Tag: media business

New GlobeReader adds puzzle and is puzzling

The Boston Globe is taking its GlobeReader product in a different direction, and I’m not sure it makes a lot of sense.

First, the good news: it’s gotten better. GlobeReader now includes a feature that lets you copy or e-mail a link, just like the parent company’s Times Reader. It’s also added the crossword puzzle, comics, a weather map and TV listings.

Now for the not-so-good. Previously GlobeReader was free to all print subscribers, including those who took home delivery only on Sundays. Moreover, you couldn’t have it for any price unless you were at least a Sunday subscriber. Given that the Globe reportedly earns some two-thirds of its revenues from the Sunday edition, the strategy seemed like a reasonably smart way of preserving the Sunday paper.

The new GlobeReader, by contrast, is available without any home delivery at all. The cost: $4.98 a week. But if you want to get it for free, you need to take home delivery of the print edition seven days a week. Otherwise, you’ll have to pay something. (I called a very polite clerk at the Globe who struggled to explain what the cost of GlobeReader would be for Sunday subscribers. It was nominal, but it wasn’t free.)

In other words, the Globe has given me a choice that it doesn’t want me to make. Several months ago, we switched to Sunday-only delivery, supplemented by GlobeReader the other six days. If we stick with Sundays-only, we’ll pay extra for GlobeReader. We could resume seven-day print delivery — but we’ve already decided we can’t afford $50 a month. Or we could pay $21 or $22 a month for GlobeReader access only. That couldn’t possibly be good for the Globe, since GlobeReader is practically ad-free.

(Conversely, this may make sense as we move into what may prove to be the post-advertising age. With no printing or distribution costs, GlobeReader is pure revenue.)

I should note, too, that the New York Times has long made Times Reader available for free to Sunday-only subscribers like us. Perhaps that’s going to change as well.

It strikes me that the new strategy, rather than shoring up the Sunday edition, will simply encourage customers to sign up for GlobeReader seven days a week — or read the paper for free at Boston.com. Although we hear from time to time that that may be coming to an end as well.

Like all newspapers, the first imperative for the Globe is to survive, and to make enough money to support a robust journalistic mission. I’m not sure this is the way to do it. But I guess we’ll find out.

Rupe prepares to take the plunge

Rupert Murdoch
Rupert Murdoch

News executives love to rail against Google as a parasite that steals their content. Yet none dares to insert a simple piece of code that would make their sites invisible to Google’s search engine.

Until now. Rupert Murdoch, the biggest, baddest media mogul of them all, says he’s moving ahead with plans to start charging for content across the News Corp. mediascape. And he adds that when the moment arrives, he will indeed block Google from indexing his content.

Murdoch even goes so far as to say that he’ll eventually mount a legal challenge to the doctrine of fair use, which allows third parties to use small snippets of copyrighted material without permission for certain purposes, including education and criticism — and, in Google’s view, search indexing.

Publishers have long had a love-hate relationship with Google and Google News. On the one hand, Google News, for many people, has established itself as a substitute front page, making newspaper home pages all but irrelevant. On the other hand, many newspaper.coms receive much of their traffic from Google.

Now Murdoch has adjusted the equation to pure hate.

Two predictions:

First, he may enjoy some success in shoring up WSJ.com, by far his highest-quality outlet, which is already partly subscription-based. But if he thinks people will pay for online access to the sagging New York Post or even a successful operation like Fox News, then he’s going to learn a bitter lesson.

Second, by essentially killing his Web sites, he may well succeed in shoring up print circulation. That’s a short-term strategy, but it may be exactly what he’s got in mind.

Photo of Murdoch at the 2009 World Economic Forum in Davis is (cc) by the World Economic Forum, and is republished here under a Creative Commons license. Some rights reserved.

A double whammy for the newspaper business

In my latest for the Guardian, I argue that the long-predicted newspaper-circulation death spiral now under way wouldn’t be such a big deal if online advertisers weren’t fleeing newspaper Web sites as well.

On a cheerier note, Jonathan Knee writes in Barron’s that recession and crushing debt are masking the fundamental soundness of many newspapers — especially monopoly papers with a circulation of 100,000 or less.

A terrifying story about the newspaper business

Outside Bagel World in Peabody
Outside Bagel World in Peabody

There’s an absolutely terrifying story about the newspaper business making the rounds today, and it’s not the one about print circulation falling another 10.6 percent. That’s hardly a surprise, given the continued rush to online — pushed along by papers like the Boston Globe and the Boston Herald raising the price of their print editions.

No, the truly ugly news is a story in the New York Times by Stephanie Clifford, who reports that companies increasingly see newspaper Web sites as a place for premium, special-event advertising, but not for everyday ads. For the latter, they use online networks, which cost a fraction of what newspapers charge.

