I love traditional newspapers. For all the custom options RSS offers, there’s still something inherently intimate about reading the Sunday morning newspaper. Nostalgia will always keep products like pens, paper, newspapers and typewriters for sale.
Having said that, Ben Thompson has been tearing apart the future of the newspaper as of late. Today, he discussed the inevitable death of major newspapers on Stratechery. More specifically, Ben talked about how the separation of advertising revenue and journalistic quality will — or has — caused a depression in the newspaper industry:
Journalists pride themselves on an ethical wall between the editorial and business sides of the newspaper. This, in theory, allows the journalist to pursue the “truth”, without concern for undue influence. As far as I know, this is nearly universally accepted as a good thing. It’s also a big red flag, at least if you are someone like me who is interested in how businesses are built.
The problem with this arrangement is a familiar one: the end user is the product, not the customer, no different than advertising-based businesses on the web, such as Google or Facebook. While this sort of division usually inspires concern that the quality of the end-user product will suffer, the opposite is also the case: it doesn’t matter how good the end-user product is if the money-making side of the business isn’t in good shape. This is exactly what is wrong with newspapers, and why, to journalists especially, the demise of newspapers feels like such an intractable problem: the quality of their work is mostly irrelevant to the financial well-being of their employer.
Ding ding ding.
Even The Newsprint acts as a microcosm in favour of Ben’s argument: the better the content, the larger the audience, the larger the advertising revenue and the larger the brand equity.
In contrast, does Nick Bilton’s latest work directly increase the New York Times’ advertising revenue? Possibly, but it’s not as direct a correlation as what The Newsprint experiences. Ben is exactly right.
Ben goes on to talk about many facets of the dying newspaper that border on symptoms we can see with another great unbundling:[1]
Remember how the New York Times was started as a means of making money? After the first year the paper had a circulation of 26,000 in a city of over half a million, but had incurred up-front capital costs of $50,000, and first-year expenses of $78,000 (In 1851 dollars; the modern equivalent would be $1.4 million and $2.2 million respectively). Compare that to this blog (which, by happy coincidence, turns one year old tomorrow, making this comparison timely): FiveThirtyEight and the End of Average, the first article in this series, has been read by over 30,000 people; meanwhile, I’ve spent less than $2,000. More readers, way less money.
You may consider the comparison unfair – an entire newsroom putting out a daily edition as compared to a solo blogger posting one article – but the unfairness is the point. No one shared my article because it was from Stratechery, but then again, no one shares an article today just because it’s from the New York Times; all that matters is the individual article and its worth to the reader and potential sharer. As a writer, this is amazing. When it comes to reader attention, I am competing on an equal footing with The New York Freaking Times! Unfortunately for The New York Times, when it comes to making money they’re competing with Google and Facebook. Most distressingly, though, when it comes to costs, they’re competing with the last 150 years. Everything from printing presses to sales and marketing is deadweight if advertising is not a sustainable model.
Bloggers[2] are the future of journalism. Individual, small-time writers who put their work online and have dedicated and supportive audiences will capture the dying journalism market.
Actually, they won’t. Because they already have. Ben stops short of saying the truth in his article, but I think he is on to something. We’ve already seen the beginning of this “unbundling of journalism” with the departure of Om Malik from Gigaom, David Pogue from the New York Times and Walt Mossberg and Kara Swisher from AllThingsD.
And that’s just naming some big tech writers.
The advent of the Internet has been accompanied by an individualistic, semi-personal drive for independence. Despite the great expanse of the Internet, every individual who takes part feels independent in their own “tiny corner of the Internet.”
Look at me as an example: In relative terms, I’m an absolute pawn in the grandest scheme of the Internet. But through The Newsprint, I’ve carved out a very tiny portion of the online world as my own independent space. This is my domain — we call them “domain names” for a reason.
And that little ad on the sidebar generates money. Real money. People still scoff when I say I generate money on this site. I don’t blame them.
Again, as Ben rightly states, individual writers make journalism. The byline is the first line of an article for a reason. Who writes an article is of the utmost importance, not which publication published the article. For the best journalists and writers to have to succumb to the brand of a publication other than their own defeats the creative process. The best writers understand this. The simplicity of creating your own publication on the Internet only increases the incentive to become independent. And this speaks nothing of their salaries within those organizations.
The only logical conclusion is for those with the largest audiences and with the most expertise to carve out an even larger — and independent — portion of the online world. And they’ll be paid for it. Take Mr. Gruber as an enormous piece of self-published evidence. John Gruber began his web-column[3] in 2002 — long before dying newspapers were a topic. The best writers were ahead of the game and they have been capitalizing on the death of traditional journalism ever since.
A trend has already developed in journalism. Those who keep the industry rolling have realized their individual power and have jettisoned themselves from the big publications. They have created their own personal publications to capture a dedicated, supportive chunk of the Internet and they have more personal freedom in their careers. The freedom to set their own prices and to charge money for memberships, sponsorships and advertisements not only increases job satisfaction, it increases personal salaries. Revenue and salaries may not skyrocket overnight, but as advertising dollars are used in more efficient and more effective ways, so too will the best self-publishers maximize their own personal benefits.
The age of the newspaper, as Ben so correctly states, is coming to an end. The unbundling of journalism will shoot the smartest, most influential and most powerful journalists into all corners of the world. They will make more money, acquire more influence and hone their expertise.
And we will all become smarter as a result.
The “Great Unbundling of Facebook” has been a fantastically interesting conversation between MG Siegler and Om Malik. I’m not very good at dreaming up my own titles. I’ll give them 100% of the credit. ↩
I hate that term. ↩
See what I did there? I avoided the word “blog”. Daring Fireball is so much more than a blog. ↩