Monday, September 21, 2009

Bailout for Newspapers? Why?

Newspapers For Sale
Originally uploaded by drewmaniac

The Obama administration has indicated they would be open to extending bailouts to newspapers. Why?

This isn't a political statement in any way. Take all the political issues out of this and I think one question needs to be asked. Why should newspapers be bailed out when they are dying?

I don't mean they've simply fallen on hard times (they have), I mean they are on their way out altogether (they are). There will come a day when newspapers, in their current paper form, will be obsolete and that day is fast approaching.

People aren't reading newspapers, but it's not because we're in a recession. People had stopped reading newspapers long before the markets collapsed. People aren't reading newspapers because they can read the news online and they can get the news from other mediums. It's that simple. Moreover, most newspapers are struggling because they refused to see this coming in spite of all the clues that it was going to happen.

It was just a year and a half ago that I wrote about holding out hope that newspapers would somehow survive in the printed form. Today, I'm convinced only a select few will (if any). The newspaper industry must adjust to the online world. That's all there is to it. A bailout doesn't do anything but extend the life of an already dead (albeit walking dead) medium.

Newspapers don't need a bailout. Newspapers need to adjust to the changing market.

Recommended reading: Seth Godin's post, When newspapers are gone, what will you miss?


Thom Singer said...

Like so many industries, they did not adapt to the changes... and thus allowed new upstarts to take away readers. If they had realized long ago (like 12 years ago) that they were not in the printed word business, but instead in the delivery of news information business... they would have lead the way into the internet. Instead they hid under a blanket and pretended that nothing was changing until it was too late.

Sarah Robinson said...

I'm wondering it short-sightedness and failure to innovate is all that is required to qualify for a bailout. If that's the case, the list will be never-ending. Excellent question - and excellent post. :-)

Chris McDaniel said...

It's even worse than just the internet for Old Media... social networking has already transformed the way we communicate and get our information, and is accelerating their decline even further.

I would go a step further - the traditional website-based news sites are next.

Where just a year ago we looked to the Drudges of the world for "the scoop", now we see a Tweet.

20 minutes sooner.
On the mobile device in our pocket.

Our friends know where we are, who we're with, what we're doing, 24 hours a day. If one of us happens to witness breaking news, we can share it with practically everyone we know within seconds.

What place do newspapers (or Radio, TV, and even the "traditional" Web) have in that world?

Danny Brown said...

Have to say, I'm tired of bailing out failed business models. Where's the reward for success when so many failures get rescued for screwing up and putting people out of work?

We may as well all be crap at our jobs and then go cap in hand to our government...

JustinG said...

Majored in journalism and dreamed of writing for a newspaper as a kid growing up.

That said, any bailout of newspapers would be a waste of least if we're talking about the print side.

If we're talking about the Web presence, what would benefit newspapers much more than a bailout would be significant research into how people wish to communicate and the way technology is changing it.

I think newspapers will survive in some way on a local level, but only if they identify the community so many people who use social media seek and apply those learnings to their coverage of local communities.

If newspapers can bring people together around a topic to share conversation, ideas and education, their just might be hope yet for them sustain their online presences.

In the past, journalists were seen as the influencers. Now they're just a few of millions of influencers. But they can still maintain authority, and more importantly reputation, in some respect if they adapt.

Linda Forrest said...

Well said. I watched the music industry implode from the inside for similar outmoded ways of trying (and failing) to do business.

We share similar sentiments about the idea of a bailout, something I wrote about on our blog today as well.

Andrew Weaver said...

@Thom - You make one of the most important points in my opinion. Newspapers should never have viewed themselves as being in the printed news business. To assume the tools of your industry will always stay the same is very dangerous. The printed paper should be viewed as simply another tool to deliver the news. Sometimes the tools change and you no longer need them. On a side note - man, I wish faxes would die already. :)

@Sarah - Thanks for stopping by! There's a lot of talk about companies being "too big to fail" too, so obviously that's a requirement too. As a result I'm eating like crazy and refusing to work out so I, too, can be too big to fail.

@Chris - You hit the nail on the head with a lot of what you said. So much of this is competition. The competition has changed. For so long newspapers have been successful not so much because they were newspapers, but because they were essentially monopolies. They still may have a place in the news information business in the future - but it will never be the monopoly they have held for years. The competition (social media, the Internet, etc) is fierce now, and they have not adjusted to it.

Andrew Weaver said...

@Danny - You and me both, man. You and me both. Markets change. Competition changes. Businesses are born. Businesses die. It irritates me to no end to see failed business models propped up by the government. All this bailing out and rewarding bad business models does one thing in my opinion - it promotes mediocrity by being nostalgic of the past instead of looking ahead to the future.

@Justin - I discussed some of this with @cmwilson on Twitter and we came to the conclusion a once weekly (printed) newspaper could probably survive in some way on the local level. But, you are right. There needs to be some research done on the local level on what the community is looking for. That said, I still cringe at the idea of ANY government money being handed out to newspapers (printed or otherwise) and that's for one reason. A free press who receives federal money ultimately ceases to be a free press.

@Linda - Thanks! The comparison to the music industry is one of the closest to what is happening to the newspaper industry that I can of. I read your post and you're right. Part of the problem, too, is newspaper owners believe Google to be the devil. They don't understand Google, the Internet, or anything about it. As a result, the change is not only slow coming - their hesitation is destroying them. Honestly, I believe that's one of the biggest problems. Instead of adjusting to the changing market - they'd rather smear the online news market.

Kasey Skala said...

Will newspapers die? Just remember we all said radio was dead.

That being said, why bail out the newspaper industry? Imagine the restrictions and strings that would be tied to this bailout. It would eliminate unbiased reporting and stifle our First Amendment.

Like Danny mentioned, why reward a failing business model?

Andrew Weaver said...

@Kasey - I don't think newspapers will ever completely die. I think there will be a market (albeit much smaller) for some printed news. Especially in larger cities. They'll have a place, like radio. They just need to find their place soon. The longer they resist and talk about getting bailouts - the longer it will take for them to adjust to reality.

As for the free press - I completely agree. Once the free press starts accepting government money, it ceases to be a free press. I don't see how you can argue any other way.