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Wasting Ink, Beating a Dead Horse

  |  February 20, 2009   |  Comments

Here's what newspapers need to do to survive -- and it doesn't include accepting micropayments online.

Lakes of ink have been wasted in the past month to discuss how to save daily newspapers.

"The New York Times" media columnist David Carr proposed that an "iTunes for news" be created. He reasoned that Apple has found a way to charge for music online, so perhaps a similar way could be found to charge for news online.

Then two Yale University financial analysts opined that newspapers cease being commercial ventures and become nonprofits supported by endowments:

    How large an endowment would a newspaper need? The news-gathering operations at The New York Times cost a little more than $200 million a year. Assuming some additional outlay for overhead, it would require an endowment of approximately $5 billion (assuming a 5 percent annual payout rate). Newspapers with smaller newsrooms would require smaller endowments.

However, the analysts conceded, "Only a handful of foundations and wealthy individuals have the money required to endow, and thereby preserve, our nation's premier news-gathering organizations." And what about the other 1,400 daily newspapers in the U.S.?

Steven Brill, founder of "American Lawyer" magazine and Court TV, proposed that people be charged to read stories on nytimes.com:

    All online articles will cost 10 cents each to read in full...A customer will be able to buy a pass to read all articles in one day for 40 cents. A customer could read all articles in one month for $7.50. A customer could read all articles in one year for $55.00. (Ad tag-line: "An Old-fashioned Tradition is Back: Read the Times for 15 Cents a Day.")...There would be a five cent charge to forward an article to someone else.

However, Brill failed to mention that "The New York Times" has already attempted to charge readers online...unsuccessfully.

Walter Isaacson also weighed in with "How to Save Your Newspaper: A Modest Proposal." The former managing editor of "Time" and the former chairman and CEO of CNN proposed that daily newspaper sites should stop providing free content and begin using micropayment systems to charge users.

And the blog LA Observed suggested this month that consumers must be force to value newspaper content:

    It's time for every daily newspaper in the United States, in cooperation with the Associated Press, to shut down their free Web sites for one week...People can do without news on the Web for a week. They won't like it. They'll complain about it. But, that's exactly what has to happen before they can be expected to care. Pulling the plug gets their attention.

Besides expending ink, these proposals have burned kilowatt-hours of discussions on blogs like the Nieman Foundation, Poynter Institute, American Press Institute, Newspaper Association of America, and World Association of Newspapers.

Yet all of these daft proposals miss the point: daily newspapers as we know them, whether in print or online, are doomed not because they aren't charging for content online but because people no longer want the traditional generic packages of news that editors hope might satisfy all people's needs and interests. People now have much more effective ways to satisfy their individual mixes of interests than reading a one-edition-hopes-to-satisfy-all daily newspaper. The 400-year-old era of traditional newspapers is over. They are obsolete.

A traditional daily newspaper is limited by its printing press: it can produce only one edition at a time. Editors are forced to produce editions that contain stories of the greatest common interests, plus some stories the editors think all people should be informed about.

The problem is that not everyone is the same. All people share very few common interests, such as the weather, wars, and impending disasters. Although some groups of people might share a few interests (e.g., New York Yankees fans or Prada handbag aficionados), each person has dozens or evens hundreds of very specific interests (e.g., Maroon 5, bonsai gardening, Anne Hathaway movies, and the town in which she went to college) and each person is a unique mix of those common, group, and specific interests -- it's what makes her individual.

Between 1605 and 1996, an era when people's only choice of daily changing information in text format was the newspaper, the majority of people read a newspaper daily. They didn't have any other choices.

But today people have access to literally millions of Web sites (plus hundreds of niche magazines and hundreds of special-interest cable and satellite TV networks) that together can more regularly and articulately satisfy each person's unique mix of interests than any generic daily newspaper. Because people now have these choices, fewer people are reading newspapers.

Throughout the 20th century, newspaper-reader surveys showed the average reader read only four to six stories per edition, no matter how many stories were in the paper. That hasn't changed, and it's worse with newspaper sites. Data from Nielsen Online and comScore Media Metrix show the average newspaper-site user visits only two to eight times per month, reads less than 25 stories all month long, and spends less time on site all month than the average print-edition reader spends on a single edition. The Web isn't the newspaper industry's savior.

People are abandoning newspapers because reading a traditional edition is vastly inferior for satisfying their diverse needs and interests than using the Web (plus specialized TV channels and niche publications). They have better choices for information, never mind that they don't have to directly pay for it.

This trend of people moving away from generic information packages toward individualized mixes of online and specialized media was clearly discernable a decade ago. Unfortunately, most newspapers companies have squandered the years since then.

If the newspaper industry wants to survive, it must begin mass-customizing its products on- and offline, rather than trying to find ways to get people to pay for the obsolete generic package. The technologies to create individuated daily newspapers online and in print exist. Newspaper companies must adopt these technologies before their traditional businesses are completely dead.

Attempts to get people to pay, micropay, endow, or otherwise subsidize the traditional generic editions in an era when people have so many better choices is simply beating a dead horse. No amount of ink is going to bring it back to life.

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ABOUT THE AUTHOR

Vin Crosbie

As managing partner of Digital Deliverance LLC and publisher of the "Digital Deliverance" newsletter, Vin Crosbie advises news media worldwide about new media strategies and tactics. As adjunct professor of visual and interactive communications and senior consultant for executive education in new media at Syracuse University's S.I. Newhouse School of Public Communications, he teaches that wisdom to graduate students and media company executives. "Folio" magazine called him "the Practical Futurist." "Editor & Publisher" magazine devoted the overview chapter of its executive research report "Digital Delivery of News: A How-to Guide for Publishers" to his work. And his speech about new media to the National Association of Broadcasters annual conference was one of 24 orations (including some by President George W. Bush, Condoleezza Rice, Hilary Clinton, and Barack Obama) selected by a team of speech professors for publication in the reference book, ">Representative American Speeches 2004-2005."

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