Newspapers and the Credit Crunch

Some numbers that terrify anyone with any skin in the newspaper game, particularly in Scotland:

Sales of the Sunday Herald are down 15% this year. More worrying still, if not altogether surprising given the state of the global economy, the Johnston Press, owners of the Scotsman and hundreds of local papers, report that advertising sales are down 15% this year. Expect that number to get worse. Two years ago the companies share price was £4.20; yesterday it closed at 19p.

These numbers happen to come from the Scottish and UK (local) market. But they won't be that different from the numbers elsewhere. So there will be more cuts which, in turn, will make it harder for newspapers to stop the slow bleed of circulation which in turn makes it harder to raise revenue from advertising which thus necessitates further cuts on expenditure. And yet management must also deliver "value" to shareholders: the question is what sort of timeframe you use to measure value.

You can't turn readers on and off like a tap, the way you can advertisers, adding them in good times, shedding them in bad. Newspaper buying is a habit that, once lost, is hard to persuade people to return to. It's like the gym: you offer the buggers all manner of rewards and freebies to get them to sign up, but even then most of them let their subscriptions lapse after a couple of months.

Then again, there is this to be said: newspapers have thrown money at new sections and been prepared to countenance any idea - no matter how loopy - in recent years. And not much of it has worked. At best, they're bailing water quickly enough to stay afloat. When the New York Times can't find a way to make a success of it all, then who the hell can? (A question for anther post, another day, perhaps.)

Gloomy stuff. One coule - and might at some point - write more, but here's a grim prediction: at least one, and probably more, major British or American paper will cease publication within the next 18 months.

Comments

[Stephen Khan]

care to nominate a title???

[dearieme]

When I were but a lad... my father took four newspapers per day, which adds to 28 per week. We take 3 per week. That's what we technical chaps call an order-of-magnitude decrease.

[ndm]

I have vague memories of now and again hauling my butt off to the newsagent to buy the pink on a Saturday afternoon. Now I'm thinking did any of us really care that much about the ups and downs of Hearts and Hibs, let alone Linlithgow Rose and Broxburn Athletic.

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The continuing loss of newsgathering is going to have a negative affect on how we understand the world. First prosecution witness: Sarah Palin.

My local newspaper has pretty much abandoned all pretence at journalism and does little but reprint wire-service stories and stale stories from the previous week's Wall Street Journal. Its demise would be no loss.

However, the loss of serious primary newsgathering operations like the Wall Street Journal, the New York Times and the Washington Post would have a pretty negative effect on the United States. They (used to) have the financial ability to sustain teams of journalists spending months investigating stories. Their reporters also have connections and, by dint of their organizations clout, the ability to access sources unavailable to mere mortals.

There are situations, such as Talking Points Memo asking its readers to trawl through thousands of pages of government documents looking for juicy information where eyeballs can replace intelligent reporting. Josh Marshall and the TPM crew have done a great job exploiting eyeballs in this way - but their work remains exceptional. And anyway their organization, unlike most blogging outfits, exists in the confluence between journalism and blogging.

The Atlantic Monthly has nine bloggers only one of whom, Marc Ambinder, professes to do any original reporting. I read Michael Tomasky's blog but due to online reading habits do not routinely read his articles in the Guardian.

Indeed, I suspect that these online reading habits are fairly common and that the article on page B7 is no longer being read. Is that important in the grand scheme of things - probably not - but who knows. Who after all needs to know what Paul Krugman thinks about total factor productivity in East Asia or whether Linlithgow Rose won last Saturday?

Bloggers are not and blogging is not going to replace journalism - or at least journalism as we understand it today. Journalism may wither away and be displaced by blogging but that will be a world in which we are all less informed.