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Posts Tagged ‘Orange County Register’

There is no Santa Claus. Many people in the news business know that as a literal fact, but they still believe there may be a kind of Santa Claus who will step into their lives. If they did not, we would not have stories such as this, from Nieman Lab this time, wondering what in the world Warren Buffett (or replace his name with your favorite media-owning billionaire) has in mind for his newspaper(s). The article by Joshua Benton wonders what might be read into the absence of tea leaves about newspapers in Buffett’s most recent letter to shareholders.

I’ll tell you what: Nothing.

In 2013, shortly after getting a new job after being laid off from Media General in the wake of Buffett’s purchase of that company’s newspaper assets, I was called by a reporter (perhaps it was Reuters, but I don’t recall for sure) who was working on a story about what Buffett was really after. I told her that from what I saw from the time of the purchase announcement in May 2012 through the transition period until the final cuts that November, you had to take Buffett at his public word — that he thought that prudent, conservative management would keep the papers viable and profitable for some time, but that he had no plans to experiment or try anything that would surprise people.

So far, Buffett’s company has been completely consistent on its management of the company’s newspapers, which is to say conventional. The managers are budget-minded. Papers have to make their “numbers,” above all. Everything has been consistent with what I saw in my brief exposure to that management structure.

So why the never-ending stream of stories wondering what lies over the rainbow, or whether there is a rainbow?

Because people thought Buffett was Santa Claus.

People in news don’t often think of news as a business. It’s a calling. It’s not a way to make money. People take pride that it doesn’t pay well, as people do when they get great satisfaction from a job that doesn’t pay well. It’s a mission. That makes it personal, to a great extent. But Warren Buffett, like most business owners, approaches his business as a business. This is business, but the news people are taking it very, very personal.

Please stop it, all of you. To the extent that Jeff Bezos or other billionaire-come-latelys to the business are trying new things or talking about new models, please, by all means, spread the word. New ideas need consideration. But please stop waiting for secret plans on how to get out of the quagmire from anyone who steps in and does not enunciate any plans that differ from what you already know or, as in the case of Orange County, require a reality other than the one you know.

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Nice column by the L.A. Times’ Michael Hiltzik about the breathless greeting every billionaire who buys a newspaper company receives. Summed up:

“Why do we keep getting taken in? Partially it’s the recognition that the economics of news-gathering are daunting in the modern age, solutions hard to come by, and the success of everything that’s been tried is still uncertain at best.”

I wrote something similar the summer of last year after Jeff Bezos bought the Washington Post, but I hadn’t revisited any of the cases I raised there. Hiltzik’s column saves me the work on Bezos (“The Washington Post has done superb work under its new owner,” he writes, and I would add that while it’s still early to judge the financial performance, things appear encouraging) and Aaron Kushner’s Orange County Register (“the Register is staggering financially”), plus adds a couple of new cases of billionaires jumping into journalism (though not newspapers).

But I still like my post’s ending better.

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Lord knows I want the Orange County Register’s print-centric business model to be successful. It is the model of simplicity: Beef up the content + charge for content = Profit!

But an article at The Guardian that asserts that model’s success doesn’t actually show any success, except in the area of spending more money.

The article sums up the paper’s approach since CEO Aaron Kushner took over Freedom Communications a year ago: Add more staff and pages, prioritize print over digital, erect a hard paywall. A quote from editor Ken Brusic perfectly captures the reasoning:

“Imagine it’s your daily coffee. Each time you put down your money the cup gets smaller and the brew gets weaker. That’s essentially what’s happened to American newspapers. We took things away from people and at the same time gave content away free on the web.”

I happen to agree with that. The first instinct of publishers over at least the past 10 years (if not since the dawn of publishers) has been to cut payroll and expenses first, seek new revenue channels later — which is lunacy. I was in Media General’s corporate offices in the late 2000s when the economy began collapsing, and the company’s three metros went, among other cuts, from four racing writers to zero, two science writers to zero, full-time state capital staff eliminated except at the one paper actually located in a state capital, each newsroom collapsing to focus on “the franchise,” local news. You had the sense of medium-sized, hefty dailies with big ambitions shrinking their staff and ambitions to become oversized small dailies. But the prices stayed the same. I always wondered what would have happened had they offered readers a choice and laid out the economic realities, explained that advertising had collapsed and what that meant for staffing. What would the readers have chosen as their preferred way of handling the budgets? Maybe the same thing. We’ll never know for sure.

In Orange County, Kushner’s approach essentially is turning back the clock to experiment with the approach no one tried: Provide the content and see if you can make that work. The Guardian asserts that “as the paper prepares to celebrate the experiment’s first anniversary, it appears to be thriving.”

But the definition of “thriving” I’m familiar with wouldn’t seem to apply here:

“Home deliveries are flat, compared to a year ago, but circulation overall is sharply up if you include an expanded stable of 28 weekly newspapers.” I would not count them, because the rest of the article didn’t talk so much about beefing up the staff and content of the weeklies. “… Revenue is ahead of target, said Kushner, without elaborating. Annual figures are due to be published in September.”

