Quality Matters: News Media Cost-Cutting Itself Out of Business

News mediaIn an effort to “right size” and cut costs, the newspaper industry (and other news media) have created and are now caught in a downward spiral that most of these organizations probably cannot and will not escape from. It’s pretty depressing.

Though largely ignorant of the financial troubles of news media the public has clearly noticed the reduction of original reporting and the overall decline of quality in the industry. Those data come from a consumer survey at the heart of  The Pew Research Center’s Project for Excellence in Journalism’s massive “State of the News Media 2013” report.

In short, the staffing reductions and reduced coverage (to save money) have compromised quality and perceptions of the value of these publications and outlets. In the graphic below 31% of respondents (n=2,009 US adults) say they have abandoned news outlets that “no longer serve their needs.”

Abandoning the news

This is essentially code for reduced coverage and quality, getting smaller/thinner and so on. According to Pew, “those most likely to have walked away are better educated, wealthier and older than those who did not.” This means that would-be subscribers are leaving. Left are the younger and less affluent readers who are less likely to pay.

However roughly 450 of the 1,380 daily newspapers in the US are using, experimenting with or about to implement paywalls. The New York Times is an example of relative success in this area. It now makes more money online from digital subscribers than from advertising.

The Times has been able to succeed with a paywall strategy because of its strong brand and the perception that it still offers quality and unique value. Increasingly both print and digital news publications are a collection of wire stories, short blog posts and other thin content. This is especially true for local news publications.

But in one piece of relatively good news Pew reports that newspaper circulation appears to have stabilized or remained steady. This may be a result of subscribers like me, who pay for the print NY Times to read it online (and mobile) and rarely look at the paper itself.

Screen Shot 2013-03-18 at 6.44.05 AM

Hyper-local was once thought to be the potential salvation of newspapers and news pubs online. It’s not. But a strong mix of national and local news, as well as other local content (events, reviews, sports, etc.) probably would stop much of the bleeding. The problem is that nobody seems to have found the model yet.

We can say definitely however that “quality matters.” The problem is: quality costs money. Community is an important component but you can’t let your community create important content if you’re a news organization. Ultimately all-freelance-written “arbitrage” (SEO-dependent) models like Examiner.com I don’t believe work.

The challenge is how to expand quality and coverage in a way that is sustainable and supportable. The catch-22 is that without additional revenue publishers can’t invest in the news; but without additional coverage and improved quality they’ll see further deterioration of audiences and be forced to make more cuts . . . and so on until they go out of business.

The problems exist not just at newspapers but in the news media across the board, including cable.

What would you do if you were running one of these organizations? How would you react to this survey data?

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4 Responses to “Quality Matters: News Media Cost-Cutting Itself Out of Business”

  1. Julie Brooks says at

    The data in this survey doesn’t reveal anything most of us in this business haven’t known for the last 5 years. It validates our collective hunch and therefore provides a solid foundation of fact upon which to strategize our way out of this hole. The strategy is completely dependent upon the medium, and the market size. I feel that having separate news + niche sites as I have done with my business works pretty well; the only reason I evolved this strategy was because I am not a journalist or a former news publisher so I saw my news site as just one property in my portfolio.

    As it turns out, it is a not-too-distant 2nd in traffic to the dominant daily newspaper site which has a paywall. I wish there were a magic monetization formula that would allow me triple my sales on the news site to hire more reporters tomorrow; but so far, no. Until that day comes, my niche sites pay the bills and the news site drives ton of traffic to them. If this is as good as it ever gets, I’ll do okay, but the community will suffer.

  2. Greg Sterling says at

    The economics and “culture” of online news are different. It’s very hard to make money and do traditional, original news coverage, even features. News orgs have to subsidize online with print, which is getting very hard to do. They must also have strong brands so that free sources (derivative sites) don’t push them aside.

    The HuffingtonPost is such an example. Overall the situation is pretty depressing.

  3. Local Painter says at

    In speaking to a local journalist for a (once) reputable newspaper, he said that most articles are now written for Google (SEO) rather than for a human reader. This is a depressing state, and perpetuating the downward spiral of journalism.

    Also, on the news source side of things, journalists these days are too often using the likes of Twitter and (dare I say it) Reddit to source new news. They are using techniques that anyone (even the consumers themselves) can use, rather than the old days when there was a genuine barrier to entry.

  4. Greg Sterling says at

    That is very depressing 

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