An early autopsy of the newspaper industry

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The newspaper business is slowly dying, but it didn’t have to be this way.

The Poynter Institute reports that 1,300 more newspaper jobs disappeared in the United States in 2013.

In what is surely a most cruel form of irony, the people responsible for running the newspaper business – the suits, the MBAs, the publishers – could have made the decisions to at least soften the decline of the industry if not prevent it, but they failed miserably.

Supposedly, they had all that business savvy, but they proved that they didn’t. They supposedly had the knowledge to read the changing business landscape and the authority to make the decisions to adjust; they did neither well enough to make a difference.

Here’s something you need to know about newspapers. They were never really a challenging business during their prime. In many communities and cities, they were a licence to print money – especially if it was a one-newspaper market. Classified advertising was the huge cash cow for many newspapers and there was also revenue from display advertising that pushed the percentage of revenue from non-subscription sources to upwards of 75 to 80 per cent.

Think about that. The people who got the newspapers at their doorstep paid for 25 per cent of the cost of collecting that news, printing it on newsprint, and delivering the bundled-up dead trees to the homes of subscribers.

Then, along comes a new medium called the Internet that can deliver the news to readers for a pittance. You still need to pay reporters, photographers, designers, and people to upload the news to a website, but you eliminate some huge cost centres. You don’t need to buy newsprint, you don’t need to buy expensive printing presses, or pay the salaries of people to print it and deliver it.

Comparatively, it’s a cheaper, more environmentally friendly way of delivering news to readers. It offered the promise of huge savings if the new medium was embraced, but the industry timidly put one toe in the water instead and continued printing newspapers while paying lip-service to their websites.

Then came the complaints that the Internet wasn’t working for them because they had to give content away because people wouldn’t pay for it. During this time sites like Craigslist and Kijiji siphoned classified ad revenue. Instead of copying their business model to keep those eyeballs on newspaper websites, they continued to charge for classified ads and drove more and more classified ad users to these free websites.

Like anything that has gone extinct, the companies that run newspapers failed to evolve.

If the companies that run newspapers want to exist — and continue delivering news — after the great demographic bubble of the baby boom passes on, they’ll need to get their heads out of their wazoos and stop printing news on dead trees.

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