Why Newspapers Are Dying

Newspapers are dying because they continue to produce papers, but are reducing the extent to which they produce news, and continue to produce news that is only fair and relevant to those still buying paper. A recent article demonstrates the first half of this statement. According to the New York Times, which has problems of its own, “The Star-Ledger, New Jersey’s largest newspaper, will cut its newsroom staff about 40 percent by year’s end, one of the largest reductions in a single move by a major American paper.” According to this source, however, the newsroom staff only accounted for 330 of 750 non-union jobs with the paper. Presumably there are at least that many unionized workers printing and distributing the papers in addition, so workers producing “news” are a small and shrinking share of the staff. In contrast at the research company I work for, one that publishes by subscription on the internet, those producing information account for well more than half of those employed. Clearly no one informed The Star Ledger that the most recent industry classification system moved the newspaper industry out of “manufacturing” and into “information.” Some newspapers have devolved into nothing more than distribution channels for the Associated Press, while others are considering dropping the AP to save money. Those still trying are losing more and more money.

The information market is being divided into those who use the internet and those who don’t read. My wife and I still subscribe to some dead trees, as it is hard to read off a desktop computer in bed or at the kitchen table, but younger folks have already moved to laptops and have no such issues. Absent the need to produce and distribute a physical newspaper, subscriptions ought to be fairly inexpensive, reflecting the cost of the information alone. Hard copies are now a luxury product, unless one does the printing oneself, or picks of a stripped down newspaper for free.

In addition to those producing news accounting for a small and shrinking share of those now working, one wonders if those now working for the newspapers are majority of the cost. It may be that the existing newspaper companies are burdened by the debts run up by executives seeking bonuses or cashing in on leveraged loan buyouts, and the rich pensions handed to unions that subsequently agreed to lower pay and benefits for future hires. Replicating the debt-financed tax breaks and public employee pension deals that have wrecked the future of public services, in other words. After all the same generations, with (mostly) the same values, are in charge of just about everything.

Now I don’t claim that information and entertainment organizations don’t have other problems, not the least of which is the difficulty in getting people, particularly younger people, to pay for their service rather that merely take it for free. Perhaps, however, younger people, who are getting robbed repeatedly by public policies that work against them, would be willing to pay a modest subscription for a publication that was on their side. Many of the existing news organizations built their readership as crusading advocates for social fairness of once sort or another. And one sort of social unfairness that continues to grow unchecked is younger generations, worse off financially in the private sector, also being made worse off financially, over and over, in public policy.

Why won’t the mainstream media confront the issues I raised in this post as a matter of overall principle, and see each issue from the perspective of whether generational inequities are being expanded or reduced? Why not tell those starting out what they need to know to ensure their future in the world they will inherit, in part through their own decisions, in part be fighting back collectively? Why not evaluate, in every case, if institutions -- business, government, non-profit -- are being built up for long term benefit or exploited for short-term gain?

Perhaps because those producing the remaining profits, older generations still receiving newspapers by subscription and watching the evening news, might be turned off by a recounting of the effect of repeated decisions to secure a better deal for themselves has affected their own children. That being the case, it is fair and reasonable that today’s newspapers will die with those generations. The MSM can take comfort in the fact that the way things are going, younger generations aren’t going to be able to afford their services anyway.

In that case, however, I shudder to think about the information they will receive. Take a web-based organization I see advertised all the time, WebMD. Just search there, and for free WebMD will provide information about your health problems and what to do about them. And where does WebMD get its money? “WebMD Health Corp. (Nasdaq: WBMD), the leading provider of health information services, stated that it has experienced a strong increase in sales of its online promotional and educational programs in both the pharmaceutical and consumer products markets during the September 2008 quarter,” according to its website. That information is about as suspect as information on housing and transportation produced by a publication that receives a large share of its revenues from automobile and real estate ads. Or a publication that includes articles driven by press releases from the PR staff of politicians and interest groups.

