The newspaper industry’s colossal mistake was a defensive digital strategy

The worst part about bad “newspapers made this huge mistake” stories is they spend the next week clogging my FB feed. Ugh.

— Chris Krewson (@ckrewson) October 18, 2016

I hesitate to give more attention to a study and Politico Magazine column that comforted newspaper nostalgists, but I must: Both are BS.

“What If the Newspaper Industry Made a Colossal Mistake?” asks the Politico headline, echoed in Jack Shafer‘s breathless lead: “What if almost the entire newspaper industry got it wrong?”

Well, the industry did get it wrong and did make a colossal mistake, but not the one that Shafer and University of Texas scholars Hsiang Iris Chyi and Ori Tenenboim think it made.

Summarizing Chyi’s and Tenenboim’s Reality Check research article in Journalism Practice, Shafer asks:

What if, in the mad dash two decades ago to repurpose and extend editorial content onto the Web, editors and publishers made a colossal business blunder that wasted hundreds of millions of dollars? What if the industry should have stuck with its strengths—the print editions where the vast majority of their readers still reside and where the overwhelming majority of advertising and subscription revenue come from—instead of chasing the online chimera?

In their research, which prompted Shafer’s column, Chyi and Tenenboim wrote that in the past 20 years “US newspapers, especially national and metro dailies, became more determined than ever to complete their transition from print to online. … ‘Digital first’ has become a mantra, a trend, and a strategy leading to the future.”

Shafer, Chyi and Tenenboim correctly chronicle the weak performance of American metro newspapers in the digital marketplace. But they wrongly conclude, as Shafer wrote, that “The key to the newspaper future might reside in its past and not in smartphones, iPads and VR. ‘Digital first,’ the authors claim, has been a losing proposition for most newspapers.”

Well, I used to work for a company called Digital First Media and at a newspaper-industry think tank, and I’ve visited more than 100 newsrooms and spoken at more than 100 newspaper-industry conferences and seminars, and I can flatly say that the industry never, ever adopted anything close to a digital-first strategy. (Update: Kurt Greenbaum responded on Facebook: “You’re being too kind. Not only did they never adopt such a strategy, they actively resisted tolerance of digital technology, much less acceptance of it.”)

The colossal mistake that the newspaper industry made was responding to digital challenges and opportunities with defensive measures intended to protect newspapers, and timid experiments with posting print-first content online, rather than truly exploring and pursuing digital possibilities.

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How networking helped land most of my jobs

This continues my series on professional networking.

I credit my skills and hard work for most of the success I’ve achieved professionally. But my professional network has helped tremendously, too.

In this post, I’m going to run through the jobs I’ve landed and explain how my network helped me get most (but not all) of the jobs in my career:

Because my mother read the newspaper …

Chuck Offenburger, right, gave me my first job in journalism back in 1971.

I was on a canoe trip in the summer of 1971, between my junior and senior years of high school, when my mother read a notice in the Evening Sentinel that Sports Editor Chuck Offenburger was looking for a sports writer. I didn’t know Chuck, and had no network connection to him. But Mom called the notice to my attention. I applied and I got the job (and Chuck and I remain friends).

But the network connection that mattered here was my mother. I’m not a fan of nepotism or family interference, which didn’t happen here. Mom didn’t even know Chuck. But she tipped me off to the first job of my journalism career. And Mimi has alerted two of our sons to opportunities that led to jobs for them. Listen to your mom.

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Orange County Register deal underscores how much of newspapers’ value is in real estate

My old company has essentially proven a point I have made at least twice in this blog: that many newspapers’ value now is mostly the value of the real estate they own.

A Ken Doctor report today does the math: Less than a month after buying the Orange County Register and Riverside Press Press-Enterprise for $51.2 million, Digital First Media, where I worked from 2011 to 2014, sold 14.3 acres of land surrounding the Register’s Santa Ana office for $34 million, two-thirds of the sale price. The developer who bought the land had purchased the Register’s building two years ago.

In posts about the Boston Globe purchase in 2013 and the Omaha World-Herald sale in 2011, I previously speculated that real estate value probably accounted for most, if not all, of the purchase prices.

I am too busy, and don’t know enough about finance and real estate, to undertake an analysis of recent newspaper sales and what the core value is after you subtract the value of real estate. But I agree with Doctor that this value is “astoundingly low.” And it’s nowhere near the first time that’s happened.

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What opinions merit front-page editorials?

The front page of The New York Times for Saturday, Dec. 5. pic.twitter.com/XsyKGA4Vrk

— The New York Times (@nytimes) December 5, 2015

As LSU’s Director of Student Media, I occasionally fire off messages to student editors and station managers with suggestions that I usually expect them to ignore. They are independent and they are rightly in charge of their newsrooms, and I didn’t follow a lot of faculty advice when I was their age either.

