Tuesday, April 19, 2011

What is the secret formula for reviving newspapers ?

Can Newspapers be saved? And should we attempt to save them? Obviously, the business model needs to be changed. But what should replace the traditional newspaper model? What follows is an excellent column by New York Times Media Writer David Carr about his own hometown newspaper (The Minneapolis Star-Tribune) and attempts to revive it. As part of your readings this week you will review the Atlantic article, "How to Save News." We have already discussed the fact that most the content on the Web is generated by reporters at newspapers. Given this fact, can we just say: good riddance to newspapers? What will be the impact on news? And what will be the impact on our democratic society if newspapers and serious reporting cease to exist? I would like for you to address these questions and look at both the costs and the benefits of newspapers. Review this column, the readings for this week and the corresponding video I have posted here relating to whether the government should get involved and bail out newspapers. Your post is due by next Tuesday April 26. - MT

By David Carr

NYT - In 2008, when I last saw Michael Klingensmith, he was sitting in a corner office on the 34th floor of the Time Warner building, one of three powerful executives who controlled Time Inc., the biggest magazine publisher in the world.

It was the only company that Mr. Klingensmith, an M.B.A. from the University of Chicago, had ever worked for. After three decades, including stops at Sports Illustrated and Time, he was on the short list to become the next chief executive. When the job went to Ann Moore, he hung in for a while as executive vice president in charge of strategy and acquisitions. “It was a real job, it just wasn’t a very fun one,” he said.

So in 2008 at the age of 55, he took early retirement. He could have gone to work at any publisher in Manhattan, but instead, after a short time as a consultant, he moved to Minneapolis to become the publisher of The Star Tribune.

It wasn’t a move to Mister Rogers’ Neighborhood. The newspaper had been through years of upheaval, churning through bankruptcy, publishers and lots of layoffs.

But what could have been a quixotic last fling has turned into something far more impressive: The Star Tribune is adding readers — the Sunday circulation grew 5.7 percent in the last audit and will most likely be up again a bit in the audit that will be out in few weeks — the business is making money and, get this, distributing money from its profit-sharing plan to its employees.

It helps that Mr. Klingensmith is a local boy. He grew up in “friendly Fridley,” a suburb of Minneapolis, and he is a serious Twins fan. He traded deeply paneled rooms with a view of Rockefeller Center and its fabled skating rink for a fourth-floor office festooned with Twins memorabilia and a view of the staff parking lots, one of which is decorated with a statue of Joe Mauer of the Twins, a local hero, and another of Lucy from Peanuts, reading a newspaper.

Even Lucy probably notices that it’s a smaller newspaper than it used to be. Once a reliable moneymaker for the Cowles family, The Star Tribune was sold to McClatchy for $1.2 billion in 1998. As the midsize newspaper business tumbled, The Star Tribune became a drag on earnings for McClatchy and it was sold to Avista Capital Partners for $530 million at the end of 2006.

The private equity firm loaded $500 million in debt on the property just before revenue dropped by almost half. There were extensive layoffs, interim publishers, and in January 2009 the newspaper, the nation’s 15th largest, filed for bankruptcy. Like Mr. Klingensmith, I grew up reading the newspaper and I found it gut-wrenching to watch.

The newspaper ended up in the hands of its creditors, including the investment firm Angelo, Gordon and Company, which also has stakes in the Tribune Company and Philadelphia newspapers.

By the time Mr. Klingensmith said yes to the publisher’s job at the start of 2010, $500 million in debt had been reduced to $100 million in the reorganization, costs were way down because of the cuts, and revenues from both advertising and circulation had begun to crawl back.

The reason the company had profits to share is that while ad revenue was down 9 percent in 2010, it was far less than the 15 percent that had been budgeted. According to David Brauer, who covers the paper for MinnPost, a local news site, the difference yielded more than $30 million in earnings before interest, taxes, depreciation and amortization in 2010. And daily circulation has remained essentially flat even though the price of the daily newspaper was raised to 75 cents from 50 cents in May. The Sunday newspaper, which did not increase in price, has gone from a low of about 477,000 in September 2009 to 504,600 in September 2010, according to audit reports.

