Tuesday, October 14, 2008

Understand newsroom problems

I recently received a call from a high school student working on a report. In previous years, I extolled the virtues of being a newspaper PJ. This year is more difficult. I was honest and explained the industry is currently in a death spiral.

Job losses aren't an enigma limited to the United States. Newspapers in the UK and Australia suffer from cuts as well.

The precipitous demise of the newspaper industry bothers me. It simply isn't logical.

Citizens of a democratic society need information to make informed decisions. People with good hearts need a place to reflect on their community and help those in need. People facing injustice need a place to bring grievances. Sometimes people just want to know what they can do for free tonight or how their favorite sports team is doing. Additionally, businesses need a place to connect with potential customers.

All of these functions are currently handled by newspapers. Newspapers are wanted, needed and desired.

Newspaper reporters and PJs are the first and often only people on the ground actually acquiring information and verifying facts - particularly with non-breaking news.

So why is there a news crisis?

Loss of classified advertising revenue to online sources such as CraigsList were the first nail in the coffin. Since then, the industry has been in a slow decline until the recent traumatic changes.

The current crisis could be seen as the final shudders of news as we know it. The most experienced reporters, editors and PJs have been asked to leave the industry.

There is no back-up plan. There are no secondary markets. All the back-up professions are glutted or caught in the same trap. It's simply a loss of the most dedicated and experienced news professionals. Each loss directly affects each person living in a democratic society.

To be absolutely clear, most online portals are aggregating news reports from newspapers. The newspapers aren't paid anything by aggregators while the newspapers carry the entire expense of collecting information. It isn't equitable.

While this may ultimately cause the utter destruction of newsrooms, let's address the underlying problem:   jobs, promotion as well as fuel and paper costs.

Jobs
When I was a kid, my family subscribed to both the local afternoon paper and the big, regional morning paper.

We subscribed to the local paper because our neighbor was a reporter at the paper and my brother delivered the paper after school. We subscribed to the regional paper because it had national and international news. It was also thick, absorbent and we raised puppies. :-)

We wanted our neighbor and my brother to keep their jobs. Our subscription helped. Likewise, everyone within a bicycle's ride of our home subscribed because some young kid knocked on the door and asked them to subscribe.

Every day at 5 p.m., they'd see this same kid peddling a bike down the street in horrible weather to deliver everyone's evening paper.

Furthermore, everyone within walking distance of band members also subscribed to several magazines. In the fall, band kids would go door-to-door selling subscriptions to raise money for band equipment (and earn cool prizes).

I'm not advocating child labor. Instead, I'll stress that human contact creates empathy for news workers and eventually creates subscriptions. Someone in another country (or prison) calling at dinnertime on an automated dialer isn't enough to get people to part with cash. The interruption (particularly if it's every night) actually has the opposite result.

Human contact actually creates subscriptions. It's important to understand this human contact comes from employment. Without potential income, people won't go door-to-door soliciting subscriptions from friends and neighbors.

I'll admit I've earned a lot from people I've never seen or even heard on the phone. But, everyone must understand it's easier to delete an e-mail pitch than delete a person standing in your office.

I spoke about this theory with a postal carrier. He said he could tell who is connected with newspapers because there's a physical circle of subscribers around these worker's homes. The block with a newspaper employee has many subscriptions. The next block has above average. Two blocks away it's slightly above average. Then, it drops to normal or below normal (because the average includes the area surrounding the employee).

It's also important to understand those employed by newspapers subscribe to papers while those released from those papers are unlikely to subscribe (and may convince friends and relatives to do the same).

This alone explains why "downsized" papers experience subscription drops after layoffs. It's human nature. You support those who support you. For example, the Fort Worth paper has already suffered three layoffs this year.

According to the Paper Cuts blog, there were 2,185 newspaper jobs lost last year and 11,683+ already lost in 2008. If each of these former employees had a circle of 25 supporting subscribers, this could result in 54,625 lost subscriptions in 2007 and 292,075 in 2008 (with more to come). Add a pair of zeros to the back of these numbers for an average lost potential annual income.

