Journalist Still Thinks Newspapers Should Collude To Stop Giving Away Free Content

from the learn-some-economics dept

Earlier this year, we wrote about how San Francisco Chronicle columnist David Lazarus had a ridiculous set of proposals for "saving" the newspaper industry. He wanted all newspapers to collude together and agree to stop putting content online for free and, in addition, to sue anyone who linked to the newspaper sites without paying a licensing fee. To appease him, we refused to even link to his column. Since then, the Chronicle has parted ways with Lazarus, who has made his way south to the LA Times, where he's basically written the same column (yeah, this time we'll link -- let's see if he sues). His argument is basically: "I have no idea what a good business model for the industry is, so why not use my really, really bad one!" He uses some high school students as a device in the column, basically mocking them for not wanting to pay for news online. He goes on to complain that "blogs" will somehow destroy newspapers by publishing so much junk that it "will be too blurry to discern" good journalism from junk. This is a common line from folks who think that if it's in a newspaper, it must be "good journalism" and if it's on a blog, it must be junk. There are so many examples of why that's wrong, it's not even worth pointing out how silly a statement that is (and the fact that it's published in a newspaper pretty much disproves the point anyway). There is plenty of good journalism found in both newspapers and on blogs -- just as there is plenty of junk found on both. And saying that people can't tell the difference is suggesting that your audience is really dumb. Next thing you know, Lazarus will sign up in support of the idea that bloggers should be credentialed.

But the bigger point is that Lazarus insists that since digital advertising revenue remains a small percentage of newspaper revenue, it means that it can't support a newsroom. This is clueless on a number of different points. First, it's using a snapshot view of a very dynamic world. Digital revenues are growing at a rapid clip, as there are both more readers and more advertisers buying online ads. Compare that to the pace (and direction) of growth for traditional newspaper revenue... and suddenly the digital realm doesn't look so bad. Second, it assumes (incorrectly) that online ads are the sole source of revenue. As plenty of other newspapers are discovering, if you stop focusing so much on being "newspapers" and start realizing that what you deliver needs to change as the market has changed, you'll find that there are plenty of ways to afford to pay journalists -- and in some cases, they'll even be able to make significantly more than before. Of course, you'd expect that sort of analysis not to come from some junk blog, but from a "real" journalist. So why is it the other way?


Reader Comments (rss)

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    Jeff Greco, Dec 27th, 2007 @ 3:48pm

    Good riddance

    The Chronicle dumping Lazarus was the smartest idea they've had in years. He was a blight on the Business section. Hey Laz, go ahead and ask the NYTimes how they feel about their huge increase in traffic (and ad dollars) after taking down the paywall.

     

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    Teilo, Dec 27th, 2007 @ 3:59pm

    Static vs. Dynamic economic thinking

    Lazarus, like far too many journalists, politicians and academics, suffers from the inability to conceive of the economy of business as a dynamic process where inputs and outputs are constantly changing and adjusting to one another.

    This is the exact same problem with those who believe that "tax cut" = "decreased revenues". It's not so much stupid thinking, as just plain lazy. It's easy to think about static inputs and outputs. It's hard to consider the effects one has on the other. Thus in almost every case, "tax cut" actually = "increased revenues". Why? Because tax cuts create incentives to spend money. Or to invest in one's business, creating more or higher-paying jobs, creating more tax dollars. Or to invest in other businesses, which creates the same effect.

    I saw the same dynamic in effect when I was night manager of a grocery store during college. The owner saw his income dropping. I knew why this was. He had the highest prices in the city. His response? Raise prices some more. Of course, his problem only got worse.

     

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    Cynic, Dec 27th, 2007 @ 4:19pm

    This whole thing impresses me as a hall of mirrors. The newspapers point to something and say "Look!" Then later they ask what someone thought after they "looked". Then they check with experts who "looked" at a lot of things. If enough people look and make decisions then the newspapers can say "look, there's a pattern!" So they are ticked off that we say "look, the newspaper said something"?

    Personally it seems to me the only aggrieved parties are the people who are actually doing things. Heck, without people doing things where would all the journalists, experts and bloggers be. Maybe the folks who do stuff should stop as a dramatic demonstration of how the whole rest of the information food chain depends on them. Oh, wait...then the reports would just say "look, they stopped doing stuff!"

     

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    Idleline, Dec 27th, 2007 @ 4:44pm

    HBO: The Wire

    The new season of this show is going to include a storyline about the media's impact on crime, politics, and society in general. The series, which is entirely fictional, is known for painting a realistic picture. The show will depict the Baltimore Sun in an economic struggle with the changing times, including online free media. I imagine they will touch on this very subject time and time again. While the show is a dramatization, it's not unbelievable that it's a serious problem.

    It will be interesting to see what light they put on this subject.

     

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    Overcast, Dec 27th, 2007 @ 4:58pm

    That's ok - don't give out any free content.

    Someone else will gladly do it for them.

     

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    Captain Nemo, Dec 27th, 2007 @ 5:01pm

    Oh, come on...

    I like blogs. There are many, many examples of when a blog gets it right, when the 'real journalists' are way way off. See Mike's You Need A 2008 Prediction... How About: The Fact Checker Is Dead... Long Live The Fact Checker.

     

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    Max Powers, Dec 27th, 2007 @ 7:25pm

    Time and Technology changes everything

    The regular way of conducting business changes with time and the smart ones will realize it and change their business model to adapt or ignore it, be stubborn and watch the rest of the world change in front of their eyes as they wonder where the money went.

     

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    Rose M. Welch, Dec 27th, 2007 @ 10:07pm

    Wow.

    You know what you have to do to become a journalist? Get hired at a newspaper. Boom, you're a journalist. The degree might make it a bit easier, but it is not neccesary.

    In my area, the local paper (The Daily Oklahoman) is so biased that an unbiased (or at least biased in the other direction, the Gazette) newspaper was born. But the 'journalists' at TDO are supposed to be better than bloggers? They're more like Republican Perez Hilton's.

    I won't pay fifty cents for the Daily Oklahoman but after I moved to Lawton, I paid to have the Gazette mailed to me. Oh, crap, I must be wrong. The Gazette can't be a real paper... It's free. Oops.

     

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    listen_to_blogs, Dec 27th, 2007 @ 10:57pm

    Nothing wrong with charging for content.

    "I have no idea what a good business model for the industry is, so why not use my really, really bad one!"
    ==> A subscription based model can definitely work for blogs, provided the quality of content is good. I wouldn't mind paying for the quality of analysis that GigaOm or the scoop that valleywag provides.

     

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    Ajax 4Hire, Dec 28th, 2007 @ 3:48am

    newspapers? thats internet news printed, isn't it?

    newspapers: an archaic term describing how news was gathered by people, printed on paper and then given to people in the morning or evening.
    sometimes the newspaper was freely given to anyone who would take it.

    Like candle making and horseback riding, newspapers are now relegated to a hobby status.

    not today but it will be.

     

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    Ferin, Dec 28th, 2007 @ 4:51am

    Back from vacation...

    And thing's have yet to improve, I see. Is this guy planning to sue the bookstores and coffee shops that put out a copy of the paper for me to read while I'm in the store? How about suing libraries for allowing me to look at the paper the same day it comes out?

    What a maroon.

     

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    Amy Alkon, Dec 29th, 2007 @ 12:44pm

    From an LA Times subscriber

    I don't read Lazarus because he's tedious. No business model in the world will change that. LA Times would have more readers if they'd hire fewer tedious writers, and fire the ones they have.

     

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