RSS FeedHow to Save the Newspaper, Part 2
Friday, May 29, 2009 at 5:12PM Is this the death toll for newspapers? Perhaps not. Sure, we've seen some old newspapers go by the wayside over the past year, but that doesn't mean the strong can't survive. The failing papers are, indeed, old companies. As renowned corporate life cycle expert Dr. Ichak Adizes says, old companies can act young, and new companies can act old. In this case, old companies are acting old. They need to be reborn to get back to their prime stage of the corporate life cycle. I think we have yet to see one paper do a great job at reinventing itself. Sure, a lot of them are finding many ways to cut costs as a stop-gap to extinction, but true change starts at the core.
Let's take a look at the business model of newspapers. They have revenues from subscriptions and advertising and expenses of staff, buildings, and the biggest of which ... their physical newspapers. The latter is their biggest challenge and their biggest opportunity. There are millions of dollars in hard costs associated with merely getting a piece of paper with print on it into your hands -- never mind the cost of creating the words on it. There's the pulp, the ink, the printers, the electricity, the delivery trucks, the drivers, the fuel, maintenance, insurance, substations, newsstands, paperboys (and girls), blue bags for home delivery, inserts, and the list goes on.
If their value proposition is rich, insightful journalism -- and I believe it is -- then why not dump everything that doesn't directly contribute to that? Paper printing is a commodity. Reporting on feature stories with the depth of the New York Times is an art. So instead of wasting money on the printing process, figure out ways to distribute the content by other means.
;)
Which brings me to my point. Introducing ... the New York Times Kindle. I say dump (or phase out) the paper delivery of the news, and simply give home subscribers a New York Times-branded Kindle. For the price of an annual subscription ($551.20), it would be more cost effective to simply give a Kindle as part of the subscription. I'm sure the Times could get the $359 Kindles wholesale for less than $250. At that point the cost of (digital) distribution is miniscule, as long as Amazon corrects their ridiculous revenue split. If they keep the subscription price the same, after a few years, the profit margin would be astronomical (since the Times would only pay for the Kindle once). They could put in the agreement a minimum one-year subscription commitment. Multiple-year contracts would lower the price accordingly, like Verizon does with their FiOS contracts.
Move quickly, folks. The first one to implement this properly stays alive.
Matthew Snodgrass
I guess Rupert Murdoch agrees with me, to some degree. And here's Jeff Jarvis's take on using the Kindle to read the Times and the Wall Street Journal.
amazon, kindle, mattsnod, new york times in Digital Marketing, Technology 
Reader Comments (7)
I'm not sure Amazon's split is ridiculous at all. I can't imagine the NYT makes 30% margin on physical paper delivery. Teamsters are expensive.
I don't think Kindle (at least the current version) can save the newspaper either. Kindle is a great electronic book. I love my Kindle. But it stinks at moving through content quickly. Not many people want to read the daily Times from front to back. It's vastly simpler to skim through headlines on my iPhone on a good newsreader app.
30% margin, no, but at least they're in control of content and delivery at that point. At least Apple's only taking half for distributing iPhone apps and practically nothing for distributing songs. The Times got the ass-end of that deal.
And I agree on the Kindle 2's size. That's why I'm holding out for the Kindle DX. I hear that, with its bigger screen, it supposed to better replicate the paper-scanning experience. We'll see. Long story short, they can't survive with paper distribution alone.
It's not so much the screen size as flipping from screen to screen. The electronic ink screen has to re-magnetize (or whatever its doing) every time the page changes. The screen blacks out and then redraws the next page. There is a good two second delay from page to page. No problem with a book, but impossible to skip from newspaper section to section quickly.
At it's core, I just think "save the newspapers" is a flawed idea. The focus shouldn't be on how to take the New York Times and move it intact into the digital world. The idea should be building a great digital media company called New York Times. In other words, throw out the baby, the bathwater, the wall paper, the floor tiles, then dynamite the house and then build it up from scratch with the right name (think Yankee Stadium or the new Star Trek movie).
Outside of saving the New York Times company, if there really is a difference in journalistic quality, then journalists should be able to make a living online by attracting readers. Writers don't need newspaper companies any more than readers need physical newspapers.
My term "newspaper" is a generality here, so I agree that the institution should remain, if not the business model. And many reporters are trying your suggested model -- just not making any money doing it. Check this out, and forgive the irony of the reporting source.
I think people will have to eventually realize that they'll have to pay for news again -- in the digital form. In the above article, Rupert Murdoch says that will be the case with his properties within a year. I think the industry shot itself in the foot by commoditizing news online.
And 2seconds to refresh a page? Takes me 10 seconds just to turn and fold a paper page.
Dude, if Perez Hilton can make a living as a blogger, then I'd have to say the reporters in the article you linked are really doing something wrong.
What this whole thing boils down to for me is this: I'm not interested in a digital newspaper. The digital New York Times should not resemble the newspaper in any way. The newspaper is a lousy format to try to replicate on web browser or an eBook reader. Just look at nytimes.com ... Step 1: Get rid of the masthead! It's not a newspaper. It's a website, folks...
People will only pay for content if it's valuable to them. Newspapers need to think of a completely new way to hit the Internet with news. Because if they're just going to try to catch with the established news sites, then who's going to care. They're a "me too" site at that point.
Here's an idea ... all these media conglomerates that own multiple newspapers can digitize all of their archives to create a 4-D geo-temporal news search engine. Think of the first paragraph of every news story: who, what, when, where, why, how? Convert the "where" to latitude/longitude coordinates. Convert the "when" into a timestamp. What an interesting way to easily query a rich perspective of history. Tie this in with archival news reels and broadcasts the conglomerates own and you have some really interesting stuff.
What news happened on my birthday five miles around the hospital where I was born? What would a stream of every news story about the Israeli/Palestinian conflict going back to the 1940s tell me about what's going on now? How far back do the roots of today's financial crisis go and what do that tell us about what's happening now? Those answers are all there somewhere.
That doesn't look anything like a newspaper, but it's starting to sound like a service worth paying money for.
Your über-news search tool does sound like a really cool idea, perhaps what WolframAlpha will eventually become. However, there's something to be said for the presentation of news in its current form. The majority of news readers would never read other news items that didn't fit their interest filtering parameters otherwise.
Knowing what Buzz Aldren had for lunch in Florida on the day I was born is great but not something I'd access as part of my daily news consumption. Remember what TV producers have known for 65 years ... sometimes people need to be told what they like. There's also something to be said for effortless media consumption. It's one reason why WebTV never took off.