The chart to the right, which shows the stock price of the New York Times Company over the last five years, is somewhat representative of the state of print journalism in general. They’re getting their lunch eaten on the revenue end by Craigslist and (to a lesser extent) on the page view end by blogs and other alternative news sources.
When the business model of “real journalism” fails, what should society do in response? When things are considered important, but can’t be supported with a business model, government sometimes steps in. National parks, highways, police and national defense are all examples. Should print journalism be next?
Last week Ralph Whitehead wrote about the issue for the Boston Globe, but said government must not step in. Today at a session led by Jeff Jarvis at the World Economic Forum in Davos, Switzerland, noted Free Speech lawyer and Columbia University President Lee Bollinger said it should be considered as a viable solution to the problem. Carl Lavin at Forbes picked up the story, and I’m now squarely in the middle of it.
At first Bollinger only mentioned it as an idea put forward by others. When I questioned him, he said he supported the notion.
The idea is both dangerous and absurd. For Bollinger, who is a free speech advocate, to even consider the idea suggests he hasn’t thought through the consequences of the government financing the press. Freedom of the press is one of the most important checks on government. If they’re paying the bills, the press is no longer independent.
Print media is wonderful, and it would be a shame to ever see it fail. But these are businesses that need to sustain themselves in one way or another. Looking for a government handout to perpetuate a quaint but outdated way of life is the last resort of the desperate. It should be avoided at all costs.
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Here’s what I don’t get — why don’t news sites leave stories up for more than a few weeks? Have they never heard of the long tail?
I run a few fairly popular blogs, and I often link to news stories on local news websites. I find that after a few weeks, those links go dead because the stories have been removed. Over the course of a few years, you’re talking about many thousands of stories that are no longer available, which destroys the amount of traffic going to the site.
Any clue why they all seem to do this?
The BBC seems independent to me. So does the BBC2.
Dirty little secret: Legally required foreclosure notices at premium prices are fattening news classified revenues again. Newspapers are the first businesses to benefit from the housing crash.
I think the whole idea of “journalism” as a career (or field of research) is in search of an identity. Anybody and everybody can become a journalist… there is no “special” skills required as the democratization of information through the net makes what use to only be available to a select few, available for the masses to consume and write about.
Jon
http://woodmarvels.com - Create Unique Memories
I agree with that to an extent, but what about investigative journalism? Who, realistically, could have exposed Watergate other than professional journalists? Woodward and Bernstein needed the time, resources, credibility etc. to be able to uncover a story like that.
I’m not a newspaper apologist, and I don’t believe in a government newspaper bailout. But I think the current situation is a little more complicated than “Anybody and everybody can become a journalist…”
Mickey, they sell archived stories, mostly obits to prove death, and annual archive subscriptions to legal firms. It’s a steady revenue source. And they’re still “up,” you just can’t find them.
Shane - the BBC does an excellent job of staying independent. But imagine if the government financed all or even a substantial portion of big media. Competitive pressure to remain independent would become secondary to ensuring continued funding. The only “customer” would be the government.
They should be run as non-profits like the st petersburg times and receive “government support” in the form of exemption on federal income tax. this also keeps them relatively independent of government or advertisers or special interests for content and programming. see kexp.org for example of successful non-profit radio.
It’s hilarious how Americans think the government stepping into anything is “dangerous.” Yet in Europe not only is government funding of the press the norm but the European press is far and away better than the joke that Americans are served up each day. Mike to avoid looking like a fool next time don’t just go with your obvious prejudices and biases. Next time do some research about how things work elsewhere and give alternatives some serious thought.
—When the business model of “real journalism” fails, what should society do in response?—
I don’t know what you mean by “society”….but individuals are already declaring with their wallets that resources used by print journalism are no longer desired and should be sold off and used somewhere else.
I see no reason why anyone would want to waste resources and finance a losing venture unless they’re willing to risk their own capital….Government risks other people’s money, so that shouldn’t even be an option.
Obviously people have found much more value in “true” free market journalism - on the Internet.
The innovative papers will make the transition to web-only and thrive in a global market (e.g. The Guardian), the ones who take state subsidy will die.
