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9/21/2009
SHOULD NEWSPAPERS GO NON-PROFIT?

There is little doubt that the nation’s newspapers are in deep trouble. And not just a few rags here and there. The entire industry is in the process of going extinct with the exception of a few papers funded by individuals with very, very deep pockets and can absorb the millions in losses incurred by running a modern, metropolitan daily newspaper.

Why this is so, is a trickier question and not conducive to simple, one sentence answers. You can say the internet is killing the daily newspaper and that would be true, but not the whole story.

You can say blogs are killing newspapers and you would be indulging in wishful thinking. They have certainly affected newspapers but most bloggers need newspapers more than newspapers need blogs.

You can say political bias is killing newspapers and you would be picking nits. Bias in reporting only makes the political class angry. No one else really notices or cares.

You can say that the standard business model for the daily paper does not reflect the reality of the marketplace and you would be correct - except most papers have already tried to adapt to the internet age and are finding it very tough going.

The number one reason newspapers are dying is because they cannot compete in a rapidly changing information marketplace. The print editions are not as immediate as television. The web editions are hard to navigate and difficult to find the information for which you are looking. Advertising revenue for both is dropping as marketing whizzes use social networking sites and techniques to drive conversation about products and services that were once full page ads. The huge falloff in revenue from classified ads moving to websites like Craig’s List has also contributed to the decline.

People’s reading habits are changing. Audio books and Kindle are revolutionizing the way we read and web sites like Memeorandum make it a simple matter to pick out information that the reader feels is necessary to know or in which he is interested. Newspapers are becoming superfluous - an unwanted appendage that doesn’t fill any need except that of tradition and continuity.

Blogs and message boards do a better job of informing about sports, style, even business. Ditto for what used to be called “opinion journalism” and is now simply ranting, for the most part. Such opinion columnists don’t marshal arguments, illuminate options, and recommend a course of action. They have - with very few exceptions - become creative writers, trying to outdo blogs in their use of colorful invective and snarky sarcasm.

If Rupert Murdoch gets his way and readers are forced to pay for the privilege of accessing on-line newspaper content, it will only hasten their demise. The New York Times “firewall” experiment proves that. Not enough people are willing to pay to read opinion - even if they are usually in agreement with the columnist. They can get pretty much the same thing for free on blogs. And sometimes, the writing and thinking is superior to that which is found at newspapers, online or otherwise.

That leaves paying for “news” stories. This presupposes that no one will step in and offer for free what these newspapers want to charge money for. The Army of Davids who would eagerly dive into the void and “report” on various news stories using what they discover on local blogs, YouTube, or even Twitter would doom to failure any attempt for newspapers to alter their revenue plans to include charging for online access - even if it’s only a “nominal” fee.

I love newspapers - both online and dead tree. But they belong to another age, much like the elegance of a horse drawn carriage or the friendliness of a Mom and Pop grocery store. What exactly is it that newspapers do that would justify their continued existence?

“Investigative” reporting? Most newspapers don’t do that anymore - too expensive. And even if a paper has an investigative reporting department, is that reason enough to pay for the privilege of access when these stories make up such a small percentage of news reported during the course of a year?

“In-depth” analysis of issues? Anyone who is interested in an issue or a story can find a dozen websites ranging from think tanks to university professors who would do an equally good job of giving context, history, and analysis to any issue.

There are niche areas where newspapers could thrive. I can see an ESPN or IDB, or Wall Street Journal remaining viable as long as their price for access was reasonable and commensurate with the value of the content. Ditto for websites that report on fashion, or movies, or any other department found in daily newspapers. I wouldn’t doubt it if there weren’t already websites that contain obituaries. Many would pay for access there too.

But why pay to read about New York sports teams in the New York Times? If you’re from New York, you could get equally good coverage and analysis on any of a dozen blogs. Sports talk radio would give the sports fan access to the same news with the bonus of it being free.

As long as newspapers were the gatekeepers for information and commanded the attention of the masses, they could charge advertisers enough money to make a profit. But with such diluted information streams coming from all points, and advertisers finding alternatives that are cheaper and actually promise to promote their products better, newspapers have become entities in search of a mission. They are casting about desperately, trying to manufacture reasons to remain relevant. And no one - not readers or advertisers - is buying it.

Nothing I’ve written so far is news to anyone who follows the newspaper industry. Nor is the idea that somehow, the government must step in and “help” newspapers survive. Direct subsidies would be ridiculous. The government should not be in the business of subsidizing opinion. The slippery slope there is so obvious a 3 year old could see it.

But what about indirect subsidies in the form of tax breaks for newspapers that reorganize themselves into non profit organizations? The Hill reports:

The president said he is “happy to look at” bills before Congress that would give struggling news organizations tax breaks if they were to restructure as nonprofit businesses.

