I had a nice little post going for a while there. It was about newspapers and the new arrangement here in Detroit. It paused to aim a kick at some of the Free Press and Gannett spin artists fanning out to sell this crap sandwich, then settled in to what I consider the topic of the day: Online advertising, and the need for it to be properly priced and not such a ridiculous bargain.
Like I said, I was rattling away on it before I went to work last night, and had no browser crashes or anything else that might have scuttled it. But today, only the first sentence of it was to be found. Sigh. Autosave, I curse you. On the other hand, maybe that was a sign that we need to rethink our point. OK:
Why doesn’t online advertising cost more? That is all.
OK, here’s a bit more: The modern newspaper’s problem is not readership, it’s revenue. Let me see the hands of everyone who is reading more than their hometown papers these days. Leave your hand up if you feel you are, in general, better-informed about the world than you were, sayyy, 10 years ago. One of the Freep apologists yesterday trotted out the figure 500 million — that’s 2008 page views for the Detroit Media Partnership. Stipulated: Page views are the easy figure — a page loads and it counts as a view. In the olden days when nervous circulation managers held these meetings, they never talked about circulation (which was inevitably down), but readership, which always seemed to be just fine. The bonus joke for newsrooms was that this was sometimes paired with penetration, defined as circulation divided by households. Gannett used to have a graphic illustration that said satisfaction would increase with penetration, and don’t think a few million laughs weren’t had over that.
Anyhoo, in online measurements, “unique users” is the coin of the realm; it’s the beating-heart figure. But page views are significant, too, and at this point in the game I’m less concerned about whether the MotorCityMoms site will continue (groan: It will), as much as what, exactly, is being done to fairly price the ads that reach them. Every day I open my ink-on-paper, home-delivered, top-dollar-expensive New York Times and see the Tiffany’s ad at the top of page 3. They pay a premium for that spot; they’ve held it for years. I notice it. Its message sinks in. Its brand is underlined. I carry around these impressions on my personal hard drive. But online, it’s not going to pay the NYT much unless I click on it. I wonder how that’s justified. Advertising of all sorts is our cultural wallpaper, and just being able to identify certain business on the basis of their ads is considered a huge coup. If the Detroit papers are delivering the eyeballs, shouldn’t that count for something?
Heath Meriwether, a former Free Press editor and publisher, points out an important distinction in Editor & Publisher:
“The home delivery audience was the big prize. They were the committed audience, they had the money to spend and they were more involved in the community.”
Isn’t that interesting? All that traffic that bloggers claim they’re driving to news media websites? It’s crap, for the most part. A local tire store doesn’t care that people in San Diego are reading a story about the Pistons; they’re selling tires to people in southeast Michigan. Every night I read the Times of London, but it’s safe to say 90 percent of their advertising is wasted on me — I don’t even live on the same continent. On the other hand, I just checked their home page, and was served three ads for National City, an American bank. That’s IP sniffing for you. I can’t think of the last time I checked a Detroit News or Free Press website and was served an ad for a bakery down the street, offering two-for-one specials on Christmas fruitcake; are the ad staffs being trained to make such sales? Are they honestly and truly trying everything? Or is this just a desperation Hail Mary pass no one expects to succeed, to be followed in a few months by a sad news conference about an unforgiving business climate, etc.?
God, this is depressing. I wish I felt better about all of this. Among the facts weighing me down today: the Detroit newspaper partnership built a $170 million printing plant THREE YEARS AGO. Alan Mutter quotes an analyst with a sobering observation:
Radical as the restructuring may appear to be, the newspapers remain saddled with certain large and inescapable costs, said Alan Flaherty, a nationally recognized newspaper production expert.
“Nothing they do at this point can mitigate the cost of owning the $170 million (or maybe more) plant that they occupied in about 2005,” said Alan in an email. “At 7.5% interest and a 15-year life, the $170 million investment represents a weekly capital lease expense of $370,000.” That’s a bit less than $20 million per year.
(Fort Wayne Newspapers built a new press even more recently. The publisher at the time had a stock answer when asked about it: “This shows how committed we are to our future in Fort Wayne,” accompanied by a smile that showed frost at its edges. Then she left town. And yet the FWN package — one pathetic p.m., 75 percent of a somewhat more robust a.m. and the agency that produces both — sold for something like $90 million in 2006. Staggering.)