I agree that the notion that government should step in to subsidize or support mainstream media is worrying. Apart from the issue of independence, it just doesnt make sense. Basic supply and demand economics shows that people will flock to news sources that provide the highest quality, most credible content. Mainstream media and online news media are free to compete for readers, but if there is no demand for the content produced by some of the struggling print media organizations, why should we artificially create demand? Instead, mainstream media should look to produce greate content, innovate and adopt to the new world. Government support for those who don’t is just ridiculous. Yes, quality journalism is a cornerstone for democracy, but we’ll do just fine if we get that news from a different set of sources than what we’ve gotten used to.
Shafqat
“Basic supply and demand economics shows that people will flock to news sources that provide the highest quality, most credible content.”
(I disagree somewhat. If this were true than the Drudge Report would be considered the most “credible” news source on the web…)
The problem isn’t really that the demand for content is dropping - quite the contrary. The problem is that the format the newspapers have (one physical paper, once per day) is suddenly totally obsolete. People want and expect immediate updates. By the time I pick up a newspaper in the morning it’s obsolete - literally yesterday’s news - the content is usually written 12-18 hours previously.
You can sell physical papers, and sell physical ads in them. But people want real-time digital news now, and are used to getting it for free, the (big) media haven’t spent any real resources trying other business models, and time has run out. It’s really that simple.
>Yet in Europe not only is government funding of the press the norm…
Where? In Russia?
“Freedom of the press is one of the most important checks on government. If they’re paying the bills, the press is no longer independent.”
That the principal negative consequence of federal funding for the press is that the press is no longer independent is actually absurd. The press isn’t independent today. All you’d be doing is substituting stakeholders, but the fact that stakeholders’ interests influence programming doesn’t change. Do the Wall Street Journal and Rupert Murdoch ring a bell?
I agree a government handout would be inappropriate. However, it would not be such a stretch to force Craiglist (who has caused so much of the print industry’s woes) to change their business practices. It should be illegal for a “non-profit” to compete in the business sector against for-profit businesses. The Newmark/Buckmaster duo is a plague on capitalism. Why should our government/legal system allow him to nearly destroy an entire industry?
The IRS does not permit a private individual to continually run a “business”, year after year without showing a legitimate attempt to earn a profit. The IRS calls them “hobbies” and they lose their ability to write off what were once business expenses.
In the legal system, courts routinely award spouses child support and alimony based not on what the other party earns, but their “earning ability”. The courts do not allow you to escape or evade your legal responsibilities because you are “underemployed”.
My view is that Craigslist should be forced to operate as a legitimate business. They are cheating taxpayers out of millions in never-paid taxes, causing the loss of thousands of jobs (many of them from the newsroom) and causing the evaporation of retirement funds with the havoc brought upon so many public companies. This is good? This is American? I makes me sick to hear Newmark talk about his values. Oh wait, he’s a socialist. His values are not American.
Broken business model because of a few down years? Are you serious Mike? This is the top story here today. You yourself said journalism is dead, well let me step in and fill in the gaps in your reporting:
1. Sam Zell just led a group of investors to buy Tribune for $8 Billion.
2. NYT, WPO, and other papers are cash cow businesses that may not be growing, but are certainly not on the cusp of failure.
3. News corp just bought Dow Jones for the WSJ - another NEWSPAPER
3. News”paper” is still read by the large number of non web 2.0 kool-aid sipping tech shut-ins
4. No blog can replace the Sunday paper - Come on!
When you have smart media people buying newspapers left and right, does this signal the end of the industry or just a shakeout and rebirth? As the founder of techcrunch and surviver of web 1.0, the answer should be very clear.
@13 - Fair point. I think media consolidation and ownership by corporate giants is also worrying - we never discounted that fact. I guess it comes down to which one is ‘less bad.’
Great post. The free market is not great at solving all things (E.g. the environment, telecom, etc.) but it is great at solving things like this. Consumers will demand news in many forms and someone will figure out a model to make this work. It may change, it may cause some companies to go out of business, even companies like the New York Times that many people embrace but the market will sort this one out. There will be news and those who provide it will be compensated for it. It just may take some time but it will create new opportunities for entrepreneurs.
