdale, etc. that he did. He could have said he wanted to end Tribune Co.'s micromanagement, which he did do, but could have said he wanted to do so simply to enable good journalism, while at the same time still selling Newsday to a cable-TV company (the relative lack of criticism for this deal shows that almost no one grew up dreaming of working for Newsday). He could have bowed before the house gods, established his cred, while sending Abrams off on quiet tours of the provinces. A year later, based on research done there, changes would have been made to the Chicago Tribune. Would it have staved off bankruptcy? Probably not. But he would have been hailed as a titan who tried to save newspapers, instead of a buffoon.
Zell was Tony Ridder with all of the communication problems and none of the occasional grace notes, let alone a century-long family heritage in the business. He saw newspapers as a business but didn't see that for journalists they are dreams -- of public service, of righting wrongs, of writing prose that will move the masses, of playing in the big leagues at 435 N. Michigan Ave. the way others dream of playing in the friendly confines of Wrigley Field. He probably did want to make money and save his newspapers at the same time, but his ego was so large that he did not realize his role in the drama was to publicly, at least, put himself second to his newsrooms. Different languages. Is it really better to be bankrupted by a bandit who can write stories than by a bumbler who cannot? (Well, you probably feel better if your house is robbed by a Gentleman Burglar than by an armed thug.) And one analyst at the time said Zell was pursuing "a childhood fantasy" himself -- owning newspapers. Perhaps all this was his dream as well. Perhaps he simply didn't understand the price of admission to the theater on which such dreams were played out.
Monday, December 8, 2008
Buzz Merritt's "Knightfall" contains the famous 1995 discussion between former Knight Ridder CEO Tony Ridder and his top editors:
"Tony Ridder, the new chairman and CEO, had the difficult task of addressing a roomful of [the recently deceased chairman Jim] Batten proteges who, he knew, were at best wary of him. After a speech with brief and seemingly obligatory bows to the need for good newspaper content, he opened the floor to questions.
"The first one was: 'Tony, what keeps you up at night; what do you most worry about?'
"He thought for a minute. 'Electronic classified,' he said.
"The air went out of the room."
Ridder is generally accounted to have been a less than outstanding CEO, one who grounded his ship on the rocks. And it was Ridder's responsibility, as head of the company, to make the people who worked for him see his vision. You sell the audience you have, not the audience you want. Then you try to get the audience you want.
Still, Tony Ridder was right, and free online classifieds have done more to weaken daily journalism than any government, any malicious department-store owner, any lazy proprietor, could ever have done. Yes, newspapers could have done many things better; yes, newspapers became set in their ways; yes, the merger of Federated and May Co. department stores, and the increasing success of retailers not dependent on traditional advertising, weakened the whole enterprise. But Ridder was right to be kept up at night by free online classifieds. And he was right to voice this problem publicly far ahead of others.
Merritt, writing from 2005, noted that "electronic classified is a substantial threat." Probably he would state that more strongly in 2008. But in the end, he feels, it was not really his problem. His problem was to cover the news. Tony's problem was to raise the money to do so and give it to his editors. He says Ridder "described the threat as one to the bottom line, rather than a threat to the company's tradition of public service journalism." Ridder was new in his job, so perhaps he simply assumed that his editors would see a threat to the bottom line as a threat to the company's tradition of public service journalism.
Tony thought like a businessman first. He didn't think like a newsman first, unlike his predecessor, Batten, and unlike Jack Knight, who set the tone that endured at his company and Knight Ridder for decades. Merritt goes into at great length the cultural differences between the news-first Knight brothers and the it's-a-business Ridder family. He rues the day the Ridders took control. He remembers that news coverage gave the Knights a win in Miami, although the same news values did not save the Chicago Daily News under Knight nor give the Detroit Free Press a circulation lead.
Merritt also points out that the investors who bought Knight Ridder stock did not see it as their role to give editors the money necessary to cover the news. They saw it as their role to demand higher returns. The only point to them of a newspaper company was to make money. Merritt notes that this was fatal to a news department. He bemoans that newspapers were allowed to fall into the hands of such people. He writes of how, when the Knights went public with their stock, it was inconceivable that institutional investors would hold most of it. The Knights and Ridders didn't come up with poison pills because they saw no reason to have them. The only people who would invest in newspapers were people who wanted to invest in newspapers, Knight thought. The whole thing is deplorable. If only Jack Knight's values had prevailed.