According to the Audit Bureau of Circulations, the Globe’s daily circulation fell 18.4 percent, and now stands at 264,105. On Sunday, it’s fallen by 16.9 percent, to 418,529. In its heyday, the Globe’s Monday-through-Saturday circulation was more than 500,000, and on Sundays it was north of 800,000.

The Monday-through-Saturday Herald stands at 138,260, down 17.5 percent. The circulation of the Sunday Herald dropped 5 percent, to 95,635.

If you had told me five years ago what the print circulation of the Globe and the Herald would be today, I’d like to think I would have been entirely unsurprised. On the other hand, I know I would have been shocked that advertising revenues had not followed from print to online.

If the eventual end of the recession doesn’t provide some relief to the beleaguered newspaper business, you really have to wonder how this will all end.

The New York Times’ non-profit partners

What should we think about a partnership the New York Times has announced with a Chicago non-profit news organization that will supply two pages of news each week for the Times’ new Chicago edition?

On the one hand, the Times, a for-profit enterprise, is using material from a non-profit in order to take business away from two other for-profit enterprises, the Chicago Tribune and the Chicago Sun-Times. (Earlier, a similar arrangement was announced for a San Francisco edition of the Times.)

I’m a huge fan of non-profit journalism, but this strikes me as raising the specter of unfair competition. The non-profit, after all, enjoys certain tax advantages not available to a for-profit.

On the other hand, no one objects when for-profit newspapers run material from non-profit news organizations such as the Christian Science Monitor. My gut tells me this is different, but I can’t explain why.

We’re all debating whether for-profit newspapers can or should take the non-profit route. At least in a small way, the Times is now doing exactly that through the back door.

Dancing on the newspaper business’ grave

Former Wall Street bad boy Henry Blodget takes a look at the state of the newspaper business and asks an impolite question: So what? Blodget writes:

“Journalism” is alive and well, as evidenced by the still-robust health of companies like Bloomberg and Reuters, the survival of the New York Times, Wall Street Journal, and other great news organizations, the hyper-growth of online news and commentary sites, and the rise of social media.

Interestingly, Blodget’s provocation coincides with news that conditions are improving at the New York Times Co., which, despite its financial woes, is almost certain to be one of the winners in the emerging media landscape.

And I don’t think anyone would disagree with Blodget’s assessment that “society doesn’t need hundreds of White House reporters.” Back in the day, many of us used to argue that at least a few newspapers ought to have the guts to leave the White House to the AP and instead dig into the undercovered federal agencies. It never happened, and the moment has long since passed.

But I can’t be as cavalier as Blodget. If major metropolitan newspapers like the Boston Globe, the Philadelphia Inquirer and the Miami Herald can’t reinvent themselves as robust local-news operations, or somehow be replaced, then democratic self-government will suffer.

As you know, I’ve been paying a lot of attention to the New Haven Independent, a non-profit news site that stands as an interesting model of where local journalism may be headed. The local daily, the New Haven Register, is owned by the Journal Register Co., which is bankrupt. [Correction: The company emerged from bankruptcy in August.] The Register still does good work, but the Independent focuses more closely on the city, on urban issues and on community-building.

But the Independent employs just four full-timers, plus another two at an affiliate site. And it may never get much bigger than that.

I have very little nostalgia for the newspaper business, and I’m excited and energized about what’s taking place at the grassroots. But if we lose the capacity to throw bodies at certain kinds of complicated stories, especially local stories, then we’ll have lost a lot. (Via Jack Shafer’s Twitter feed.)

Paid content, free alternatives

Boston Herald publisher Pat Purcell is the latest to argue that newspaper owners need to get together and agree to start charging for online content. And as I’ve said before, I’m not philosophically opposed. But it’s not going to work.

Let’s say every newspaper began charging for Web-site access tomorrow. By the end of the day, anyone could put together about a half-dozen bookmarks giving them at least 75 percent to 80 percent of what they were getting from newspapers, provided by news organizations that are free and will almost certainly remain so.

Here are just a few top-of-my-head alternatives. I’m leaving out a lot more than I’m including.

Consider, too, that many of these sites would beef up if newspapers were to withdraw from the free Web. Nothing remains static, especially when a business opportunity beckons.

There is no pot of paid-content gold at the end of the online rainbow.

More: Steve Buttry made similar points back in June.

Tax incentives, yes. Government subsidies, no.

Len Downie
Len Downie

Len Downie, former executive editor of the Washington Post, and Michael Schudson of Columbia University will release a report tomorrow that calls, among other things, for direct government funding of local journalism. Rick Edmonds of the Poynter Institute says such funding could amount to $500 million a year.

Despite Downie’s sterling credentials — and he’s looking better every day — I suspect this isn’t going anywhere, nor should it. True, Downie and Schudson try to draw parallels to existing models such as the National Endowments for the Arts and Humanities in order to make their proposed Fund for Local Journalism seem less exotic. But it still amounts to a direct government bailout for the news business, which would severely compromise journalism’s ability to act as a watchdog on government.

