Newspapers’ Biggest Problem? Paper!

The most disturbing part of CNN’s report today on the demise of the newspaper industry (what we at HighTalk call the Great Media Collapse of 2009) is this stunning figure:

Newspaper jobs lost: 21,000.

Firing baseball players would kill the Red Sox.  So why are newspapers firng reporters?

Firing baseball players would kill the Red Sox. So why are newspapers firing reporters?

As newspapers continue to grapple with plunging advertising revenues and defecting subscribers, they are falling into the trap of laying off reporters and editors to save money and improve the bottomline.

It’s a fool’s gamble.

The only product of value that a newspaper sells is news. If they continue to slash editors and reporters – the employees who gather, write, and create their “news” product – then they will continue to fail.

Here’s an analogy to put this practice into perspective. Compare a newspaper to a professional baseball team. During this brutal recession, baseball teams have been forced to cut costs like every other business. But they have been doing so by reducing administrative staff, cutting out on ballpark improvements, slashing overhead, and even reducing maintenance costs. But one thing they have not done is get rid of the people on the field playing baseball.

The Boston Red Sox will not begin this season without a first baseman or a left fielder. That would be nuts. A baseball team understands that the product they sell every day is baseball. So baseball players are their most valuable assets.

So why do newspapers, who sell news, fire their most valuable assets: the people who collect and write it? That’s the equivalent of a baseball team starting the season without its starting pitching staff. A practice that would erode its ability to win – and to succeed as a business.

It’s because newspapers can’t break out of thinking about the “paper” in newspaper. They spend a fortune maintaining the paper part of their business. They maintain printing plants and the cost of printing hundreds of thousands of daily copies (ink, paper, chemicals, employees, etc.). They pay for the cost of putting the papers together and distributing it to tens of thousands of households. This means paying for a fleet delivery vans and trunks (and the infrastructure, fuel, and maintenance costs associated with it). They also employ entire circulation departments.

These “paper” based functions are not going to help newspapers survive. In fact, they’re a big part of the problem.

I’ve watched in the last several months as my newspaper, the Boston Globe, has shrunk to a flimsy size (the Globe is reportedly one of the newspapers on the verge of closing). The Boston Sunday Globe, for example, no longer has a thud factor. The news inside of it is becoming less valuable because less of it is generated by Boston Globe reporters (due to lay-offs). The articles now come more from wire copy and freelancers than ever before. This makes the Globe less valuable to me. I want news and they are not providing it.

Newspaper have many problems to address, but one thing they should all do is abandon their “paper” operations. Quickly. There’s no future in it. Newspaper need to become web-based and get back to their roots: reporting and editing news. It might be too late at this point, but if I ran a newspaper, I would invest in reporting and divest from the “paper” and the costs associated with it.

News not paper should be the rallying cry for the industry.

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