American pie: A 'yee-aha' moment

Oct 05, 2008 at 09:55 pm by Staff

Nashville – self-styled ‘music city’ and spiritual world capital of country music – seemed a strange place to be mulling over the state of the US newspaper market. You’d need local knowledge to fully appreciate ‘Nashville Scene’ managing editor Matt Pulle’s description of it as “a city that is so squarely on the cutting edge of thought and innovation that it nearly elected Bob Clement mayor” ... but you get his thrust. Here are more churches per square-kilometre than I recall there being pubs in the former dockyard town in which I cut my editorial teeth. Yet a publishing experiment is underway in some respects encapsulating the dilemma facing US newspapers. Declining circulations and dwindling advertising sales have shifted the country’s publishers to a slough of despond about the future of the print media. Even Rupert Murdoch appears to have been infected with gloom, predicting lower profits and suggesting that publishers could have to print stories “people want to read” instead of the ones which might win a Pulitzer prize. For me, Nashville was incidental to a train of thought which had started with a random slide in a Macau presentation. As I travelled across America’s south after the Nexpo exhibition and conference in Washington, there followed more consideration of the state of the US newspaper market than I’d cared to give the subject for years. My first Nexpo had been bigger than expected ... but also more deserted. Even allowing for the rival attractions of then presidential hopefuls Obama, McCain and Clinton spruiking delegates over lunch, the halls had been pretty quiet, and most of the activity had centred on online technologies. Perhaps a technical session on getting more life out of your old press was a clue ... and then I headed off down the interstate, enroute for a couple of meetings in Nashville, and began to see more. No it’s not the country’s most-wired city, but it so happened to be where we had found where the hosting service which writes code for the browser-based CMS and other services we use for the new website and, since the beginning of the year, its sister site at President and chief executive Tim Choate also has an interest in a community newspaper half-an-hour out of town in Murfreesboro, and a sharing site for digital graphic artists. And so, having left the hushed halls of Nexpo – and some agreeably Australian and Canadian country music in nearby Wolf Trap (Virginia) – by the time Choate and I met up, there was more common ground in a discussion of what was happening in his home town. The talk was that Chris Ferrell’s SouthComm Communications was buying the haemorrhaging ‘City Paper’ in a deal which has since been formalised (in early August). Matt Pulle writes with some passion in the free weekly ‘Scene’, asserting that “he may have just bought a daily newspaper, but Chris Ferrell isn’t coming to praise print. He’s coming to bury it ... or at least kick some dirt on its wheezing body.” But there’s some acknowledgement that the ‘boy wonder’ – who as publisher, helped turn ‘Scene’ around – may be able to stem “money-dripping losses” put at between US$10-15 million during CP’s eight-year life. The plan isn’t novel: ‘The City Paper’ goes from daily to biweekly, with daily news going on the paper’s website in a model Ferrell tells him is likely to emerge all over the country: “The economics of printing a paper every day just doesn’t work.” Pulle postulates that advertisers may go for “a combo platter” from a menu of media options including “old-fashioned print editions” and the latest news from the online pay-for-content model of its Or take a cafeteria approach. “Either way, to lure them, he’ll have the largest staff of business reporters in town and thus, in theory anyway, the wealthy readers ad buyers crave,” he says. The ‘dead tree version’ gets the arts and entertainment – of which there’s a lot in Nashville – but concentrates more on analysis; the website focuses on shorter, breaking news items “you can scan in your office cubicle”. But Pulle says (and remember the subjectivity), “for all its fancy components, the move is primarily a marriage of two long-struggling operations.” This primarily local story involving local money – in this case that of investor Townes Duncan – is one which being re-enacted elsewhere. Duncan’s comment that people who figure out what newspapers will look like in ten years time “will make good money” echoes the thoughts of others on the lookout for print media opportunities. Some statistics from the same source: Last year, online newspaper advertising jumped 18.8 per cent while print advertising dropped 9.4 per cent, according to the Newspaper Association of America. But online advertising still accounts for only 7.5 per cent of total ad revenue. Ferrell says his model will allow him to wait out the evolution of the online world: “I believe it will be a number of years before online advertising equals print advertising, both nationally and for our own publication.” Perhaps, Pulle argues, Ferrell has it the wrong way around, and the newspaper is still the moneymaker, while the website is “just a handy way to add some loose change”. And he quotes ‘Wired’ magazine editor-in-chief Chris Anderson’s blogged remark that newspapers are still a $45 billion business, twice as big as