Clearly I know nothing about how this business works. If someone else does, enlighten me. For further reading, this Romenesko post has the most useful links.
You can tell I’m grumpy this morning. We had a snowstorm overnight and the blowers commenced around 5 a.m. Last night’s bedtime for yours truly: 1:30 a.m. The luck of the neighborhood blowers that I am not a violent person with a sniper rifle in my possession? Priceless.
Let’s try to leave on an high note. My Russian teacher forwarded me a set of pictures going around, called “only in Russia.” This one’s my favorite. The sign reads, “This is our favorite store.” At the moment, it’s mine, too.
Jeff (the mild-mannered one) said on December 17, 2008 at 10:31 am
Ah, the little bottles for the baby.
There’s not only the problem that ad staffs aren’t able to even imagine what they could be selling, and the fact that they’re buying on-line webpage packages that they can’t manipulate (and hardly have anyone on staff that knows how to write code even if they could crack the programming from the vendor), but the fact that they’re still stepping up the efforts to sell text, print or on-line, to people who don’t read. “Linking more video content” is their answer when you ask, but it’s still an adjunct to a mainly text-based experience.
On the “we’ve been here before,” i linked a quote from a New Yorker review about Sam’l Johnson and the awkward gap between business models at the end of the previous comment thread.
mark said on December 17, 2008 at 10:46 am
Sounds like you are asking the right questions. I don’t have much by way of answers, just one big hunch.
I don’t think people notice internet ads like they do paper ads. They don’t register. I’ve been visiting here for a few months and, while I know your site has an ad or two- I can’t remember or name a single advertiser.
Even though i get most of my news from the internet, and don’t see that changing, the process seems different than the days of paper papers. There is a subtle urgency to reading on the internet that isn’t there with a paper. Reading a paper is an experience- ads included. When I read a paper, I’m noting what is there and what is not there. With the internet it’s always there somewhere.
I don’t think internet ads are worth much of anything, excepting porn and dating services which have apparently found a lucrative presence on the internet.
I like your ideas and thoughts, though. Solve the puzzle you’re attempting and win big cash prizes.
Julie Robinson said on December 17, 2008 at 10:53 am
We’re still a 2 papers daily family but I can see it won’t extend to the next generation. When the am paper is late, which is more and more often, we wander around, bereft, trying to figure out how to behave. Online reading doesn’t do it for us. I have great empathy for Detroit readers.
nancy said on December 17, 2008 at 10:54 am
Most of my ads are Google text ads, which are shit, pay me practically nothing and don’t register with anyone, Mark. So I’m not surprised you don’t remember them. I can’t remember the last time I got a payment from them, either.
Now if Great Glam was an advertiser here, brother, you’d remember them.
Gena said on December 17, 2008 at 10:55 am
I don’t know, the homepage of indystar.com has an ad for Birkenstock (!) that sucked me in. Would love to see the rationale for that placement –
coozledad said on December 17, 2008 at 11:03 am
The only time I’ve ever seen a woman in anything like those Great Glam clothes is when a friend of mine dressed up as a “Cosmo Slut” for the Halloween Beaux Arts ball.
She won third place for the costume prize with Wendy O. Williams second and the naked woman in Zebra body paint first.
mark said on December 17, 2008 at 11:05 am
So let’s market nn.c to great glam! Winners all around!
Gena said on December 17, 2008 at 11:29 am
Ok, I’m clueless how it works on a site like this. If advertiser X called you up and said they’d like to run a banner ad on your site, do you control that? Does it have to go through Google? Do you decide how much it would cost?
alex said on December 17, 2008 at 11:36 am
The ads on the Fort Wayne Newspapers web site are memorable for only one thing — loud, irritating recordings accompanied by graphics that take forever to load. This shit tries my patience almost as badly as the unreliable delivery people in my area, which is why I no longer subscribe.
Jeff (the mild-mannered one) said on December 17, 2008 at 11:41 am
(and when you have no one who can change settings and layout on your paper’s website without calling “customer support” who usually tell you “that’s not alterable under the terms of service” let alone people who can figure out how to use what you can adapt to fit your local readership . . .)
