Read A Newspaper Recently?

About a year ago the Bellingham Herald put their online content behind a paywall and was followed by the other McClatchy papers The News Tribune of Tacoma and The Olympian.

Right after the last election, The Herald of Everett took their online content behind a paywall, leaving the Peninsula Daily News— also owned by Sound Publishing— as the last daily paper in the Puget Sound basin without a paywall.

After asking Bellingham Herald executive editor Julie Shirley whether the strategy putting up an online paywall worked to increase paid subscriptions, I got kind of an answer from publisher Dave Zeeck at The News Tribune who said that McClatchy Corp. didn’t release information on a paper-by-paper basis but from the McClatchy’s company third quarter report:

“...year-over-year circulation revenue went up 6.5% or about $5.3 million. I would assume most of that increase is paywall revenue, but that's a matter of interpretation, rather than fact. For the same quarter our daily circulation dropped 5.6%, and our Sunday circulation went up 1.1%.”

That’s for all of the 30 company papers. So did it help the three Puget Sound McClatchy papers?

The circulation figures from the Alliance for Audited Media (AAM) show the daily circulation of The News Tribune went from 74,826 (9/30/12) to 73,557 (3/31/13) and the daily circulation of The Olympian went from 21,876 to 21,621 in the same period. There were no audited daily circulation figures for the Bellingham Herald, which stood at 16,154 at the end of September 2012.

Going to paywall didn’t result in much change in daily circulation where figures were available but seems to have brought increases in Sunday subscriptions. McClatchy Corp. lists Sunday subscriptions for The News Tribune at 98,155 in 2012 and for The Olympian at 27,201. The 3/31/13 AAM report lists Sunday circulation for The News Tribune at 102,080 and for The Olympian at 30,143. Again, there were no Sunday circulation figures for the Bellingham Herald in the latest AAM report.

So, as far as I can tell, daily circulation didn’t get worse for The News Tribune and The Olympian and Sunday circulation got better. Is that good enough to make daily print news with paywalls a good business proposition for these papers in Puget Sound?

Zeeck, speaking again to the overall 30-company McClatchy picture, thinks newspapers have a future:

“If we're taking more money in by charging for digital subscriptions, both for our print customers and our digital only customers, then I think that's good news for print publications. In my opinion, going down 5.3 percent in daily subscriptions when you are charging people more to pay for the digital portion of their news consumption, that's a very good sign. So is going up 1.1 percent in Sunday circulation. I think print has a very long future.  I think it was more in doubt when people could get their news for free on the internet, and drop their print subscription.  Now, however you take the news, you have to pay for it. I think that bolsters print subscriptions in the long run.”

Maybe so. For the sake of daily print newspapers in the Puget Sound basin, I hope so. For McClatchy’s 30 daily newspapers, online revenue from circulation and advertising increased over the previous year’s third quarter; overall net earnings, however, declined in large part due to continued losses in print advertising. The business of newspapers is not to provide the news; it’s business is to provide the space for advertisers to communicate with readers.

The more eyes on your product, the better your chances are to sell advertising and increase revenue. What brings and keeps eyes on your product? Content, news, items of interest to readers.

An important question is whether the print and online content of the Bellingham Herald, The News Tribune and The Olympian has the kind of content in quantity and quality subscribers are willing to pay for. Will more people subscribe so more advertising can be sold— and more revenue generated? Is this the business model that will keep daily print newspapers serving the Puget Sound basin?

I hope so but am feel pessimistic when I read the recent report from the Pew Research Journalism Project: News Use across Social Media Platforms. About half of Twitter and Facebook users say they get their news from those sites, and 65% of users of social media platforms say they get their news from only one social media site. And roughly only a fourth of users of each social media platform say they also get their news from newspapers, about the same as all adults.

And on the revenue side, I learned last week that Google is on course to do $60 billion in revenue this year, almost all of that from advertising. According to, Business Insider CEO Henry Blodget , Google alone is now bigger than either newspapers and magazines. (See graph, above, in Google Is Now Bigger Than Both The Magazine And Newspaper Industries )

Maybe Google’s success and the success of Facebook aren’t necessarily taking away ad revenue from magazines and newspapers but what makes these platforms appealing is their ability to deliver large audiences that can be segmented, targeted and sold to. Daily newspapers are neither search engines nor social media platforms. But, in this day and age— and into the future— what are they?

--Mike Sato

Who Reads Newspapers Anyway?

It’s a morning ritual: get up and let the dog out the front door and walk to the spot in the lawn where the morning Bellingham Herald’s been tossed in its bright red plastic wrapper. Sure, sometimes like this Monday morning, the paper’s about as thin as its plastic covering but having the morning paper in hand is a nice, familiar ritual.

