Received this in an email from Tattersalls today promoting their online network ahead of their retail network for this week’s $21 million draw. I would prefer that I could click a link in the email to find the nearest outlet.
Courtesy of Romenesko is this exchange between Matt Lauer of NBC’s Today show and Jack Welch, discussing a possible purchase of the Boston Globe. The emphasis is mine.
Matt Lauer: “Newspaper sales are down 2.8%, the end of September, according to the latest study, and yet the word out on the street is that Jack Welch wants to buy the Boston Globe. Isn’t that like buying an Edsel factory right now?”
Welch: “It’s one way of looking at it, but we don’t see it that way. We see all kinds of opportunity. But look, we’re in the very early stages. Matt, if we were going to buy a factory at that price, we wouldn’t have all this ink. If you fool around in the media, the ink gets (exposed).”
While it’s a good answer from Welch, it’s Lauer’s question which gets the attention. Newspaper executives will be angry and frustrated at the Edsel comparison. In isolation it could be ignored. But it’s not an isolated view. Outside of Australia many are asking questions about the future of newspapers – not suggesting they will disappear but that the model will radically change. Take the story Newspapers, Nor or Never by Dave Morgan at MediaPost. The opening paragraph sets the tone:
IT’S MAKE-OR-BREAK TIME FOR NEWSPAPERS. Over the last couple of months, I’ve spent a lot of time talking to newspaper companies about their digital futures, particularly when it comes to advertising. While I’ve had these kinds of discussions with them for many, many years, the current plight facing the industry has made these discussions take on an immediacy that I have never seen at any point in the past 15 years. They know that their future is now and that they had better figure it out fast. They know that their chance to dominate local online advertising as they have dominated local offline advertising is looking slimmer and slimmer. Google, Yahoo and Microsoft (GYM) are all lining up to take a piece of the $100+ billion local ad market as much of it shifts online.
We’re insulated here in Australia because of tight media ownership and because of a historically strong newspaper distribution network through newsagents. The distribution network is consolidating and along with that customer ‘ownership’ is moving from the newsagent to the publisher, from a local connect to a faceless call-centre connect. This will, in my view, make customers more fickle and put us close to the US situation – hence the value in understanding the challenges newspaper publishers in the US face today.
It is appropriate the newspaper publishers urgently source revenue online. Likewise, newsagents need to source traffic and revenue from non traditional sources. They can no longer rely on guaranteed traffic from newspaper sales.
Is Lauer’s question valid? Is a newspaper company like an Edsel factory? No, not if they are racing online. Newsagencies, on the other hand … now that’s a different question.
The Age today has another stuck on ad. This means more trash in the streets, more trash at newsagent sales counters and more copies of the paper being ripped when part of the front page comes off with the stuck on ad. I wonder if any of the resulting frustration translates to frustration toward Hewlett Packard, today’s advertiser?