Knowing how to actually *use* the technology is a big part of the problem. Meanwhile, all the Google Ads entries i see here on this comment thread are for buying newspaper advertisements – snort.
Musky said on December 17, 2008 at 11:42 am
I’m a lurker on your site who has posted maybe once or twice before. As the editor of a small, daily newspaper, I share your frustration and concerns.
You’re 100 percent right that many — maybe most — people are better informed. I read parts of a dozen or so newspapers and blogs every day. That’s way more than the 2-3 newspapers a day I’ve always read.
But my question is: When are we going to stop giving away our product? Isn’t it time to make people pay online to read information about our communities that they aren’t likely to ever get anywhere else.
Dave said on December 17, 2008 at 12:09 pm
I sure hated to hear about the Detroit papers cutting back to three issues per week. I hope all the other papers don’t follow suite, but I’m not overly optimistic. I’ve said for a long time that the “lack of old newspapers” will be the final nail in cellulose insulation’s coffin.
Jeff (the mild-mannered one) said on December 17, 2008 at 12:12 pm
Selling news retail, piece by piece, isn’t the only way news has been paid for, so i’m not sure it’s wise to talk about “giving way our product.” Who pays where for value received . . . i remember my dad saying about cable TV “who the bleep will pay for something they get free from the aerial?” I think advertisers need news and quality content to get their work done and sell their product, so the real question is how to get them to pay reasonably for it so the news work is reasonably supported.
Which is why cutting back delivery and starting to push up online rates only makes sense to me, but Nancy’s asking about the how and who of what ads cost. Sponsorships per page/section more than popups and banner ads to connect products with certain ideas or areas of interest seems like a better model, which is what i got from her “Tiffany’s” example. What’s the internet version of delivering that page 3 top right experience . . .
Jenflex said on December 17, 2008 at 12:13 pm
Hey, Beloved Hostess,
I’m on the flip side (advertiser) of all this, and I can say there are a couple issues…and I love advertising in newspaper Web sites.
First, I do pay for total circulation (page views), not just clicks. We rate an ad’s efficiency by its CPM, or cost per thousand impressions. So, the click-throughs are just a bonus…one we watch, but the click-throughs say more about our offer than they do about the strength of the placement. And, Nancy is right the ads are inexpensive relative to the investments in other media, in some cases; not so much in others.
Unique users is an important figure, but it tells me more about the reach in a market than it does the price I’m willing to spend…it helps me determine whether the Web ad is a better investment than the alternatives (which are also declining in effectiveness and efficiency).
My biggest issue with the medium is that I can’t do anything that’s remotely flighted. I’m either in, or I’m out. Permanently, all the time, on contract. (Contributes to the wallpaper problem, to be sure.) Space is more scarce relative to print, and I’m competing against everyone else who wants the space, so I’m stuck with the contract, even if I don’t have anything to say. Which makes my ads look, yet more, like wallpaper.
Where I see the news outlets really facing a challenge is in their source as a place for individuals shopping; researching deals; kind of “keeping their eyes open.” Part of the value in receiving a pulp paper was to get the ads themselves…they used to be of actual value (and add value for the paper, as well) for people who were shopping.
That’s the value that is gone, and that I don’t see returning. Online, I don’t see news outlets being able to overtake the search engines as a venue for research on what deals, what features, what prices, etc. If I want to sell a CD rate to someone under 30, they aren’t getting the paper…they’re subscribing to my RSS rate feed. Or they’re Googling someone else, or checking out Bankrate.com (etc., etc., etc.).
Just my $0.02. ($0.05?)
nancy said on December 17, 2008 at 12:27 pm
Musky makes an interesting point. The whole shootin’ match falls apart if newspapers charge for content. But no one knows how to, exactly. The WSJ isn’t giving everything away just yet, although most people believe they will, eventually. The NYT model (Times Select) had it exactly backwards, charging for opinion and offering news free, when it should be the other way around. Most magazines are far stingier, sharing only a teaser.