Everett Herald columnist Julie Muhlstein captures the feeling well of what happens when the morning paper isn’t there in “Nothing replaces a physical newspaper”:

“....when the paper isn't there it's just an awful feeling. Something pleasurable and important is missing. The day does not properly begin. Coffee doesn't taste as good. It's an addiction, really, and it's common in my generation.”

Like Muhlstein, print newspaper readers of The Oregonian might begin having that “awful feeling” as the venerable publication goes to delivering the daily paper to home subscribers only on Wednesdays, Fridays, Saturdays and Sundays. Muhlstein reports that the newspaper will be published seven days a week and sold daily at newsstands and will have an expanded digital presence. This is all part of a business strategy by the publication’s owners who have made similar cuts in both publication and staff at papers in New Orleans and Cleveland.

It’s a business move that newspaperman Floyd McKay questions this morning in his Crosscut article, “The Oregonian: Going the way of all newspapers?”--

“If the paper does maintain its present staff size, it reflects the move to digital. There is some irony in this: The Oregonian’s strongest suit has been a talented staff of reporters and editors; its weakest link has been its web site, OregonLive.com.”

But maybe it is a generational thing shared by Muhlstein, McKay and me. According to an article in BBC News by Leo Kelion, the move to paying for non-physical, digital news is slowly gaining support in the UK. “Gains were also seen in the US, France and Germany, although Denmark bucked the trend. Those aged 25 to 34 appeared most prepared to pay, and men were more willing than women, the study suggests.” ( Online news is becoming easier to sell, suggests study  )

... "The data indicate, on average, 10% of people have paid for news in some digital form - about one-third higher than last year," said Prof Robert Picard, director of research at the Reuters Institute for the Study of Journalism, which carried out the study. “Public-affairs magazines are finding it easier to get the public to pay than newspapers, especially on tablets, because digital payments for magazines are becoming the norm and they offer news analysis and commentary in ways general news sources do not.”

So if the news business strategists are right, it will be the young who will pay and read the news in its digital form. Some of us will just have to explain why we are standing on the front lawn in the mornings. Then it will be up to the young to define the standard of what constitutes good news reporting— in whatever form it comes.

--Mike Sato 

My Newsroom Lies Over The Paywall

Last month the Kitsap Sun set up their paywall and cut Puget Sound readers off from reporting by Christopher Dunagan, one of the few remaining environmental journalists covering Puget Sound water quality and habitat issues.

Sun editor David Nelson believes erecting the paywall to limit online access to print and digital subscribers will make the Sun a better publication. He wrote on May 11:

“A digital subscription covers all of our online coverage, but readers will always be able to access certain ‘free’ stories — our daily weather report, news with a public safety element such as fires or inclement weather. Certain other stories, such as government decisions that make a difference in your life, or sports scores, will be available to all for a limited number of hours before becoming “premium” stories only for subscribers.”

After “a limited number of hours” Chris Dunagan’s stories are pay-for-view at $10 a month.

I like newspapers and I like Chris’s reporting but I don’t think paying $10 a month is going to give me any more or better environmental reporting nor is it going to give Chris a bigger paycheck. David Nelson couches the Sun’s paywall decision as a decision about better journalism. It isn’t. It’s a financial decision and a last-ditch effort to boost paid subscriptions to sell advertising.

Subscriptions alone have never paid for reporters’ salaries and, in that respect, their product was and is in large part “free.” Advertising revenues paid for most of  the newsroom salaries and, in the days of shrinking ad revenues, newsrooms get slashed and fewer reporters now cover multiple beats.

 Last Friday, PR Daily reported that the Chicago Sun-Times laid off its entire photo staff. The Sun-Times justified it not as a financial decision but as a journalistic one by writing:

"The Sun-Times business is changing rapidly and our audiences are consistently seeking more video content with their news. We have made great progress in meeting this demand and are focused on bolstering our reporting capabilities with video and other multimedia elements. The Chicago Sun-Times continues to evolve with our digitally savvy customers, and as a result, we have had to restructure the way we manage multimedia, including photography, across the network."  

Readers won’t get better journalism. Sun-Times reporters will now take news photos. Will they get paid more and the journalistic product improved? Don’t think so.

The Sun’s paywall decision leaves only the Sound Publishing-owed Peninsula Daily News and The Herald of Everett as Puget Sound daily papers for now without paywalls. The Herald’s circulation had been dropping before the purchase last April by Sound Publishing. According to Greg Lamm in the Puget Sound Business Journal, “The Herald saw its average daily circulation — which included print and digital subscriptions — shrink 15 percent for the six month period that ended March 31, compared to a year ago. Sunday circulation declined 8.4 percent. The declining numbers suggest Sound Publishing will be focused not only on growing revenue through added readers, but also on looking for more ways to cut costs.”