OK. I agree. Nearly all journalists would agree. But -- so what?
Lord knows I have no solution to the problem of lost revenue. I wouldn't expect Buzz Merritt to have had. I wish Tony's editors would have said: "Geez, Tony, if you're right this will cripple us. What are we going to do about it? Should we come up with editorial content to support redesigned classified sections?" OK, dumb idea. But as Merritt notes, "He and his editors were speaking different languages." Apparently both decided to continue doing so.
I don't know. Maybe they did ask those things. Maybe they asked Tony a-hundred-times-better things.
But I get the feeling that what they said was: Tony, you should be more troubled about the threats to Freedom of Information. You should be more troubled by what your cuts are doing to our ability to cover the news. You should not talk business to us. You should talk about statehouse coverage. They did not seem to believe that catastrophe lay ahead, and even if it did, journalism was a Public Good and it was the obligation of publishers to support it. KR was the gold standard of journalism and it was not the job of editors to figure out how to persuade readers and advertisers to part with their money. The bills just would have to get paid. Ridder, for his myriad faults, saw catastrophe ahead, saw it before most industry CEOs. I may be overstating Merritt's personal views here, certainly, but these are not views it was difficult to find in Knight Ridder.
Tony Ridder, when asked to defend his call for higher profits, would say: Knight Ridder has a lower profit margin when compared with Gannett, Tribune, and other peer companies. We have no second class of stock like the New York Times. If we do not produce the margins demanded by investors, they will break up or sell Knight Ridder. Do you want to work for a company like Gannett, one that cares about nothing except its financial performance? he would ask. I don't want to, he would add. Last week's Gannassacre once again showed Tony Ridder to be right.
Tony always tried to have everything both ways, and thus he failed. But he was correct that Knight Ridder would be broken up by investors wanting higher returns. And what they really wanted was to gut the Philadelphia operation, which accounted for one of every five KR dollars and about which KR alternated almost daily between admiring and evicerating. To some extent, Tony blamed the failure of KR on the failure of the Philadelphia Inquirer to "conquer" the suburbs. Editors at the Inquirer would respond that Tony did not give them enough money to do it. But I remember the comment of a KR executive to a top Inquirer editor about a zoning plan: We wanted a Chevrolet, and you gave us a Cadillac. They compromised on a Buick, which they could then not raise enough money to run, so they just junked the whole thing. Different languages.
There's never been enough money for journalism, and until the late 1970s and early 1980s it wasn't even close. Then, for a brief period, there was lots of money -- in a few places almost more than you could spend. Newsroom workers blame owners for keeping profit margins high and not investing in news. But profit margins were the only thing publishers had going for them to attract investment. Circulation was declining in real and relative terms; ad revenue was being pushed up by annual rate increases more than actual growth in business. Old retailers were dying and new retailers were not taking out ad contracts. Young people were less and less interested every year. The only card newspapers had left was that they controlled a unique pipeline and could charge monopoly rates. Online may be killing newspapers, but they were already beginning to stagger before the first browser clicked on the World Wide Web.
As readers clamored for more local news, editors engaged in lengthy debates about the meaning of local news, usually ending up with how what they wanted to cover was local. (If it happens in Zimbabwe and could affect you, it's local news.) Readers said they didn't have time to read the paper, and editors added space and stories got longer. Readers said stories took too long to get to the point, and writers crafted anecdotal ledes. Readers asked for news of their community, and one West Coast metro decided to regularly cover a neighborhood in Manhattan. Readers said the ink rubbed off on their hands, and we told them to wear gloves while reading the paper. And, of course, there are jumps and throwing the paper in the street.
What Buzz Merritt writes is in the greatest traditions of the Knight Ridder journalistic principles I worked under for years. It is a high-minded view of journalism's good to society based on a love for the trade and for democracy. It is what we all admire about journalism. It also is based on other people -- publishers, advertisers, whoever -- underwriting a civic good because they made money off it. That enabled a class of creative people, who as they became more professional and educated came to see the desires of readers as conflicting with the great work that needed doing. When the crisis came, each group had little to offer the other.