Promotion
Benjamin Franklin is my favorite historical figure. In his day, parishioners purchased or rented pews at their community church. Although Franklin was a Deist, he had pews at many churches to show his support to all the communities and thereby gain support and business.

Franklin was two centuries ahead of other promoters with this idea.

In the 1980s, any small-town newspaper PJ was welcomed at high school or little league game. If someone asked which paper they represented, the PJs pointed at the scoreboard.

The scoreboard itself wasn't the answer. Instead, the papers' nameplates were proudly emblazoned on the scoreboards.

The nameplate on the scoreboard reminded attendees about the community paper. The community paper supported the community and coverage from the game might be in tomorrow's paper.

In reality, it meant the promotional department paid a small amount or exchanged house advertising to various school booster clubs for year-round display at almost every stadium or park in the coverage zone (turf).

In emotional terms, it meant the paper was part of the community. It also told attendees the paper supported the team - Our team.

Go team! Go newspaper! See it all tomorrow!

This display advertising tactic was successfully used at any venue willing to sell for a low enough price. It was effective promotion of the paper to the people most likely to read the paper.

Because people look at the scoreboard, a hot-air balloon, or other outdoor advertising several times during an event, the advertising minimum threshold (seven times) was exceeded. Viewers became buyers.

However, as budgets were cut and maintenance costs grew, these displays were abandoned and replaced by banks that wanted the same return on investment as newspapers.

Go team! Go bank. Move your cash here...

It doesn't have the same hometown ring, but we get the point.

To make things worse, many marketing departments decided the best place to advertise the product was inside the product. Instead of exchanging house ads for display ads at events, the marketing departments used house ads to solicit subscriptions.

Unless future subscribers buy the paper at the newsstand, they won't see the ad. Current subscribers already have a subscription, so it wastes their time and attention.

In conjunction with other advertising, this is fine. By itself, it's like screaming for water in a mountain lake.

Paper
About the time the cost of pulp rose, the newspaper industry decided to promote recycling. Here's a "History of Recycling" PDF document by the State of California.

Newspapers printed on recycled paper are better for the environment (and cheaper). To get children involved (since most papers don't use child labor anymore), the recycling program was co-branded with Newspapers In Education.

Schools which recycled the most paper (and saved newspapers and paper mills the most money), got bragging rights and a substantial incentive for the year. This seems altruistic, however, children learned pulp newspapers are bad and harm the planet.

I'm not Einstein, but I can fast-forward this movie and predict how it ends. Yup, these kids grew up, and don't want to subscribe because it might harm the environment. If one tree is saved through recycling, then two trees are saved by never buying a paper in the first place.

They believe they're saving the planet by not subscribing.

I'd believe this too (the promoters were convincing), but I lived in Southeast Texas. I saw first-hand how the timber and paper companies work. It's professional and sustainable. The trees are specifically planted and harvested in rotations like any other agricultural crop.

Newspaper pulp doesn't come from old-growth forests. It comes from pine chips (the stuff the lumber mills previously burned or threw in the river). If anything, the forest growth time (20 years of converting carbon dioxide into oxygen) plus reduction of wood waste may actually help the environment while it provides the forest animals a place to hide from the environmentally-conscious sprawling suburbanites.

Yes, the paper mill literally stinks, but it also provides good-paying jobs for lots of people (who probably subscribe to a newspaper because they "dance with the one that brung 'em").

Fuel
Fuel prices are the one thing we all love to hate.

While fuel prices are an international issue, they hit very close to home in Texas. Every business and individual commuter hates any fuel price increase. For PJs, it can be catastrophic because we're less likely to "cruise" or roam far from home without a reason. This means we're less likely to spot something unusual as we're moving around.

In short, it affects our ability to report.

Because trucks are a dependable delivery system, newspapers use huge amounts of fuel. They must use fuel to move heavy paper over long distances, cover news and ultimately deliver the results before the coffee is ready. This isn't cheap, and the cover price doesn't cover the price.

Unlike other business expenses (pencils, new computers, etc...), publishers can't control fuel prices. While this is a profit margin issue, it's also workforce, sales, product quality and circulation issues. The cost of fuel affects every single aspect of the publishing business.

