April 6, 2009
Coming Soon, the Death of Newspapers, but Not the News
The newspaper industry suffered another shock last week when the New York Times Co. threatened to shut down the Boston Globe if it did not receive $20 million in concessions from unions whose members work for the Globe. The union is taking the threat seriously. So where do we stand on the newspaper front?
Christian Science Monitor, essentially a web only newspaper
- Rockey Mountain News, shut down
- Seattle Post-Intelligencer, web only
- San Francisco Chronicle, under threat to shut down
- Chicago Tribune (publisher of the Los Angeles Times), in bankruptcy proceedings but still publishing
- Chicago Sun-Times, in bankruptcy proceedings but still publishing
This isn't merely a shakeout in the news business, but something really serious. Circulation is plummeting because many people have transitioned to the web and other media outlets for their news. As newspapers give away the content they have cannibalized their print operations, and web ads can't support the bills. In fact, some of the ads are also free on the web. Just go to the Best Buy or Office Depot web site and you can view that sale flyer without having to buy the Sunday paper. Want comics? Just look them up on the web at the respective syndicate's web site. Want personals or classified ads? Just go to Craigslist.
This is not going to change soon unless the papers figure out a way to charge for content online. Whether it's micropayments or another form of subscription remains to be seen. There are a few successful models out there. ESPN offers free content, but locks away the good stuff for subscribers. And they do get subscribers. The problem with newspapers is that they have been giving the news away for so long, they will get resistance for charging. That coupled with competition from free sites may make it difficult for consumers to justify buying something they can still get for free in one form or another. The free side of news would have to dry up considerably before a subscription model can succeed. It's not anything that is going to get solved soon. In the mean time, look for more closures and threats of closure.
April 6, 2009 | Permalink
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