I’ll tell you one thing I’m real sick of — bloggers who mock any effort to curtail content. When the AP announced it was going to start enforcing “fair use” quoting, you’d have thought they’d held a book-burning. Maybe we’re building toward a precipitating event — a lawsuit, or probably a bunch of them — that resets copyright law. Someone told me the other day that they’ve started watching TV shows online via Hulu and iTunes, and would happily sit through any number of ads to do so, because the freedom and flexibility was what they prize about the experience.
I think you have to deliver quality first. The WSJ and Financial Times can charge because they deliver first-grade content. Which is why cutting staff is cutting one’s own throat.
Jenflex makes a point that ads are billed both at cost-per-thousand impressions and for clickthroughs. All I know is what GoogleAds tells me, and admittedly it’s a bad example, but here goes:
Yesterday I had 2,197 page impressions and 948 uniques — about average for me, post-election. Payment: zero. The day of the Goeglein story and immediately afterward, it was around 30,000 uniques and about twice that many page views, and my payment was under $2.
Whenever I mention ad clicks, I always get a few (thanks, Brian!), and I should also note that it’s technically against my agreement with Google to encourage it. So far today I’ve gotten seven. Payment: 38 cents.
This makes no sense to me. We’ve noted before that GoogleAds are whack, anyway — the algorithm that matches them to my content is ridiculous, and I don’t think it’s better anywhere else. (I first saw Great Glam ads on Alicublog, a site dedicated to making fun of the right-wing blogosphere.) But, to answer a previous commenter, without an ad sales or support staff, it’s probably the best I can do.
Catherine said on December 17, 2008 at 12:33 pm
Jenflex, you have some great perspective as an advertiser. As a sometime marketing person myself, I have a couple more observations:
1) Internet ads are a great deal.
2) Being able to track click-through is a huge advantage over most other forms of advertisement.
3) I’ve done Internet campaigns with 4% click-through rates and 2% close rates. A direct mail campaign with those numbers would have been considered a huge success and we’d immediately have tried to copy everything about it to the next campaign.
4) People are fearful of change. In my last marketing job, I would have guessed, and I proposed probably 8 years ago, that we start to move our mix from 75% direct mail/20% print advertising/5% other, toward 50% Internet/25% direct mail/20% print. You’d have thought I was Che Guevara proposing a world with no property rights. Today, that same organization is probably 70% direct mail/20% print/10% Internet… and getting the same results.
Bottom line, Internet ads can be terrific, but marketing folks can be slow to leave the tried and true.
Jenflex said on December 17, 2008 at 12:38 pm
OK, so by the CPM metrics/benchmarks I use, NN.c value should be between $5-$20 per day on average, for the right advertiser, in a display ad of some sort.
Here’s a new business paradigm: find me a media buyer that can tell me which blogs I should advertise in to reach a particular audience, and then broker the deal, and I’ll gladly mark up my CPM accordingly. That, to me, is added value.
Surely there’s some bright, entrepreneurial soul out there who could do that, on the Web, efficiently….
Jenflex said on December 17, 2008 at 12:40 pm
(OK, I’m comment-happy today).
Nancy, you should look for ads from small wineries, book referrals to Amazon pages, and (when they get to this point) ads for mainstream media outlets. They’re already benefitting from your blog links…that’s a way you are adding value for them; eventually I would see that being compensable.
Jenflex said on December 17, 2008 at 12:42 pm
Catherine: I am so with you on the media mix changing slowly! The media is changing faster than the consumer (advertiser, this time) mindset.
Catherine said on December 17, 2008 at 12:46 pm
Jeff asks (and mark makes a similar point), “What’s the internet version of delivering that page 3 top right experience?”
I’d humbly submit dooce.com as an example of how to lay out a webpage to make ads noticeable, and how to use the banner. Not that I think the content in any way rivals that found here.
Connie said on December 17, 2008 at 1:02 pm
I just ran into a newspaper page that wanted me to pay for content. I was at a legislators meeting the other day and a photographer from the Kendallville News Sun asked me my name because she had taken my picture. I looked for it online, but this paper is part of a Fort Wayne papers group that requires payment and login to see all articles. Wonder if I’m in there today or yesterday.
Jeff (the mild-mannered one) said on December 17, 2008 at 1:18 pm
Catherine, i’m stealing that Che line — nicely put. (Yes, i’ll give credit, “an unknown blogger said”.)
