Newspaper industry changes

Oct. 8, 2008

Transcript:

Ted Simons:
>> Well, Monday of this week "the east valley tribute" announced plans to cut 143 jobs and publish its print editions only four days a week. It's not the first sign of weakness in the newspaper industry. According to the phoenix business journal, nearly every valley newspaper experienced significant job cuts and slight declines in circulation during the past year. Joining me is professor Tim McGuire, the Frank Russell chair for the a.s.u. Cronkite school of journalism, also the former senior editor and -- of the "the star tribune" in Minneapolis. Good to have you on the show.

Tim McGuire:
>> Thank you for having me.

Ted Simons:
>> surprised by the changes of "the east valley tribute"?

Tim McGuire:
>> Not at all.

Ted Simons:
>> How come?

Tim McGuire:
>> They're on the front edge of what's going to happen around the country. The newspaper industry and the business model of the newspaper industry is under absolute siege. And these are the kind of changes you're going to see around the country.

Ted Simons:
>> four days a week. Make sense for the newspaper of tomorrow?

Tim McGuire:
>> Absolutely. Those right now are the biggest advertising days. And that will shape the kind of paper they become. I wouldn't be surprised if other kinds of publications try to fill in the voids. I think you're increasingly going to see newspapers fill various niches rather than being one size fits all serving big major communities.

Ted Simons:
>> which we may have seen with the "east valley tribune" in the sense that now you've got gill berth, queen creek, chandler and mesa as the focus, leaving Tempe, leaves Scottsdale. You're saying watch out we could see another Tempe daily news or Scottsdale tribune or something along these lines?

Tim McGuire:
>> You know as well as do I that if there's a vacuum somebody will fill. It but right now what they're trying to do is enhance their zoning and their emphasis on those four communities and try to truly own those communities.

Ted Simons:
>> The tribune recently made a pretty big change at the time, the tabloid a section kind of model. Why didn't that work?

Tim McGuire:
>> I think there are a lot of reasons. One, they believe that charging for what was in the issue. Free newspapers are going to be a wave of the future. I think without question the business model is at issue here, not necessarily readership. People are still reading news papers, not as high numbers. But the problem is business model. Newspapers have depended on advertisers to buy the eyeballs of readers. These days that's wasteful when people who want particular products can go on the internet and find those products. They have an intention to buy a car, for example. Making an auto section in a newspaper much less relevant and important.

Ted Simons:
>> What does this do, though, to content, to coverage of news? We talked about niche marketing. We're talking about what seems to be a dying industry here. Who's covering city hall? Who's covering bigger stories? Statewide stories? National stories? Who's covering all of this?

Tim McGuire:
>> That's a real question. And right now there's not money to cover that. We have funded American journalism with advertiser dollars, not revenue dollars. And consumers are going to have to make up their mind about this issue and start supporting news papers if they really need it. The fact is that that kind of news hasn't been in high demand. If it is in high demand, i guarantee you somebody will fill that.
Ted Simons:
>> But it's still right now buy newspapers, but most folks seem to be going on the internet, even to the newspaper's websites to get this news and not paying a whole heck of a lot for it, and the newspapers aren't getting a lot in terms of advertising revenue for it. So newspapers, news content on the internet. Is that a viable model?

Tim McGuire:
>> For some audiences. People like you and i are going to be wedded to a newsprint kind of product for a long time. We, however, are going to be phased out. I want to be gentle with you. But we're going to pass. Young people are not particularly engaged by newsprint and get their news electronically. The other possibility is an electronic tablet that might replace print. The issue, however, is journalism. I believe journalism is thriving. There is more demand for more stuff than there ever has been before. The challenge is, as you suggest, how do we support and pay for that journalism.

Ted Simons:
>> Is the internet business model capable of supporting and paying for that journalism?

Tim McGuire:
>> Not at this moment.

Ted Simons:
>> can it change? Besides the little tablet that you talked about, is there some new idea out there just waiting to be born to get revenue into websites?

Tim McGuire:
>> People are looking for it. The business model is being fundamentally questioned. People are looking at imaginative ways to create revenues. I've seen a couple of newspapers that i think have ideas that are going to be exciting. Nobody's doing it to a significant extent right now.

Ted Simons:
>> in terms of credibility, can the internet survive as a credible source of news?

Tim McGuire:
>> Brands can survive.

Ted Simons:
>> But we're losing our brands if newspapers go out of business.

Tim McGuire:
>> No. "The east valley tribute" is going online. The "east valley tribune" will be online seven days a week. That brand is going to stick around, that brand is going to have a much smaller news-gathering force but it is still going to have the second most significant news-gathering force in the city. There's nobody else that has 50 reporters other than the republic. So that is still strong. And the web may well serve to be the newspaper of tomorrow.

Ted Simons:
>> political polarization, if you read some of the comments sections on newspapers within the story is that so-and-so got laid off or the tribune suffers this, that and the other. Almost uniformly it is, I'm glad the paper is leaving. They're too liberal, I'm glad they're leaving. Et cetera. Et cetera. Political polarization. We see the success of fox news on broadcasting. Are we going to a system in newspapers where you see more partisanship, more overt partisanship?

Tim McGuire:
>> There will be come. Some newspapers will go that route. Some will remain a newspaper of the center, a community-gathering spot. I will suggest to you that fox news is not as strong as it once was because of the political wave. That is risky business. And yes, you'll always see people who will say, well, the reason newspapers are having trouble is an editorial they wrote in 2004. That is poppycock. It's just not the case. It's the business model that's fundamentally changed. Advertisers are driving this phenomenon.

Ted Simons:
>> Where do bloggers fit into all this?

Tim McGuire:
>> They have an important informational role. But again, are you going to trust a single individual blogger for your information? Probably not. There again, we might well have Simon and McGuire Inc. Who aggregates those blogs and makes them into something like a newspaper.

Ted Simons:
>> Yeah.

Tim McGuire:
>> That's the kind of thing that's going to happen.

Ted Simons:
>> is there a place for nonprofits in journalism, especially the investigative aspect which takes so much in terms of time and personnel and cost? Are nonprofits making a move here?

Tim McGuire:
>> Yes. Propublica is an investigative operation with some 85 to 100 investigative reporters going to distribute their material in other ways. A close friend of mine in Minnesota, Joel Kramer, has started something called min post which is a public radio, public TV kind of operation. There's one in San Diego. There's one in Seattle. There's one in new haven, Connecticut.

Ted Simons:
>> Last question. Broadcasting aspect of all of this. Obviously we're focusing on the tribune and newspapers. TV news, other broadcast news outlets and facilities. Are they in trouble?

Tim McGuire:
>> Yes. Facing the same advertising challenges that newspapers. They're not getting the coverage, they're not getting the big press. But television is going to face this inevitably.

Ted Simons:
>> Will television revert to niche marketing like -- I mean, broadcasting especially is expensive. Can it do the same thing as newspaper? Can you have a station that focuses on Tempe or Scottsdale?

Tim McGuire:
>> You've already got niches in the television business. The TV news's biggest competition is often "mash" or something on TV land.

Ted Simons:
>> So basically when we talk about journalism in general, watch out because the horse and buggy is going away.

Tim McGuire:
>> But something was invented to replace the horse and buggy. And that car has been pretty successful. I predict something will be invented that will be just -- just as successful in the information business.

Ted Simons:
>> Thank you so much for joining us. We appreciate it.

Tim McGuire:
>> Thank you.