A county near us is divided between middle- to upper-middle suburbs and a bunch of depressed factory towns. Almost no one read our paper in the factory towns; they read the local daily. We had a big readership in the newer suburbs. We covered almost nothing that happened in those towns. We gave huge amounts of space to political pissing matches in the blue-collar cities. We did so because there was conflict, or there was a racial angle, or there was corruption. Most of our advertisers did not seek new customers in those towns. Wrong zip codes. Our coverage did not get us new readers in those towns anyway. There were major injustices, such as the disproportionate siting of waste facilities in the poorest city. There was a publicity-hound mayor who pulled stunts. There were great stories. We did not want to be red-lining news. Our reporters did not want to write routine stories about sewer bonds. People don't get murdered often in upper-income suburbs. The view was that the poor need the newspaper to address their issues; the richer can take care of their own issues themselves. It was good public-interest journalism. As a business, it brought us nothing except the ability to be ignored by people who wanted to read the paper and whom our advertisers wanted to market to. They said we published nothing about their lives and concerns. It was a wonderful time to be a journalist.
Thursday, December 4, 2008
Davis "Buzz" Merritt's "Knightfall" -- which I had avoided because of Merritt's disastrous tinkering with the copy desk in Wichita and the loss of trust that ensued when readers found pages of misspelled headlines and nonexistent people and locations -- was worth reading just for this quote from Daniel Yankelovich on "The McNamara Fallacy":
"The first step is to measure what can easily be measured. ... The second step is to disregard that which can't be measured. This is artificial and misleading. The third step is to presume that what can't be measured easily isn't very important. This is blindness. The fourth step is to say that what can't be measured easily doesn't exist. This is suicide."
Unique visitor hits, anyone? One could say the same thing about audited paid circulation, probably, but the tortured present of Internet advertising, trying to find its balance between voluminous yet unbelievable statistics and a lack of performance for much outside of search, does seem to have Robert Sixtus McNamara looking over it.
The other great lesson of "Knightfall" to me was its view of the problem with public ownership of newspaper companies. The problem is not simply evil analysts or rapacious shareholders, but something more ingrained, which he calls the Wall Street Syndrome:
"The newspaper business is relentlessly and unavoidably cyclical... The flow of advertising varies day by day through any given week.... It varies throughout the year ... It varies with short- and mid-term economic trends: Classified advertising .... suffers quickly as the economy slacks off because employment advertising drops, as does auto advertising. ... True recessions are absolutely murderous for newspapers." In light of the determination that the economy has been in recession since December 2007, this takes on added resonance. We need not add how department store advertising is also both a bulwark and extremely variable.
"All of this was historically well understood by investors in newspaper companies whose owners and shareholders were in it with the expectation of mid- to long-term profits, which they eventually would receive when the economy bounded back." Today, though, "all companies, newspapers not exempted, are expected to deal with business cycles in ways that will keep profits steadily rising. When revenues are in a flat or down cycle, the only way to produce ever-rising short-term returns is by cutting costs" (or, as Merritt notes elsewhere, buying another paper and cutting its costs). "The top two costs ... for newspapers are people and newsprint. Cutting costs in either place immediately diminishes the size and value of the product." In an increasingly electronic era, cutting the costs of newsprint may help your online product, but cutting people has the same effect.
Elsewhere, Merritt also notes that in the old days, if you were having a bad year in Detroit, and having a good year in Bradenton, you used one to balance the other. Analysts, however, looked at each operating division and said that each must pull its weight every quarter; you could not subsidize Detroit with Bradenton's extra revenue, but must cut Detroit's expenses while holding level Bradenton's. Every dollar must justify its own purpose. Good for accounting, but bad for newspapers.
Merritt shows the difference between 2005, when he wrote, and now:
"Newspaper companies are historically solid investments for the long haul because of their hefty underlying profit margins, so they can offer a safe haven for investors even during soft times in the general stock market." Well, history does not always repeat itself. "Beginning in the 1980s, however, long-term thinking became scarce around Wall Street."
None of this would have spared the newspaper industry from the catastrophic one-two of secular change and a national economic collapse. When Newhouse slashes and burns, when Forum Communications makes major cuts, all bets are off. Could newspapers have come into the 21st century, however, in better shape had they been understood to be a cyclical business -- and not one fulfilling the promise of Al Neuharth, who made Gannett a major public company in order to raise money for his dream of USA Today, and did so by promising quarter after quarter of higher earnings -- which he was able to achieve in the 1970s and 1980s by replacing printers and hot lead with newsroom computers? Well, maybe it doesn't matter anymore. But Merritt also shows the problems of newsroom thinking, to which we will next turn.
