Searching For a Viable Media Business Model: French Government Aid For Newspapers
By Tom Foremski - January 26, 2009
Elke Heiss pointed me to this: The Associated Press: Sarkozy offers new help for French print media
The French state will help provide free newspaper subscriptions to teenagers for their 18th birthdays, President Nicolas Sarkozy announced Friday. But the bigger gift is for France's ailing print media.
Sarkozy also announced a ninefold rise in the state's support for newspaper deliveries and a doubling of its annual print advertising outlay amid a swelling industry crisis.
Sarkozy argued in a speech to publishers that the measures are needed because the global financial crisis has compounded woes for a sector already suffering from falling ad revenues and subscriptions.
In a speech to industry leaders, Sarkozy said it was legitimate for the state to consider the print media's economic situation.
"It is indeed its responsibility ... to make sure an independent, free and pluralistic press exists," he said.
This is interesting news but I'm wondering why does it have to be print focused? Surely it shouldn't matter if the news is delivered via paper or electrons--the point is to support news organizations that are producing high quality media.
It's a shame that the free market cannot come up with a business model that distinguishes between low and high quality media. State intervention is welcome during tough times but it could be problematic if the state controls the viability of media (although the BBC is doing well).
OK, I am biased, because I see the world through a media lens, but I believe that the single most important challenge that faces this Internet economy is how to develop a viable business model that supports a professional media class that produces high quality media.
It is essential to society.
If we lose our New York Times, Wall Street Journal, Financial Times, BBC, etc, we lose our "fourth estate." We lose the people that that watch our politicians, business tycoons, and government policies. More importantly, we lose the people that investigate corruption, that check on the conduct of politicians, that know how to deal with spin.
An army of bloggers won't and can't replace our media professionals - the journalists, editors, producers, sub-editors, photographers, videographers, etc. Our media is the way we figure out solutions to important problems--and the better it is, the better we are.
Media is the way society thinks about important issues. If we have crap media we have crap solutions.
Software engineers have a phrase for this: Garbage in--Garbage out.
We are heading for a world of crap media. Buckle your belts.
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January 26, 2009 | Permalink | Comment | Category: MediaWatch | Subscribe to SVW
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Comments (4)
"...why does it have to be print focused?"
As an ex-NYTCo employee, this is the question I keep asking myself over and over again.
Why do so many "print" companies struggle to understand that their real value is not in the paper but the words that are printed on that paper. A majority of their operational costs come from printing and delivering that paper. Costs that would mostly go away if the paper product were eliminated or positioned as a premium product with premium pricing. (The paper version should cost $5 not $0.50).
As you said, with many of their stocks are multi-year lows and bankruptcy looming, we are in real danger of losing these institutions and entering the world of "crowdsourced" news delivered instantly from camera phones and text messages without any research or deep thought put into what is published to the web.
Posted: January 26, 2009 11:24 PM
DBH: Thanks for your note. It's always interesting to see how difficult it is to change a business culture.Newspapers don't think of themselves as news organizations. Also, print advertising, despite the costs of doing business, is more profitable than online advertising. That's the issue, how to bump up online ad revenues to be equal to (print advertising revenues minus print and distribution costs.) That's the equation but what's the solution? The two are far apart and I think you are right, people will have to pay for news, and pay a lot more than today.
Posted: January 27, 2009 4:09 PM
Tom,
Your point brings to light an interesting question. When newspapers were first founded, I like to believe that they thought of themselves first and foremost as news organizations. Then, and I don't know when, at some point that changed and they evolved into the large commercial entities that they are. Perhaps they need to go back to thinking of themselves as news organizations, though I realize that the complexities of shareholder value, market pressures, financial obligations, etc makes this far more complex than a simple mindset switch.
While not the solution for everyone, I know of an extreme example in the UK (Wales) that tore the bandage right off and eliminated their print magazine while immediately transitioning to a website presence as well as a digital edition of the magazine. The initial loss in readership was more than offset by the resulting savings in business costs ultimately resulting in higher profit margins for the company as a whole.
All in all, the Sulzberger family and the other keepers of the fourth estate should hurry up and find a solution to that equation before its too late.
Posted: January 28, 2009 12:47 AM
Devin: A solution will be found but it might be too late for NYT and others. Which means we will lose best practices created over hundreds of years, and we will have to rediscover them again.
Posted: January 28, 2009 10:55 AM