Yes all the newspapers are trying to move onto the internet. I read them there for free, but I feel no obligation to pay until I see the things I know to be true described there, consistently, and statements from others I know to be at variance with those truths either ignored or at least challenged. I’ve noted repeatedly that the real deception, in business, in government, and in the media, isn’t the untruth of what is said. It is in the truth of the unsaid. What is the unsaid? Who doesn’t want to hear it? Who needs to hear it? Who needs to hear it now, with the press of debt and pension obligations and an economic crisis in our successfully and profitably bankrupted country, city and state leading to talk of severe reductions in public services and benefits and increases in taxes – after the election?

Is it ongoing references to casual sex, bathroom functions, and profanity what those under 35 need to hear? That sounds about 35 years out of date to me. But that’s what you find on some of the blogs in New York. Just something else someone is trying to sell. My kids aren’t that stupid.

By occupying space, the newspapers help keep the unsaid, unsaid. Imagine if a mid-sized city lost its one and only newspaper. Chances are an online one would spring up for those who wanted local news – without the past debts and retiree obligations, without the overhead, without the physical paper – but perhaps with photographic, sound and video information as well as written information. The reporters and editors would, perhaps, have to work out of their home offices and their cars to save money. But if enough people were willing to pay for such an information network, at perhaps half the cost of a newspaper subscription today, they might be able to earn a living. And deserve one.

Until then, if you want to say the unsaid, you’ll have to do it for free. Otherwise, you’ll have to report the press release from the interest group about what New York’s comparable tax and spending priorities are, how its public employment and pay compare with other places, the value received for that money, and regulatory policies. Or issue their study.

As it is the newspapers are like the auto industry with its legacy costs, political influence and SUVs, who will get subsidized even as start-up Telsa goes under. Held down by their past successes -- and the prejudices, interests and rationalizations of their customers. Just keep reporting what those who matter say, and tell the rest they are lucky it isn’t worse for them.

Until newspapers go the way of the dodo-bird, it will be difficult for paid on-line sources to compete with the newspaper incumbents, unless they are little more than a series of links to information produced by those incumbents. That’s what most independent web-based sources are, for now. But that paper information, incomplete as it is, is going away, and those in the information business need to start imagining alternatives. After all, younger generations are going to have to learn to live cheap while working even harder, to pay back what was enjoyed by others. They can’t afford the paper. Perhaps they can afford the information. But the newspapers, dependent on the advertisers, have to think twice before even providing information about how to live cheap.



Submitted by Ed (not verified) on Thu, 10/30/2008 - 6:03am.

The 19th century "yellow journalism" tabloids drew most of their revenue from circulation, so it was in the interest of the proprietors to boost circulation.  This meant lots of lurid headlines and scant regard for accuracy, but also these papers often spearheaded populist crusades since they actually had to appeal to alot of people to sell papers and gain revenue.

 Mid-twentieth century, newspapers moved to a model where most of the revenue was provided by advertising.  This meant the populism went out the window.  Papers became more conservative, in the sense of being more careful about things like accuracy, but also in the sense of being more boring and less likely to print stories that would offend advertisers.

 I think alot of the problem with papers today isn't the internet, its that the advertising-driven revenue model eventually ran its course.  Papers became too boring, much of their audience started getting their news from TV.  The more literate types stuck with newspapers until it became possible to get news from the internet, including the web versions of papers from other cities and even other countries.

Many papers in second-tier cities now consists of lots and lots of advertising, a local columnist or two, and stories run off the AP wire.  But if you can get AP stories directly, why spend the quarter?  Instead of the local columnist you have a choice of bloggers.  I've noticed there are now blogs covering local news in many neighborhoods.

 I think its more of a matter of content rather than medium. News on paper will still be around as long as people commute, plus its nice to have them available in coffee shops.  There will be times when people don't have internet access, such as during blackouts and brownouts.  The pattern has been for old techs not to be totally eradicated by new techs, more to become secondary.

 The reason the internet was a challenge is that the cost of "publication" is much lower, reducing barriers to entry significantly.  Now you have competition in what used to be a monopoly.  As with most monopolies, newspaper publishers became fat and dumb.  Its not unprecedented for this to happen in businesses.


