A VC’s view of saving The New York Times

I’ve long enjoyed reading Fred Wilson’s blog. He’s amazingly open with his quest to figure things out in digital media as a venture capitalist with Union Square Ventures. It doesn’t hurt he’s had a nice track record in Web 2.0, backing companies like Delicious, ComScore, Tacoda and now Twitter. He gets this stuff.

After a Q&A he did yesterday with John Battelle, an audience member asked what he’d do to save The New York Times. What’s interesting, for me, is that it comes from an outsider to the publishing industry. I find too many distressing parallels between the publishing and auto industries. They both coasted for too long on artificial advantages, relied on insular leadership and are now paying the price with unsustainable business models and products not aligned with consumer demand. Here’s what I took down as Wilson’s first few steps, things that run completely counter to what anyone within the industry would suggest.

1.    Stop printing the Times immediately. This is absolute heresy. Can you imagine Arthur Sulzberger standing in the newsroom and explaining that his legacy will be the family member who killed the newspaper? Wouldn’t happen. No matter what is said, publications still view themselves through their distribution medium. Newspapers are newspapers, not news sources. Magazines are magazines. The Web, whether they admit it or not, isn’t where their thinking begins.
2.     Kill the sports and business sections. Wilson believes a company needs to double down on what it’s good at. For the Times, its business coverage can’t compete with The Wall Street Journal’s. Its sports coverage is inferior to The New York Post. Following the logic of Jeff Jarvis, Wilson sees a Times that shrinks to its core competencies and links to the rest.
3.    Concentrate on political and world affairs. Where is the NYT at its best? Wilson saw it in its coverage of the selection of Sonia Sotomayor as the next Supreme Court justice. The Times still sets the national news agenda.

I doubt these suggestions would be put into motion at the Times. For one thing, there’s less money in politics than in, say, the Sunday Styles section. The Times has to do the fluff stuff to support the serious journalism. What Wilson didn’t address is how big the Times would be. I wonder if to be thriving for-profit company it needs to go from 700 journalists to 200. Thomson Reuters CEO Tom Glocer made this very point recently. He went even further, saying “Why not 30 reporters with 30 apprentices?” Whatever the case, I have a feeling we’ll see the shrinking of media organizations to fit the new realities. It’s eerily similar to what the auto companies are doing, although I hope it won’t be done in bankruptcy.

Comments

[ed drossman]

Less than penny press

Manhattan: This past weekend I bought the papers on Friday, Saturday and Sunday. Why? Because my computer was in the shop. If newspapers want to survive, they must stop giving content away on the Internet free. Why would people want to pay money for newspapers when they can read them online free?

[Alan Wolk]

Kind of reminds me of the many suggestions one reads in the blogosphere from tech types on how to save the advertising industry.

A politics & world affairs only NY Times would have a strong position. But it wouldn't be the NY Times, it would be something else.

As we've discussed offline, I keep wondering what would happen if the government relaxed some of the anti-trust laws that keep newspapers out of the TV business (and vice versa) and so that we wound up with something like "The CBS Evening News from the New York Times." That would expand their presence, give them clips the could disperse about the web and maybe even open up a revenue stream for them in creating video content for TV and Web that they could actually charge for.

Just a thought.

[Adam]

I honestly don't know if not printing the Times is right or wrong, but he's absolutely one-hundred percent right on points 2 and 3.

Look at this chart:

http://www.businessinsider.com/chart-of-the-day-newspaper-print-ad-sales-2009-6

Things were worse this past quarter for newspapers than they've ever been. But over the past several months I've read that both USA Today and the Financial Times are bucking the trend and doing well.

Why? Because they do one thing and do it well.

If newspapers positioned themselves like any other business does, they wouldn't be in this mess. I hear Phil Bronstein (from the SF Chronicle) on the radio in whining about how the fate of newspapers was sealed a decade ago when the industry make the "fateful" decision to give its content away for free.

How about the fateful decision not to pull their head out of their ass?

The web is world wide! Why does the Austin Herald or the Cleveland Gazette or the Skennectady Journal need reporters on the ground in Iraq? It used to work out because they had municipal monopolies and people didn't have a choice. But they chose to ignore the fact that geography no longer tethered their customers to the local rag and they chose not to adapt.

Every successful company in the world at least makes an attempt to understand their audience and the unique value they can provide to position themselves in the marketplace. Or they fail. Newspapers, it seems, felt they were above that nonsense.

How's that working for ya, Phil?

[Steve Wax]

The newspapers may go away, including the beloved NYT. But reporters won't - we just gotta figure out how to pay them direct: audience to journalist. See spot.us for one example.

[Brian Morrissey]

Adam, I agree. I don't buy for a second the argument that newspapers are merely victims of unfortunate circumstances, just as I don't think the auto industry just hit bad luck. Both industries had their heads up their asses.

I think you're right, Steve. There isn't a sustainable model right now, but I'm pretty confident one will emerge. The ugly fact is there is so much waste in the news industry. Too much money goes to production costs and non-content creators.