New York Times Unveils More Details on the Journal's new NYC Metro Section (Which Competes with the NYT)

Interestingly, reports about the Wall St. Journal's new daily New York City metro section, which starts April 12 and is expected to average 12 pages, came not from the Journal but from the New York Times -- with whom the Journal is directly competing in a newspaper war.

Check out the Times article, "Journal vs. Times in Newspaper Battle Over New York Readers – And Advertisers" by blog fav Richard Perez-Pena. The article positions the Journal's new metro section as the latest front in a newspaper war (the advantage: reporters are already embedded). But beyond the scope of a NYT-WSJ war, Perez-Pena notes that the Journal's new section could also impact the New York Post, another News Corp. properties and one already serving NYC -- though not the upscale readers and advertisers.

Here are some key facts about the upcoming section:

• The Journal is investing $15 million in the new section.
• It will have a staff of 35 people (out of a staff of 750).
• Most of the reporters will be reassigned from other sections.
  
• The Journal plans to invest another $15 million in another attack on the Times, aimed at attracting women readers and more home subscribers (more attractive to advertisers).
• The new section will cover daily real estate news, cutlure, business, sports and some metro/government news.
  

As readers of this blog may remember, the Times and Journal have competed over the past year to shed light on how the recession impacted the super-rich.

Check out Perez-Pena's article for more details and insight.

NYTimes Quickly Validates Our Prediction about Online Subscriptions

Last month, we issued our annual list of predictions, and posted more details on Feb. 2, Prediction #3: 2010 will be the year of online subscriptions. In today's New York Times, blog favorite Richard Perez-Pena wrote, "Some News Outlets Ready to Try Charging Online Readers."

It's nice to be validated -- so quickly.

Can Local Papers Survive?

I think they can. But it's not going to be a cakewalk. Local broadcasters are having trouble this year.

Check out an interesting profile in the Times by Richard Perez-Pena, "A Reporter With a ‘Tom Sawyer Business Plan’ Buys a Newspaper.

Worst Headline of the Day: NYT: Newspapers Have Not Hit Bottom, Analysts Say

The real news is that newspaper declines should slow in Q4.

Ok, so that's not as catchy a headline.

And that's not as if the analyst is predicting an immediate recovery.

But slowing declines is good news.

You'd think the Times would want to publish a headline that positioned the industry better than "Newspapers Have Not Hit Bottom, Analysts Say."

Perhaps that's another problem with newspapers: they focus too much on the negative.

Micropayments for News Content Faces Significant Reluctance

Free may be a great price to pay, but for content on the Internet, it's an unsustainable business model. Especially for journalism.

I realize I'm giving away content on this blog for free, but this blog is not my main source of income. Offering opinion is easy. Researching and conducting real journalism takes time and money.

Last week, the New York Times wrote about a number of organizations that are trying to find a system to charge readers for news content. In the article, "Lots of Fee Ideas for Media Online," Richard Perez-Pena wrote that Steven Brill, News Corp., Google, Microsoft and I.B.M. have all offered up approaches.

Brill's Journalism Online says it will have a system in place within months, one that could be used by hundreds of sites.

The challenge, according to Alan D. Mutter, a media entrepreneur, consultant, and an investor in a failed startup that tried to develop a micropayment solution, “There is no unanimity among publishers about what to do — whether to charge for content, how to charge, whose solutions to use — and most people in the business still don’t believe they can put up a pay wall without repelling a large part of their audience.”

Actually, Mutter told the Times that there's another hurdle, too, “I doubt you’re going to see a lot of companies spend a lot of money building a system for the newspaper industry as long as there’s no resolve on the part of the industry about what they want to do.”

The Times article covered the lack of a technological solution to the problem.

What has yet to be fully addressed is that consumers love "free,"and have grown accustomed to not paying to get news content. What's ironic about the fact that Google provided some ideas on a payment structure, is that Google has helped fuel the decline in the demand for print newspapers because its Google News makes it easier and faster for some people to get just the news they want.

The declining demand for print is coupled with the disinclination to pay for news at all. I saw this article on the San Francisco Peninsula Press Club that makes the case that people don't want to pay for content.

