Is there anyone not talking about a crisis in the news industry? The New York Times is dumping 100 jobs. The troubled Tribune Co. is offloading 400 to 500 people. And across the country there are reports of slumping advertising and impending layoffs. Now this report: in AdAge
U.S. media employment in December fell to a 15-year low (886,900), slammed by the slumping newspaper industry. But employment in advertising/marketing-services – agencies and other firms that provide marketing and communications services to marketers – broke a record in November (769,000). Marketing consulting powered that growth.
So things are pretty bad, and we're working in a dying industry. Nobody's reading newspapers anymore.
And yet they are. And in record numbers. Look at this report in Editor & Publisher. The online audience is soaring, and here's the growth rate and numbers of unique readers for newspaper Web sites in January 2008:
Not only are these huge audiences, but the growth rates continue to be spectacular. By far, more people are reading newspapers than ever before. As just one example, scroll down the list to No. 16, the Seattle Post-Intelligencer, which has a Web audience of 2.2 million people per month. The P-I's print circulation, when it was considered healthy in the previous century, was in the low 200,000s.
This is spectacular growth in audience. And yet, as the P-I's print circulation has declined to the lower-100,000s, its newsprint ad revenue has slumped, the paper is losing money, it's not replacing staff, and the owners are managing losses. As the paper's content has degraded, the perception of it in the community is one of declining influence and quality.
The problem, say newspaper industry execs, is that lucrative print ad sales have been melting away, and online ad revenues don't come close to making up for the losses. Classified ad revenue has died, and job ads have fled. If we're really in a recession, ad revenue figures will get even worse this year. Newspaper after newspaper is reporting tough times, and many are beginning to make fundamental changes in their operations.
Just a few days ago, the publisher of the Orange County Register wrote that his print paper will shrink, and the future is in free community papers and digital content. Conventional wisdom says that newspapers are caught in a business model which doesn't support the changes to digital media, and despite huge efforts, the newspaper industry is in decline. Maybe there's no longer a place for traditional newspapers.
The conventional wisdom is crap.
It's hard to take claims that newspapers are taking the Digital Age seriously when they have so under-invested to compete in it. Consider:
- Most digital operations are seriously under-staffed and under-resourced. They don't employ even the basic traffic-building strategies that independents are using with great success.
- Newspapers have declined to innovate as eBay, Craigslist, Monster.com, Google, and myriad ad networks have sprouted, thrived, and stolen customers.
- Digg, Reddit, Newsvine, and others are experimenting with community selection of news, while newspapers pay little more than lip service to reader involvement.
- Hundreds of small Web operations have sprung up to compete with traditional newspapers, while news organizations remain mired in old conventions.
- Social networking has changed the way young people interact, yet newspapers have failed to meaningfully take the plunge.
Pretty much every online initiative in the traditional news industry has been me-too-ism rather than bold invention. The back-end digital news production structure at most newspapers is a mess. Many papers still bizarrely consider their online and paper versions separate operations.
High-paid editors who ought to be spending their time on content spend their days snarled up in uploading images and navigating other technical mazes. Reporters and editors are pressed to add digital duties – blogs, podcasts, etc. – as add-ons to their "regular" jobs, instead of incorporating the digital world as essential tools that should make their ability to gather and tell stories and interact with their communities easier. This shouldn't add to the workload (but always seems to). Instead, these things ought to make reporting easier.
Finally, most Web operations are seriously understaffed and technically deficient, making what should be even basic tasks difficult to impossible.
And all that lip service about how newspapers want to listen to their readers? Not really true. Sure, comments sections have given readers places to vent, but what newspapers are actually treating their readers as communities to be interacted with rather than loud voices demanding to be heard? What's interesting about that?
These things (and many more) have combined to poison the business. Meanwhile, social networks have amassed millions of users, and prominent bloggers have begun making so much money that they're madly hiring editors and reporters and winning awards. Some "small" editorial operations now have more daily readers than The New York Times.
Let me focus on one area in some detail: ads. Say I want to advertise on the Web site of my local paper. How about those 2.2 million P-I readers? I go to the Web site. Look for how to do it. Not easy. I have to call someone, negotiate a deal. Can I advertise on the newspaper's blog that I know all my customers are reading? No. No one's advertising there. So how much will it cost? Not worth it to me.
Now go to any large blog. Next to every ad there's a link that says "advertise here." Click the link, you get rates, you can specify where it runs, and for how long. You can upload your ad online. If there's space, your ad can be up an hour from now. And the price drops if the space is under-utilized. Easy peasy.
At a time when Internet advertising can get ads to readers with incredible accuracy, why aren't newspapers on board? Last week, several newspaper companies announced a new ad network. This is only eight years late in happening, and it's not at all clear how this new network is going to make things better.
A local example: Here in Seattle, art galleries don't advertise in the local papers. Why? It's way too expensive, and it's probably not hitting the art-buying audience. Yet the popular online visual art blog of the P-I's art critic, Regina Hackett, is a place where the city's visual arts community increasingly logs in every day. Make the ads cheap enough, and galleries would be clamoring to buy space. The paper's Microsoft blog and venture capital blog have substantial, highly-sought-after audiences, yet the paper doesn't look to be even interested in attracting new advertisers for it. You don't think startups looking for funding wouldn't flock to the place where the VC's check in every day?
There are plenty of small businesses that would be micro-advertisers if the rates were right. And who has a bigger local audience online than the local newspaper? Traditional advertisers are falling away? Then start exploiting non-traditional advertisers. Hard to take newspaper execs seriously when they say they're trying everything they can to keep up their revenue. Meanwhile, they're not doing even what any savvy blogger can.
This article originally originally ran in the ARTicles blog of the National Arts Journalism Project.
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