Paywalls, anyone?

We live in a time of diminished expectations and shrinking baselines when it comes to news coverage on many issues like the environment in Puget Sound. I’ll risk sounding like an old guy by saying it used to be a lot more fun and a lot more interesting when there were many more reporters competing to get a story in print and on the radio and TV about an environmental issue or event.

I’m not sure what the price point is for paying for quality news reporting but I know what I’m paying for currently isn’t quality in coverage or depth. The Columbia Journalism Review reports that the Orange County Register’s investment is in hiring more reporters and giving readers good journalism— and charging them for it. Will it work? If we knew the answer to that we wouldn’t be in the fix we’re in. But if it does work, maybe the days of print journalism with its material costs will finally evolve into more cost-efficient and timely digital versions.

I never believed the civic line that we had to have big sports arenas and professional sports teams in baseball, football and basketball in order to be a world-class region. But I always believed that we needed to have quality news reporting to be a world-class region. Maybe we can have both.

--Mike Sato

Puget Sound Starts Here Launches New Campaign

The Puget Sound Partnership has done social research into how the 4.5 million of us think and feel about Puget Sound and is launching a new Puget Sound Starts Here campaign this month.

Take a look at the campaign website.

In an email to ECO Network members, the Partnership wrote: ‘On May 6, the Puget Sound Starts Here website, advertising and local materials will have a new look. Instead of a static website that tells people what to do, the new PSSH will feature a mosaic of ever-changing content (videos, infographics, photo essays, articles and more) that celebrate why life in Puget Sound is so special, and why we each have a role in caring for the Sound. Next Monday we will do a “soft launch” of the website with the May “Walking the Sound” creative materials. In addition, our online advertising campaign and regional public relations efforts will begin. For each, we will begin slowly and build momentum as new content is added to the site over the coming months.’

According to Dave Ward, the Partnership’s Regional Stewardship Program Manager, in an April 9 memo, the new campaign goals are to “rekindle an emotional connection between area residents and Puget Sound, increase PSSH brand awareness from 26% to 50%, position PSSH as a connector for residents to a healthy Puget Sound, and reinforce the ‘umbrella’ PSSH brand to unite regional and local efforts of partner organizations.”

Sounds exciting and something to look forward to in the months to come.

--Mike Sato

A Fresh Breeze From The Herald Wafts Over The Partnership

Check out the editorial voice Peter Jackson and his editorial writers at The Herald are establishing. Over the last three weeks, they've opined on coal exports, the San Juan Island National Monument, food fish safety and coal trains.

Earlier this month, the subject was saving Puget Sound and praise for Governor Jay Inslee's proposed natural resources budget.

Specific to Puget Sound, the editorialists wrote:

"Most of Inslee's recommendations dovetail with the priorities of the Puget Sound Partnership, the state agency responsible for the Sound's recovery. The partnership has become a lean, efficient bird-dog of state funds, ensuring oversight and accountability. Coordinating and leveraging federal dollars also falls on the partnership, as well as developing indicators of a healthy Sound consistent with its 2020 restoration goals. The partnership no longer gets scapegoated as too top-heavy or PR oriented, with an evolving bipartisan consensus. The reason centers on tangible results such as restoring shellfish beds previously off-limits because of contamination."

The "lean, efficient bird-dog" description and no longer "top-heavy or PR oriented" description had me checking out the Partnership staff web site since I'd not heard much from or about the Partnership since its executive director Tony Wright resigned earlier this year. I couldn't tell how much leaner or efficient the Partnership had become by perusing its staff roster but I did learn that Marc Daily is now serving as Interim Director.

With all due respects to Marc Daily, having an interim director for an agency charged with saving Puget Sound unfortunately doesn't inspire much confidence in the state's pursuit of this important task.

Nevertheless, The Herald editorialists see a new day for the Partnership thanks to delivering "tangible results such as restoring shellfish beds" and to "developing indicators of a healthy Sound." That led me to check out how well the Partnership (and Puget Sound) is doing in meeting the 2020 benchmarks that measure how 'fishable, swimmable and diggable' our Sound is. 

The Partnership's colorful Vital Signs display shows a few tangible results-- but we're clearly running out of time as the Partnership moves closer to 2020. What's disturbing is how many of the indicators of Puget Sound recovery don't show progress and some don't have interim targets to measure progress.