In Print-only experiment upsets online crowd, the SFPPC reported that a San Francisco Chronicle column critical of SF Mayor Gavin Newsom by Phil Bronstein's column "appeared briefly on the SFGate.com site and then was pulled." Apparently, the Chronical had intended the column to appear only in the print edition, and not online, as a way to boost newsstand sales.

The reaction to the SFPPC's article itself is what's instructive: "Sorry, but I'm not paying a dollar for a daily, local newspaper. Too little news for too high a price." Another comment said, "print's dead. this experiment was doomed. hope the chron/hearst/sfgate has learned a lesson: back away from print and go entirely online."

Go entirely online means no payments.

Without finding ways to generate revenue, online news content is doomed.

I like free, too, but the news sites we like to visit will be in a death spiral unless they can generate revenue from online users.

Perhaps multimedia content like the Times' Gauging Your Distraction could help generate revenue, although I'm not sure how the Times would charge for that. (Per time playing the game?)

What Brill, Murdoch and the rest of the news sector must do is start making the case why online news content is valuable, and that people who access online news content will either have to support it or get used to dwindling sources for news.

AP Continues to Innovate...but is it enough?

Battered by the downward spiral of the print newspaper sector, the Associated Press, the member-funded nonprofit news agency, is looking at new ways to provide value.

Some ideas seem like they will be difficult to succeed. For example, trying to clamp down on non-member sites that use all or part of an AP article. It makes sense in a pre-social media world.

But in a social media world, you actually want others to post information and cite about you, and to provide links back to your site.

Plus compliance will be difficult to maintain.

On the other hand, AP has started a six-month experiment to provide articles by the Center for Public Integrity, the Investigative Reporting Workshop at American University, the Center for Investigative Reporting, and ProPublica. According to the New York Times, these new sources can help newspapers " fill the gap left by their own shrinking resources."

That's the kind of innovation that should help AP demonstrate its value to its 1,500 US newspaper members.

For more details, check out the Times article, "A.P. in Deal to Deliver Nonprofits’ Journalism."

What The Selling of BusinessWeek Tells Us about the Economy -- That BusinessWeek Hasn't Told Us

The news that McGraw-Hill is trying to sell BusinessWeek, "McGraw-Hill Is Said to Be Seeking a Buyer for BusinessWeek," tells us something imporant about the media business -- something that you won't find inside the pages (hardcopy or otherwise) of BusinessWeek itself.

It's that the Great Recession has not started rebounding.

Circulation for BusinessWeek is holding steady at about 900,000, but advertising is declining.

BusinessWeek is a great publication, does a terrific job covering news and trends. And its website and BusinessWeek Exchange community are very popular.

Doesn't matter, though, because advertising pages has dropped 40% since 2004.

Here's what Peter F. Appert, an analyst at the Piper Jaffray Companies, said to the New York Tmes about the potential sale: “It certainly makes all the sense in the world for them to sell it, even though in my view there is likely to be minimal proceeds, if any. There could be buyers, if the definition of a buyer is someone who’s willing to take it off their hands.”

That last part of his statement is worth repeating: "There could be buyers, if the definition of a buyer is someone who’s willing to take it off their hands.”

What that tells us, unfortunately, is that BusinessWeek is in trouble. That a high profile, important business publication will be spun out, its future uncertain under new owners looking for a bargain.

It means, if McGraw-Hill feels it makes sense to ditch BusinessWeek now, that we're far from being out of the woods, that a recovery is not just around the corner.

Meanwhile the list of failed magazines continues. Former Mets (and Phillies) Lenny Dykstra had filed bankruptcy, and shut down his finance magazine, according to Forbes. "Dykstra Done In By Debts: Ex-ballplayer goes bust, owes millions after failed investment in glossy finance magazine for pro athletes."

In the short-term, we should expect further belt-tightening at the BusinessWeek and other major publications -- that layoffs and offers for buy-outs will continue, that print will continue to look for ways to shrink their publications to save money, continue to look at ways to increase revenues (the problem with a recent Washington Post pay-for-access salons), and that more publications will shift to an online-only business model.

What that also means for PR functions is that the competition for ink will continue to be tough since the number of organizations trying to get into a publicaiton seems to be holding steady while the number of actual pages is shrinking.

Can United's New Hemisphere's Magazine Redesign Take Off?

At a time when publishers are considering/preparing for an inevitable shift to an onlne-only business model, business travel columnist Joe Sharkey at the New York Times reported on changes to United Airline's Hemispheres, its print monthly.