Where is the skepticism we would bring to any other businessman? Kushner SAYS revenue is ahead of target. But what was his target? You double your staff in one year and make your paper so heavy that, as deputy editor of local news Rob Curley says, it could kill a cat, you incur gigantic expenditures. It’s really easy to ramp up spending. Ramping up revenue is a good deal harder. So what does the Register and its there’s-no-more-free-content approach charge readers for this giant, cat-killing package? Print or online, it costs just $1 a day. I would be shocked if that covers even the cost of the newsprint and ink the Register is using. The Register has been working to increase advertising, but with readers contributing just $1 a day, the idea that advertising has increased enough in just one year, especially coming out of a recession and in a national slump in advertising, for the venture to break even seems ludicrous.

If you were to tell me that Kushner expects to lose money for a while, build the product and its reputation, use that to bring in more advertisers and revenue streams, gradually increase the cost to readers, and eventually get it to where both the print and online products are sustained as primarily pay-for-content products supported by readers rather than advertisers, I could believe that.

Just don’t tell me it’s “thriving” right now and expect me to believe it without any numbers to prove it.

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from the Nieman Journalism Lab
A friend who is a web editor asked on Facebook what her journalist friends think of the news that the new owner of the Orange County Register is going all-in on a print-first approach to news.

My initial response was that it was “goofy.” After letting the idea simmer for a few hours, I can substantially amend my response.

First, I applaud the reasoning being used, as explained by editor Ken Brusic:

“The new owners have decided that the way they want to proceed with a business model is to really move from solely an advertising-based newspaper model to a subscriber-based one, and in order to accomplish that — basically, what we need if we’re going to charge more — is more quality in the newspaper.”

This is no small thing. Moving to a subscriber-based model means you believe you can make money primarily from the content you produce, not from finding advertisers who want to reach your subscriber base. Beefing up the staff, then, is just putting your money where your mouth is – the exact opposite of putting up a paywall while also cutting staff and/or pay.

That said, I still think there are limitations to the model. If the beefed-up Register succeeds, I tend to think it eventually will become a niche product for a high-information demographic. If smartly marketed – and keeping a free website for breaking news and pushes to the paper or an all-subscription site is a part of that – it would not be resigning itself to a forever aging and shrinking demographic, but it almost certainly would find itself with a small one: older than average, wealthier than average, better-informed than average. Not a bad demographic to have, for outside promotional events and whatever advertisers might remain, but not a mass-circulation base.

The main reason for that I think is entirely outside the control of the Register, or any news organization, as I summarized elsewhere in a completely different context on Wednesday:

“As Jeff Cole of the Annenberg School’s Center for the Digital Future has put it, the ongoing changes (facing the news industry) are not just technological but behavioral and comprehensive, of the same order as the changes that followed the advent of television, and anyone seeking to lead a business affected by them has to understand that.”

When my grandfather was a young man, it was an absolute given that if you read a newspaper, you did it after work. By the time my father started dating a pretty, young features writer at the Columbus (Ohio) Citizen-Journal, that was no longer a given. By the time I worked a summer internship at The Phoenix (Ariz.) Gazette, that was one of the few afternoon papers left in the country, and it was on its last legs.

Why the change? Were the morning papers that much better? In some cases they may have been, but that wouldn’t explain a nationwide phenomenon, so no. The change came about purely because of changes in people’s lives. It began to make more sense to people to read a morning paper. Their afternoons maybe became busier and busier, or the evening TV news filled their information needs better than a P.M. paper because the TV news was more up to date. Whatever the reason, it was less a vote on the afternoon paper than a symptom of larger trends in society.

Similarly, newspapers today are not facing financial trouble because they are “giving away” their content online – or, if you believe that is a genuine problem, not solely or even mainly because of it. Morning newspaper circulation had been in decline before most people ever heard of the World Wide Web. The advent of the Web, then the high-speed Web, then the mobile Web merely accelerated the trend and added on the burden of advertisers having new options for reaching people.

The decline of the printed newspaper can be seen as merely part of a continuum of change in how people choose to get information, and there’s no reason to think the change is stopping where it is now. And if that is the correct view, then restricting your information to print – even a high-quality, smartly marketed product – is swimming against the tide. It doesn’t mean you can’t make a living at it, but you are planting yourself squarely where the majority of people have decided they don’t want to be. You might be able to entice some to visit, those few who highly value what you have to offer, but the day will come that you are not and never will be a mass product again. Maybe that isn’t so important to you, and maybe journalism will be better served this way, but just understand where it is you are going.

Another excerpt from what I wrote in a different context Wednesday:

“The biggest obstacle our industry faces is not the tools, which are ever-changing and seemingly ever more powerful and diverse, but whether those leading the newsrooms can accept the necessity of change, even painful change, and find ways to adapt – without letting others keep focused on what is lost and how things used to be. The pace of change, and the related challenges, isn’t likely to let up.”

The reactions my web editor friend has gotten to her post are (as of this writing) largely from the “focused on what is lost and how things used to be” end of the spectrum. There is no Ghost Dance for newspapers. What’s past is past. You can celebrate it, but you can’t bring it back.

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