Very Interesting.
nhick
http://www.itrush.com
man, once a government pays for a newspaper, the speech isn’t free no more, you can’t bite the hand who feeds you.
I am not sure what to think of this post. I guess America’s free speech movement has created the likes of News Corp, which is a money machine first more than an institute of journalism.
This post seems to come from some one who fundamentally mistrusts governments. I am not sure if this is right or wrong, but there are many countries where an institutionalized, government backed broadcasting organization provides the better product (there is more than just the BBC in this regard). In the end, both types of journalism have got their pitfall: commercial journalism compromising independence over money; while wrongly structured government backed news organizations can end up replacing government spokes people. Competition between these flavors should guarantee quality.
If we agree that online news media are an addition rather than a replacement for hardcopy newspapers, than there should be a more creative solutions than the cost cutting programs our hardcopy friends are enduring now for years.
The argument for the preservation of the press is that a working democracy needs an informed citizenry. But how has that worked out with privately owned media? Profit comes from pandering to the lowest common denominator, which usually means Britney’s crotch shots, rather than actual news. The election coverage focuses on such tough questions such as “will they vote for a woman or a black guy” rather than cover the actual policies of the candidates. Yesterdays headline on CNN pondered the existence of Sasquatch on Mars.
And let’s not forget how the independent media saved us from a pointless and ruinous war by exposing the lies and duplicity of those that wanted it to happen. Oh wait.
I say let them be funded by a government grant, one that is legally mandated to be a certain amount no matter what. And forbid coverage of fluff - private entities will always be there for that.
Michael,
I understand your point and it makes rational sense. Fear of government control is a tenet of a free-market democracy. But in practice, I’ll take government control (the government funding and media) over corporate control (corporations owning and funding the media through advertising). Although a mixture of both is acceptable as well.
Many people forget that government is merely a collection of the people. So, in essence, the people control the government funded media. One doesn’t have to look far to see quality successful, reasonably unbiased government funded media (Australia, Canada, the UK, even NPR and PBS) far out of reach of the halls of power.
Government should not step in, and I think you can easily make the argument that neither national parks nor highways, are necessarily government-only tasks. James Hill had zero tax dollars given to him to create a railroad from the Mississippi to the Pacific. That’s easements across more than half of the US, privately purchased and justified through demand. I personally way prefer private parks, and public ones have direct user fees anyway. Without central planning we might actually get a lane or two for traffic instead of billion-dollar light rail that no one uses except for political resumes.
Further, we already have our NPR and government-sponsored news at the state level, at least they have to compete for viewers/listeners. I have no idea what the government needs to be involved in this for. If, for example, there is not enough demand for ‘news’ in the traditional sense, then you just force people to pay for it? Makes no sense.
Why should the government step in? Just because the NY Times prints on paper? As a taxpayer, I fund the U.S. government and I think it’s absurd that the government should invest my money in a company that professional investors think is a bad investment (see stock price for investor opinion of the NY Times).
This is simply natural selection in the market. Keeping this old, sick, and maladapted creature alive through government intervention is pathetic.
Why do people (whether in congress, Davos economic forum, the executive branch, or whatever) think they know how and can fix the world with their great ideas. Just leave us alone and stop spending our money on your pet projects. The same people who support this would probably call $50 million bridges to nowhere in Alaska pork barrel. Only other people’s pet projects are pork barrel.
@Shane
“Seems independent” is completely subjective. Govt should stay way the hell out of journalism/news reporting.
@Autodope
Most of our federal govt is a collection of people who don’t have to face a vote for the decisions they make. Sure, the senators, reps and president can be voted out but there are many parts of our govt that make huge decisions that dont have to face the people.
You dont hand that type of control over our media to them. Not a chance.
The CBC (Canada) is independent
I don’t understand what do you mean by “Real Journalism” because journalism is still flourishing, only thing that has changed is the media. I go to NYT.com every day and read a news or two. That is also real journalism. I think you meant print media is on decline. Well that is more of a life style change and the internet in our lives. That is what is breaking the model. I think this is a natural and inevitable decline of print media. Isn’t it simple or am I missing the point here. I agree with all those who are against govt. shadow on the media.