“When I was talking to them about the job, I looked at the financials and thought it had a good shot,” Mr. Klingensmith said. “I actually thought that newspapers have a lot more life in them than they get credit for.”



  1. As discussed in class, I think it's more interesting to talk about where journalism is going, not where newspapers are going. As a medium, I don't see newspapers ever going away completely (just like cellphones haven't completely replaced land-line telephones). There are still several important functions newspapers serve for their readers.

    Many people believe newspapers are best suited to reporting local news, but since there are so many online media outlets chasing the "hyperlocal" buzz word now, and from our discussion, it sounds like people aren't too interested in local news, I'm starting to wonder if newspapers will contain much news at all. Maybe in the future, newspapers will just serve to deliver indexes and entertaining information like sports scores, stock prices, movie times, funnies and crossword puzzles.

    As for the impact this might have on the news ... the death of newspapers is being driven by declining consumer demand, not the other way around. I suspect there's just as much news now as there ever was (maybe there's even more news now), it's just distributed differently. The impact on the news is minimal -- the impact on newspapers is dire.

    I realize there are many drawbacks to government subsidy, but I tend to think that the government should step in and support the news (but not necessarily the inefficient business of newspapers). I know that in other countries, news outlets are partially or fully subsidized by the government. This doesn't necessarily mean that the government is controlling those media outlets. I do believe news is a public service, and if it's not making enough money to sustain itself, perhaps we can look to other successful models to continue providing this public service to people, just as we subsidize any other unprofitable public service. But I'm also a dirty socialist, so take my opinion and tax dollars for whatever they're worth.

    Re: consumer demand for good journalism
    It's easy to look at the past and say people were smarter, more well-read and less interested in celebrity scandal. The truth is that sensationalism, self-selection and the lowest-common denominator have always existed. What's changed is the cost of doing business in an increasingly fractured world. If good journalism isn't fiscally sheltered, it may not go away entirely, but it will drastically decline in both quality and content, as we're already seeing.

  2. I believe strongly that newspapers can be saved. In the article, David Carr talks about how The Star Tribune is in fact adding readers and making money. This shows that newspapers can be saved at that they do not need the government to save them. One way I feel like newspapers can be saved is to go more traditional and focus on one local area with some national and global views. As we have talked about in class, newspapers have tried to become more profitable and owners look more towards personal gain than the goal of spreading news. By focusing more locally, people will feel more of a connection to the paper and therefore subscribe and read it. Carr mentioned that The Star Tribune is a smaller newspaper than it once was, but it is working for them. Papers cannot contain all the information the internet does, but that does not mean we should get rid of them all together.
    I, like Lauren, am more interested in talking about where journalism is going. As I stated in class, journalist are becoming easier to replace. With this, will we also lose serious reporting? Because journalist do not have to go to school to become published writers on the web, they do now have the same skills and abilities to get the same information that educated journalist have. For years, the public has turned to newspapers to be educated on what the government or a company is going.
    I fully agree with Lauren views on how newspapers are being driven by a decline of consumer demand. I think if pay walls work and all the online papers switch to it there might be an increased demand in newspapers again.

  3. Lauren’s comment about the difference between newspapers and journalism is an important one to continue to remember in this discussion. Citizens of a democracy need good journalism to stay informed. When it is working the way it should, good journalism also serves the public’s interest by monitoring those in power and, when necessary, pointing out their errors, abuses and/or shortcomings. Good journalists who are not affiliated with newspapers can and do perform this function, but in today’s world, most of the journalists who serve effectively as watchdogs are still affiliated with newspapers. That is one reason why newspapers (or at least newspaper companies) are still important. Newspaper names provide built-in credibility that many blogs can’t (or at least haven’t yet) built. If newspapers (I’ll use that word in place of newspaper companies for ease of discussion) go away, will the public have a voice? Can a gaggle of blogs and a sea of reader comments fill that void? Right now, I doubt they can.