Wednesday, December 3, 2008
Segue: After yesterday's Gannassacre. it's another day on which we need some upbeat news. The Newspaper Association of America has posted its version of Presstime's "20 Under 40" -- brief bios of people who are making a positive difference in the newspaper business. One of them is written by my longtime pal Clay McCuistion.
Don't have time? Here are synopses:
Bonita Burton, Orlando Sentinel -- the lead redesigner there and involved in many efforts by Tribune to refashion its papers. If you believe Sam Zell is the antichrist and that any effort to connect better with readers on their own terms is a cheapening of newspapers' mission, you can stop right here. Her design colleagues seem to like her, though; she's been elected to a top SND post.
Emma Downs, Fort Wayne Journal-Gazette -- wrote a 16-part murder mystery for the paper set in the Three Rivers City. "She developed and often writes three columns, including the monthly 'A Week Without…' She has gone one week without swearing, one without using her car and another without styling her hair or applying makeup. Other columns include 'Rockin’ in the Region,' a weekly profile of a local band that includes song samples online, and the monthly 'Fashion Forward,' which showcases area residents who are artistic, creative or 'surprising' in their style choices, with an online audio slide show." In other words, everything she does is surprising. But perhaps a columnist's only role is to serve as a civic conscience. Or not.
Mike Fuhrman, editor, Statesville Record & Landmark -- Recently he helpted train 30 people from five Media General newsrooms on writing for the Web and alternative story forms. He also is working with the other papers to create an emergency response plan that would dispatch reporters, photographers and Web content producers to help a sister paper covering the event -- an obvious response to Roanoke's online fumble with Virginia Tech.
Chris Snider, Des Moines Register -- Brings his sensibility to digital news offerings, including "new excursions into mobile, live sports coverage, content-distribution widgets, video-sharing partnerships with Google and YouTube, and multiple versions of the site’s home page to accommodate different kinds of news events." In other words, as Doug Fisher says, not just doing print journalism online, but doing online journalism.
Digital media development
Brian Butts, Cincinnati Enquirer -- “By giving users a bird’s-eye view of local data," his product CinciNavigator.com "has increased Enquirer Media’s ability to embed hyperlocal information on many of the Web pages produced, allowing readers to find information ranging from neighborhood home sales to school report cards to where to see favorite local bands."
Dan Cox, Lawrence Journal-World -- Developed a publishing system based on open-source coding. He cites the author Douglas Adams: "Anything invented when you’re between the ages of 15 and 35 is exciting and anything invented after you’re 35 is against the natural order of things.”
Jeffrey Graham, The New York Times -- Director of the paper's first product research department. "Graham’s department found a general correlation between increased Web traffic and single-copy newsstand sales. So when the Times broke a story on its Web site last March about then-Gov. Eliot Spitzer’s penchant for high-priced call girls and saw traffic climb to 35 million page views, the paper printed extra newsstand copies for the next day." Gosh, online drives print sales? Can't happen. Print is dead, right?
Shannon Dunnigan, director of online revenue, Gatehouse Media -- "As her team works with sales reps and helps them become online specialists, revenues have climbed from $3.8 million that first year to a projected $25 million for 2008. In the second quarter of 2008, online revenue increased 41 percent year to date over the same quarter last year."
Chadi Irani, The Palm Beach Post -- His "six-pack program" boosted frequency for smaller advertisers who typically ran small ads one day a week, encouraging them to run ads at least six days in a 14-day period. The initiative generates between $200,000 and $300,000 in sales a month. Yes, that's right, print advertising.
Paul Kasbohm, Minneapolis Star Tribune -- "Helped the Star Tribune gain media market share in 2008 in the major retail, national and regional retail categories while showing year-over-year ad revenue growth in online and niche publication categories. In addition, Kasbohm has shown a willingness to invest in his people and take innovative chances with unique ad sizes and shapes, as well as sponsored content." Yes, that's right, growth in print advertising.
Tyler Mack, Spokane Spokesman-Review -- Created a print and online weather package that now generates about $190,000 in annual revenue, and an online directory that offers enhanced paid listings to area businesses.
Patricia Miller, Indianapolis Star -- Developed IndyMoms.com, the prototype for Gannett's Mom sites.
