From The Publisher in Palm Beach

I know the Germans have bombed Pearl Harbor.

But I also know it's not over.

 

Hammer is rolling.

 

i insulted the sec on another thread.

 

I read these posts on here all the time. I just shake my head.
The fact remains, there is no business model for this to work. It has little to do with management or mismanagement, more to do with a muddling product and antiquated delivery system/process. The idea that a 50k circulation paper is going to survive without the print product is fallacious thought. The market for local advertising is small and adjusting the rates to online leaves further diminished revenue.
Now, regional and national advertising does better. There's more competition in these zones. And, at that level, 90+% of American papers are a nonfactor. And the ones that are, are struggling for their piece of the Madison Ave. pie.

 

So you don't think a Web site full of solid breaking news and a print product full of well-written features and agate/stats can find a way to be successful?

 

Well, ain't that the multi-billion dollar question.
I think we're going to find out pretty soon. In the end it will be dependant on the market and not the industry. The market will have to be big enough for both print and online user and advertising support.
And, the same uniform package throughout the industry will not work. The same product in Kansas City will not work in Seattle will not work in Orlando. We're going to have to customize our product(s) the best we can to suit our customers.

 

Can a company providing good journalism be financially successful? Sure, depending on what you consider to be successful. Some would say 15% profit margin is pretty darn successful, but the current suits disagree. A financially stable media company in a 50k market 10 years from now isn't going to have the same staff size as a 50k paper now. The low overhead cost of online journalism will make it easy for individuals or small companies to carve out a foothold, but the fragmented nature of online advertising and shrinking print ad dollars will make it harder to prop up a large company. That will take away newspapers' biggest current advantage over many online journalism sites -- their comparatively large staff and experienced personnel. You need that big a staff to mass produce quality journalism in a decent-size market on a daily basis. Yet, for existing newspapers to be financially stable in the future, that staff size would be the one thing they won't be able to afford. In such a marketplace, it would be more likely to see several smaller media companies competing in one market than having one big company per market as is the case today.

And newspapers are not the same as hamburger joints. Hamburger joints make all their money from customers buying their product; for newspapers, the income from what customers pay for their product is a small source of their overall revenue.

 

Earlier in the thread there was some discussion of whether 50 percent market penetration is good. It is. Here's the new Scarborough report:

http://images.mediapost.com/pdf/NewspaperRatings2008.pdf

 

Love how the Scarborough people figure a suburban daily should be judged by how well it penetrates the total market. It makes perfect sense to assume that the Bradenton Herald would be able to break into the markets on the north side of the bay.

 

No, that's the basic report. You can get county-specific information for a price. This is just the most general big-market information.

 

Frank is right. Scarborough Reports are tiered.
They will tell you how many papers are circulated in a county all they way down to reasons for cancellation for each subscriber, then break that down those reasons. (i.e. product no longer relevent, dissatisfaction with product, no time, conversion to web, etc.) The tiering depending on how much money you're willing to spend on the commission of specifics.

 

Newspapers have always been stories and advertising, they go together out of necessity, not because they have to. Online, readers are consuming the news, but not the advertising.

That doesn't mean they want the news any less, they just don't want the ads. And who can blame them? I hate ads. So we have to find a way to support the news without relying on ads.

The news part isn't the problem here.