Future of Journalism

The Kauffman Economics Bloggers conference kicked off on Friday morning with a speech by David Warsh. David covered economics for The Boston Globe for 22 years and, earlier, reported on business for The Wall Street Journal and Forbes. The speech explored the historical and directional movement of the newspaper business, battered today by the loss of its primary revenue generator, the classifieds, a trend I have covered extensively in the last two years.

The most important insight I gathered from David’s speech was the notion of a well-edited, finite newspaper (or magazine) that has a beginning and an end is still a desirable form factor.

This morning, as we had breakfast in bed, I read the new issue of The Economist from beginning to end. Yes, the fact that The Economist has a beginning and an end, and is extremely well-edited, is a big factor in making it one of the very few publications that I actually pay money to subscribe to.

David’s speech evoked a comment by Bob Cringely, who pointed out that only 8% of a newspaper’s budget is spent on editorial content, and a very large percentage goes into trucks and drivers, a distribution model that is inherently unsustainable.

And one other by Tyler Cowen about the importance of devices like iPhone and Kindle in determining the future of media.

With that as the backdrop, Virginia Postrel moderated a panel discussion on the future of journalism. She set the bottom line by quoting Esther Dyson who said, back in 1994, that the price of content will go to zero over time, because of unlimited competition. Well, here we are, all of us, producing enormous volumes of free content…
And that makes it impossible for newspapers and magazines to sustain themselves with their bigger overheads.

Brian Carney mentioned that the Wall Street Journal still has a million paying subscribers who pay close to a hundred dollars a year to read the Journal. Rupert Murdoch decided to hang on to the $100 million in highly profitable revenue, instead of following his competitors and going free. I had originally assumed Murdoch would follow the trend, but am pleasantly surprised to see that he was able to hold on to his subscribers and charge for content. May be there is still hope for those who can preserve quality?

Amity Shlaes pointed to the Bloomberg model of expensive, deep, rich, high-quality content for a specific group of people for whom it is almost like belonging to a country club. They are willing to pay a LOT.

She also stressed on the need to focus on the quality of the content itself, rather than form, process, and myriad other things that the media industry has become obsessed with these days.

Amity’s comments struck a chord with me. Just look at the amount of crap that’s on the web right now. Even prestigious brands are putting out absolute, total crap, because sometimes, that is what gets them the traffic. Hmmm. May be I should start mixing in some pornography into my writings. If I heard her right, Amity is disgusted by the prostitution by once classy media brands. I certainly am.

In the end, though, my personal instinct for the future of media resonated the most with Bob Cringely, who suggested that there will be personal franchises of journalists and media personalities who will make money through a variety of different mechanisms including advertising, perhaps subscription, speeches, books, may be consulting …

Now that has to sound familiar, right?