Month: April 2009 Page 4 of 9

Re-Kindling the Globe

On April 17, 2009

Warning: Fuzzy math ahead.

As we know, the most deadly problem the newspaper business faces is that very little advertising has migrated from the print to the Web. A dollar’s worth of print advertising translates to pennies online. Thus we have initiatives like Steven Brill’s Journalism Online aimed at getting people to pay for Web content. As I argued earlier this week, it probably can’t be done.

But we do need to shift to a model by which consumers will pick up a decent share of the cost. Even after the recession, classified ads are not going to move back from Craigslist to newspapers or their Web sites. And with far fewer local businesses, display ads bring in less revenue than was the case at one time.

What are people willing to pay for? A premium, well-edited news package, portable and easier to use than a typical newspaper Web site. The print edition meets that definition, which is why I think the Boston Globe ought to charge a lot more for it, even though it would, inevitably, drive down paid circulation. The logic: As it stands, circulation revenue barely covers the cost of printing and distribution. If ad revenue is not going to recover, then readers are going to have to pay.

But there’s another possibility. Fifteen years ago folks like Roger Fidler, then of Knight Ridder, suggested that portable digital devices he called “tablets” would one day be so cheap that newspapers would give them away so they could shut down their presses. It’s possible that moment has come in the form of Amazon’s Kindle — not as cheap as Fidler had envisioned, but maybe cheap enough.

The Globe’s Sunday circulation is about 500,000. Let’s say around 400,000 of those are home-delivered. What if you gave every one of those households a free Kindle in return for a three-year, seven-day subscription to the Globe?

Let’s do the math, such as it is. A Kindle costs $359. Assume the Globe could get a price of $300 apiece in return for buying 400,000 of them. That’s $120 million. Spread it over, say, six years, and that’s $20 million a year.

The Globe already charges $10 a month for its Kindle edition. If it extracted that from 400,000 households, it would come to $48 million a year in guaranteed income for three years. (And I’m not so sure you couldn’t charge double that.) After that, subscriptions would renew automatically once a year, which is how the few online news organizations that charge for online access (the Wall Street Journal, The New Republic) handle it.

And here’s where the big savings come in: You shut down the presses. Permanently. No more paper, ink, trucks, fuel and the like. No more jobs for a lot of hard-working people, either, which would be a tragedy, but not as big a tragedy as closing the Globe.

I’ve never gotten my hands on a Kindle, but I have played with a Sony Reader, which is a similar device. The portability and the clarity of the e-ink are both well ahead of even the smallest, sharpest laptop. The Globe’s Kindle edition gets mediocre reviews. But with no more print edition to think about, I’m sure it could be upgraded considerably. And with a large regional customer base, it might prove to be an attractive platform for new kinds of advertising.

Can this work? I have no idea. As a last-ditch effort, though, I definitely think it makes more sense than simply closing the print edition and trying to sell ads on Boston.com. If we come to that point, then I definitely think the Kindle would be a better option.

Credit where it’s due: There are very few original ideas out there. Although I wrote favorably about the Kindle as a newspaper platform way back in November 2007 (here and here), I want to point out that Mike B1 floated a proposal very similar to the one I’m making today just recently.

And Tim Allik points out that Silicon Valley Insider, in January, looked at the numbers behind moving the print edition of the New York Times to the Kindle.

Not the worst idea we’ve heard

By Dan Kennedy

On April 17, 2009

In Uncategorized

The Boston Herald’s Jessica Heslam reports that Red Sox principal owner John Henry has broached the idea of taking the Boston Globe off the New York Times Co.’s hands. The Times Co. is attempting to unload its 17.75 percent stake in the Red Sox.

Henry has a proven track record of building value. Any new owner for the Globe is likely to begin with deep cost-cutting. I’d rather see Henry wielding the scalpel than some other prospective owners doing it with a chainsaw.

On second thought: Given the state of the Globe’s finances, maybe I should say I’d rather see Henry do it with a chainsaw than someone else use tactical nuclear weapons.

Globe, Herald target each other

By Dan Kennedy

On April 16, 2009

In Uncategorized

Boston Globe reporter Keith O’Brien today weighs in with a story about the financial problems being faced by the Boston Herald and GateHouse Media, which owns some 100 community papers in Eastern Massachusetts.

GateHouse’s problems are considerable and well-known. The Herald, though, is a bit of a mystery, as publisher Pat Purcell tends to play his cards close to the vest. What we know is that the paper and its reporting staff have gotten tiny, but that Purcell appears to have hit upon a formula for survival.