“I haven’t seen detailed proposals yet, but I’ll be happy to look at them,” Obama told the editors of the Pittsburgh Post-Gazette and Toledo Blade in an interview.

Sen. Ben Cardin (D-Md.) has introduced S. 673, the so-called “Newspaper Revitalization Act,” that would give outlets tax deals if they were to restructure as 501(c)(3) corporations. That bill has so far attracted one cosponsor, Cardin’s Maryland colleague Sen. Barbara Mikulski (D).

White House Press Secretary Robert Gibbs had played down the possibility of government assistance for news organizations, which have been hit by an economic downturn and dwindling ad revenue.

In early May, Gibbs said that while he hadn’t asked the president specifically about bailout options for newspapers, “I don’t know what, in all honesty, government can do about it.”

Obama said that good journalism is “critical to the health of our democracy,” but expressed concern toward growing tends in reporting — especially on political blogs, from which a groundswell of support for his campaign emerged during the presidential election.

“I am concerned that if the direction of the news is all blogosphere, all opinions, with no serious fact-checking, no serious attempts to put stories in context, that what you will end up getting is people shouting at each other across the void but not a lot of mutual understanding,” he said.

The president obviously doesn’t spend 10 hours a day on the internet like the rest of us. If he did, he would have known that there are many websites and blogs that already offer mostly unbiased analysis and fact based opinion. The idea that these qualities are solely the province of old school journalists found in the newsrooms of America is absurd.

Sadly, many on both the right and the left read only those blogs and websites that reflect their partisan tilt (this is less true on the left but there is still a very significant percentage of liberals who will read only liberal blogs.) It is not that the kind of information the president is talking about isn’t already available, it is that the number of people interested in non-partisan or less partisan reading is relatively small.

And perhaps the president would like to tell us how newspapers have promoted “mutual understanding?” Newspapers have historically promoted their own biased viewpoints, from Hearst to Ochs. Until relatively recently, newspapers were basically organs for one party or the other. Some still are.

If newspapers believe they can investigate corruption, fairly analyze politics and culture, and offer fact based opinion pieces that seek to inform rather than inflame, then by all means give them the tax breaks.

But you and I know that won’t happen. In fact, it is the profit motive that restrains newspapers from being too overtly biased in their reporting. Currently, newspapers must attract as many people as possible regardless of their political biases or party affiliation. If they were to go non-profit, what would be the incentive to be fair? There would be some, of course, who would respect the idea that they were in the business of informing their readers in as neutral a way possible of the issues and politics that are newsworthy. But such nobility would be even rarer than it is today. Without the incentive to make money, newspapers would de-evolve and revert to their past practice of being openly partisan or ideological. Remove the profit motive and you remove the one thing that governs content.

In the last 5 years, I may have read half a dozen dead tree newspapers. My reading habits have changed and the time spent perusing a newspaper could be better spent googling what I want to know. That’s the bottom line and I see no way that newspapers - online or traditional paper editions - will ever to be able to overcome the problem that the meteor has already struck Chicxulub and there is nothing they can do to save themselves from catastrophe.

By: Rick Moran at 9:47 am
14 Responses to “SHOULD NEWSPAPERS GO NON-PROFIT?”
  1. 1
    Juan Paxety Said:
    10:33 am 

    Newspapers, and television, too, made a huge mistake when they decided to view reporters as an expense rather than an asset. As a result, they stopped reporting what most folks subscribed for - local news. They filled their pages with AP stories and syndicated opinion. They thought they were saving money because they focused solely on the quarterly bottom line. They were actually destroying their asset.

  2. 2
    Tom Bowler Said:
    10:36 am 

    Sorry, Rick. Gotta disagree with you on this one:

    “You can say political bias is killing newspapers and you would be picking nits. Bias in reporting only makes the political class angry. No one else really notices or cares.”

    It’s true there are other factors, but bias is so prevalent now at some institutions that readers may not rely on the veracity of the reporting. Who is going to buy a newspaper, or even click on a papers web site, when doubt runs so high that the content is true and accurate. Papers like the Washington Post and the New York Times have destroyed the one thing that once made them indispensable. That would be their own credibility.

    And people do notice.

    http://www.rasmussenreports.com/public_content/politics/elections2/election_20082/2008_presidential_election/55_say_media_bias_bigger_problem_than_campaign_cash

    August 11, 2008: “The latest Rasmussen Reports national telephone survey found that 55% believe media bias is more of a problem than big campaign contributions. “

  3. 3
    Roy Lofquist Said:
    11:37 am 

    The fundamental reason why newspapers are failing is lack of advertising. There are two reasons for this that are usually ignored in discussions - cable TV and community shoppers.