Circulation, marketing and business development
Brooke Christofferson, Arizona Republic -- Developer of a B-to-B Web site, a baby boomer readership campaign and increasing online community news. “We’ve been aggressive about understanding our audience and what’s important to them,” says Christofferson. I keep giving you opportunities to stop reading.
Giovanni Gutierrez, Tampa Tribune -- Product creation for Hispanics in the Tampa Bay area.
Amanda Mountain, Colorado Springs Gazette -- The paper’s good works help residents in need and also help readers connect with the paper, she says. Telling stories about area residents in need and giving readers guidance about ways to give back builds readership.
Wendy Reeves, Raleigh News & Observer -- Reeves contributed to daily circulation increases (2005 and 2006) and Sunday circulation increases (2005, 2006 and 2007), respectively. In one of her campaigns, subscribers received 13 Sunday papers for $13. Reeves adds that the campaigns’ number-based slogans seemed more effective than promoting specific editorial content in the Sunday edition. Yes, that's right, print circulation. Those of you who believe newspaper sales are about nothing other than journalism can stop...
David Sickle, Zerbey Newspapers -- Achieved “consistent home-delivery volume growth for the first time in many years.” Yes, that's right, print circulation.
Human resources and internal operations
Josie Martinez, Arizona Republic -- "In addition to nurturing staff with flex scheduling and improved career development opportunities, Martinez crafted a formal process that initiates new hire assessments at 45, 90 and 120 days to address employee concerns before they reach the point that the only communication left is the exit interview."
Sharon McGinnis, Ottaway Newspapers -- Seems like she just basically does a good job. Good for her.
Anna Singletary, Houston Chronicle -- A cost-saver par excellence: $250,000 by renegotiating a contract with a local courier service; $150,000 by reducing the number of printers in the building; $500,000 by shrinking the weekly TV book and streamlining its production and printing. Well, we need people like this today, particularly ones who can do it where you don't feel the knife.
OK, all together now -- Only one of these is about traditional capital-J journalism -- the editor at Statesville. Most of them are about -- how do we sell more ads, sell more papers, get more online viewers; what can we provide them that they will want to use, not how do we provide them what we do and get them to pay for it?
None of these is about winning prizes or landmark series that change the world, or at least a city. I don't know about the past of this particular recognition, but I can imagine that it might have included at least one Pulitzer-potential reporter or editor whose main accomplishment was a five-part series showing police harassment of the homeless.
That doesn't mean those are wrong. It means the current challenge is finding ways to raise the money to pay for them. Which means recognizing that readers don't need (except in a purely civic way), and are not willing to pay for, prize-winning landmark series. We should do them anyway, but the newspaper industry's crisis is not in creating journalism. It is creating ways to sell advertising to support journalism. Everyone, including newspaper journalists, has to be part of solving that. That will lead us back to Buzz Merritt.
But let's hope Gannett didn't lay off any of the five of the 20 who work for it.
Tuesday, December 2, 2008
Recently I re-acquainted myself with two books by journalistic leaders of the 1970s and 1980s -- "The Last Editor," by Jim Bellows, and "Knightfall," by Davis "Buzz" Merritt. Both I only knew of only by reputation. Bellows, during his runs at the Washington Star and the Los Angeles Herald-Examiner, seemed like the sort of creative demiurge one desperately wanted to follow. Merritt "blew up" the copy desks at the Wichita Eagle, so I had little interest. Bellows' book, published in 2002, is basically about himself; by that time he was a celebrity, having created TV shows. He was a character in Doonesbury. Merritt's book, from 2005, was published by the American Management Association and is to some degree a critique of Knight Ridder's management under Tony Ridder, although a good bit is about Buzz Merritt. But few outside the newspaper world would have heard of Merritt.
Useful threads to the past that can be followed from reading them in the context of the current crisis. Merritt, for example, wrote just before the dismantling of Knight Ridder saddled much of the industry with massive debt. The survival of KR would not have warded off the current problems, but certainly would have left newspapers in Philadelphia, Minneapolis, San Jose and Sacramento -- and throughout the entire McClatchy and Media News empires -- in far better financial shape than they are now.