    The Carr piece shows how important it is for media companies to have leaders who are genuinely interested in the places where they work. I would argue that local news is (or should be) the main franchise for all but the nation’s largest national newspapers. The Strib’s resurrection is due at least in part to Klingensmith knowing, and genuinely caring about, his audience and the craft of journalism (which is different from the business of newspapers). Personal stake in a place can (should?) lead to a commitment to a newspaper that transcends financials. I’m not suggesting that Klingensmith doesn’t care about making money. I am saying that bottom-line-oriented news managers would never think of profit sharing in today’s environment. One of the last reader comments on the Carr piece sums it up well:

    “What you have here is the best illustration of the difference between running a business that does what you love to do, profitably, VERSUS constantly worrying about the ROI of some faceless shareholder mooks that couldn't care less what it is that you sell (newspapers, vapourware, services, widgets, etc).”

  4. Being from Minnesota, I know Minneapolis is a unique city. The demographic there doesn't replicate that of many other places, which means that the success of The Star won't necessarily translate to other cities across the US. I agree with Anne in that, the majority of newspapers should focus on local reporting and leave national news to the giants.
    I think that by limiting the demographic of a paper the content as well as the medium can be better tailored to the readers. The success of The Star is in part due to a locally raised man understanding his audience. I don't think there is a simple fix for newspapers, and I certainly don't think the government should bail them out, but I do feel that by taking unique approach for individual cities could prevent the demise of print journalism.
    Although newspapers will never be what they once were, they are not ready to decease. I agree with Clay when he said that papers are a major source of investigative journalism, which to me is the heart of journalism. Without the watchdog instinct, journalists could be easily replaced. I don't see the public letting go of that service though, they just don't want to pick up a paper to read about it. So now part of our job is to figure out how our audience wants to hear the real news.

  5. Here’s what we need to do to revive newspapers: Stop writing such boring bullshit and learn to live again.

    I was just talking to a friend about our futures as journalists and we both came to the gnawing conclusion that we don’t want to be pretentious, life-sucked paper-squinters like so many become. We don’t want to get sucked in with the obnoxious jargon and the whining about figures.

    We, as writers, even though we are writing factually, are at our core—artists. And we need to embrace that. I write for the love of writing, and probably will live penniless for it. That’s scary on some levels, but I will not compromise my heart for a corporation.

    Should we attempt to save newspapers? Not if they’re soulless pieces of flimsy paper that don’t move anyone. Why would we want to contribute to the endless scratching at the souls of the humans who write them? That’s pretty cruel.

    When you write about the war, don’t write about that obligated beat. Human lives are not a beat. Write about the real guts of the situation, and don’t be afraid of it.

    Newspapers are invaluable as long as they continue to be written by passionate people. It’s not, by nature, a passionate medium, but when you mean something and are truly sincere about it, people sense it. THAT is what will fuel readership. Give them feeling—give them spirit that they can’t find somewhere else.

    Keep the papers that have nothing to see through. Keep the ones that mean it, and let the web follow.

    -Cassie, frustrated and sick of dry stories

  6. Focus.

    Focus would definitely be a good step in the right direction.

    By “focus” I mean passion and also, quality over quantity of stories produced instead of the re-hashing of stories already told. These days it seems journalism is only a business model and that is unavoidable because journalists need a paycheck. But what if journalism could become a more effective business model? The talent behind the journalist is already there, I know it. There are plenty of brilliantly reported stories in the world that don’t get a chance to shine when opinions of that same story are diluting the hard facts of what was originally meant to come across.