MichaelG said on December 17, 2008 at 1:21 pm
How does Josh Marshall do it? He seems to be making money.
deb said on December 17, 2008 at 2:07 pm
a blogger ran an op-ed piece in our paper recently with this lede: “i’m one of the reasons that american journalism is in trouble.” she’s a news junkie who has stopped buying newspapers and magazines because online news consumption “meets two compelling social needs: a desire for community and a desire to know and understand others.”
this is my favorite part, though: “there are more than 400 school districts in wisconsin. i don’t think there are 400 reporters tasked to cover them all, but a local blogger can cover one and can do this exceptionally well.” sure, until he decides to skive off the meeting where they decide to double my taxes.
there is something truly terrifying about these people who seem to think journalism is such a simple-minded enterprise that any fool with a notebook can do it. and how do i know this blogger in bumfaulk isn’t sleeping with the school superintendent, a disgruntled former employee with a penchant for firearms, a garden-variety whack job, a parent with a beef against the principal, or… and what will these folks do when the board decides to convene an illegal closed session? do they have a lawyer they can call?
go right ahead, round up all these reporter wannabes. but when they don’t make it to the next board meeting because the streets were icy, or left early because the whole damn thing was just TAKING too long, don’t come bitching to me.
del said on December 17, 2008 at 2:14 pm
With all the free content out there I feel like I did about music in Napster’s heyday. There will be a reckoning soon and a business model will crop up that preserves payment for content. Fair use type lawsuits, etc. And the thought has crossed my mind that the NYT and others have given away their product shrewdly, so as to winnow out smaller papers before that day arrives.
del said on December 17, 2008 at 2:21 pm
The NYT video stories are very strong. (eg. today’s article and video about an 85 yr old mount climber.) Have a feeling that print journalism will change to become like a quasi network news show.
Big problem with internet advertising: geography. Where are the customers?
Catherine, I just parted with $800 to advertise with Google “affiliated” Localbiz.now for my business. The results after 2 weeks — absolutely nothing. No website views, no telephone calls, nada.
Deborah said on December 17, 2008 at 2:34 pm
I’m with Mark, I don’t think people notice internet ads like they do print ads (in the NYT anyway). Part of it, I think, has to do with quality, but I’m a graphic designer so of course I’d say that. There’s often just too much visual information to digest, it all comes screaming at you and it’s information overload, you tune it out, it’s white noise mostly. IMHO. I think the same thing about interactive touch screens in museums, I pass them by, I’d much rather look at physical specimens or whatever than moving pictures on an LCD or plasma screen. I think it is because of ubiquity of TV. I’ve designed exhibits and I try to avoid the digital displays as much as possible.
Musky said on December 17, 2008 at 2:50 pm
Jeff (the mild-mannered one) is right when he says “the real question is how to get (advertisers) to pay reasonably for it so the news work is reasonably supported.”
It’s not that way now. At my paper online ad revenue shows huge percentage increases most months over the previous year. But it’s still less than 10 percent of the total revenue generated by the newspaper.
Yes, I’m tired of giving away the news content. But what I’m really tired of is the bloggers who, in one breath, call my newspaper a dinosaur, and in the next, link to the work of the newspaper’s reporters and use it as the foundation for a blog entry. I’m tired of watching some of the same bloggers copy and past AP stories that my newspaper pays dearly to use.
Journalism is not rocket science. Anyone can learn to do it and do it well. But it takes practice and effort. I have watched more than one blogger do exactly the things deb mentioned in her post.
I really like online journalism. We’re shooting video and beating the electronic media to all kinds of stories. Covering a developing, breaking story on our Web site is one of the most-fun things I’ve ever done as a reporter and/or editor.
And it is working. I just checked our Web statistics. We are a small newspaper (7,500 circ.) Yesterday, we had more than 60,000 page views. That number has more than doubled in the past year. The number of unique daily visitors has increased by more than 60 percent in the past year.
But I’m tired of continually doing more with less at a newspaper that is still far more profitable than many of its readers might imagine.
I hope someone figures out the new business model before it’s too late and no one is left to turn out the lights.
