19 June 2012 · By Earl J. Wilkinson
Ownership changes and reduced print schedules in the United States are the latest developments in the slow-motion transition of the newspaper industry to the “newsmedia industry.” New owners are joining the club with new motivations, while old owners are doing whatever it takes to preserve journalism.
The United States newspaper industry has been re-made so rapidly in the past 30 days that it is difficult to make sense of it all. It is a staggering amount of change crammed into a short period of time:
What to make of it all? Is this the beginning of the end or the end of the beginning?
Let’s take a deep breath and try to connect the dots.
For the most part, the current class of U.S. newspaper owners operates newspapers to:
The American ownership class operates on a continuum of “how big is the check and how blind an eye for journalism?” and “how big is the profit?” Some like journalism more than profit. Others like profit more than journalism. It was an “umbrella” with which we all grew comfortable.
The perceived value of this model to all parties — shareholders, advertisers, readers, journalists — is that there is a deep, wide moat around the operation, which requires minimum innovation and maximum template management.
This model was dying for decades and collapsed in the recent U.S. recession, as key advertising categories left print for high- metrics media.
Thus, the premium now on innovation, people, and finding a new template — fast.
What is left are:
These are tough, tough judgment calls for owners who prefer benevolence and deference to the tough business of change.
What happened with The Times-Picayune in New Orleans and Advance Alabama reducing from seven-day print publishing to three-day print publishing, while emotionally draining, demonstrates the owner’s commitment to repairing the business model before it’s too late. Would it have made everyone feel better if Advance had waited a few years when economic conditions tightened and there were fewer options?
As for billionaire investor Warren Buffett being a “saviour” for newspapers in his sudden ownership of 88 titles, this requires sober assessment. The “Sage of Omaha” bought de-valued assets on the cheap. He saw a fantastic price for long-term assets. Don’t read much more into it than that. Having said that, I love that solid money is now behind a lot of newspapers, and I would love it if more of Buffett’s shared wisdom came with the package.
As the industry’s ownership base rapidly changes, the news industry is awash in hyperbole.
A recent article in The Atlantic described The Times-Picayune’s move to three-day printing as something that will “damage its journalistic foundation” and affect “residual goodwill at the same time.” Advance’s Internet strategy is not about journalism, but about “clicks.”
Let’s deconstruct that:
For the new ownership class that is emerging in the United States (as well as the old one hell-bent on ripping off the Band-Aid and embracing multi-media), there is no equivocating about standards of journalism, church and state, professional fiefdoms, opinion versus news, editorial versus commercial, and the like. I sense they want to cut through decades of cultural myopia in one big swoop. This is dizzying for the standard-bearers of the news industry.
Judging from the public comments, they want to smash through these debates that have held back the news industry for four decades:
What we are witnessing today is the exodus of publishers that owned newspapers for high profitability and the emergence of publishers that have different ownership motives. There are many reasons to own a newspaper; a 30% profit margin is not the only motivation. This has been true since the first daily newspaper was published 367 years ago.
What we have today is the slow-motion, excruciating transition of the newspaper industry to the “newsmedia industry.” There will be many New Orleans stories in the months and years ahead. We will learn lessons, good and bad, from those making the first steps today.
New ownership will create an American market of experimentation that has not been seen before on this scale. It is exciting ... and scary.
Stare through the hyperbole to understand the meaning behind these changes.
Author/Contact: Earl J. Wilkinson is executive director and CEO of INMA. He may be reached at firstname.lastname@example.org or via Twitter at @earljwilkinson. This post is part of The Earl Blog at INMA.org.
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Earl J. Wilkinson is executive director and CEO of INMA. In his interactions with INMA members worldwide, Earl has one of the broadest views of newspapers of anyone serving our industry today. He is a trendspotter and a leading advocate for cultural change, transformation, and innovation. This blog represents his unique view of the emerging global newsmedia industry.
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