The Vanishing Newspaper, updated

In 2004, Philip Meyer calculated that the last newspaper would be published some time in early 2043.

The USC Annenberg School Center for the Digital Future has moved up the date for most papers. To 2017.

“Circulation of print newspapers continues to plummet, and we believe that the only print newspapers that will survive will be at the extremes of the medium – the largest and the smallest,” said Cole. It’s likely that only four major daily newspapers will continue in print form: The New York Times, USA Today, the Washington Post, and the Wall Street Journal.  At the other extreme, local weekly newspapers may still survive.”

I have not read the entire report because it’s behind a paywall, but I feel comfortable in responding with two words: Wanna bet?

Circulation is dropping, but Sunday has flattened out. Most papers are profitable, and many have margins in the double digits. Not like the good old days, but what is? My wife ran a successful business in which the profit margin was in the low-to-mid single digits. Newspaper companies have taken dramatic, unfortunate actions to reduce their costs, usually to the detriment of their product. The layoffs and content cuts certainly cost readers. Still, the report notes that “the percentage of users who said that they would miss the print edition of their newspaper if it ceased to exist continued to grow — but slightly — for the second year in a row — now 63 percent.”

Baby boomers are the core audience for newspapers, and even though their readership is declining, it is still strong enough to support most newspapers for well past 2017. I’d say another 10 years, at least.

But newspaper companies need to do what that they haven’t done very well, despite advice from everyone who’s anyone, and that is to innovate. Or certainly innovate with more energy and imagination than they have. A mobile app is part of it. A paywall could be part of it. So could curating and social networking and writing with a point of view. But these piecemeal efforts — really being done by many media companies after first trying to protect the primary product, which is the newspaper — aren’t the answer. Making a firm commitment to revolutionize as they have at the Journal Register with its Digital First company is a fine example of the boldness that newspaper companies need right now.

Update: Doug Fisher points to this column by a media consultant in the Savannah Daily News that boasts of the rosy financial picture of three national chains, one of which is in bankruptcy and all of which has had layoffs and furloughs. The lack of self-awareness or irony in the piece is discouraging. It sort of makes my point about the money newspapers are making…and that they need to invest more of it in reinvention.

Update 2: Philip Meyer responds in the comments. Part of it:  If you are willing to build your own good will from scratch, there should come a time when you can acquire a newspaper for 20 percent of the historic cost, manage for a 6 percent margin, and enjoy the same return on investment that required a 30 percent margin in the good old days. See “The Vanishing Newspaper,” 1st edition, pp. 44-45 (or 47-48 in the 2d edition).

10 thoughts on “The Vanishing Newspaper, updated

  1. John is right. A happy newspaper publisher with a 6 percent margin is both feasible and likely, although getting there can be awkward. Remember that in the good times, only 20 percent of the value of a newspaper was the physical plant and inventory. The rest was what the bean counters call “good will.” If you are willing to build your own good will from scratch, there should come a time when you can acquire a newspaper for 20 percent of the historic cost, manage for a 6 percent margin, and enjoy the same return on investment that required a 30 percent margin in the good old days. See “The Vanishing Newspaper,” 1st edition, pp. 44-45 (or 47-48 in the 2d edition).

  2. My parents had grade school educations But we always took the paper. Boxscores brought me the Boston Red Sox, and still do. I had my own morning paper route in 1973 when I read that George Foreman had beaten Joe Frazier the day before in Jamaica. There was magic in that. What happened at Fenway the day before, or in Kingston the night before, jumped out to me the next morning. For years, I thought AP Wire Photo was a credit to a guy named Ap Wire. I wondered how he cold be in so many places.
    I graduated to The Washington Post in college. There was a box at the bus stop. It cost a quarter. How could I not? The writing was exceptional, and I lived for that. I carried it along to my communications classes, sneaking in crossword work while they told me newspaper was obsolete. How could that be? Wasn’t it right here in front of me? Where it always had been?
    I sold newspaper ads briefly after graduation. Then moved over to news / sports and stayed there 10 years. Then, finally, I guess, I agreed with the experts about the obsolete thing. I quit and went to law school.
    I wonder what I’ll do when they say that’s obsolete.

  3. 1 — Old media forms don’t die. You can still send a telegram. But so what? Telegrams aren’t exactly relevant.

    2 — “Newspaper” isn’t one media form, not as a business, not as an expression of the press. The differences between a national newspaper (NYT, USAToday, WSJ), a metro daily and a community weekly are vast. And interestingly enough, it seems that the weeklies are still doing OK.

    3 — The people who care about the future of “newspapers” are generally the people who print them. What the rest of us are concerned about is a viable subsidy for a quality press corps.

    4 — National news organizations (print or online or broadcast) get good economies of scale for the reporting they do, but their margins are small because of competition. Local (one-community) news orgs have decent margins (because there’s little competition) but lousy grosses. Both should be able to find limited ways forward, in print or online or in combo. The crisis is in the metro middle, where they’re not doing well in terms of economies of scale, margin or macro. And that’s where most of the nation’s journalism resources are clustered.

    5 — You want to find a sustainable subsidy for a quality press corps, you’re going to have to find a business model that isn’t primarily based on advertising. And since the newspaper business is really the advertising business, there ends the discussion. The interesting question is, who is going to spend the money to explore those alternate business models? Because they’re out there, ignored, and waiting for backers.

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