Kirk said on December 17, 2008 at 2:57 pm
Journalism also relies heavily on standards that don’t seem to occur to most of the people who aren’t in the business, including the bulk of the so-called “citizen journalists” that Deb rightfully worries about.
nancy said on December 17, 2008 at 3:16 pm
Deb (and Kirk, and Musky) are absolutely right. This is why I avoid the bloviations of so many new-media gurus — Jeff Jarvis, et al — and their pie-in-the-sky scenarios of our brave new future. They forget that many days, this job is simply a flippin’ grind, and the “fun” of covering your local school board will wear off fast.
The media world they hope for sounds simply exhausting, even for a dedicated news junkie: You get this coverage here, and that coverage there, and oh wait here’s a blogger who’s doing X, and you’ll want his RSS feed bookmarked, etc. As Deb says, I can’t wait for some of these chickens to come home to roost. I’m still amazed at how many PR people think I/we accept substantial gifts, or should give them “text approval” before we submit stories, and so on. (Noted: Many publications, mostly glossy magazines, do these very things.) Wait until some shifty blogger figures out how to work those angles.
Rana said on December 17, 2008 at 3:36 pm
Nancy – you might look into Project Wonderful for your ads – they’re using a different model than click-throughs, in which advertisers bid against each other to place an ad in a slot you determine (both size and minimum bid). Whoever wins the slot has to pay you the amount of the winning bid, regardless of clicks. (It’s something I’ve been considering as an advertiser, for my shops on etsy and redbubble.)
On online papers and content… I tend to not notice the ads because most online newspapers are such a dog’s dinner of graphic noise. There is too much to look at, with some teeny chunk of text in the middle, text which usually rolls over onto a second page. The only time I read these things is when someone else links to them, or when a headline on Yahoo news shows up in my mail and catches my eye. If they streamlined the look, it’d improve both the appeal of the content and make the ads stand out more.
I think the way that sites like Salon.com handle ads and access make sense – if you pay for a subscription, you forgo the ads, except for a few small banner ads here and there. If you don’t want to subscribe, then you “pay” for a “day pass” by watching a video ad before gaining access to the site.
I also think that online news services might want to look into the possibility of payment for _use_ of content, rather than access to content. That is, if a blogger goes to Big Newspaper. Com, and reads a piece there that they find interesting and want to comment on, they can either (a) pay for the right to excerpt from that piece and publish it on their blog (with a link back to the original a mandatory part of the deal) or (b) link to the piece without excerpting from it. HOW one would manage this, technically, I’m not sure, but that seems like a model that could work and keep everyone satisfied.
Jeff (the mild-mannered one) said on December 17, 2008 at 4:06 pm
Gifts? When is someone going to offer me gifts, darn it? I’m sure i can’t be bought, but i’d like to have my integrity tested, at least.
The skunk in this woodpile is, as Musky said, it isn’t that print journalism isn’t profitable. It just isn’t returning 40% any more (and won’t anytime foreseeable), but it’s doing better than running a grocery store or even big box retail (net store margin for Walmart is something like 3% last i heard reliable figures; any grocery store asks clerks in training what they think profit on $25 bag is, and all are always stunned to learn it’s 75 cents, which is why slippage is no small deal).
So newspapers are getting whipped like drayhorses because they’re *only* showing 12% profit, when the hairball who leveraged their way into ownership borrowed the money on a 20% assumption for thirty years. Actually, it’s a better business model than running a TV station, printing books, selling recorded music, promoting concerts, or [koff] making cars.
Which makes me say again, the Tribune Company shouldn’t have to declare bankruptcy — Sam Zell is the one who’s bankrupt, but he set up the purchase so if he couldn’t make payments, it’s the fault of the company he bought with the borrowed money. Anyhow, newspapers still make money, just not as much as they used to, a point that doesn’t come up often enough.
nancy said on December 17, 2008 at 4:21 pm
There was a business reporter at the Dispatch when I was there. One day she went out to do interviews for a routine feature on a company that made very high-end garden hoses. High-quality rubber, solid brass fittings, made to last a lifetime. They were the hoses used in the White House Rose Garden. Expensive. You get the idea.
