3 ms·

There is a fundamental flaw in your analogy: airlines are selling actual scarce goods (limited seats on a plane). Newspapers, as they are today, aren't really

There is a fundamental flaw in your analogy: airlines are selling actual scarce goods (limited seats on a plane). Newspapers, as they are today, aren't really selling anything. Fact: News existed before newspapers. Fact: News will exist after newspapers. The "news industry" has never been in the business of creating anything. They were simply in the "fact distribution" business. Facts used to travel more efficiently via the newspaper than any other means (gossip, telephone, even television). But now that distribution costs on the internet are virtually nil, they can no longer make money by exploiting inefficiencies. This is the reason that Simon's plan is never going to work. If they try it, they'll go out of business just that much sooner. There are publications that still make money off subscriptions. The Economist is the shining example (I even subscribe, for a pretty substantial fee). The value in their publication is in their analysis of the facts. Everybody will know the same things pretty quickly. However, not everyone will come to the same conclusions. Those conclusions are what they should be charging for, not the facts.

albertsun 17y ago
Even people in the "fact distribution" business via the internet (newspapers or not) will expect to make an amount equal to the value they are creating by moving those facts about.
antidaily 17y ago
Maybe common facts or stories (eg "MJ dies") could free or cheaper than exclusive content.
lutorm 17y ago
I disagree that papers aren't creating anything. To the extent that todays' news industry just parrots back press releases, you may be correct, but I definitely think there's a need for not just interpretation but investigation. If there had been no newspapers in 1972, I don't see who would have put in the effort of pulling at the threads until the Watergate scandal unraveled. To take a more modern example, I don't see any bloggers that would have taken the time or had interest in doing the few big investigative stories that the San Jose Mercury has broken in the past few years, the one about people being wrongfully jailed because of bad public defenders and the one about the SJ Police's outrageously high number of downtown disorderly arrests, come to mind. Those are not stories that would have come out in the absence of an operation willing to commit to long-term footwork. They certainly wouldn't have been written by some bloggers looking for news online, because it's happening in the real, offline, world, and you can't just "link" to it. Without newspapers, or the equivalent thereof, these stories would not be told and no one would keep the government honest (to the extent that newspapers today haven't already failed at this). And I think this would be a loss to society.
- alanthonyc 17y ago
  I've heard the Watergate story used as an example before of a reason why news organizations should "matter." At first thought, it sounds like there is a third value proposition there (the three being fact distribution, analysis and investigation). Upon thinking about it more, don't you think that the value of the Washington Post is a little over-emphasized in that story today? As much as the newspaper itself played a huge part in allowing the story to break - from employing and training their staff, through providing an infrastructure for doing the investigation to publishing the actual piece - they almost had as much of a role in killing the story. If the editor at the time had succumbed to the pressure from the politicians, he may have caused the story to disappear. In the end, it wasn't the "newspaper" who investigated it, it was two guys named Woodward and Bernstein. One thing I believe in is that the internet empowers the individual to do things that were previously impossible to do by one person. Theoretically, I think this applies in this situation as well. As for the SJ Mercury News example, would that not be the same thing here? I'm sure there at least a couple of individuals in that group that are driving this kind of journalism. Maybe the newspaper as an organization helps foster and nurture this type of behaviour, but so what? Couldn't an organization that is not in the business of printing on paper do the same thing? What is the difference between a newspaper and a blogging organization anyway? Is it the salary? Is it the medium? Nobody is decrying journalism, just the old (economically) unsustainable models.
eli 17y ago
One of the main reasons The Economist is doing so well is that they've done such a piss poor job of promoting their website that it's almost as if they never started posting articles for free in the first place. It's a lot easier to charge for something when people don't realize they can get it for free. It's a lot harder to the NYT, which everyone is used to reading for free.
eli 17y ago
I couldn't disagree more. Facts don't float around waiting to be plucked from the air and distributed to readers. It takes serious work to uncover secret CIA prisons. I do not believe there is any other organization today that has the time and resources to needed to uncover something like that. And you're wrong about the business of newspapers. They've never made money distributing news. They're in the advertising business. The money you pay for a subscription barely covers the cost of getting the paper printed and to your door. Newspapers made lots of money because -- for a time -- they were absolutely the best advertising medium in the world. Newspapers are in serious trouble right now not because of subscription declines (which have been slow bleed for years) but because of a rapid decline in ad spending, which fell off a cliff about a year ago. What's killing newspapers isn't the competition from online news startups, it's really AdWords and Craiglist along with the decline of national retail chains and the failure of car dealerships.
- alanthonyc 17y ago
  Saying newspapers aren't in the fact distribution business because they're in the advertising business is like saying Google isn't in the search business because they're in the advertising business.
  - eli 17y ago
    99% of Google's revenue is directly from ads. Less than 1% comes from licensing search technology and selling search appliances. Of course they're in the advertising business! Search is just one vehicle (among several) for delivering targeted ads. Heck, they make about as much money selling ads on non-Google sites through AdSense as they do selling ads on their own search results pages.
    - mediaman 17y ago
      Google sells attention to advertisers via its distribution channels. Their search engine is certainly the most successful distribution channel, and they have (with somewhat less success) added other distribution channels such as AdSense, which is a partnership distribution model. Whereas NYT is obligated to invest in journalism to generate distribution, Google invests in useful tools. It appears that investing in useful tools is a more efficient way of generating distribution than quality journalism, at least for the time being.

