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 commentoncomment on my post: