The real news algorithm

Doug Petch reports that the Lexington Herald-Leader cried uncle when readers bitched about a shrunken TV book and they expanded it again. Petch asks:

So, what’s a publisher to do? Follow Jarvis’ recommendation and do away with the TV Book altogether, or attempt to placate the paper’s dwindling readership by giving it a widely requested feature?

My response:

I think the gutsy calcuation is this: If you killed the TV book and lost N readers as a result, does the cost of losing them (N * (circulation net revenue per lost reader + net contribution to CPM per lost reader)) exceed the cost of producing the book ((paper + ink + syndication fees + staff) – measly tv advertising)?

Yes, you’re going to piss off some readers when you make any change. That is the first rule of newspapering. But the necessary calculation — for parts of the product that are not profitable and are not key to the paper’s journalistic mission and value in the community, which precisely describes TV books — is whether that part of the product costs you more than it gets you. That’s the calcuation you should make if, that is, you are brave enough to shrink the circulation to save the business and invest in new growth, if you are not merely hanging on for dear life and milking the cash cow.

Here’s an example from another medium: Magazines got addicted to giving away premiums to get subscriptions. Sports Illustrated was famous for its sneakerphone (and I used to work with the guy who did that). But it became clear that some readers were buying subs for the phones, not the magazines. Those subscribers were an expense. So are TV book fans — people who get the paper only to get that book — an expense?

: A Paltry Thing says I missed the real value of newspapers: Ads!

Why are newspapers doomed? They’re doomed (among other reasons) because the people running them no longer understand – if they ever did – a critical role their papers play in people’s lives and how “readers” use newspapers.

Take Jeff Jarvis’ recent posts, and the comments on them, as an example. The posts, and the responses to them, add up over time to a serious, carefully considered and far-ranging attempt to understand the reasons for newspapers’ decline and venture prescriptions to reverse it by an individual and an audience who genuinely care about newspapers.

The whole effort is as irrelevant to the real reason for newspaper decline as newspapers are becoming to their readers.

Not a single commenter has noted one of the simplest and most basic truths about newspaper readership: people need, want, value and use local advertising and commercial content. Skimp on the ads and the readers go away….

Listen up: it’s the ads, stupid. If you don’t believe me, go ask Craig. You do know who he is, don’t you? The guy who’s taking your readers?

That’s not at all wrong. When I was Sunday editor of the NY Daily News during a horrible strike in the ’90s (I had just quit Entertainment Weekly in a public snit and a wag on the city desk at the paper, just before the strike, shook his head and told me, “Man, you just went from the frying pan to the microwave”) we lost our coupons during the strike and after we came back under the ownership of robber baron Robert Maxwell. Maxwell and Rupert Murdoch hated each other and Murdoch controls newspaper coupons (aka FSIs, or free-standing inserts, in the jargon). The week that they found peace and we got our coupons back, the circulation jumped, as I recall, more than 100,000.

People buy ads, indeed.

: MORE FOLLOWUP: The Dallas Morning News blog has comment and comment-on-comment on my post:

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  • http://www.DataBasedAds.com Joe Zekas

    According to Al Neuharth, who knew a thing or two on the subject, the first rule of newspapering is “tits above the fold.”

  • http://marginalizingmorons.blogspot.com/ CaptiousNut

    All of these “local” wailers are hopelessly misguided.

    We have a national culture these days. No one stays at the same job for 35 years anymore. People travel AND move all the time now. Ergo, fewer and fewer people care about extremely local events.

    The local businesses can advertise all they want but economically can’t compete with the big box retailers. Increasingly, advertising is not worth the money spent for the smaller guys. Also it is more work to sell ads to a bunch of small businesses with wobbly prospects.

    Self-appointed newspaper reformers can pound the table all they want about “local, local, local” but that won’t make it the elixir they dream about.

    “Local” isn’t so much a grand idea as it is a desperate grasp. Just watch the local newscasts in New England these days. They hyperventilate about and exagerrate every inch of forecasted snow like it is the apocalypse and like nobody up here ever saw a snowflake.

    They hyperventilate about the weather because THEY HAVE NOTHING ELSE TO SAY, not because it is good business strategy.

    I still haven’t heard one media person admit they have a propaganda issue.

