more fishwrap

Posted on April 4, 2009
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I know, I know, I’m always posting something about the poor fucking newspapers and how they’re swirling round the sinkhole of oblivion and why won’t someone give them a break or at least some fucking money so they’d stop whinging for a moment and write about the news. Yet, I’m interested in this for a number of reasons.  First up, without newspapers we’re all fucked.  Independent journalism based on the subscription, masthead revenue, classifieds model provided a watchdog for the excesses of those in power, business and government.  Secondly, I like reading newspapers, their stories are generally reflective of an on going relationship with a community, with rags like the Sydney Morning Herald or the New York Times  defining or at least reflecting the values of those communities and finally, I think, in a certain regard, this is the harbinger of a total collapse of the idea of content other than the constant and miserable grey rain of nano content from bloggers (such as myself), myspace, youtube et al or else the viral monstrousness of the keen kids consumer world.  What is happening with News, is in a sense, analogous to the demise of the music industry and its a very simple problem.  No one feels like we have to pay for content anymore, so there is no money to pay the bills for the stuff that makles news worthwhile, thorough independent research.  So what will we get instead? Who the fuck knows, but at this stage its not looking so good…

from the Ad Age

Chicken Little, don your hardhat. Nudged by recession, doom has arrived.

The toll will be so vast — and the institutions of media and marketing are so central to our economy, our culture, our democracy and our very selves — that it’s easy to fantasize about some miraculous preserver of “reach” dangling just out of reach. We need “mass,” so mass, therefore, must survive. Alas, economies are unsentimental and denial unproductive. The post-advertising age is under way.

This isn’t about the end of commerce or the end of marketing or news or entertainment. All of the above are finding new expressions online, and in time will flourish thanks to the very digital revolution that is now ravaging them. The future is bright. But the present is apocalyptic. Any hope for a seamless transition — or any transition at all — from mass media and marketing to micro media and marketing are absurd.

The sky is falling, the frog in the pot has come to a boil and, oh yeah, we are, most of us, exquisitely, irretrievably fucked.

Newspapers

Amid 23% population growth in the past two decades, U.S. newspaper circulation has dropped 20% — one reason your morning paper, downsized every which way, is no match for a stiff breeze. Craigslist, siphoning off $7 billion worth of classifieds, is another.

There are so many horror stories to choose from. The Rocky Mountain News just folded, the Seattle Post-Intelligencer went web-only last week and the San Francisco Chronicle is on death’s door. A decade ago, the Minneapolis Star Tribune sold for $1.2 billion. In January, it declared bankruptcy. Chicago’s vast Tribune Co. was valued at $12 billion in 2000, when it took on debt to acquire the Times-Mirror Co. for more than $8.3 billion. In April 2007, real-estate developer Sam Zell snapped up the whole empire for $8.2 billion, and commenced wholesale retrenchment, including layoffs, bureau closings and the sale to Cablevision of the venerable Newsday. Within 20 months, bankruptcy.

As for The Wall Street Journal, nobody knew when Rupert Murdoch plunked down $5.5 billion for a $3.5 billion paper last year whether he was a genius of synergy and valuation or a sucker. The recession obscures the answer, but last month News Corp. declared a write-down of $8.4 billion in assets — about 40% of it attributed by Wall Street analysts to the Journal deal. Oops. For sheer poignancy, though, it’s hard to beat The New York Times. With a $400 million May debt payment approaching like a runaway cement truck, the Times is selling 75% of its shiny new headquarters. More alarmingly, it has suspended its stock dividend and borrowed $250 million at usurious rates from Mexican oligarch Carlos Slim, whom a Times editorial not long ago condemned as a “robber baron.” And if not Slim, who, Gazprom?

On the plus side, thanks to the internet, all of these papers — especially the Times — have seen their readership soar. Surely, with the attendant savings in production and distribution, the future online-only paper represents a promising business model, right? No. That ship has sailed. Long ago newspapers based their online strategy on advertising, at which point traffic became the holy grail. Times Select — the walled garden of premium columnists available by subscription only — generated income but depressed traffic. So out it went. The Times and 99% of its brethren opted to give away all content in exchange for audience, neglecting to understand two structural facts of online life: 1) Nobody clicks on ads, because why would they? 2) The virtually infinite supply of online ad inventory will always depress the price even the best publisher can fetch. Always. Immutably. Forever. Mass media thrived on the economics of scarcity. The internet represents an economy of unending abundance.

As Philadelphia Inquirer and Daily News boss Brian Tierney told me at the end of January, “Clearly a free internet model online — if you build it, they will come — I don’t think is working for media like ours. … I think we’re going to have to start to find a way to charge for it and not just rely on advertising.” continue reading

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