So she does the interview, and at the end, the company president and a couple of his underlings make a big deal of presenting her with one. She turns it down flat; of course she can’t accept such a thing. “But we had it made for you!” they say, and sure enough, she looks down, and her name is embossed in the rubber, for its entire length: AndiGates AndiGates AndiGates. She splutters, they’re slack-jawed, and she finally ends up rushing out of the office without the hose. They were very offended, but jeez — it would have been so wrong to take anything like that. On the other hand, what were they supposed to do with it?
I think the incident was resolved when all parties agreed to donate the thing to the zoo or something. I hope the executives learned a lesson along the way.
Oh, and Jeff: I see your point, but we’re told the Detroit papers are actually losing money. As in, “in the red.”
Kirk said on December 17, 2008 at 4:56 pm
And many of those papers that are still in the black remain so only because they’ve cut the hell out of their staffs.
jeff borden said on December 17, 2008 at 4:59 pm
No question some newspapers are losing money. Some are making tons of it. Anyone see that chart of the Gannett holdings that showed a whopping 45% profit margin at their Green Bay property? Even in Ohio, the Cincy Enquirer was doing a solid 13+%.
The only time Wall Street likes newspaper stocks is when companies are announcing layoffs, acquisitions and mergers. How did that come to be? And how did 20+% margins become the rule? Did Al Neuhart throw that much weight around when he was running Gannett?
Re: print and Internet. Right now, the Chicago Sun-Times is operating a nifty little Web site called http://www.blagobusted.com, where you can find all things relating to our corrupt and corrupting governor. (Blagojevich just hired Ed Genson, who successfully defended R. Kelly on kiddie pornography charges but also has lost some huge cases including the defense of Lord Conrad Black, who pillaged the Sun-Times of tens of millions that will never be recovered.)
Julie Robinson said on December 17, 2008 at 5:16 pm
Knight Ridder was consistently earning 10-15% but some little t*** in Florida decided that wasn’t enough and started the process that led to its breakup/demise. FWN had for years been even more profitable then KR as a whole and yet was always being sqeezed for more.
None of that is to say that newspapers wouldn’t have run into the internet problem anyway, only that management, like at most corporations, was being ruled by quarterly profit statements that precluded spending money on developing new products. There were many good people with great ideas, but they never got a real hearing because they couldn’t show a quick profit.
paddyo' said on December 17, 2008 at 5:31 pm
Thank you, Deb, for nailing so succinctly the No. 1 Problem with the post-newsroom fantasyworld of news coverage that too many blogmeisters think will be Just A Piece Of Cake. It’s what drives some ink-strained editors to think that “crowdsourcing” is the answer to staff cuts. If only . . .
One of my daily duties at my post-newspaper-journalism-career job is to comb yesterday’s/today’s dailies and other pubs online for stories/topics related to my employer/agency. In the process of doing that, I occasionally run up on “content” in one or another of those “Examiners” that sprang up here and there and not-quite everywhere over the past coupla years, on printed paper and online.
Interestingly, when I click on the story link from, say, the “Washington Examiner,” the page that pops up has “Denver Examiner” on the . . . I dunno what to call it, the “template” or wallpaper or whatever . . . that surrounds the actual story or item that I was seeking. I realized the first time that, well, the Examiners’ central computer-serving “brain” recognizes that I’m from one of the towns where it has an Examiner (online anyway), and thus it automatically throws that template, and its contents and (getting to my point here), maybe its ADS at me? I have to admit, I stopped noticing the ads because I was just after that specific news item I was seeking.
Anyway, it makes me wonder if that sort of bundling or linking or whatever the ‘Net mavens call it is transferrable to groups or networks of bloggers (like Nance) or others that can improve the ad revenue stream.
Obviously I haven’t thought this one all the way through, so probably I’m forgetting/ignoring/not knowing some critical factor at play. But that ability of the ‘Net to zero in on ME and decide what to throw up on the screen when I go in for a specific thing . . . well, it’s sorta like how Google Mail would throw up a one-line ad for, say, “The Wire,” atop my inbox whenever I’d open an e-mail from a friend chewing over the most recent episode when that best-show-ever was still on.
Dexter said on December 17, 2008 at 6:15 pm
…how much is Elvis getting paid to be in that in-booze-store billboard ? At least we know he’s safe.