Yahoo and Google put together. Will Ferrell make a go of it, and build a media empire in the backyard of the (Gannet) ‘Tennessean’? Certainly the bigger corporations – the ones which seem to find it hardest to respond to change – are vulnerable and have most to lose. But there’s a reminder here of the assets traditional newspapers hold: Nearer home we’re familiar with the whinge of it being hard to fund quality journalism as the ‘rivers of gold’ run dry. Murdoch’s saying it in the comments (above) from his address to a digital publishing conference in California; Fred Hilmer clearly identified it in relation to the perceived woes at Fairfax. Those who expected to fund quality journalism through classified were kidding themselves. It’s an expense freesheets and classified publications largely don’t carry – but that doesn’t make it an asset without value. Newspapers all over the world are having to fight for reader time and adjust to the fragmentation of the advertising market, just as they did when commercial radio and TV first emerged. And the USA – without the resources-boosted economy Australia enjoys – is taking it hard. Labour costs are lower ... but so is the price of petrol, so much so that even as I cruised down the I-81 in the Grand Marquis Mercury (with its standard 4.6-litre V8) which Hertz had issued in place of the Camry asked for, I wondered what people were complaining about. It’s good occasionally to step outside the big cities, get a sense of context ... and look at the newspapers which punctuate a route, and the trip to Nashville provided an opportunity to join the dots ... via Wytheville, Asheville, Knoxville and probably some lesser-known ’villes. Beyond the gas stations and fast food of New Market, Virginia, lurked Confederate history, houses built of interlocking beams, and a faded sign offering discount subscriptions to the Shenandoah Valley local paper. And between the honky-tonks of ‘music city’, a poster printer where the letterpress craft was being kept alive by bright young things from the digital generation. The inevitable armful of papers and publications I picked up showed a lively sense of innovation, and were generally designed well and printed indifferently (or worse). Which shows that there’s more going wrong in the land of the free than a lack of confidence. The week before, I’d gotten into (sorry, become involved in) a conversation with manroland sales executive vice president Peter Kuisle in Macau about the US market: Ifra’s Manfred Werfel had shown a slide showing that the average age of newspaper presses in the USA is close to a quarter-of-a-century. Kuisle told me a few things I knew and some I didn’t: About conservative attitudes, a focus on capital and a tax regime which dictates that machinery must be depreciated over 30 years. “It’s a conservative capital-driven market,” he says. One in which lower profit margin and a weaker dollar “don’t help”. But 24 years old? Yes, I know these things are built to last, but the same is true in Europe where the average is more like ten years, and in the less mature Asian market where it’s 12. My albeit basic understanding of the laws of statistics suggests that if there are also presses in the USA which have just been commissioned, there will be a few which are coming up for their half-century. Which beggars belief. Until you consider that some of the flexo newspaper gear in the Bay area plants of the ‘San Francisco Chronicle’ – being replaced by the triple-wide manroland semicommercial kit contract printer Transcontinental is installing – is 40 years old! There’s some of this message in a briefing Fairfax Media’s top two – chief executive David Kirk and his deputy Brian McCarthy – gave in a first-year review of the merged company in May. The discussion touched on the differences between the Australian, and US (and UK) markets, with Kirk making a moot point about the “dominance” of major national newspapers, and McCarthy saying newspaper publishers in Australia had managed the changing media environment better. Investments in colour presses had created “a major reader and advertiser attraction”, he said. If the position in San Francisco is representative, as the statistics suggest, it’s little wonder US newspapers are in trouble. Those who saw the changeover to web-offset as the last major replant newspapers would make have been proved wrong time and again. The Australian experience, for example, has seen new presses installed to deliver increased colour capacity, and to make colour production more efficient in terms of waste, manpower and environmental impact. Colour classifieds – lineage, semidisplay, entertainment, you name it – are one product unthinkable without back-to-back colour, just like the zoned property guides winning back business for Sydney and Melbourne metros. Likewise mailroom investment is the enabler for a range of preprints and inserts ... both the means of assembling them and of adding value with stitching, glueing, trimming, ‘post-its’, pouches, polywrapping and the rest. Without new equipment, the picture is of a downward spiral in which publishers don’t have the capability to attract advertisers ... and consequently think they can’t afford to invest in a future of which they’re uncertain. Y’all know where that will lead.
Sections: Columns & opinion


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