MA,
You forgot to mention Banks, Lending institutions as well as Bond insurers to your list of folks the Feds will bail out.
Hell no the government shouldn’t step in. Journalism/Newspapers are just the beginning. Next is television. After that its corporate America. Its a pattern that is being caused by the next industrial revolution. The knowledge worker has finally figured out they don’t need a corporation to earn money. The rise of the knowledge worker is just beginning. You also have to factor in the advancement of technology, such as the ability to create applications in days, rapid/mass production of parts (mfg.com) from your house, etc…
They say gen y, gen x, and gen (n) are lazy and just want to be famous. No they just don’t want to work for a corporation. Corporations are nothing more than a group of resources working together to produce an output. Why give your energy (resource) to a company who will profit off you when you can do it yourself and make just as much if not more money, set your own hours, and work from where ever whenever?
So back to the topic. If the government steps in the US is going to be in a world of hurt, because our economy will be screwed more than it currently is. This will be beginning of the end (Rome) when we have to uphold something that cannot support itself. Whatever happened to the phrase let the market decide?
Lets put all the old boys out of business….keep it up everyone!
I have to agree (with reservation) with Shane @ #2. And Mike, there have been numerous conflicts of interest within traditional journalism in the past as well — major corporate sponsors have sometimes exerted far too much influence, sometimes at the expense of journalistic integrity; some news outlets report all stories from the political perspective of the company’s executive(s) (i.e. Murdoch’s FOX News).
Reservation: It really depends on execution, and equally brave/committed management teams — the BBC serves as an excellent model in this.
And to Jon @ #4 — while, in principal, I laud the ideals of citizen journalism…it suffers from the same ills as Digg: “The illusion is that Digg is a system typically referred to as ‘direct democracy.’ As such, denizens of that democratic environment want a system they can count on to put across their agenda, especially the long time users of Digg. They’ve formed the online equivalent of coalition governments with their sizable friends list, so when they post something to the site, they can reasonably expect it to make front page if it is of a certain quality.
This is one of the major components the new algorithm looks to combat, as well as another problem involved in direct democracy: self-interest.” — quoted from Mark Hopkins, at Mashable ( http://mashable.com/2008/01/23/digg-revolt-again/ )
Now, ask yourself:
1. How many of the top blogs reported the trouble in Kenya?
2. How many actually conduct original investigative journalism to expose misconduct and questionable actions in the VC, Tech, or whatever professions/markets/etc. that encompass their spheres of influence?
Now compare those results with:
– How many simply echo what appears in the NYT, CNN, or some other established “real journalism” outlet.
Heck, Jon, you have two serious grammatical errors in a total of 4 lines… Hardly a hallmark of bigger and better things to come for the world…
The short version:
Decentralization of media, wealth, etc… It is scaring the crap out of them.
Michael:
You’re looking at state-subsidized “news” through a market lens. You’re not wrong in your analysis of the likely outcome, but I think you’re missing the real dynamic that’s going to be at play.
In the USA there’s no real direct line of communication between government and normal citizens. This holds both for reporting on what government is up to — debating such and such proposal, investigating such and such scandal — and for reporting on what it’s done — raised postal rates, deployed troops, and so on.
In a system that’s supposed to be “democratic” a lack of transparency* is problematic and it tends to result in a broad-brush de-legitimization of governmental action; the lack of easy, direct communication between citizens and their government makes a lot of government action really opaque.
Since the founding of the republic the print media have been a sort of “buffer” for increasing transparency: the government, proper, is quite opaque most of the time, but the media’s reporting efforts get the information out and thus make it seem much more transparent than it really is.
The resulting symbiosis has rewards for both parties: the government can continue on doing what it wants while only making minimal efforts at transparency, and the media can gain influence — and, occasionally, profit — from what amounts to a primitive form of information arbitrage.
If the traditional media like print and broadcast were to fall away, one half of the government-media symbiote would be effectively dead. To survive the other half would almost certainly have to adapt, becoming much more transparent; we know it doesn’t want to do this, b/c if it wanted to be transparent, it already would be.