Catherine said on December 17, 2008 at 6:33 pm
That pay-to-play thing that several people alluded to above used to drive me nuts as a marketer, specifically: If you advertise in this publication and schmooze me at conferences, we will review your product in our pages. Otherwise, that press release will be used as T.P. in the executive washroom. That is not the case, as Nancy’s hose story illustrates, with newspapers, but I wonder how many bloggers have picked up on the you-scratch-me-I’ll-scratch-you thing? Not many, per Jeff.
Jeff (the mild-mannered one) said on December 17, 2008 at 7:05 pm
Really, even the Freep? I’ll defer to direct knowledge, but my impression has been that even “money losing” papers are actually papers not making as much as their buyers planned to have them earn to pay their debt.
To change the subject briefly, here’s a delightful “well, duh” headline — http://www.nytimes.com/2008/12/17/dining/17bake.html
Catherine said on December 17, 2008 at 7:12 pm
Ode to Butter. Yum.
nancy said on December 17, 2008 at 8:08 pm
Jeff: Here’s my source on Gannett profit margins. Detroit’s losses — shared by the JOA — are around 5 percent.
brian stouder said on December 17, 2008 at 8:13 pm
Is there such a thing as web-publishing that discourages copy/paste of the text?
(For example, I don’t think you can copy/paste text from a pdf document)
Seems like if copy/paste is disabled for copyrighted text, then when it shows up on a blog somewhere, there’s no doubt that a conscious effort was made to violate the copyright, and a bill will be due and payable.
I agree with the folks who say that some combination of successful lawsuits and technological upgrades will yet save the professional news operations.
Maybe some accepted norm will evolve – wherein part of your bill for internet access goes into a big pot, which then gets disbursed to the real news organizations that draw the most traffic…sort of an updated version of the FCC licensing that created and protected tremendous value for the broadcast radio and tv media
moe99 said on December 17, 2008 at 9:48 pm
a pretty darn good youtube video put together by an advertising firm, far as I can tell. Wonder if this will get them any business?
Then, I hope these guys are invited to the inauguration parade. From Plymouth, Michigan, the Fred Hill briefcase drill team:
alex said on December 17, 2008 at 10:18 pm
I used to write for trade magazines. It was expected that you’d accept gifts and then write effusively about them.
Jeff (the mild-mannered one) said on December 17, 2008 at 10:54 pm
Yeah, i should have remembered Jim’s gannettblog for that. It’s indicative of the general ill health of the Detroit economy that the Freep ends up such an outlier in 07, let alone now.
But i’m still a little baffled — NNCO, f’r instance, includes the Newark paper (or does in every statement i’ve gotten over the last decade), so is the profitability figure for NNCO include Newark, which is then also listed sep, or am i missing something?
Sadly, this maintains my general if not Detroit point that newspapers are making a fair amount of money, just not as much as their overleveraged buyers expect. And the income from plain vanilla circ is so little that it makes sense to peel off a chunk of the delivery and production cost, having no doubt warned the advertisers that there’s going to be change, but don’t expect a reduction in ad rates if you bought the full print/online package.
Maybe the Freep needs butter.
Catherine said on December 18, 2008 at 12:07 am
We all need butter. And bacon. And chocolate. At least until after the solstice.
basset said on December 18, 2008 at 12:56 am
Meanwhile, one of the better rants you’ll see about the current state of the newspaper business – play the first video at:
and scoot it forward to 3:02.
Gasman said on December 18, 2008 at 1:52 am
Thank you for the video link. I have now entered the phrase “infuriating little piss-weasels” into my personal lexicon. I expect that it will see it’s rightful place in my vocabulary’s rotation quite soon. (Scroll to 8:40 in the video above.)
nancy said on December 18, 2008 at 7:29 am
Yes, basset. My takeaway from the same clip is, “I’m so old my pussy is haunted.” Still chuckling.
alex said on December 18, 2008 at 7:47 am
And the cavalierness about shooting up a school. It’d never play in America these days.
Kirk said on December 18, 2008 at 9:12 am
R.I.P. John Byrne, lead singer of the Count Five (anyone remember “Psychotic Reaction”?).
LA Mary said on December 18, 2008 at 1:36 pm
Catherine, you just recreated my shopping list from Trader Joe’s last night.