Indirect government subsidies in the form of non-profit status and the tax incentives that go with that status make much more sense. Not that every news organization should go non-profit. But many non-profit news organizations are already doing good work, including public radio and television (which, alas, do receive some direct government funding) and community Web sites such as Voice of San Diego, MinnPost and the New Haven Independent.

If legislation is needed to bring non-profit news more into the mainstream, that might not be a bad idea. But when government starts writing checks, it will, inevitably, demand to have some say in what it’s paying for.

GateHouse reverses pay cuts

Despite having plenty of financial problems of its own, GateHouse Media New England will reverse pay cuts that had been implemented earlier this year. A little while ago Media Nation obtained a copy of an e-mail that president and CEO Rick Daniels sent to all staff members announcing the news. The full text follows.

Colleagues,

Based on the strengthened cash flows over the last several months, I am pleased to announce that the temporary pay cuts that were implemented in June and July are coming to an end, and our pay rates will be restored to full, pre-cut levels. For those whose pay was reduced as of June 1, the first workday that will be paid using the original, “pre-cut” rates will be Oct. 5th. The first paycheck that will reflect your original rates will be Oct 23rd. For those employees who received paychecks on Oct. 14th, your “retroactive pay” (from Oct. 5th onwards) will be reflected in your first post-announcement paycheck. For those colleagues who are represented by unions, the restorations will be done in accordance with the terms of the relevant agreements. These dates have been communicated to union leadership and your respective managers will communicate these dates to you under separate heading.

First and foremost: Thank you all — for your work, your dedication and your toughness. NONE of us were pleased about the need to take this step, yet the vast majority of employees did not choose to do anything BUT to put in their very best efforts to do their jobs so that we could reverse these cuts as soon as possible. We believed then, and still believe that this step allowed us to preserve the core assets and capabilities our customers value most. While the members of the senior management team had hoped we could restore these cuts prior to year’s end, at least partially, we are heartened that the time spent under the pay cuts will prove to be shorter than expected; that said, even had it been a week or a month, it would have still been an onerous sacrifice. Ending these cuts is not only a major relief for all of us, but it’s also an important affirmation of our business model, and an affirmation of the quality and effectiveness of our collective efforts, and the results we have been able to generate. We are in a position to restore the cuts because GHMNE is again generating sufficient cash flows to be clearly and safely in the black. If you remember, when we announced these cuts, I said there were two kinds of companies: Those that produced positive cash flow, and those that didn’t, and we could not allow ourselves to be among those that didn’t.

I don’t want to create any misimpressions that the economy, and its powerful effects on our advertising revenues, is improving all that much. Ask any of our sales personnel. Most of our advertisers are struggling. For the most part, most of our cash-flow improvements are being generated by very stringent spending reductions, NOT a rapid return to great revenue performance — (although there has fortunately been some strengthening in revenue comparisons vs. the year over year declines we experienced earlier in the year). NONE of these cost reductions has been “easy”, and while we’ve turned over many stones to reduce the structural costs of GHMNE by several millions of dollars, we need to continue to take all possible steps to increase our efficiencies — and we will. Going forward, we need to continue to evaluate all aspects of our operations to help ensure that we are operating in a smart and efficient manner. ALL of us hope that we will never have to cope with pay reductions again (and I’m sure we all hope we never see another “Great Recession” in our lifetimes). We have, once again, proven that highly focused and very efficient local publications (both print and digital), that are produced by a very focused, talented and dedicated group of team members are extraordinarily durable, because they provide exceptional and truly unique value to readers and advertisers. We have a GREAT, and now very much battle-tested, group of employees and publications that will allow us to get back to the business of growth, and probably in the not-too-distant future. There are a host of new business initiatives, both at local and at GateHouse-wide levels that are being put into effect, and both I and the members of the senior team will be scheduling site visits and employee meetings in just over a month to share details on some of these, as well as answer your questions and hear your thoughts and suggestions. Again, thanks very much — you’re talented, dedicated and durable and a group that’s a true privilege to work with and lead.

Richard Daniels,
President and Chief Executive Officer

“What’s the end-game there?”

Former Boston Globe columnist John Ellis, a venture capitalist who disclosed earlier this year that he’d done some work for a potential buyer, warns that things are still bad at 135 Morrissey Blvd. and likely to get worse.

“How long can the NYT afford to carry the net operating losses?” he asks. “When does it make more sense to just shut it down?”

Ellis also argues that the Globe must do everything it can to hang on to what’s left of its big-name sports talent, namely columnists Dan Shaughnessy and Bob Ryan.

I revere Ryan, who, despite his veteran status, happens to be one of the hardest-working folks at the Globe. Shaughnessy’s a good read even when he’s sending me over the edge. But the idea that management might have to shell out more money to keep its stars from jumping to the Internet is galling at a time when everyone else is being asked to sacrifice.

Which is not to say Ellis is wrong. He’s probably right.