Newspapers’ terrible week illustrates need for “the suits” to lead their organizations to web-based models 7/3/08Posted by Steve Boriss in Online news.
Last week, Mark Potts chronicled the stunning recent staff losses in the newspaper industry, and today the NY Times added to the bad news, reporting that the LA Times is shrinking its newsroom by 150.
Yet as Timothy Egan points out, the audience and reach of newspapers have never been greater – it’s just that they are reading the Internet editions, which are free and more up-to-date. And, local advertisers should still be most interested in the most popular local sites, a position that many papers already hold. So, the only thing, but no small thing, keeping papers from returning to their historically high margins are costly resources not coverable by print revenues and not necessary for Internet revenues.
In the end, newspapers actually do have an opportunity to restore their traditionally high profit margins, but it comes down to three questions. First, will they shed their no longer helpful resources quickly enough? Second, will they be able to tell the difference between those resources that are helpful from those that are not? Since both of these questions are better answered by cold, calculating business people than by journalists, the third question is this. Will newspapers allow “the suits” to call the shots? That may be the difference between papers that survive and those that don’t.