O’Brien, after chronicling shrinkage in the Herald’s staff and circulation, offers a quote from Sunday editor Tom Mashberg: “How are things now? It’s tough. We once had a newsroom filled with reporters and a commercial department filled with commercial staff. And it has definitely shrunk.”

Mashberg, upset that none of the positive comments he says he made got into O’Brien’s story, has fired back with an e-mail to the Globe, which I offer here in its entirety, with Mashberg’s permission:

To Globe Editors:

Tom Mashberg from the Herald here. I’m pretty disappointed at the way the reporter slanted this story. We spoke at length about how the Herald was performing miracles to survive and turn a profit in a terrible climate. When I asked him what he was going to use from me, he sent me this email:

“Here’s what I will be attributing to you: The total staff figures you sent me yesterday. Is that OK?

“And I will be quoting you regarding how the Herald has dealt with the cuts. And about how the Globe should have seen these changes coming. The quote at the end of our interview yesterday when you said it was puzzling that the Times allowed this to play out like this at the Globe.

“This could change, of course. Still haven’t filed my story. So e-mail or call if you have any questions.”

No one expects a puff piece, especially between competing newspapers. But it looks like the editors got hold of this and turned it into a hatchet job. I guess that explains a lot about where the Globe is headed. Sad.

If O’Brien or anyone else at the Globe would like to respond, I will post it immediately.

Meanwhile, Herald media reporter Jessica Heslam today reports that veteran media-watcher Michael Wolff believes neither Rupert Murdoch (about whom he wrote a book) nor New York Daily News publisher (and former Boston real-estate mogul) Mort Zuckerman has any interest in buying the Globe.

Heslam includes this toxic quote from Wolff: “I don’t think that anybody’s going to buy the Boston Globe. The Boston Globe is now an unbuyable property. It loses too much money and it has too many union obligations. No one will want it now. They might have wanted it. They did want it two years ago. Not now.”

Left unsaid is that (1) Murdoch can’t buy the Globe, since the Federal Communications Commission bans anyone from owning a television station (WFXT-TV, Channel 25) and a daily newspaper in the same market; and (2) Murdoch and Purcell are business partners.

Finally, the second of Herald columnist Howie Carr’s sneering pieces about the Globe’s missteps over the years prompts an observation. Carr actually found a way to poke fun at the 1998 departure of Globe columnist Patricia Smith, who was caught fabricating, without making any mention of the other, far better known Globe columnist who lost his job that summer: Mike Barnicle, caught making things up and plagiarizing by — among others — the Herald.

Anyone who listens to Carr’s talk show on WRKO Radio (AM 680) knows how much he detests Barnicle. But, after all, Purcell hired Barnicle to write a column a few years ago, and though it didn’t work out, Barnicle still pops up occasionally in the Herald. Since Carr can’t write what he’d really like to write, perhaps he should go cover a press conference or something.

Gambling mecca drowning in red ink

By Dan Kennedy

On April 16, 2009

In Uncategorized

Think casino gambling is going to save Massachusetts? Here’s how Lynn Doan begins her story in today’s Hartford Courant, the leading newspaper in Connecticut, home of two resort casinos:

With the state’s three-year budget deficit forecast hovering between $6 billion and $9 billion, Democrats are pushing a tax plan that economists warn will wipe out thousands of jobs both in old-line and emerging Connecticut industries.

The tax package unveiled by the state legislature’s Democratic majority earlier this month includes three main hits to business: a 30 percent surcharge on the corporate earnings tax; an end to sales tax exemptions on some key purchases such as computer services; and stricter limits on tax credits, including the lucrative research and development credits that keep many startup businesses afloat.

As both the Boston Globe and the Boston Herald report, expanded gambling is looking increasingly likely as Massachusetts officials scramble to make up for plunging tax revenues. Senate President Therese Murray is pushing for resort casinos, while House Speaker Robert DeLeo wants slot machines at race tracks.

The Mashpee Wampanoag tribe’s plan to build a casino in Middleborough quickly deteriorated into a tragicomedy of corruption and recriminations. But state officials, starting with Gov. Deval Patrick, think they know what’s best. So it’s likely that we’re going to end up with some form of expanded gambling.

Still, the facts are clear, for anyone who’s interested.

More Mass Pike shenanigans

By Dan Kennedy

On April 15, 2009

In Uncategorized

A government official confronted and forced to spin on the fly. A shadowy source, speaking through a voice-changer. Prat Thakker of New England Cable News has a terrific story on the Massachusetts Turnpike’s decision to short-staff the toll booths on Easter Sunday. Alan LeBovidge’s reaction: Hummina hummina hummina. Great stuff.

