This was going to be a comment on Alan Mutter’s post “What’s Next For Newspapers?” but The Newsosaur’s commenting system is in a cranky mood this morning. So, here you go, with some clips for context.
Alan Mutter says recent moves and rumblings in newspaperland point to a coalescing around three possible routes to the future in the ink-by-the-barrellful business:
Not so very long ago, the newspaper business was a snap: Build the largest possible audience, sell the most possible ads, charge the highest possible rates, print the fattest possible papers and pump out the biggest possible profits.
This enviable model worked exquisitely for generations, because publishers had little, if any competition. But it is now clear, as attested by the 50% drop in newspaper advertising since 2005, that the old ways can no longer succeed.
So, most publishers – after arguably procrastinating far too long – are faced with choosing the best possible going-forward strategy for their mature, if not to say declining, businesses…
Here’s a quick way to think about the three approaches:
– Farm It – Keep doing what you do today as well as you can in the hopes of optimizing the existing franchise for as long as possible. This presumes that (a) the company will operate in a reasonably hospitable and predictable market environment and (b) management is sufficiently skillful to execute smartly with the available resources.
– Milk It – Accept the inevitable decline and fall of the traditional newspaper model and then whack costs to extract the most profits from the decaying business for as long as possible. On the day you no longer can turn a profit, throw the keys on the table and call it quits.
– Feed It – Determine that even the most proficient management cannot overcome the fundamental changes in the marketplace that have been cutting readership and revenues since the Internet arrived two decades ago. Instead of retreating, however, you leverage the waning strengths of the legacy business and invest aggressively in new digital products to reposition it for the future.
Mutter mentions 2005 as the baseline for the massive drop-off in revenue. But 2005 wasn’t just the moment in time before Wile E. Newspaperman realized he’d stepped off the cliff, it was also the year that an unlikely evangelist — Rupert Murdoch — stood in front of them at the ASNE convention and tried to shake them our of their obliviousness. The gathered brain-trust was too polite to hiss in his face but more than willing to roll its eyes upon return to newsrooms around the country, wrongly conflating the message with the messenger.
Murdoch’s words are uncannily like Alan’s own above. But remember, these were spoken more than seven years ago, before the collapse that, somehow, nobody saw coming.
In the face of this revolution, however, we’ve been slow to react. We’ve sat by and watched while our newspapers have gradually lost circulation. We all know of great and expensive exceptions to this – but the technology is now moving much faster than in the past.
Where four out of every five americans in 1964 read a paper every day, today, only half do. Among just younger readers, the numbers are even worse, as I’ve just shown.
There are a number of reasons for our inertia in the face of this advance. First, newspapers as a medium for centuries enjoyed a virtual information monopoly – roughly from the birth of the printing press to the rise of radio. We never had a reason to second-guess what we were doing. Second, even after the advent of television, a slow but steady decline in readership was masked by population growth that kept circulations reasonably intact. Third, even after absolute circulations started to decline in the 1990s, profitability did not.
But those days are gone. The trends are against us…
So unless we awaken to these changes, which are quite different to those of 5 or 6 years ago, we will, as an industry, be relegated to the status of also-rans.
You can read all of Murdoch’s speech here.
Seven years ago. Seven. But, hey, committees take time.
(And, yes, Rupert Murdoch carries his own issues along with him, including his stampede to the comfort of a paywall a few years ago, but who else — other than their underlings and people like Jarvis, Rosen, Shirky and, of course, Alan Mutter — was speaking this kind of brutal truth to newspaper leadership in 2005? Here’s hoping we don’t have to do this same exercise again in 2019.)