BuzzMachine

In the continuing parlor game — “What would you do with ____ [fill in media organization here]?” — I’ve been asking people what the brash, bold, ballsy thing they would do. In newspapers, I’m hearing three such options:

1. Sell. Fast. Find some local egotist who wants to be a publisher and get the hell out of town. Today, Jack Welch is reported to be interested in buying the Boston Globe (see more grisly details in the Wall Street Journal). I’d take him out for a very drunken dinner and get him to sign on the line before it’s too late. The advantage for the seller is that the hell is over. The problem if you care about journalism or the community is that they will descend deeper into hell. Witness what is happening in Philadelphia now: The new owner of the paper is suddenly discovering that the business is shrinking and he’s better shrink it faster if he’s going to pay off his loans. Oops. Note well that the Times story said that the newspaper industry “appears to be in a free fall/.” Yow. [Disclosure: I still consult at The NY Times Co., but you can bet it’s not about strategic asset sales.]

2. Get out of the printing business and into the news business. I’ve heard more than one exec suggest trying to offload printing and distribution and concentrate on the real business of news and advertising. That doesn’t change the P&L much; you’ll have to buy those services so long as you are tied to a physical product. So it’s no cure for the business. But it gets rid of certain obligations and liabilities and makes other options easier — like selling the thing.

3. Give it away. A few weeks ago in the Guardian, a former newspaper editor made back-of-the-envelope calculations to argue that giving away the paper makes sense because it reduces marketing costs and increases circulation and ad revenue (while also increasing paper costs) but that the real value is that it would force the organization to stop protecting the paper and to drive people online. I like that in theory. I’ll be no one will have the balls to do it.

Note that I did not list going private. At best, that merely puts off the inevitable. See Philadelphia. Nor do I buy the argument that newspapers should become beneficiaries of not-for-profit foundations. That, too, is just an attempt to shield the paper from reality.

I am not ready to give up the idea that news is commercially viable. It is. News is getting bigger than ever. It’s just run with terribly inefficiency by the old guys. With a fresh start, news can and should be a viable business. See Netzeitung.

No, you have to do something brash, bold, and ballsy to drive the paper to its future. Anything else is as good as giving up.

: See also Will Bunch at the Philadelphia Daily News: “And so I’ve never been more pessimistic about newspapers than I am today.”

: And see this from PaidContent:

Merrill Lynch analyst Lauren Fine came out with a report today on the state of the newspaper industry, and wrote that even as online rises in importance, but still small overall. “Although online now represents 6-7% of newspaper ad revenues on average, the proportion is still small overall. Even if we assume double-digit growth for online ad revenues through 2012 and then 5% thereafter, while print ad revenues drop by 1.5% annually, we do not see online representing over 50% of total newspaper ad revenues until more than 30 years from now. (Of course, we can get there sooner if print declines faster.) In terms of EBITDA, even if we assume 50% margins for online ad revenues and 25% for print (but declining slightly every year), a back-of-the-envelope calculation suggests that industry EBITDA will be flattish for the next 20 years, supporting our assumption of flat to slightly declining perpetual free cash flow for the industry.”

Well, I’d assume a faster drop for print. But I’ll also say this represents the essential problem of the industry: They think they can maintain (or grow) their monopoly-supported margins and cash flow. They can’t. News operations will have to be smaller. That doesn’t mean they have to be unprofitable. But bloat is out.

: And see Jack Shafer’s very good column today questioning the holy writ in newsrooms that more bodies means better journalism and questioning the even holier gospel that investigative journalism is the great protector of democracy.

However appalling newsroom downsizing may be for journalists, it will ultimately reveal what the people who run and own newspapers really think their publications are for. Scratch a serious reporter, and he’ll offer volumes about the “public service” his newspaper performs in the form of investigations: It watchdogs government. It keeps corporations honest. It uncovers the dastardly deeds of foreign dictators and prevents genocide. It exposes quacks and charlatans. (It turns the common man into a Socrates if he reads the editorials!)

Newspaper people have enormous egos, if you get my drift, and don’t mind massaging the big hairy things in public. Yet the press is hardly the sentry and bulwark of society reporters imagine it to be.

: But here a much calmer newspaper publisher, Carolyn McCall of the Guardian (which is owned by a trust), speaking in London. Three of her five points for managing the digital transition:

3. Innovation must be used for learning purposes. Newspapers can’t be afraid to fail. They must experiment and take risks to see what works. McCall mentioned the Guardian’s blog experiment, Comment is Free, which has proven a huge success with hundreds of contributing bloggers and dozens of comments on each post.
4. Software developers are now just as important as your journalists, an insinuation that would have been mocked only three years ago.
5. Newspapers must drive digital revenue growth.

[Disclosure: I write for and very occasionally consult for the Guardian.]

A favorite parlor game among fellow media blatherers these days is, “What would you do with _______?” Fill in that blank with the LA Times, any old newspaper, a TV station, a TV network, a cable network, a radio station, a cable company, a book publisher or any media company. The rules of the game are simple: When asked, sigh, shake your head, say you’re just not sure, and then come out with your personal prescription for the shrinking enterprise. The current round of the game is about the beleaguered, bedraggled LA Times.

Kit Seelye reports today that the LA Times just assigned a task force of reporters to a Manhattan Project to figure out their future. I wish them luck, but I fear they are off on the wrong if predictable foot: namely, preserving print and the past.

“We want to collect the best thinking on how to sustain the vitality and profitability of the print franchise,” Mr. Duvoisin said. “And we want to find the best thinking on how to transfer our journalism to the Web in the way most likely to grow audience and revenue.” But Mr. Loeb described the changes to come from the investigative project as a “reimagining” of the print paper in conjunction with the Web site.

I’d say it has nothing to do with the medium you’re in and everything to do with your essential value. And I find it surprising that I find nothing under “Manhattan Project” or its boss’ name at the LA Times. I’d think the first, best thing to do is to get the ideas from your public.

Meanwhile, ex LATimesman Michael Kinsley writes a column in the paper arguing that it should become part of parent Tribune Company’s national newspaper, creating a national brand with national content wrapping around local content in company’s juicy markets — Chicago, LA, Long Island, Baltimore, Hartford, Orlando. It’s a neat idea. I like everything about it but the paper part. I have long believed that there is an opportunity to start a new national newspaper — online. But I agree that sharing the national (read: commodity) content makes a lot of sense. This also focuses the paper on what it should do — local. I also applaud Kinsley for saying this:

L.A. Times journalists are not entirely blameless for the chaos and carnage. Journalists know how to stage a great hissy fit. And I’m not sure a fit was really called for in the initial staff reductions. On the editorial page (I can reveal, from the safety of hindsight) we initially had 15 people producing 21 editorials a week! So now cries that Tribune Co. has moved from cutting fat to cutting bone ring a bit hollow.

See also Doc Searls’ 10-pill prescription (and Doc is also trying to figure out what to do with the local paper near him: the Santa Barbara mess). And see smart newspaper consultant Juan Antonio Giner’s list accompanied by Juan Luis Cebrian’s. (See, I told you it was the hot game.)

I was going to take a turn at the buzzer with my to-do list but, frankly, I found myself going over the same territory I’ve paved here before — in these posts, for example, so I’ll hold that for another day. What would you do with the LA Times?

: See also a vision of the future from Shane Richmond of the Telegraph here and here.

: Matt Welch opens a blog discussion about the Manhattan Project on a Times blog.

: LATER: See Jon Fine pondering the future of the LA Times.