    The ubiquity of cable channels that deliver a focused interest group and low rates is drawing a lot of the money from auto dealers.

    Community newspapers are thriving and drawing down the classified advertising.

  4. 4
    shaun Said:
    12:26 pm 

    Good post on a topic about which I can speak with some authority since I worked for daily newspapers for 35 years until taking an early retirement and turned to book writing and blogging.

    The biggest reason that newspapers are failing is a hubristic resistance to change, specifically changing their business models until it was way too late for many of them. That has had a ripple effect, including the loss of advertisers.

    A close second is the consolidation of the industry into a few large media companies for whom their stock prices became more important than the quality of their products.

    Checking in at third is changing reading habits, although there is something to the notion that some papers may be able to surprise in online specialty niches.

    Bias — perceived or real — is way down the list, Rasmussen’s push polling notwithstanding.

    I oppose any federal bailout of failing newspapers, but I fervently support finding new approaches to cost sharing such as the several organizations that recently helped the NYTimes underwrite Sherri Fink’s terrific investigative piece on the Katrina hospital disaster.

    I didn’t hit the consolidation angle at all. Paddock (now CNH) and Gannett own 75% of all community daily newspapers. They all look alike and sound alike. Diversity is a thing of the past. There is very little in those newspapers that you can’t find somewhere else.

    ed.

  5. 5
    Harry O Said:
    12:48 pm 

    Say it ain’t so, Joe.

    “Sadly, many on both the right and the left read only those blogs that reflect their partisan tilt (this is less true on the left …).”

    Hot Air had a post, “Conservatives more likely to read opposing viewpoints than Liberals”, in which university studies would seem to rebute this. Why do you think the left’s reading is more diverse?

    Anecdotal evidence (i.e. not worth much). My sister, a liberal, accused me of getting all my info from Fox and right-leaning blogs. I told her I also read articles in Salon, Huffington Post, the NY Times, Washington Post, etc.
    I also rarely watch Fox News. I asked her where she gets opposing views. Her answer was that she watches “Morning Joe” on MSNBC. Enough said about who is exposed to the most diverse commentary, etc.

  6. 6
    Anon Said:
    2:07 pm 

    Should typewriter manufacturers have gone non-profit? Should vinyl record album makers have gone non-profit? How about rotary dial telephones, or for that matter home phones altogether? Newspapers aren’t selling anything consumers want. There are other ways to get the news, many, many other ways. Times have changed. Moreover, not only are consumers no longer interested in reading their news on paper, the newspaper industry hastened its own demise by producing a really bad, biased product. They already function as instruments of the state (so long as the head of state is a democrat). To ask consumers to pay for their propaganda via tax breaks is an insult to democracy. This will be a very bad move. We already pay for state propaganda; it’s called the White House communications office. Why do we need to pay to read their press releases twice, once as it comes out of the White House and again on the front page of the New York Times? Has the left lost its collective mind?

  7. 7
    David Said:
    2:29 pm 

    I find that most newspapers are the same. They simply move the AP reports to there own page and that is it. There are numerous issues in my town that could be addressed by the paper but they don’t do it as they might offend a local official. As to political affiliation, they are all liberal and have never met a tax that the paper does not support.

  8. 8
    funny man Said:
    3:26 pm 

    I would agree with most of the analysis of Shaun. To some who apparently have nothing but glee regarding the demise of print publications. Newspapers are not just propaganda but valuable part of the civil society. I’m talking about well researched articles, investigative journalism with actual reporters on the ground. Of course it is cheaper to just have talking heads giving their opinions. I for one like the quality of many articles in the Economist but also the NYT. You don’t have to agree but when it is well crafted it is a piece of art in a way.

    Heh - Shaun would have a thing or two to say about a “well crafted article” being “art” I’m sure. In a way, that’s the problem. Journalism is a profession and a craft. Too many creative writers want to be journalists. Give me the hard bitten beat reporter who can knock out 750 words in 20 minutes and gets the essence of the story. The editor can massage it or pump it up but the essence of who, what, when, why , and where are all there in the first 3 or 4 graphs.

    There are a few reporters like that but not many. Today, they’re are a lot of Dana Milbanks who can be amusing but who is not much of a journalist.

    ed.

  9. 9
    Moltenorb Said:
    5:02 pm 

    Regional community newspapers will survive.

    Every town has their rag that will tell you who is playing at the blues club, what’s on at the movies, or how good that new restaurant is. They usually cover local newsworthy events and politics, opinion, world news, lifestyle pieces, classifed ads..ect..

    This is free, useful information that’s convenient to have at a local level…and consumers want it..

    My local independent is not not hurting for advertising dollars…and is widely read in my town..