I sent this message to the editorial board of our newspaper, the Daily Reveille, on Oct. 1:

I just checked. I didn’t carbon anyone from the New York Times on the message. But the Times ran a front-page editorial this morning, calling for an end to “the Gun Epidemic in America.”

My students sort of followed my advice (or moved that direction on their own), running some opinions on the front page but more frequently than I suggested. That’s OK, too: The Reveille’s front page and editorials should reflect their judgment, not mine. I’m proud of their work, which has included excellent opinion pieces by columnists and the editorial board on page-one this semester, about such topics as mental health and racial discrimination at bars near campus.

As Kristen Hare’s Poynter piece that I shared with the student editors indicated, newspapers are increasingly responding to important issues by stating opinions on newsprint once reserved for “straight news”: the front page. The New York Times is following this trend, not leading it (nor am I, obviously). Hare’s piece was prompted by this Chicago Sun-Times cover:

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O Canada! Your newspapers are hurting, too (and that makes me hurt)

Few sights are more beautiful than a Tofino sunset.

Perhaps the most alluring job I ever turned down was an offer to lead newsroom transformation for Canada’s largest newspaper company.

My fondness for Canada is long and deep, and a job that would mean lengthy stays and frequent visits in such beloved cities as Vancouver, Montreal, Ottawa, Calgary, Toronto, Edmonton and Victoria was enticing. I relished the opportunity and challenge of helping metro newspapers retool for digital success. I nearly accepted the job.

I’ll quickly address the national-loyalty issue. Except when my father was assigned to overseas Air Force bases, I’ve happily lived my whole life in the United States. I love this country and wasn’t looking to leave it. But when a Canadian company recruited me, I listened. I love Canada, too.

Cox Beach, south of Tofino

Mimi’s and my favorite place in the world may be Tofino, a tourist/fishing village on the Pacific coast of Vancouver Island. We’ve visited there several times at different seasons of the year, always enchanted by the crashing waves, the lovely beaches, the bears and whales, the fish tacos and other fine dining.

If she writes a best-selling novel and sells its movie rights for a whopping sum, or if I could make a living writing, consulting and training based there, we would happily live the rest of our lives in a small Tofino home, walking distance from one of our favourite beaches. Those are huge ifs, but we share the fantasy every time we visit.

And Tofino is just one of the many places we’ve loved visiting in Canada. From Cape Breton and the lighthouses along Nova Scotia’s Atlantic coast to the crystal waters of Lake Louise in Banff National Park to golden eagles near Williams Lake, B.C., to a Jeep ride into the Yukon territory, we have enjoyed Canada’s spectacular scenery coast to coast. We’ve enjoyed the museums, restaurants and other cultural offerings of Canada’s great cities.

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Contact information on a website is a matter of journalism ethics

Contact information on a news site is certainly a matter of customer service. I’d argue that it’s also an essential form of community engagement. But what about journalism ethics? Is easy access to journalists a matter of ethics? I think so.

Whatever factors you think should motivate contact information, I hope you’ll agree with me that many news sites make it difficult to contact them. And nearly all should do a better job.

Before I make some recommendations and examine some news sites and report on how easy it is to find out how to contact someone in the newsroom, I’ll make the case that accessibility is a matter of ethics:

Correcting errors is one of the basics of journalism ethics, mentioned in the Society of Professional Journalists Code of Ethics, Poynter’s Guiding Principles for the Journalist and Radio Television Digital News Association Code of Ethics. We’ll correct more errors if we learn about more of our errors. And if we’re easy to reach, we’re going to be more likely to learn about our errors.

The New York Times study of the Jayson Blair case revealed that people who read his fabricated stories didn’t bother to contact the Times because they didn’t think anyone at the Times would care. As much as I believe in corrections and accuracy, I don’t bother to request corrections about every error published about news I’m involved in (and my most recent request was ignored anyway). I think news organizations need to invite access and requests for corrections, or they won’t become aware of many of their mistakes.

I think if you tried to reach many news organizations through their websites today, you might come to the same conclusion: that no one there cares. Readers and viewers shouldn’t have to work to call our errors to our attention.

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Advice for Gannett on running a single news operation

I have some advice for Larry Kramer and Gannett on running a nationwide network of newsrooms as a single operation.

Ken Doctor speculated yesterday that Kramer, publisher of USA Today, might lead Gannett’s editorial operation as a single unit.

As Gannett separates its newspaper properties from its broadcast and digital properties, Doctor tried to parse what Bob Dickey, CEO of the print operation, which will keep the Gannett name, meant when he said he would be “uniting our different news businesses into a single, nationwide news powerhouse.”

Doctor observed:

If Gannett’s journalists were to be centrally directed, they would comprise 2,700 journalists, the largest single journalistic workforce globally.

