A recent article in the Washington Post made the point that local newspapers are at death's door.
It was driven by news that the newly combined conglomerate of Gannett and Gatehouse intend to cut their budgets by $300 million.
Gannett and GateHouse, two major newspaper chains, finished their planned merger, and the combined company intends to cut the combined budget by at least $300 million. That will come on top of unending job losses over the past decade in the affected newsrooms of more than 500 papers.
Other local papers are also in serious trouble
The McClatchy newspaper group — parent of the Herald and the Charlotte Observer — is so weighed down by debt and pension obligations that analysts think it is teetering on bankruptcy.
The list is pretty endless.
The reason, of course, is that technology has changed the business model. Newspapers used to print money, when they weren't printing the news. The news, in fact, was just the filler that held the ads together. But the advent of the web has, of course, changed everything, except the business model of the papers. They press on printing their local news or putting it online and charging ad dollars against a diminishing readership.
Like a lung cancer patient still puffing away, they don't seem capable of change. Death is at their door.
The problem is that newspapers still think of themselves as newspapers and not media companies. This is a big mistake, because people are making billions in the media business, but not newspapers.
It does not have to end this way.
We are working with a European newspaper group to create new revenue streams for old papers - and it works.
Newspapers are first and foremost magnets for people who want to tell stories. Good. Storytelling is big business. Just look at Netflix.
Second, newspapers may be fixated on 'the news', but the most valuable asset they have is what has traditionally been called The Back of the Book - ie, fashion, sports, food, travel, etc...
Now, take a look at cable. You see lots of Food, Fashion, Travel, Home Repair, Real Estate, etc.. channels. They ALL need content and they pay a lot for it - like $250K per half hour show.
Newspapers are already there. They just are providing it with the wrong packaging.
When I was President of NY Times TV, we took the Times into the world of cable TV - kicking and screaming - and generated many millions in revenue for them.
Today, the appetite for Food, Fashion, Travel, Home Decorating etc shows is even bigger. So simple, yet seemingly so complciated. It isn't.
Do papers want to survive?
The solution is right there - on the back pages.
You know, all the work that used to be done by all the people you are firing to cut costs.
Dumb dumb dumb
Generate a few tens of millions and you can do all the local news you like.
And hire more reporters.
The ball is in your court.