Submitted by Anonymous (not verified) on Thu, 10/30/2008 - 8:00am.
until i can carry a device that logs on anywhere, anytime and is as small and convenient as a book, magazine or newspaper, what am i to do.  of course, the assumption is that the populace still cares about what happens in the news.  as we work our way more and more to a Farenheit 451 world, reading will decline.
Submitted by Larry Littlefield on Thu, 10/30/2008 - 5:08pm.
News in snapshots is even more portable now for the younger set. Not my world, but it is theirs.

I think the problem is legacy costs and customers. A major newspaper morphing into a much smaller, cheaper organization is like Buffalo morphing into a smaller city -- what about all those pensions, and public patronage employees who live in the suburbs, and debts?

The music industry has had to adjust, a friend who writes for Billboard told me. Instead of touring to promote records, which get a few people rich, records just promote tours, where an army of musicians earn a living but will never be as rich as the Beatles and Stones.

M Burgos's picture
Submitted by M Burgos on Fri, 10/31/2008 - 11:29am.

I have an Amzon Kindle, their ebook reader. What makes it different is that it has built in, high-speed internet access (using Sprint's network and an EVDO modem).

Besides ebooks, a lot of mainstream newspapers, magazines, and blogs are available. The form factor is good for subway and bus reading, as well as just sitting around your home or a cafe. It's about the size of a 6x9 novel.

With the wireless feature, my NY Times and other periodicals are delivered to me every day, complete. Just like years ago when I got the newspaper delivered to my home every morning.

That means that if I'm on the subway deep in a tunnel, the article I choose still comes up, as opposed to a cell phone.

There are serious disadvantages with the Kindle such as no color, low graphics resolution, and high price tag, but besides that, it it terrific for newspapers and magazines to use as a way of staying in business while delivering the news in a way that is easy to read, portable, and takes advantage of new technologies (searching, dictionary look-up, annotation, etc.).

As this device evolves (new unit due in 2009) it may give some old newspapers new life. One sign of this is that the NY Times and Wall St Journal are consistently top sellers on the Kindle. It also will someday (soon I hope) give newer internet-based news and magazines an opportunity to become part of the mainstream.

Manny Burgos,
Brooklyn, New York
"Más vale morir luchando, que vivir muriendo."



Submitted by Larry Littlefield on Fri, 10/31/2008 - 12:26pm.

After reading this I heard the Christian Science Monitor has moved to a print version for weekends, when you can look at paper sitting on the porch, with internet on weekdays.  I think that would work very well for a publication like the Times.

There is one thing the free internet gives me that I would be reluctant to lose, however.  I can read articles on subjects that interest me from all news sources, rather than paying for and receiving just one.  I think the newspapers need to cut a deal with each other.  Otherwise, they'll get wiped out like they did in job listings, because Monster.com provides listings all over the country and not just in one area.


M Burgos's picture
Submitted by M Burgos on Fri, 10/31/2008 - 1:38pm.

There's no such thing as free internet  :-)

Someone is paying for it. Whether it's for the ads that you look at (some more obtrusive than others), or the monthly internet access you pay for at home, money is exchanged.

The NY Times tried to switch to a hybrid of a free (defined as "no fee") and paid site and that didn't work out so well. They switched back to non-fee supported because the model didn't work so well. Now their online edition is ad-driven only.

Wall Street Journal online is subscription based and has been for some years now, but many of it's viewers subscribe to the print edition which includes the online edition at no extra charge. But the online edition also has plenty of ads on its pages.

Soon as wimax networks roll-out, and cellular networks penetrate subways, etc. portable viewers can view the news more. But even sites that are not ad driven cost money--you pay for it through your monthly fees.

Govt-sponsored wifi sites and soon wimax city-wide sites you pay for too--through your taxes.

Years ago when newspapers dominated there was no such thing as the internet. But sitting at home viewing a "free" news site still costs you money from your ISP. I pay about $45/month for Optimum Boost. 10 years ago I didn't. But I was paying about $18/week on newspaper subscrptions.

Of my $45/month: about 1/3 of my time online is reading news. So in reality the news online is not free. I am paying $15 for the news (and who knows how much else through things I buy through the influence of ads). 

The main difference is that the $15/month would have gone to a newsaper but now it goes to my cable company.

Manny Burgos,
Brooklyn, New York
"Más vale morir luchando, que vivir muriendo."



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