Publishers: Don’t Punish the Readers
A long time ago even Pennysavers raked in the money just on classifieds alone. I should know, because I used to design ads (both display and classified) and manage the computer network for a Pennysaver. I didn’t typeset those little text ads. They were done by minimum wage making working mothers and elderly ladies. At first it was done on phototype machines but then we got smart and had them typeset on Macs. When we purchased those Macintoshes and some of those ladies in the classified section lost their jobs, boy was there a lot of screaming and yelling. This was back in the early 1990s, so in the entire history of the newspaper business, it really wasn’t that long ago. When we implemented a pagination system so that we didn’t need the paste-up artists anymore few years later, again people bitched and complained.
Back then Apple Macintosh networks were rather small affairs and in small shops the head Graphic Designer was most often also the Macintosh network administrator. Crazy, I know. If this was your lot in life at the time, then you must remember what it was like being caught between a rock and a hard place suggesting to your Art Director and Publisher and Editor the immense savings they would see from pagination and typesetting on the Macintosh. See you were essentially selling our your fellow artists because some of them were going to go extinct in the transition to all digital design and lose their jobs from this change. On the other hand, if you didn’t suggest these small investments in equipment and software to show a cost savings, someone else was going to come in the door very soon and do it. Then you lost your job (or risked demotion.)
When the cost savings was going toward the publisher, all was well and good in the industry. We happily traded human power for machine power in the production department because we could slash costs while still cornering the market on display ads, a market monopoly the print business had since Ben Franklin’s day.
Then one day a guy named Craig came along with his confounded list and ruined the party. We all know the story of how the newspaper business made a ghetto out of the web until they just couldn’t ignore it anymore. Call it blindness. Call it ignorance or arrogance. Call it what you will, but publishers let it all go by as they watched first Google, then eBay then Craigslist steal their revenue right out from under their noses when what they should have been doing was hiring these guys and buying them out for pennies on the dollar before they were billionaires. The web was just the ultimate printing press but no one (except young innovators who may or may not have been bought for a song back in the late 1990s) saw it for what it was.
Newspaper men will be newspaper men and now that the truth is staring them right in the face, what do they do? Go after the little guys once again. Just like when technology made it easier to beef up the bottom line by eliminating costly staff and their benefits packages publishers like Rupert Murdock think a paywall is the life preserver for their sinking industry.
“Google is ruining our business!” they cry, among other things.
What they don’t realize is that what traffic they are getting is because of the sites that scrape their stuff and provide backlinks. Or the search engines that crawl their news sites and provide an easy way to find news then go read it, even if it is one story at a time.
The rallying cry of the industry: Blame Google. But that’s the lazy way out. What they aren’t looking at are the advertisers. Google manages to monetize their product very nicely with ads sitting astride news results being only a small fraction of their income, according to an op-ed piece in the Wall Street Journal by Google CEO Eric Schmidt.
Newspapers and magazine publishers rushed to get online put the cart before the horse, so to speak. At first it was a ghetto. Then it was the place to be. But what they didn’t do is think about a business model before throwing all their content up for the world to see for free.
I don’t have numbers to support this but I suspect that if you take out distribution and printing costs what’s left can be supported strictly by advertising in the news industry if you do it right. I think a website like newjerseynewsroom.com poses as a model. Ex Star-Ledger newspaper staffers started this news site. It seems to be going string but I can’t find any stories on its financial stability.
The New York Times or the Wall Street Journal with the sheer number of visitors they get and the long history of each of these publications can easily dictate to advertisers a fair price for all those readers. They are not eyeballs or clicks, they are exactly what they used to be: readers of papers of record.
By the number of times I see these news organizations’ stories cited by bloggers and on twitter I have to suspect that they also have just as high a brand loyalty and trust than they ever did when they were printed on paper only. Papers like that have to set the bar a little higher. They must charge what a reader in that paper seeing and ad is worth, just like they did when they were in print. No one in the world can compare one little blog banner or an ad network buy to a display ad on the New York Times website.
In another version of this blog post I wrote a couple of paragraphs about a central clearinghouse standard whereby all newspapers and magazine publishers can filter content to eReader devices to be distributed and charged a fair subscription rate. Alas real life beat me to the punch and I saw this story on Mashable about a Hulu type of website for magazines. I think it’s a step in the right direction. Of course it’s in the early stages and I know very little about it yet but it’s a start.