Bellows subtitles his book "How I Saved The New York Times, The Washington Post, and the Los Angeles Times From Dullness and Complacency." For those who do not know Bellows, he worked for only one of those papers, and he does not claim great accomplishments at Times Mirror Square. He mainly worked for the two papers named earlier and the New York Herald Tribune. All died during Bellows' tenure or shortly thereafter, but he credits their journalism, and his involvement with it, with loosening up the sober market leaders.
Saying losses were wins does put the author's argument at a disadvantage, as does being a person who can write a book filled with others' praise of himself and phrases such as "I redefined news," and still write that he has no ego. But his view is mainly that he put others in the right place. The book shows the change in social values; while he largely judges on talent, he is a prep-school boy at home in the clubby world of journalism's owners in the pre-corporate era, and the final act that secures the No. 2 post for a woman at L.A. is that she single-handedly throws a dinner party for 12. If she can organize that, he tells his wife, she can organize a reporting staff.
Bellows' newspapers were No. 2 (or weaker) and he gives them every idea he's got. Substantive stories and gossip columns. Star writers in Sunday magazines. Lots of Jimmy Breslin. Redesigns, reorganizations, and lots of cheek, such as letting "Rosebuds" replace stars in movie ratings in the Hearst-owned Her-Ex. Enthusiasm, fun, give the writers their head, let them go do interesting stuff.
Great times, but Jock Whitney -- who had bought the failing Herald Tribune, the book says, as a favor to Dwight Eisenhower to keep a mainstream Republican voice alive in Manhattan -- pulls the plug. Joe Albritton -- who had bought the failing Washington Star, the book says, to try to become a playah in Washington society -- shows Bellows the door and sells the paper to Time Inc., which shows it to its grave. Hearst -- which had allowed a six-year strike to cripple the Her-Ex -- eventually pulls the plug as well. Perhaps the Timeses and the Post had simply taken Bellows' innovations and, having larger staffs, done them better.
Bellows' view is that his papers were largely doomed when he got there, as a result of labor contracts, evening publication, the growth of TV news and features (to which he eventually decamps). He did great journalism, but there was little that could be done for the business, he feels, and it is nice to save the newspaper, but good journalism is more important. Let us take him at his word. What lesson does his book offer?
I see his view as: Journalists need to do journalism and shouldn't worry about the rest. The business side is always trying to force his hand and is often run by vain, short-sighted people. "I felt newspapering should be fun," he writes of why he did not fit in with the Chandlers at Los Angeles. Rick DuBrow of the Her-Ex contributes this view of Bellows' tenure:
"I have a lasting vision of the Herald; it was like sitting in on a jam session every day, riffing your stories on the keyboard, taking exhilarating solo flights that Jim encouraged... There was a swagger in the city room, and flair in the air." The sort of atmosphere that Bellows apparently tried to set at all his newspapers. The sort of environment that journalists love, or profess to love. And, alas, whatever the quality of the work, whatever the quality of work life, the environment of newspapers that went out of business in 1967, 1981 and 1989. (He also worked for the late Miami News, by the way.) These are newspapers that never had a chance to be destroyed by online. Newspapers where you played with someone else's money until the spigot turned. Money's not there anymore? Go somewhere else. There was always somewhere else to go.
It's a wonderful view that we all grew up on, from an era when journalists were misfit tramps going from paper to paper, and while weaker newspapers failed you could always get a job at a stronger one, in your town or somewhere else. It combined the grandiosity of the journalist's dreams, the sense of shy egomania, with the fatalism of -- it's not my fault. Someone else didn't pay the bills. No one understands us. I pick up my lance and ride on. The truth will out.
The worker at GM can say: I did my job. It's not my fault the cars were poorly engineered or designed. But journalists design the content. Poor delivery or ad sales are not their problem, but if year after year more readers say, "Sorry, not interested," journalists are not asking the right question. Theirs is the view of an artist, an actor or musician -- I do the work, and maybe there'll be a gallery owner. If not, it's society's loss.
For all its many wonderful tales, Bellows' book basically tells us that high-quality journalism didn't save the newspapers he worked at. He comes from the era in which a Jock Whitney would buy a paper as a favor to a president or a Joe Albritton would buy one to hobnob with the influential. People owned papers partly to get rich, partly because they believed in the mission of the press, partly to promote their friends and beliefs, partly to be powerful, influential, invited to the right parties. Put all that together and you are willing to subsidize a newsroom as it plays its game. Merritt tells us how that era ended, to which we will turn next.