    Just recently something like four out of five papers in Vermont have defended that judge that gave an admitted child rapist 60 days in jail.

    Keep ignoring the newspaper bias issue….it is serving them so well these days.

  • http://robertdfeinman.com/society Robert Feinman

    Ever since Long Island’s Newsday started having circulation scandals advertisers have been looking for other ways to reach local consumers.

    As a consequence I now get about four “pennysavers” a week bundled with all the supermarket, drug and electronic store inserts that used to only come in the paper. No news, just ads. Where there’s a will, there’s a way.

  • http://www.kirabug.com kirabug

    I don’t know about local vs. not-local (except that you couldn’t pay me to subscribe to the local rag) but I can definitely say the ads figure in heavly.

    I subscribe to the Sunday Philadelphia Inquirer just for the Sunday grocery coupons. The paper costs me a little over $22 per quarter, and I save at least $20 per shopping trip (at least 3 trips per quarter), so it saves me significant cash to subscribe.

    Now, if only I had time to read the thing… most of the time the Saturday half of the Sunday edition gets glanced at while I’m culling it for coupons and comics, but the Sunday half almost always goes straight into the recycling bin.

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  • http://www.wingercomics.com/ Carson Fire

    Oops, good thing I trotted back over here. My flippant blog post title (from Winger Blog) isn’t meant to be a comment.

    I go on to say that there’s some merit to this line of thought:

    You know, now that the subject has been raised, the only time I buy a Sunday paper anymore is to get coupons. And the most exciting part of the daily paper is the big Fry’s ad chockablock with affordable electronics and gizmos.

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  • Ravo

    Keep ignoring the newspaper bias issue….it is serving them so well these days.

    So true.

    I have friends who reluctantly buy the Star -Ledger Sunday edition, solely to get the Circuit City, Best Buy, etc. circulars and other sales flyers.

    They consider it’s content biased and twisted. Most of the paper is simply thrown out – unread.

  • http://publishing2.com Scott Karp

    Maybe there’s a business in producing local coupon circulars with brand advertising space. Why waste good paper on all that news dross?

    That is, until all local coupons go online with everything else.

    It’s bad news for scissor manufacturers — when there’s no more paper, what’s left to clip?

  • Ravo

    Even as the newspapers continue biased drivel that attract less and less, Hollywood follows the same path:

    Spinning the Golden Globes
    By Don Feder
    Leftist Hollywood rewards awful, box office flops that reflect its skewed worldview.

    http://frontpagemag.com/Articles/ReadArticle.asp?ID=20993

  • http://www.boulogne2005.com/ Nina

    “Local” isn’t so much a grand idea as it is a desperate grasp. Just watch the local newscasts in New England these days. They hyperventilate about and exagerrate every inch of forecasted snow like it is the apocalypse and like nobody up here ever saw a snowflake.

  • http://www.kirstenmortensen.com Kirsten

    I buy my local paper’s Sunday edition for the circulars and the print TV guide. (I’m online a lot and have a laptop set up in my living room, but I don’t really like looking up t.v. programming online — my cable station’s online listing has a terrible interface).

    The other edition of my paper I like is the Thursday edition, because it has an insert of things to do around town.

    If I could get a subscription package that included those two editions, I would take it, but my choices are to get it daily, or get Saturday & Sunday, and I can’t be bothered.

    On a related note, I remember talking to a publisher of a small weekly back in the 80s, who said that weeklies were growing in an otherwise flat market because they focused on local news. Can anyone corroborate that? Are weeklies still doing relatively well by hitting the local new niche?

    Bear in mind this is almost newsletterly local — the paper you buy because it prints photos of your kid in the school play, etc.

  • jon

    Reading the sunday Times was a ritual and the ads were the best part for this kid, growing up in the midwest.

    When the national edition came in, they started charging a dollar more and had no local NY ads– thus reducing the mythic power of places like Lincoln Center, Film Forum, and the (late lamented) Bottom Line. Stupidstupid.

  • http://www.sloggahouse.at Mike

    That is, until all local coupons go online with everything else.
    I still haven’t heard one media person admit they have a propaganda issue.

  • http://www.hela.at Manuel

    I can follow only mine previous speakers can by media a person be decided?

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