Gannett gives a lot of corporate direction to newsrooms. Currently the Newsroom of the Future is the Gannett wave, but earlier thrusts have emphasized Information Centers (2006, after the Newspaper Next report), First Five Paragraphs (2000 or so, when I was a Gannett reporter) and News 2000 (that was the priority when I interviewed for a Gannett job in 1992). And I probably forgot a few. Remind me, if you recall one I missed. Update: I forgot ContentOne (2009).

The company also is consolidating print production in regional Design Studios, a trend throughout the industry.

But, as Doctor noted, Gannett editors don’t work for a national corporate editor:

Those editors now report solely, within a traditional newspaper structure, to their paper’s publishers. Gannett senior vice president for news Kate Marymont (“My job is to elevate the journalism across Gannett’s local media sites,” says her LinkedIn job description.) leads editorial planning and strategy. Like her peers in similar positions at newspaper companies, she may act as an editorial advocate, but doesn’t have line authority.

I worked for nearly three years at a company where the newsroom editors did report directly to a corporate editor. Early in the formation of Digital First Media, I was on a conference call with all the publishers when CEO John Paton told them their editors would report to Editor-in-Chief Jim Brady. Publishers would still be in charge of the local budgets and the local operation, but for all journalism matters, Jim was in charge.

I was one of a handful of editors who reported directly to Jim, and I visited 84 newsrooms, including all DFM dailies, so I suppose I’m as qualified as anyone but Jim to share some lessons from our brief experience trying to run a single journalistic workforce.

I will neither boast of our successes here nor criticize our mistakes (mine or others’), though I will make passing references below to my DFM experiences. The lessons below are my own observations and advice to Kramer and Gannett (if Doctor’s speculation is correct), based on successes and mistakes at DFM and many experiences that were a mix of both. And I suspect some other companies might seek to better unify their news efforts.

Here’s my advice for Kramer and others who may lead national news operations:

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Continuing efforts to sell Digital First Media: observations from a distance

Anything I have to say about Digital First Media today is speculation or observation but I will speculate and observe.

(I’ll explain in some detail at the end of this post what I used to know about DFM operations and strategy, and what I don’t know now.)

A tough sell

My first observation: Selling this scattered company and its diverse properties has probably been much more difficult than anyone thought last year when executives decided to pursue a sale. My first knowledge of plans to sell the company was that they would likely sell it in pieces. I think the difficulty of that job led to an effort to sell it in one piece, as Ken Doctor reported last year. That led to a pending $400 million purchase by Apollo Global Management. Ken’s speculation – more informed than mine, but probably not coming from DFM sources – is that the deal fell through over price.

I think DFM CEO John Paton, Chief Operating Officer Steve Rossi (who will become CEO take over the company’s reins in July) and whoever is making decisions for Alden Global Capital, the hedge fund that owns DFM, have decided that some individual parts of the company will attract higher value separately. I think they’ve decided the higher values of some individual pieces will be worth the trouble of operating and eventually selling or shutting down the properties that would be more difficult to sell, or possibly operating a reduced company after selling the most attractive parts.

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Scripps’ ‘Digital Leads’: a strategy and process for newsroom transformation

I am cheering on the Four Platform Newsroom transformation efforts of the Journal Media Group newsrooms. And I encourage you to read a new report, published today, about the project in newsrooms of the former E.W. Scripps Co.: Digital Leads: 10 keys to newsroom transformation.

I have some experience with newsroom transformation efforts. As editor of the Cedar Rapids Gazette in 2008-9, I led a local effort to change how a newsroom worked. As digital transformation editor at Digital First Media, I led a companywide transformation effort, first an informal effort involving visits to 84 newsrooms, then helping hire and mentor new editors and finally Project Unbolt, focused on four pilot newsrooms shortly before I left the company last year.

I wouldn’t describe any of those efforts as a complete success, and I know none of them was a complete failure. However much we succeeded, I learned a lot and blogged a lot about what we did.

Michele McLellan, one of the Scripps consultants on the project, knew of my transformation efforts and gave me an advance copy of the report, so I’m going to share some observations here.

During the Scripps project, a corporate restructuring resulted in a merger of the Scripps newspapers with the Milwaukee Journal Sentinel to create Journal Media Group. Since the Journal Sentinel wasn’t involved in the Four Platform Newsroom project, I will refer to the group here as Scripps. The company consulted with the Knight Digital Media Center at the Annenberg School for Communication and Journalism at the University of Southern California. Today’s Digital Leads report was produced and released by KDMC.

I have visited only one of the eight Scripps newsrooms where the transformation is considered to be working, and that was just briefly years ago. So my knowledge of the changes at Scripps is based solely on reading the report. As a result, I’m not going to praise or criticize specifics of what Scripps newsrooms have achieved or attempted. Instead, I’m going to summarize the 10 keys of the report, with some highlights from the report and advice for other newsrooms undertaking their own transformations:

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Thoughts on the DFM sale and newspaper values

If reports are correct, my former company, Digital First Media, is going to sell to Apollo Global Management for about $400 million.