albertsun 17y ago

Even people in the "fact distribution" business via the internet (newspapers or not) will expect to make an amount equal to the value they are creating by moving those facts about.

antidaily 17y ago

Maybe common facts or stories (eg "MJ dies") could free or cheaper than exclusive content.

lutorm 17y ago

I disagree that papers aren't creating anything. To the extent that todays' news industry just parrots back press releases, you may be correct, but I definitely think there's a need for not just interpretation but investigation. If there had been no newspapers in 1972, I don't see who would have put in the effort of pulling at the threads until the Watergate scandal unraveled. To take a more modern example, I don't see any bloggers that would have taken the time or had interest in doing the few big investigative stories that the San Jose Mercury has broken in the past few years, the one about people being wrongfully jailed because of bad public defenders and the one about the SJ Police's outrageously high number of downtown disorderly arrests, come to mind. Those are not stories that would have come out in the absence of an operation willing to commit to long-term footwork. They certainly wouldn't have been written by some bloggers looking for news online, because it's happening in the real, offline, world, and you can't just "link" to it. Without newspapers, or the equivalent thereof, these stories would not be told and no one would keep the government honest (to the extent that newspapers today haven't already failed at this). And I think this would be a loss to society.

alanthonyc 17y ago
I've heard the Watergate story used as an example before of a reason why news organizations should "matter." At first thought, it sounds like there is a third value proposition there (the three being fact distribution, analysis and investigation). Upon thinking about it more, don't you think that the value of the Washington Post is a little over-emphasized in that story today? As much as the newspaper itself played a huge part in allowing the story to break - from employing and training their staff, through providing an infrastructure for doing the investigation to publishing the actual piece - they almost had as much of a role in killing the story. If the editor at the time had succumbed to the pressure from the politicians, he may have caused the story to disappear. In the end, it wasn't the "newspaper" who investigated it, it was two guys named Woodward and Bernstein. One thing I believe in is that the internet empowers the individual to do things that were previously impossible to do by one person. Theoretically, I think this applies in this situation as well. As for the SJ Mercury News example, would that not be the same thing here? I'm sure there at least a couple of individuals in that group that are driving this kind of journalism. Maybe the newspaper as an organization helps foster and nurture this type of behaviour, but so what? Couldn't an organization that is not in the business of printing on paper do the same thing? What is the difference between a newspaper and a blogging organization anyway? Is it the salary? Is it the medium? Nobody is decrying journalism, just the old (economically) unsustainable models.

eli 17y ago

One of the main reasons The Economist is doing so well is that they've done such a piss poor job of promoting their website that it's almost as if they never started posting articles for free in the first place. It's a lot easier to charge for something when people don't realize they can get it for free. It's a lot harder to the NYT, which everyone is used to reading for free.

eli 17y ago

I couldn't disagree more. Facts don't float around waiting to be plucked from the air and distributed to readers. It takes serious work to uncover secret CIA prisons. I do not believe there is any other organization today that has the time and resources to needed to uncover something like that. And you're wrong about the business of newspapers. They've never made money distributing news. They're in the advertising business. The money you pay for a subscription barely covers the cost of getting the paper printed and to your door. Newspapers made lots of money because -- for a time -- they were absolutely the best advertising medium in the world. Newspapers are in serious trouble right now not because of subscription declines (which have been slow bleed for years) but because of a rapid decline in ad spending, which fell off a cliff about a year ago. What's killing newspapers isn't the competition from online news startups, it's really AdWords and Craiglist along with the decline of national retail chains and the failure of car dealerships.

alanthonyc 17y ago
Saying newspapers aren't in the fact distribution business because they're in the advertising business is like saying Google isn't in the search business because they're in the advertising business.
- eli 17y ago
  99% of Google's revenue is directly from ads. Less than 1% comes from licensing search technology and selling search appliances. Of course they're in the advertising business! Search is just one vehicle (among several) for delivering targeted ads. Heck, they make about as much money selling ads on non-Google sites through AdSense as they do selling ads on their own search results pages.
  - mediaman 17y ago
    Google sells attention to advertisers via its distribution channels. Their search engine is certainly the most successful distribution channel, and they have (with somewhat less success) added other distribution channels such as AdSense, which is a partnership distribution model. Whereas NYT is obligated to invest in journalism to generate distribution, Google invests in useful tools. It appears that investing in useful tools is a more efficient way of generating distribution than quality journalism, at least for the time being.