So, if you start to see real movers and shakers floating this idea, it’s less about preserving antiquated business models and more about preserving a particular operating environment for the funders (aka the government), in which only nominal transparency is needed. Or, differently: the internet and the huge increase in efficiency of communications it brought with it have a tremendous possibility to make our system of government tremendously more efficient, accountable, and effective, and as a result the incumbents will be fighting a ton of rearguard actions to prevent those changes from happening any time soon.
* Technically a fair amount of information is publicly available over the web, but usually in obscure locations, inappropriate formats, or highly technical or legalistic verbiage, which means the disclosed information is useless to non-professionals.
And perhaps this is hitting too close to home, but is TechCrunch totally free of consideration/influence regarding its major corporate sponsors?
Would YOU skewer VC’s or potential TechCrunch conference attendees — possibly putting their hefty registration fees in jeopardy — for inappropriate behavior and/or business practices?
Have you conducted any original investigative journalism of your own to bring such improprieties to light?
Just a few things worth considering… So as not to have a situation of the pot calling the kettle “black”…
Re: Humble Pie
1. How many of the top blogs reported the trouble in Kenya?
More than the top news outlets did in the U.S.
2. How many actually conduct original investigative journalism to expose misconduct and questionable actions in the VC, Tech, or whatever professions/markets/etc. that encompass their spheres of influence?
More than the top news outlets did in the U.S.
Sadly, most of the investigative journalism is happening because of bloggers these days. Maybe the story gets advanced by traditional coverage (although it’s more likely to be buried) but the breaking news is more often happening in the blogosphere.
The reason why is not because blogs are somehow really good at investigative journalism (although they have a certain knack for harnessing the power of crowds) but because traditional news outlets have just stopped producing good quality news that investigates and informs.
– Brian Boyko
– M.A. University of Texas School of Journalism
– Professional Blogger, http://www.networkperformancedaily.com
No, the government should not step in. Thats what the internet is for - information. I dont even watch TV news, or read the paper. I get my info from the web. Once something is printed, that info is outdated relatively quickly. The web helps with this problem. One of the main things I think news reports(blogs or articles) are missing is that they dont follow a story completely - thru all the details, court cases, related info - everything! Talk about boosting readership!
this is such a biased pos article, the nytimes stock doesnt represent the print journalism industry, and it isnt declining because of some delusional fuck who thinks print is going out.
I’m still in University, so I’m a bit ignorant when it comes to commerce, but how can Mr. Arrington conclude the failure of print journalism as a business model based on near term trends of its stock price? Moreover, he used the NYT as a paradigmn case. It seems like a slippery slope argument sprinkled with a generalization based on an insufficient sample size.
If anything, the decline in stock price will force the dailies to re-examine how they package and distribute their content.
It’s my opinion that what is occuring is a divergence of content from its traditional medium. The medium is changing but the content is still valuable. Once the dailies figure out the best and optimal new medium (kindle, e-paper, mobile devices + wifi bill boards) to distribute the content, they will be viable. The bigger question is: what do we mean by ‘print’?–printed text on paper; or digital print displayed on LCD screens.
Everything is a high marketing strategy. To call the attention is all the purpose behind all of this.
Just a clarification regarding craigslist:
– we’re a for profit corporation, have never claimed or implied we’re a nonprofit.
However, we act as a community service, hence, the site is almost completely free.
– fact checking is good; while we have an effect on newspaper revenues, it’s minor. Most of the chatter just reinforces the urban myth otherwise.
Thanks!
Two observations:
1. The US media is independent from the government, and yet the average US newspaper is far less neutral than most news-outlets in Britain. This contributes to the polarisation of public opinion - people either get ‘democrat news’ or ‘republican news’. This is getting worse with blogs such as ‘Huffington Post’ which will publish pretty much anything if it’s anti-Republican. In the UK, people are exposed to a range of opinions.