"An In-Flight Magazine Is Given an Upgrade" provides a look at the plight of in-flight magazines, explains why what Hemispheres is doing is interesting, and provides some insight into how the magazine is assembled.

Even as WiFi becomes available on increasing numbers of flights, print can still exist at takeoff and landings, when you're not allowed to use electronic devices.

The strength of print was the theme of another Times article, "Hearst’s Contrarian Strategy Pays Off" by blog favorite Richard Perez-Pena. Hearst's magazines actually don't post all its articles on the web. To get them, you actually have to subscribe or purchase them. They've been successful at that, even being able to raise newsstand costs during a recession without lossing readership.

Change to Atlanta Journal-Constitution's Approach to Editorials

The Atlanta Journal-Constitution is making a change in its approach to editorials -- one that could set the standard for local editorial pages. Until now, many editorial pages wrote editorials on national issues as well as local issues.

But the AJC plans to publish fewer editorials, and avoid hot-button ideological issues.

Hot-button issues are what newspapers are supposed to address.

Explaining the move, the AJC's editor, Julia Wallace, told the New York Times' Richard Perez-Pena, "We have moved to a different kind of editorial that’s much more about community issues and less about, ‘let me opine on national issues.’ ”

What's potentially troubling is the fact that the top editors and the publisher are now joining the editorial board. Traditionally, editorial boards have been kept separate from actual news gathering.

The lesson for PR functions is their approach to editorials has to adjust, especially for smaller market newspapers. Make sure you have a strong local angle to an issue. Check out the Times article, "Editorial Voice of an Influential Atlanta Newspaper May Move to the Right."

For Two-Paper Markets, And Then There Were None...

The prognosis is looking bleak for newspapers. Whereas last year it seemed like some two-paper towns might be affected, experts are now suggesting that some single-paper markets could lose their paper, becoming no-paper markets. That's partly because several newspapers have been put up for sale -- but there are no takers, even after months.

Even Joel Kramer, former editor and publisher of The Star Tribune and now the chief executive of MinnPost.com, an online news org, said this to the New York Times' Richard Perez-Pena: "It would be a terrible thing for any city for the dominant paper to go under, because that’s who does the bulk of the serious reporting. Places like us would spring up,” he said, “but they wouldn’t be nearly as big. We can tweak the papers and compete with them, but we can’t replace them."

Check out the article, "As Cities Go From Two Papers to One, Talk of Zero." It's especially worthwhile to check out the accompanying graphic, "Bad News for Newspapers."

Another Day, Another Newspaper Files for Bankruptcy

It was a tough weekend for East Coast newspapers.

Both the holding company of Philadelphia's two newspapers -- Philadelphia Inquirer and Philadelphia News -- as well as the holding company of the New Haven Register and 19 other dailies filed for bankruptcy.

Three other newspapers companies have filed for bankruptcy since Dec. 2008.

And more are in precarious positions. The New York Times recently cut its dividend again to save capital for the business.

As a side note, what's interesting is that yesterday's Journal article took aim at its midtown rival, reporting: "Newspaper companies have been pounded by spiraling advertising declines, but many of their wounds are self-inflicted," and then mentioned the New York Times.

At the same time, the New York Times took a bigger potshot against the Journal in an article,
"Murdoch’s Soft Spot for Print Slows News Corp." Of course, by saying that News Corp's dependence on its newspaper business is dragging down its revenues, is not a great point for the Times to make -- since the Times is suffering from the same trends.

But at least they get to bash the Journal.

As for PR functions, there are two lessons from this:

1. Look for more layoffs and cutbacks at large metro papers. Which means: we need to find alternative ways to communicate information to key audiences.
   
2. Don't try to buy newspapers -- which is what Brian Tierney, a Philadelphia public-relations executive, did. The deal has not worked so well for him.

More Consolidation in the Newspaper Sector

The New York Times reports "5 Big Papers to Share Articles and Photos."

Five New Jersey and New York newspapers announced they will share articles and photographs as a way to deal with fewer reporters and photographers.

The papers include the New York Daily News, Newark Star-Ledger, the Buffalo News; the Hackensack Record, and the Albany Times Union.

This is a growing to the articles, "similar alliances were formed in the last year among groups of papers in Ohio, Pennsylvania, Florida and Texas."