Why newspapers can’t charge for online content

By Dan Kennedy

On April 15, 2009

In Uncategorized

With the bottom falling out from the newspaper business, it seems likely that owners are going to take another gamble on charging for online content.

The respected newspaper consultant John Morton practically insists on it in the American Journalism Review. Boston Globe columnist Scot Lehigh, whose paper will reportedly be shut down by the end of the month if the unions don’t come up with $20 million in givebacks, is pushing the idea, too.

I am not philosophically opposed to the notion that newspapers ought to be able to charge for their online content. The trouble is that it hasn’t worked before, and it almost certainly won’t work now. It’s not that there aren’t plenty of people who value what newspapers have to offer. It’s that there are too many free sources of high-quality information, even at the local level.

Let me hold off on the Globe for a moment, because this is easier to explain at the national level. Imagine we woke up tomorrow morning and discovered that the “Slate Five” — the New York Times, the Washington Post, the Wall Street Journal, USA Today and the Los Angeles Times — were all charging for online content, either in the form of monthly subscriptions or “micropayments” — that is, click on an article and you’d be charged a nickel or a dime. (The Journal already charges for some online content.) What would we do?

A few months ago I marveled at the Times’ success in attracting 19.5 million unique visitors a month to NYTimes.com during 2008, making it by far the most successful newspaper Web site. I immediately heard from a knowledgeable reader who pointed out that the Times’ site wasn’t even close to the largest news site.

According to Nielsen, MSNBC.com drew nearly 45 million unique visitors in January, followed closely by CNN.com, with 41.6 million. Yahoo News — which does pay for content, and thus can’t be lumped with aggregators like Google News and the Huffington Post, which Associated Press chairman Dean Singleton was bellowing about last week (even though Google is a partner with the AP) — was third with 40.5 million. AOL News (!) came in fourth with 23 million. And then, finally, NYTimes.com came in fifth, with nearly 21.6 million — an impressive jump over its 2008 average, but still well behind its non-newspaper competitors.

Just to take the top two, MSNBC.com and CNN.com aren’t going away, and they’re not going to start charging. Unlike newspapers, MSNBC and CNN already have a reliable source of revenue in the form of cable fees and cable advertising. (MSNBC and MSNBC.com have different ownership structures, so MSNBC can’t be said to “support” MSNBC.com; but NBC holds a significant stake in each.) And both MSNBC.com and CNN.com do some original journalism as well.

Do CNN.com and MSNBC.com offer the sort of depth and analysis that a great newspaper does? No. But consider that the discerning news consumer can also visit the Christian Science Monitor, NPR.org, The Guardian and Guardian America, BBC News and other sites that are now and will likely remain free. All of those sites are non-profits with Web strategies more advanced than most of those offered by for-profit newspapers. The truth is that even for someone who puts a premium on being well-informed, the Slate Five are optional.

Which brings me back to the Globe. In fact, the Globe may face fewer obstacles in charging for content than, say, the Times, because there aren’t that many free sources of high-quality local news. Nevertheless, I still think it’s a losing strategy.

Consider the news outlets with free Web sites. First and foremost there are WBUR and New England Cable News, which, at the moment, have the healthiest business models — listener contributions and corporate underwriting for the former, cable fees supplemented by advertising for the latter. Neither is going to start charging for online content, and both could be in a position to pump up their Web sites if the Globe starts charging.

There are numerous other outlets as well, of course — the Boston Phoenix, the Boston Herald and all of the over-the-air television stations, for starters. (WBZ, with both a television station and an all-news radio station, would seem to be particularly well-positioned.) Moreover, no one should be surprised if people start talking about a non-profit community Web site for Boston along the lines of the New Haven Independent, MinnPost or Voices of San Diego. And we’ve already got one of the best examples of intelligent local aggregation anywhere in Adam Gaffin’s Universal Hub.

But what happens when the Globe has a significant exclusive? Sadly, the answer to that is easy. When the Globe breaks a long, important investigative story, every other news outlet runs stories that begin, “The Boston Globe today reported that …” The quick summary will do for most people. And if you really want to read it, you can buy a copy of the paper. That’s not going to buy many groceries.

So is it hopeless? I don’t think so. I continue to think that there’s a large group of readers who would be willing to pay much more for the print edition — certainly more than the modest price increase that was announced recently. Yes, a substantial price hike would hasten the day when the Globe (and other major dailies) becomes a niche publication for an elite audience. But with advertising drying up, someone has to pay. And if it’s not going to happen online, then it has to be in print.