    From my experience, most of these local papers seem have a slightly liberal bias…but that may be just because of the places I’ve chosen to live..

    Let the big national papers die off…no government intervention allowed…

  10. 10
    Surabaya Stew Said:
    12:45 am 

    You’re forgetting the cost issue here. Using “the increasing cost of newsprint” as an excuse, the average daily read is twice the price than just 10 years ago. (Of course this is a lie, because when newsprint prices collapsed last year, not a single newspaper reduced their prices!) In addition, many broadsheets have reduced their physical size down to the “berliner” format, which gives the strong impression that the consumer is getting less product for his money. Finally, the Sunday edition is usually the one unique product that newspapers offer that the internet cannot replace, yet most newspaper owners insist on not offering subscriptions that only include the Sunday paper.

  11. 11
    Kendra K. Said:
    5:54 am 

    Hi Rick,

    I am your liberal reader and I am all about healthcare reform and environmentalism. Yet I read conservative, independent and libertarian blogs often.

    It is for a specific reason that relates to the newspapers demise. Speed. When news hits, the right and the left jump to the keyboards first.

    Obama really needs to check in with the geek squad before he does this. We have real-time capabilities of the web, combined with the internet going mobile through phone apps. The likelyhood of information delivered by paper being “news” to anyone will be gone soon. There may be unheard of new mobile web competitors on the horizon. Internet papers may have a voice subscription that reads articles to you by phone. Oh- I like that idea!

    By the way, I also read conservative posts because when we do agree on a topic, I can find good sources of detailed information. In terms of Healthcare reform, I wish conservatives knew that many liberals would have loved a Swiss style bill too. We never were never able to talk on that.

  12. 12
    shaun Said:
    8:48 am 

    It pains me no end to once again have to agree with Rick regarding journalism as art vs. craft. The art is very far and very few between.

    I have mentored many young reporters and taught many journalism classes and long ago refined my role into that of a bad cop.

    What I tell these kids is that if they don’t have a hair-on-fire enthusiasm, limitless curiosity and can’t show why readers should care about what they write then they need to find some other kind of work.

    It is the rare creative writer who can excel at deadline journalism, and as Rick notes it is best left to the editor to pump up the prose. Trouble is, more and more newspapers follow the Bloomberg news service model wherein the reporters file directly to the wire. It shows.

    If I may be so bold, I have excelled as a writer because I have done so damned much of it over the last 40-plus years and at some point found “my voice.” That is writing punchy and to-the-point prose that has some stylistic depth.

    About half of all the visitors to my blog, which is a small one, arrive via Google, Yahoo or other portals. The robots at these search engines “love” my writing because that to-the-point prose is packed with key words that will take readers interested in, say, Duane Allman to my blog.

  13. 13
    jackson1234 Said:
    9:58 am 

    I fairly well agree with this blog except for a few minor nits.

    The first is that the newspaper industry, in which I worked in management up until the late Eighties, pretty well knew the dangers it faced early on. In fact, given it took another two decades to hit full force, top management was pretty much on the mark. This is ironic since absolutely nothing was done to adjust the business model.

    The second point is that while I agree political bias as such has not been that much of a factor, something has changed recently. Print (and increasingly broadcast, which also is on the ropes for similar reasons to newspapers) ignores stories such as the ACORN scandal and Van Jones and it drives readers and viewers to sources that report these items. Spiking stories to promote bias has started to hurt, and badly.

    Finally, I agree right-of-center readers originally gravitated to right-of-center on line sources. That has diminished with the proliferation of other conservative outlets, which have started to reach parity with their liberal counterparts in broadcast.

    Again, good analysis.

  14. 14
    DoorHold Said:
    12:27 pm 

    I don’t agree that liberals are any more likely to read opposing views than conservatives. Maybe you’re confused by their propensity to say things like, “Rush Limbaugh blah, blah, blah,” or “Ann Coulter, blah, blah, blah.” There IS the remote possibility that they have first-hand knowledge of strictly conservative viewpoints, but it’s far more likely they heard from a liberal source about one thing or another that some goofy conservative said and, if they checked it out at all, it was solely to garner the relevant-but-out-of-context sound bite and no more. (Or am I projecting? Uh-hem.)

    Regarding newspapers, why are they so sacrosanct? The newspaper as we know it today hasn’t been around forever and if something replaces it, so what? I’m sure people missed that buggy-ride into town to pick up a month’s supply of goods at the general store for a while but, time marches on.

    I DO subscribe to a local paper, but it’s physically shrinking at an alarming rate (while the price continues to go up). I can remember only one in-depth politically-charged report entirely researched by the paper’s staff, and that was recent (and came as quite a surprise — I didn’t know they had any investigative journalists left).

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