Newsweeklies...And Then There Was One...

“News has become a commodity. They already know the news. We’re not in the business of telling people the news,” Richard Stengel, managing editor of Time, told the New York Times' Richard Perez-Pena.

Very startling acknowledgment.

According to the article, "The Popular Newsweekly Becomes a Lonely Category," "Newsweek may be poised to" make substantial changes this year: "Executives have said it will strive to be a “thought leader,” competing more with The Economist than with Time — in other words, a big stride in the direction it was already headed. The strategy includes a major reduction in circulation and operating costs and a focus on an elite audience to attract advertisers."

Here's some further analysis by Perez-Pena:

Unable to compete with the immediacy of television, cable and then the Internet, newsmagazines have been moving for decades in the direction of analysis, commentary and news-related feature articles. That trend has accelerated in recent years, driven by financial pressures. The magazines’ editorial staffs are about half as big as they were in the 1990s, and they have shuttered many of the bureaus they once had around the world.

They still produce some deep, original reporting. But these days, they are more likely to offer a comprehensive survey of a subject to present an argument or offer a prescription — like Newsweek’s recent cover article on why President-elect Barack Obama may come to embrace Vice President Dick Cheney’s view of executive power, or Time’s on how a trillion-dollar stimulus package should be spent.

Seattle's Newspaper Environment May be Post Post-Intelligencer

According to the New York Times' Richard Perez-Pena, there's bad news for Seattle, one of the remaining two newspaper towns. In the article, Perez-Pena reports, "Hearst said that if it could not find a buyer (for the Seattle Post-Intelligencer), it would either shut the paper entirely or make it an Internet-only operation with a much-reduced staff."

The decision could be made within 60 days.

Interestingly, until now, the Seattle Times was considered to be the paper more at risk.

Check out the article: "Hearst Looks to Sell or Close Seattle Paper."

New York Times Finds New Revenue Stream

Demonstrating the seriousness of its finances, the paper of record, The New York Times has recently cut its dividend and mortgaged its new headquarters.

The latest step: selling ads on its front page -- something the Wall St. Journal started first.

Read more about it here, "The Times to Sell Display Ads on the Front Page."

More Newspaper Cutbacks; Expect a Dozen to Be Online-Only in 2009

To the list of online-only newspapers and magazines that started with the Christian Science Monitor and U.S. News & World Report, add the Kentucky Post, and, more significantly both of Detroit's daily papers, the Detroit Free Press and Detroit News.

According to the New York Times' Richard Perez-Pena, "Detroit Newspapers May Sharply Cut Home Delivery; the wounds of both a troubled industry and a hard-hit region," both Detroit dailies will cutback the number of days they deliver their papers to home subscribers -- perhaps as much as three days each week, including Sunday, one of the most profitable days for a home delivery. The papers will also reduce the number of pages they publish that will be available at newsstands.

At this rate, we expect that in 2009, there will be a dozen newspapers that will have transitioned to an online-only business model.

How Does the Media Cover the Current Economic, Um, Cr-- no, Meltd-- nope, Situation?

According to blog favorite, Richard Perez-Pena of the New York Times, the current economic situation has been a "lesson in semantics" as they avoid words like "crash," "meltdown" and "apocalypse."

Very interesting. Check out "Amid Market Turmoil, Some Journalists Try to Tone Down Emotion."

More Bad News for Newspapers, Part IV? Part V?

It's difficult to keep track these days. Another day, another piece of bad news for the newspaper industry.

I write this, as always, as someone who loves newspapers, and wants to see them succeed.

But things are pretty bad, and the New York Times continues its coverage of an industry in decline. Check out "Newspapers Could Be Bargains, but Few Are Buying" by Richard Perez-Pena.

This time out, Perez-Pena reports that a lot of newspapers are being shopped around, but no one's really interested.

Or, to pick up the quote from Ken Doctor, a newspaper analyst with Outsell, "A year ago, the conventional wisdom was, 'Yep, there are problems out there, but there's still significant value. Now it's 'Run away."

The latest paper hitting a wall is the Newark Star-Ledger by David Carr. Owned by Advance Publications, which is owned in turn by the billionaire Newhouse family, the Newark Star-Ledger is, in the words of of Donald E. Newhouse, president of Advance, "cannot be sustained by us or anyone else...This is the reality we face. The perfect storm. And it shows no sign of letting up."