I also think there may be some promise in coming up with ways for newspaper Web sites to receive revenues from broadband providers. On the face of it, it makes no sense that Comcast and Verizon cable customers have to fork over money to CNN, MSNBC, Fox News and NECN, but Comcast and Verizon broadband customers pay nothing to the Globe, the Herald, the Times and other newspapers.

The logistics of such a system could be extremely difficult. What do you do about the thousands of bloggers who would demand their cut? It would very different from dealing with the finite world of cable channels.

Still, pursuing such new ideas would make a lot more sense than chasing after the dream of charging for online content — an old idea that failed, and that likely would fail again.

Photo (cc) by Tony the Misfit and republished here under a Creative Commons license. Some rights reserved.

Let the Pike go bankrupt

By Dan Kennedy

On April 15, 2009

In Uncategorized

Massachusetts Turnpike executive director Alan LeBovidge doesn’t understand many things. Here’s one of those many things: We don’t care if the Pike goes bankrupt.

When he says, “I can’t provide Rolls Royce service on a Chevette income,” we have no idea what he’s talking about. And we know he has no idea, either. It’s a road. Letting people drive on the damn thing isn’t giving them “Rolls Royce service.”

When he says, “Everyone wants premium services but they don’t want to pay for it,” we scratch our heads. What “premium services”? Blacktop?

LeBovidge’s salary is $160,000 a year. That’s enough to light the Zakim Bridge for 32 months. If his position were eliminated by, say, noon today, would anyone care?

Look, I know it’s more complicated than that, and I know the gas tax ought to be raised by quite a bit. But LeBovidge’s arrogant, clueless performance is enough to turn even a liberal weenie like me into an angry populist. Enough.

The Washington Post versus George Will

By Dan Kennedy

On April 14, 2009

In Uncategorized

In my latest for The Guardian, I take a look at the insurrection with the ranks of the Washington Post over George Will’s repeated mischaracterizations of the scientific evidence for human-caused global warming.

College students and newspapers

By Dan Kennedy

On April 13, 2009

In Uncategorized

I’ve received several e-mails today from folks who saw my quote in today’s New York Times and wanted to commiserate with me about my observation that, on the one occasion when I had an opportunity to teach freshmen journalism students, I discovered that very few of them had previously read a newspaper.

It’s true — I’ve got no complaints with the Times reporter, Richard Pérez-Peña, who quoted me accurately. And I didn’t think I was saying anything controversial, given that I was talking about 18-year-olds. But the point I was hoping to make was slightly different from the way it came out.

At the time I was teaching that class, in the fall of 2007, I made it a requirement that my students pick up a Boston Globe every morning. It was not an onerous task — the Globe was distributed free on campus. By the end of the semester, quite a few students told me they enjoyed the experience, and intended to keep reading the paper.

Then the Globe ended free distribution. I don’t think it’s a contradiction for me to say that the Globe, in general, should be charging more for its print edition, but that to stop freebies for college students was not a smart move.

These days there are so few Globes on campus that I would have a hard time even requiring everyone to buy a copy.

Tuesday follow-up. Peter Porcupine asks, Why the Globe and not the Herald? To which I offer several answers: (1) the Globe was distributed free on campus; the Herald wasn’t; (2) even now, it’s harder to find a Herald on campus than a Globe; (3) I wanted my students reading a metropolitan daily characteristic of such papers across the country. Despite my high esteem for the Phoenix, for instance, I didn’t require my students to read that, either.

Herald’s Mashberg has advice for the Globe

By Dan Kennedy

On April 13, 2009

In Uncategorized

Former Boston Herald union official Tom Mashberg has some advice for union folks at the Boston Globe, based on his experience with the Herald’s own brutal downsizing:

[F]rom 2005 through 2007, we struggled as a team to make the terms work. There was pain — many people abandoned beloved careers in print, and many devoted trade- and craft-union employees saw their work disappear entirely. But the same goal was shared by union members and the front office: Provide decent buyouts for the departing, spread the pain of pay cuts across all ranks of labor and management, and act in good faith.

One major difference to which Mashberg (who’s now the Herald’s Sunday editor as well as a former Globe staff member) alludes: Herald owner Pat Purcell universally wins high marks for being open with his employees.

I haven’t always been a fan of the way Purcell has run the Herald (though he certainly deserves credit for keeping it alive). But the secrecy-obsessed New York Times Co. could learn much from the way Purcell has kept the lines of communication humming.