2. Mike: you said that it would be scary if the government became the main source of media, and I agree. But the bloggers will still be there, as will Time, Newsweek, Economist, etc (and are all doing pretty well). That’s a big part of the reason why the BBC is independent - if people see the BBC as being biased, people complain, and another independent arbitrator judges whether they are right. Who is going to be the independent arbitrator of the Huffington Post?
err..
I forgot to add that the newspaper can compete with craiglist, if they provide location based news (neighbourhood news coverage ie: events listing, business reviews (yelp clone), traffic report, etc–essentially answering the question: what’s happening in this neighbourhood) + local advertisement.
Brian — As a M.A., you have to know that one-line unsupported declarative statements are hardly credible answers (I’m sure you NEVER tried such a tactic in your academic career…or it would have been quite short-lived).
Any stats and/or figures to back that up? I realize comments (and even blogs) are hardly a suitable place for scholarly discussion, however, I cannot let you get off that easily.
And yes, I’m also well educated. But feel no need to state my credentials in such an informal forum as blog comments… sheesh.
All that’s happening is that the dominant medium is changing. There will always be room for the very best writers with the best journalistic skills at beacon publications, whether on paper or online.
As to government subsidy for media, it’s not a completely bad thing. But naturally, it is somewhat risky. The BBC, for example, was completely decapitated after revealing that the UK government had misled Parliament over WMD in Iraq. Also, they produce the most hagiographic nonsense whenever a member of the royal family corks it. National anthem 3 times on the radio and all that crap.
Jefferson said if he had to choose between a country with government and no newspapers or newspapers and no government, he would choose the latter.
Government-run papers or only a few good papers and lots of blogs? Jefferson would clearly choose the latter.
Agence France Presse
Government corporate charter, indirect govt subsidies through subscriptions that distribute news to a wide variety of government agencies, third largest news wire in the world.
As another poster, Americans are too paranoid about government subsidizing. Relax and have a beer.
“NYTimes omits second place NEVADA winner”
So an “8 year-old” fixed it:
http://img242.imageshack.us/im.....vm8fx2.jpg
Another person sent NYT this email:
==========
“Subject: Need official statement on your website censoring Ron Paul from Primary Seasons Election Results (European documentary)
Dear,
We are writing this email to you regarding the censoring of Ron Paul on http://politics.nytimes.com/el.....index.html
Since he is not being mentioned there although he is considered top tier and won 2nd place in Nevada, we assume you are actively seeking to censor Ron Paul.
We are making a documentary in Europe on how the American media is manipulating the public and are seeking an official statement from the New York Times regarding this censorship.
Please reply with your statement within 7 days, otherwise we will mark down that you did not wish to address this issue.
Regards”
==========
The current and corrected list:
http://politics.nytimes.com/el.....index.html
When this topic comes up, inevitably someone somewhere will say, “The best newspapers will find a way to survive online.”
But I wonder if more technologically savvy people than newspaper editors and publishers might just figure out a better way to present the news and then start hiring the experienced and talented newspaper journalists. I believe that may be the better model and the true salvation for “real journalism.”
And I think most of us can agree that “real journalism” is essential to democracy and to the U.S. and therefore must be saved.
Government involvement isn’t necessarily evil, just premature. This is a time of enormous change in how people get information, but if the technology settles down won’t the winner once again be the one with the best writing, the breaking news, the most insightful analysis, the most trust, whether that be a blogger or the NYT?
And the NYT site has gotten much better in its digital delivery, incorporating video, blogs, social news, eliminating registration. In fact Michael, you just posted on how the NYT’s traffic has surged since the ending of Times Select.
The whole debate between blogs and journalists is a little tired because the differences between the two are harder to discern: journalists now blog, citizens often contribute to newspapers, and the major blogs have become such institutions with an entrenched audience that in many ways the barriers to building a large audience are once again fairly high.
Good Craig stepped in b/c I was going to post that: CL is not a non-profit, although many people still seem to think they are (I think it had a lot to do w/ the .org for a while). They have their own non-profit foundation inside but it’s nothing to do with the CL operations http://www.CraigslistFoundation.org that helps other non-profits (their boot camp is great for anyone working in the non-profit world).
Just noticed that job posting in most major cities is now $25.