What does the future hold?
The answers are unknown. This can be both invigorating and terrifying. Either way, the industry won't resemble what most of us know as "press." No matter what happens, reducing newsroom staff isn't good for democracy.

Reducing the newsroom means less content. Less content (and fewer neighbors employed by the paper) means fewer subscriptions/readers/viewers. This creates an endless downward spiral.

I think the printing and circulation departments are in for some hard times. I wish this wasn't the case, but it's part of the financial reality facing print newspapers.

If printed products are cut from newspaper expenses, the profit percentage could return to "acceptable" by industry standards. The high costs involved in purchasing paper, printing and delivering the paper are eliminated.

This requires a fundamental change in consumer and advertiser habits. However, nimble online enterprises have excelled in recent years.

I still feel there's an opening for Renaissance Journalism cooperatives. These enterprises could provide information for readers and "employment" (information, access, outlet, income and administrative support) for information workers (reporters, PJs, ad reps and support staff) without the hardship of rebuilding existing publications.

The RJ cooperatives won't be "retirement communities," but the current manifestation isn't either. The news industry must eventually address and resolve the four fundamental issues:   jobs (human connections), promotion, paper and fuel.

Then, we can tackle content and advertising equity.

Enough for now,

UPDATE: 16 Oct. 2008
Please also read, "e-Newspapers may become reality in 2009"

7 comments:

kjwes said...

Mark: I believe your comments on the surface discribe the illness. I think there is another problem at work in the demise of newsprint. The day of community newpapers have been replaced with the huge corporate/political behemoths that use the print as a social soundboard instead of writing the news. Each article includes the writer's opinion on whether this particular subject, law, or policy is a good thing. People have other ways to obtain information without being subjected to the editorial page being place on A1-A14. I love reading newspapers, but I can get the instant take on an article by a click and browse of a webpage. Newspapers may be a victim of their own failures... wes

Mark M. Hancock said...

Wes,
The startling cuts in the industry go beyond superficial conspiracy theories and political hyperbole. Zoning ordinance, crime, court and budget stories aren't rife with opinion. They're factual.

Newspaper reporters collect and present facts. Truth is in the eye of the beholder while facts are absolute.

Pro reporters are completely accountable and responsible for the facts they present. Their name, e-mail address, phone number and reputation are associated with every fact they present. If a fact is wrong, the newspaper corrects the record and the reporter is held responsible.

Without newspapers, we'd currently be left to depend on TV news and private citizens. TV is fine for car chases, sports and celebrity gossip, but it isn't known for depth. Individual citizens definitely have agendas and aren't dependable, timely or accountable.

This is the crisis.

With each newspaper job cut, there are fewer people collecting facts. Without a stream of authentic facts, we're all exposed to those who do have agendas and aren't accountable.

Tim Gruber said...

Some great points there Mark.

I often wonder to myself just how many people pick up the paper just looking at the bylines because they feel a connection to the person who once took their picture for the local paper?

Hopefully I'll see you around Dallas, while I'm in town for the coming months.

Tim

Mark M. Hancock said...

Hey Tim,

If you're interning in Dallas, we'll probably never bump into each other. Instead, drop me a note when you're here. We'll meet for coffee. :-)

Daniel Han said...

Great points, Mark. I'm nervous too, because so many people nowdays refuse to think and know in depth. They think 30-seconds TV news is enough; they also think the information on the internet is good enough, when most of it is false/unverified/heavily biased.

Thankfully, in my town all the colleges have the "readership program" where the colleges provide newspapers to students for free. (New York Times, Boston Globe, USA Today, and Telegram & Gazzete). So, perhaps there is SOME hope...

Mark M. Hancock said...

Daniel,
The "readership program" sounds great. It appears to increase newspaper reader numbers (to increase ad revenue) while it promotes good lifelong habits.
Additionally, it probably cuts down on fuel costs per paper.

I'm not anti-Web nor anti-TV. I'm also not pro-pulp. Instead, I want to ensure media professionals have a range of places to work and readers have legitimate, vetted sources of news.

Tim Gruber said...

Sounds good Mark.

I've been here for about two weeks now.

Tim