Tribune Co. remains canary in the coalmine for big media's continued breakdown

When Sam Zell first took over Tribune Company -- the corporation which owns the Chicago Tribune, Los Angeles Times and Orlando Sentinel, not to be confused with our local Tampa Tribune -- the hope was that a guy with some business success who hasn't worked in newspapers might figure out how to save them.

Instead, once he climbed inside the business, Zell has found himself bedeviled by the same problem faced by every other newspaper manager in the country: What do you do, when your current economic engine is disintegrating and you can't find another one?

So far, Zell's response has been pretty much the same as every other newspaper owner: layoffs and slimming of the newspapers to save money on staff costs and news print, along with Hail Mary-level changes to the product in hopes of staging a turnaround (Zell and new COO Randy Michaels promised an emphasis on maps, graphics, lists, rankings and stats -- which is great, because nobody's tried that in newspapers since, oh, USA Today debuted 26 years ago). The Orlando Sentinel is expected to be the first to reflect this aggressive revamp -- with a redesign expected to debut less than two weeks from today on June 22.   

Walking the halls of the National Conference on Media Reform Friday, I felt the same frustration and misguided anger. Fans of quality journalism and media want to believe this industry fragmentation is the result of somebody's screwup; newspapers took audiences for granted, filled themselves with fluff, gave readers too much, gave them too little. Because if this mess is the result of somebody's boneheaded mistake, all it takes is quality leadership to turn things around.

The more troubling and probably more accurate conclusion is that we've hit a perfect media storm of longtime newspaper complacency and audience disconnect, combined with collapse of almost every significant source of revenue fueling newspapers -- classified ads, retail ads, real estate ads, automobile ads and subscriptions. And turning that around takes much more than fixing a few mistakes.   

At a time like this, there's far more questions than answers, and here's mine:

Why are newsprint companies jacking up prices when the industry is in the deepest recession its ever seen? Everywhere newspaper publishers expect increases in nerwsprint prices to cost millions, just as they have in years past. The cost increases are helping drive the pressure to shave down editions, which is making it tougher for newspapers to survive. So shouldn't newsprint companies limit their cost increases to keep their floundering market alive?

Why is anyone surprised that Tribune COO Randy Michaels is helping lead a downsizing of the company? The last big company Michaels led was Clear Channel, the radio giant which bought up 1,200 radio stations across the country and then slashed their individual resources in attempts to save money by corporate synergy. The resulting dips in original content, localism, news programming and quality have been used as case studies for opponents of media consolidation. And now Michaels -- with several of his former pals from Clear Channel -- is running one of the country's biggest newspaper companies.

Why has Zell's approach focused on devaluing the things which distinguish newspapers most? In a conference call with Wall Street analysts, Michales and Zell reduced their changes to numbers and figures -- pages at all newspapers will be reduced to a 50/50 split between ad space and news pages, and downsizing figures for staff were calculated by looking at the column inches of news produced by each reporter. This means no accounting for local standards or values in the size of the newspaper, and the column inches encompassing a front-page investigative story or blockbuster column are treated the same as the column inches featuring TV listings and the police blotter. Forget about fitting the newspaper to the community, the brand value of well-known columnists and reporters or the quality of the content -- which is only the backbone of newspaper's appeal to readers and advertisers. No wonder his own employees are confused.

Can newspaper companies get consumers to pay more of the real costs for gathering information? The biggest problems with using advertising to fund newspapers was that it taught consumers for decades that the facts packed into an average newspaper were only worth 10, 25 or 35 cents each day. The real cost of newsgathering is much more -- even subscription fees for most newspapers only pay for costs incurred in getting the newspaper to everyone's doorstep -- and now the Internet has convinced consumers that all this information should be free. So how do newspapers convince consumers to shoulder more of the real cost?

My biggest fear: that newspapers are headed for the same kind of decline previously experienced by radio and local TV, in which staff reductions and corporate synergies have left many such outlets hollow shells of themselves. Boy, it's getting ugly out there.

Comments

[Jim Johnson]

Eric makes a good point, but there is a difference: the barrier to entries are so low, why are we limited to current choices?

If there is a market for news, there will be a way to provide it -- that is the beauty of our capitalist system.

Sure, we may not use FCC-regulated parts of the electro-magnetic spectrum to send and receive the news...

In 20 years, there will be no difference between TV, radio, newspapers, or the Internet. Everything will be delivered the same way. (IMHO).

All your news are belong to us. :-P

[Crikey]

I agree Eric. In fact, aren't lists like "most emailed" and "most commented" the same as ratings? I can see where online newspapers would be tempted to play up the high interest stories, like the Hulk Hogan family saga, that get thousands of clicks, and let important stories like lead in the drinking water die for lack of clicks.

