Newspapers have cut their way out of crisis. More radical surgery will be needed
Jun 10th 2010 | from PRINT EDITION
WHATEVER happened to the death of newspapers? A year ago the end seemed near. The recession threatened to remove the advertising and readers that had not already fled to the internet. Newspapers like the San Francisco Chronicle were chronicling their own doom. America’s Federal Trade Commission launched a round of talks about how to save newspapers. Should they become charitable corporations? Should the state subsidise them? It will hold another meeting on June 15th. But the discussions now seem out of date.
In much of the world there is little sign of crisis. German and Brazilian papers shrugged off the recession (see article). Even American newspapers, which inhabit the most troubled corner of the global industry, have not only survived but often returned to profit. Not the 20% profit margins that were routine a few years ago, but profit all the same.
It has not been much fun. Many papers stayed afloat by pushing journalists overboard. The American Society of News Editors reckons that 13,500 newsroom jobs have gone since 2007. Readers are paying more for slimmer products. Some papers even had the nerve to refuse delivery to distant suburbs. Yet these desperate measures have proved the right ones and, sadly for many journalists, they can be pushed further.
Demolishing the house that Otis built
Newspapers are becoming more balanced businesses, with a healthier mix of revenues from readers and advertisers. American papers have long been highly unusual in their reliance on ads. Fully 87% of their revenues came from advertising in 2008, according to the OECD. In Japan the proportion is 35%. Not surprisingly, Japanese newspapers are much more stable.
The whirlwind that swept through newsrooms harmed everybody, but much of the damage has been concentrated in areas where newspapers are least distinctive. Car and film reviewers have gone. So have science and general business reporters. Foreign bureaus have been savagely pruned. Newspapers are less complete as a result. But completeness is no longer a virtue in the newspaper business. Just look at the fate of Otis Chandler’s creation.
Thanks to family connections, Chandler ended up in control of the Los Angeles Times in 1960. The paper he inherited was parochial and conservative, reflecting the city it served. Chandler jettisoned the anti-union dogma and set about building a west-coast rival to the New York Times. His paper was heavy on foreign news and serious, objective reporting. The result was hugely impressive—but not, as it turned out, suited to the internet era. In the past few years the paper has suffered repeated staff cuts. In 2007 it was acquired by a property magnate and in 2008 filed for bankruptcy protection.
The problem with such newspapers is that, although they do much that is excellent, they do little that is distinctive enough for people to pay for it. The Los Angeles Times’s foreign reporting is extremely good. But it is hard to argue that it is better than the stuff supplied by the New York Times or foreign papers—sources to which the residents of Los Angeles now have unfettered, largely free access via their laptops and iPhones. Similarly, it has never been clear why each major newspaper needs its own car reviewer: a Corolla is a Corolla, whether it is driven in Albuquerque or Atlanta. And by extension, it is not clear why presidential candidates or sport teams require huge journalistic entourages. Papers should concentrate on what they do best, which means, in many cases, local news and sport. If the rest is bought in from wire services or national outfits, readers are unlikely to complain—as long as there is enough competition between those larger providers to keep up standards (and thanks to the internet there probably is now). Specialisation generally means higher quality.
It is grim to forecast still more writers losing their jobs. But whether newspapers are thrown onto doorsteps or distributed digitally, they need to deliver something that is distinctive. New technologies like Apple’s iPad only make this more true. The mere acquisition of a smooth block of metal and glass does not magically persuade people that they should start paying for news. They will pay for news if they think it has value. Newspapers need to focus relentlessly on that.
from PRINT EDITION | Leaders