    So the journalists I know who have talent stand apart from the kind of journalists who rehash published stories into watered down versions of their opinion and yes, I understand morally news should be “free for all”, but if there was a way to focus stories in a way the business industry side of news could thrive a little stronger, not even newspapers would wither away?

    Carr proved a great fact when he described how a once struggling paper like The Star Tribune suddenly flourished a little more once Klingensmith’s direction. And this was only made possible because Klingensmith was not focused on lucrative money or the business aspect of The Star Tribune. It’s obvious he could have had far more prestigious jobs, yet he took a small town paper like The Star Tribune under his wing because he was passionate about it.

    Having passion is important in any business, but if that passion dies, then that business is doomed to fail.

    Therefore, as long as somebody has the passion to continue within the newspaper industry, it will continue to live.

    So getting back to my prior point regarding “focus”, journalists should try to “focus” on what they find most important to them and instead of writing on a subject that would assume to receive the most readership, even if that’s by rehashing a story already told, a journalist should focus on covering a topic that that journalist finds within that topic a passion.

    It would then certainly be a story worth telling more than the rehashed works of what is considered “popular” news.

    And that is a value that newspapers still adhere to and respect. They respect “focus” and passion because there is no meticulous rehashing of articles. They are always fresh and always thorough and I believe the newspapers are going nowhere anytime soon.

    Perhaps there should even be a movement to prevent the continuous rehashing of stories so the original reported stories can have a chance to bring in the profits those companies deserve to keep their industry alive and thriving.

  7. While it's certainly comforting to see the Star Trib experience a revival, but that doesn't make it's new business model the savior for newspapers. I do however believe you cannot emphasize the importance of having editors/publishers WHO KNOW THEIR READERS. That, I believe more than door-to-door sales or increased reporting on international news. That little caveat is just thrown in the story and then never referenced again. I'd really be interested in what demographics, polling data, etc. because it really seems to contradict the trends of local papers nationwide.

    I think there certainly are merits to "bailing out" newspapers. They serve the public interest, surely more than automobile companies that have, say, bought and buried patents to ensure products that could take away their control of a market (and profits) never see the light of day. What if the New York Times tried that with the Internet? Moving on...

    My largest concern however with government subsidization of newspapers isn't the fear of censorship. I believe that newspapers would still be able to accurately report the news and do in-depth reporting. But, once Uncle Sam starts signing the checks there is a perceived conflict of interest. It doesn't matter that newspaper employees know they're not being censored, because the perception is there and will always be there.

    We rag of Fox News, and other outlets, because of an apparent bias. But even if Fox cancelled Hannity, Coulter, O'Rielly and Beck (whoops) while giving distinguished alumnus Ailes the boot, the damage to its reputation has been done. Once that seed is planted in the readers mind that there could be censorship, that newspapers could be tools of the White House press secretary, it doesn't just go away. It's our job as journalists to disclose anything that could be perceived conflict of interest, but we don't necessarily decide whether it's there or not. We can feel confident that we can do our jobs without impediment, but if the public doesn't then what's the purpose?

  8. I believe that you need to let economics play its course when it comes to newspapers. When the demand is no longer there, let them die and move on to the next platform. If newspapers go bankrupt, that does not mean that quality investigative journalism will cease to exist. Reporters report for the people, regardless of the platform.

    The internet should help to democratize and give more people the chance to report their stories without having to go to a giant newspaper to get it published. That being said, I agree that newspapers are going nowhere fast. It is generational and they will be around for decades to come. When our generation reaches full adulthood and retirement, I can see print newspapers being obsolete, but not journalism.

    "Newspaper" companies also may move to other platforms like the kindle or some type of electric reader, significantly reducing their distribution cost and passing much of it on to the consumer.

    There is no magic solution for newspapers, but if history has showed anything it is that older media hangs around much longer than originally anticipated.