Letting popularity decide what's news is like asking children what they want for dinner. Spinach will not be high on the list

[Eric Deggans]

I think the problem with some people looking at the future of media, is that they are too invested in the idea that technology will lead to better content, not worse.

If you look at radio and local TV, two media platforms which have already fgone through the kind of economic realignment newspapers are suffering through now, you see that their news product is less comprehensive, less detailed and less informative than in years past.

There is greater pressure to compromise editorial integrity to save and make money. There are fewer people to chase stories, and much of what they do is about chasing rthe easiest news to report -- crime, accidents and spot news.

I think, unfortunately, newspapers are headed down a similar road. As salaries drop, the pool of workers will get worse. communities outside major urban centers will have a hard time getting their news covered by professionals. Who will report on the major school boards in lakeland or bradenton, if those newspapers go away or significantly reduce their staffing? there's not a lot of bloggers working those communities.

Giving people greater power to dictate what is news may not matter much if there are few news professionals doing original reporting in the first place.

[Jim Johnson]

Paul,

There will still be journalism in a post- newspaper world. It will just be in a different format. Instead of people going to a single source (or a handful of sources) for their news, they will get their news from dozens or perhaps hundreds of sources.

Rather than have hundreds of reporters, a news source will have a handful of reporters (or perhaps just a single reporter) covering specialized niches... from International stories to neighborhood happenings.

In fact, I am willing to bet that once newspapers complete their evolution, people will be BETTER informed about the world around them. They will have greater power in dictating what is and what is not news. Like any good or service sold in the U.S., news has to be both relevant and of good enough quality to succeed.

----
I think the Future of News site can be quite enlightening on this subject: http://thefutureofnews.com

[Big Tuna]

The only way to save your precious journalism industry is a "not for profit" business model.

Your product costs more to produce than people are willing to pay for it! Both consumers and advertisers.

It's not a hobby....it's a business.

[crikey]

I guess what I'm baffled about is what small advertisers are doing. The newspaper classifieds and smaller zoned sections were a place mom and pop stores could make themselves known. i'm already getting 30 some emails a day, I really hope that isn't the only way small businesses will be able to get the word out.

There's still a market for local news and local advertising, so how do these two needs find a home on the Web that can make money for anyone?

[crikey]

I guess what I'm baffled about is what small advertisers are doing. The newspaper classifieds and smaller zoned sections were a place mom and pop stores could make themselves known. i'm already getting 30 some emails a day, I really hope that isn't the only way small businesses will be able to get the word out.

There's still a market for local news and local advertising, so how do these two needs find a home on the Web that can make money for anyone?

[Paul Carson]

Jeesh, Jim...

Do you realize that creating all the content that newspapers offer costs millions of dollars? Do you realize that Google and Yahoo would have none of it if newspapers cease to exist? Do you understand that the only information out there will be from those who stand to benefit from it, or have an axe to grind, if professional journalism collapses?

The reality is that no one -- read that, NO ONE -- out there does real journalism except for newspapers. Where do your so-called experts get their information? Rush Limbaugh certainly doesn't do objective research himself and then lather on his fat layer of spin.

Make no mistake: If and when newspaper journalism collapses, our democracy will follow quickly.

And the sad thing is, no one appreciates just how devastating that day will be until the government turns totalitarian. And by then, well, it will be too late.

[Jim Johnson]

Eric,

I have better questions:

Why are news organizations so steadfastly sticking to 19th (or 14th!) century technology -- ink on paper??

Why don't newspapers understand the how the long tail could positively impact the bottom line??

Why do newspapers like the Tampa Tribune archive on-line articles when there are two axioms: Google lives forever and storage capacity continues to get cheaper??

Finally... I believe people will pay for news under some conditions:
1) Scarcity -- If they can't get it any other way (supply vs demand).

2) Personal -- Let people build their own newspapers so they get stories on topics they want to see. Of course, I would call this "RSS Feed Reader" rather than "newspaper."

3) No Ads -- People download entertainment shows to avoid commercials, why not give me advertising-free news?

4) Convenience -- If you can make it easy for people to get their news, no matter where they are, that could be worth something.

5) Unique -- Make people feel like insiders by giving them access to information no one else gets (Rush Limbaugh is a good example).

6) Expert Analysis -- Perople would pay a small fee to read analysis by experts they trust, even if they disagree with the experts.

Just my thoughts...

[Eric Deggans]

Not sure who "you guys" refers to. Sam Zell bought Tribune co. amd put Randy Michaels in charge. I certainly didn't have anything to do with it....

[Steven Tamayo]

You guys put the clearchannel people in charge and wonder why things are going down the toilet???