I’m not going to pretend I can analyze what that means for DFM, my many former colleagues there or for the news business. I hope for the sake of my many friends remaining in the company’s newsrooms across the country that the Apollo’s management will find a path to prosperity that doesn’t involve endlessly cutting staff. I hope the company will genuinely pursue the kind of digital creativity that the future demands and will have the staying power to let good ideas flourish.

Since seeing initial reports about the pending deal, I’ve wondered about the meaning of the $400 million sale price, reached in a long “auction” process that sought the best deal(s) to sell the company as a whole or in pieces.

The reported price tag is a breathtaking fall from what newspapers used to be worth, even in the past few years. I hope this means Apollo’s strategy isn’t to keep cutting staff to maintain profits. DFM doesn’t have much left to cut, and values have dropped as newspapers have been cutting. The best way to maximize this $400 million investment will be to build value by developing new revenue streams.

Comparisons of sales prices of media companies can be misleading. One sale might include more real estate, while another might include more debt or pension obligations. Successful subsidiaries can add value to a company. In a sale such as the DFM deal, which is essentially between two private equity companies, full terms may never be disclosed. You might not be comparing apples and oranges, but apples and lawn mowers.

I was not involved in the sale at all, other than losing my job last year as the company was preparing for the sale. But I understood DFM enough to know this was an extraordinarily complicated deal, with an array of factors that make it unique:

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Aaron Kushner (newspapers’ Harold Hill) is in Trouble with a capital T

You kinda love Harold Hill when you watch “The Music Man,” even though you know he’s a hustler. But the “think system” only works on stage or screen with an audience of adoring and forgiving parents. However charming he was, Hill was still a hustler. And the think system doesn’t work in the news business. You have to be able to play or you’re in trouble with a capital T.

Aaron Kushner was a hustler* who blew into Orange County, California in 2012, as though it were River City, Iowa, and he had some band instruments — er, newspapers — to sell. I kinda rooted for him, but I also kinda knew the Orange County Register and Freedom Communications had trouble in their future.

When Kushner bought the Orange County Register and announced a bold, expensive print-first initiative, I thought it would probably crash and burn quickly, but I wanted it to succeed.

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Thanks to GigaOm and Mathew Ingram for great coverage of digital media

I am saddened by the news that GigaOm has shut down its operations, burdened by debt.

I regard Mathew Ingram as one of the most important, insightful commentators on digital media (and not just because we often agree). I hope he continues blogging under his own banner or gets snapped up quickly by another media outlet that recognizes the importance and value of his voice.

An awful day for journalism — it seems Gigaom is closing. What @om and his team did there has been an inspiration to so many others.

— Dan Gillmor (@dangillmor) March 10, 2015

More on Mathew shortly, but first a salute to Om Malik, the founder of GigaOm. I admired what he built and salute his entrepreneurial spirit. Like Dan Gillmor, I am sad that this venture appears to be ending. (I didn’t use the word “failed,” because Om succeeded journalistically, and because he had a nice nine-year run. When afternoon newspapers closed in the 1980s and ’90s, I didn’t say they failed. Like GigaOm, they succeeded for years. Life cycles of successful ventures may be shorter in the dynamic digital age.)

I was pleased to meet Om over breakfast last year at the International Journalism Festival in Perugia, Italy. I hope I told him how much I admired the business he built. What I remember best about the conversation is Om’s great story about how he came up with the name GigaOm for his business. I won’t retell it here, because it’s his story and I won’t do it justice (if you have a link to somewhere he’s told it publicly, let me know and I’ll link to it).

March 11 update: I didn’t originally address the business aspects of this in depth because I don’t have much expertise in the area of venture capital. But I highly recommend Danny Sullivan’s post comparing the VC approach with what he calls the “Sim City” approach of bootstrapping a company and growing slowly, which is working for thriving Third Door Media. (And, he notes, other digital media companies are thriving on VC investment.) There are multiple paths to lasting success. Back to my original post’s salute to Mathew Ingram:

I also met Mathew in person at the International Journalism Festival. He was a keynote speaker at the 2013 festival and I was a panelist. We had been digital friends for a few years and both were pleased to finally meet in person. It was in joining Mathew and his wife, Rebecca, for breakfast last year that I met Om.

Rather than gushing my admiration of Mathew at length here, I want to show by links to some of his posts that have caught my attention through the years (and some of mine that have cited his work). Mathew would approve of a tribute in links, I’m sure, because one of my dozens of links to him was in my 2012 post about linking that linked to his post about whether linking is just polite or a core value of journalism. (It’s a core value; we haven’t won that fight yet, but we will.)

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