    I believe the government should only bail out an industry under dire circumstances, and newspapers are not there yet. Quality reporting is still done on many platforms so that should only increase competition for newspaper companies, which is healthy for an industry. If newspapers fail, let it be and move on to a more viable platform: quality journalism will always be around, hopefully.

  9. Michael’s comment about how newspaper names provide built-in credibility that many blogs can’t is, in my opinion, the sole reason readers and other journalists believe newspapers will still continue to exist. Newspapers are a traditional medium that provides hard factual evidence and sources that many believe online news cannot offer. However, I don’t believe that the public will loose good investigative pieces if newspapers go under; quality, credible journalists exist today in the online world that can publish hard news just as well as those hired in the newspaper business. Newspapers will forever be in circulation, but their target audience will drift to the locals and contain mostly all local entertainment and advertisements. In previous readings, it has been noted that newspapers cease to exist because of their availability and particular content (Newspapers tend to focus more on political issues and contemporary events). Although newspapers are convenient, we are in a technological boom right now where USA Today and the Times are available with one click on my phone. With everything shifting to the web, I have a feeling some papers will take advantage of the Internet and publish solely online; whether or not they decide to charge readers is another story.
    Although newspapers have been the major source of investigative reporting, why are papers the only medium people claim to provide the only source of investigative reporting? Although citizen journalists will always exist on the Internet, it would not be difficult for credible, investigative journalist to publish their pieces on the web. What makes newspapers more credible? That the byline is in print rather than on a screen? Over the years the public has drifted more towards the web, declaring that technology is their new medium for news. So why does the web have to lose credibility just because times are changing? The way we view our news is changing, but as journalists, our credibility shouldn’t.
    As for a government bailout, newspapers aren’t in serious jeopardy in comparison to other companies. Some newspapers are slowly recovering financially and unless all papers are going bankrupt, a bailout is not necessary.

  10. As I mentioned in class last week, I don't think that newspapers will necessarily die out entirely. They will always have a loyal readership and there will always be people who wish to consume the news via print media.

    Now, serious reporting isn't necessarily restricted to newspapers. There are online media, such as news sites and even blogs, that are well-organized and provide newsworthy, factual content. That being said, I think we will see more news online in the next few decades.

    However, some writers on the Internet are sloppy and don't provide accurate information to the public, which is a failure in our journalistic duties. In order for journalism to stay strong, the public might have to step in and call writers or news sources out if there are any flaws. But if the public doesn't really care about the news, then I can see the field of journalism eventually collapsing.

  11. After completing Newsonomics and writing the book report, it has become clearer that our class discussion was along the right lines. The question of newspapers dying looks trivial when you place it next to the inquisition of whether journalism is dying. An intriguing way to think about the journalistic landscape is that newspapers might still be the best thing journalism has going for them.

    Newspapers serve as the stubborn, slow, and tradition based media industry. This has cost the business in the Internet age. If you want journalism, though, it is going to be best done in a newspaper. There is still this weird sacred value to publishing words in print. The reporting process is still valued at newspapers. Even the daily physical newspaper holds some value to people.

    On the contrary, newspapers are in jeopardy. Journalism is not only best done through newspapers, but as it is defined, it may only be comprehensively done through newspapers. The editorial page and classifieds were not journalism, but for the most part the newspaper industry ran parallel with the journalism industry,

    On the web (and let's be honest on TV), the industry is not journalism. It is media, and that may be putting it nicely. Entertainment is becoming more and more of a factor. To watch CNN and call it 24-hour news is absurd. Often it serves as 24-hour noise. A recent visit to their website allowed me to see some journalistic reporting on a devastating tornado, but it was in the same general area of a page on political rumors (not journalism at all) and the agonizingly short of funny Joy Behar ranting about the Celebrity Apprentice.

    That brings up an interesting point. Entertainment seems to be becoming more and more a part of the news. With dwindling resources at journalistic outlets, the fact that so much is being devoted to entertainment may be saying something about the future of hard journalism.