That could be a negotiating tactic with the unions -- and Advance is asking unions and non-union employees to make concessions. But the Newhouses tend to be good owners, a case Carr makes.
The Newark Star-Ledger is a good paper.

But that may not be enough to keep it going.

New Pew Study Backs Up PRBackTalk's Position on Newspapers & Format Changes

Another interesting article about the sorry state of newspapers by the New York Times' Richard Perez-Pena, "As Papers Struggle, News Is Cut and the Focus Turns Local."

Findings of a new Pew Research Center survey include:

• 64% of newspapers have reduced foreign coverage.
• 10% of editors think foreign news is "very essential."
• 57% of papers reported a decline in the amount of space allocated to national news.
• One-third of papers are allocating less space for business news.
  
• Three/fifths of papers have less space for news overall.
• Large papers are reducing space given to business, arts, features and opinions -- topics that smaller papers generally don't give much space to in the first place.
• 85% of large papers have seen a decline in the size of their news staffs. Overall, there's been a 59% decline, which means smaller papers have been a bit more resilient.

Makes it a very difficult time for journalists and PR executives.

Also check out an interesting article in the July Conde Nast Portfolio, "The Romenesko Empire: How the first media gossip site inadvertently ushered in the era of fact-free journalism" by former top NY Times editor Howell Raines. Apparently, Romenesko is being supplanted by Gawker the same way traditional print media is being supplanted by blogs.

Today's iPhone Release May Be Big News -- But the Continued Drop in Ad Sales Has Bigger Implications

According to major media, along with the social media world like Twitter, today's big news is the release of the latest iPhone 3G.

The iPhone has certainly had a significant impact on the cellphone handset business. But the latest version is an iteration, not a revolution. It will be replaced next year with more of the same -- no doubt cool stuff, but more of the same.

Bigger news, I think, was reported on page 5 of today's New York Times' business section: "In Deepening Ad Decline, Sales Fall 8% at Magazines: The decline is led by automotive and technology ads" by Richard Perez-Pena.

The current business model of magazines and newspapers in the U.S. is based on advertising. Without advertising, a U.S. magazine won't survive -- even if it maintains a high circulation base. In the past year, magazines with circulations of several hundred thousand have folded merely because advertisers had dried up.

That doesn't mean that readers had given up on the magazine. Just advertisers. In contrast, European magazines typically charge higher subscription fees, which are used to underwrite a greater proportion of a print outlet's costs. Presumably, in Europe, a magazine with a high circ. could survive an advertising downturn.

Not so in the U.S., where news and some business mags were hit by the continuing slump. BusinessWeek's ad pages dropped 14.8% and Forbes dropped 12.6 for the first half of 2008, according to the Publishers Information Bureau, which tracks this information.

Even some of the biggest circ. magazines were hit, including Reader's Digest, Cosmo, Ladies' Home Journal and Family Circle.

Things are so bad here that Thomas J. Wallace, editorial director at Conde Nast, told Perez-Pena, "The joke here is, 'Flat is the new up.'" (Translation: that just having flat advertising sales is great in this environment.)

The implications to the news is that there will be more layoffs at magazines and newspapers, which are having an even more difficult time. Many of those layoffs will come from editorial for two reasons:

1. You can't cut the advertising dept., because you people to sell space to advertisers.
2. The decline in ad pages by 14.8% brings with it a drop of at least 14.8% in editorial pages. That means magazines don't need as much content, which means they can cut reporters without much impact.
   

Over the past year, BusinessWeek and Fortune updated their formats. Expect more to follow suit. When they do, a letter from the editor or publisher will say that the new format is designed to better help readers, but don't be fooled. The new formats are designed to convey that the magazine continues to be relevant.

But after cutting reporters and editors and bringing more charts and graphics, that's probably not the case. Skimpier content is not more relevant. Meanwhile, in announcing format changes, a number of newspaper chains have said they will be adding more charts and graphs, as the Boston Globe's business section has done.

Unfortunately, these changes have not stemmed the exodus of readers or advertisers.

The iPhone is great. I would consider getting one if the carrier had better coverage in my area. But the news about the ad declines is unlikely to be cyclical, and means bad news for traditional media.
to attract advertisers .