Sadly, the Partnership has never told its story or the story of Puget Sound very well since its inception in 2007. Maybe better "PR" -- in place of or in addition to its campaign of picking up dog poop -- would have resulted in more Puget Sound residents seeing the waters of the Sound as at risk. In 2007 about three-fourths of people polled thought the health of Puget Sound to be good or excellent; five year later, the Partnership's polling found little change in that public perception. ( General Public Opinion Survey 2012 ) 

It's a good thing that The Herald newspaper still thinks the Partnership and the need to save Puget Sound are important enough to editorialize about.  The issue is too important to fade from public awareness. How about Puget Sound environmental groups and other major news media do their parts to watch dog the Partnership and put the "action" into its Action Agenda?

--Mike Sato

Pay To Read: Still Waiting

I’m still waiting to see what difference it makes paying to read the online version of the Seattle Times, Bellingham Herald, Skagit Valley Herald, The News Tribune of Tacoma, The Olympian, Vancouver Sun, Times-Colonist, and Globe and Mail makes— aside from paying for what previously didn’t cost me to read.

I guess I’ve been waiting to see how much more added value there would be with a paywall in place: broader community news coverage, deeper coverage, multi-media formats— things that can distinguish online publications from print publications.

Having addressed this previously, Erecting the Paywall to Save the Product  and Pay-To-Read —What?, I’m disheartened to see that what people pay to read newspapers for — news — shrinks away as newsrooms shrink. I know that newspapers are businesses but to ask people to pay more for less and less seems like going into a death spiral. Less readers, less advertisers, less revenue.

So it’s at least a bit heartening to read the Columbia Journalism Review and to find in a depressing article about the evisceration of the New Orleans Times-Picayune a mention of another business model, a “contrasting vision of a digital future.”

“Consider the Orange County Register, a similar-sided paper that was purchased by the Aaron Kushner-controlled Freedom Communications in June,” writes Ryan Chittum. “Kushner boosted print pages by 40 percent and added a new business section. He’s installin a metered paywall, raising print prices, and even improving paper stock. Most important, he has gone on a hiring spree, expanding the newsroom by 50 percent. From 180 to 270.... Kushner’s idea is that newspapers can’t cut their way to survival, let alone prosperity... Diminishing your journalism means chasing away readers and advertisers who have paid you good money.”

According to Chittum, “The New York Times has preserved the size of its dominant newsroom at the expense of its profit margin, and devised a digital-subscription model that others in the the industry are emulating. As a result, last year the Times’s revenue was up for the first time in six years, despite continued print-advertising declines.”

Maybe in the long run the business model of the Orange County Register and The New York Times won’t work, but I learn something new every time I read The New York Times online because they report news in addition to the staple of sports and entertainment. I’ll continue reading it online and in print when I can. And I’ll keep waiting to see when the local paywalls start paying off for me when I read the local newspapers.

Meanwhile, read former AP reporter Curt Woodward's blog on Newspaper Paywalls: Here's Why They’re Really Doing It.

What are you reading these days?

--Mike Sato

Where Did You Stand 10 Years Ago? Where Do You Stand Today?

"Mission Accomplished" 2003 (AP)

Some of us must remember why George Bush and his cronies said it was important to go to war 10 years ago in Iraq. Some of us didn’t agree and thought the reasons were phony and destructive to our country. And the reasons turned out to be phony and destructive to our country.

What puzzled and disturbed me was that many of my fellow citizens believed that Saddam Hussein was connected to the 9/11 attacks— and that connection somehow justified the invasion. It never was true.

In fact, a lot of crap got passed on as truth over the last 10 years. From the McClatchy News Service, which ones of the following are true?

• Iraqis greeted U.S. troops as liberators.
• At least women’s rights have improved post-Saddam.
• The Sons of Iraq project, also called Sahwa or “Awakening,” was a successful strategy to isolate extremist in the war zone.
• The bombing of the golden-domed al Askari shrine in Samarra in February 20006 touched off the brutal sectarian ware that would engulf iraq for the next two years.
• Sovereignty was restored in 2004, with the U.S. Occupational authority handing over power to interim leader Ayad Allawi.
• The “surge” strategy of sending 20,000 additional U.S. Forces to Iraq in 2007 was the catalyst for a turnaround in the war, bringing enough calm to the country for the U.S. Military to stay on schedule for withdrawal.
• As of the end of 2011, there’s been a full U.S. withdrawal from Iraq.
  

Alas, none of those are true— but does anyone care anymore? George Bush and his cronies can go write their memoirs; we and the Iraqi people will be paying for the Iraq War for years to come.

Learn anything? I’d have hoped we had after Vietnam.

Just like I hope we’d have learned about assault weapons and high-capacity magazines after the killing of children and teachers in Newtown.

I hope because it’s too hard to stay angry for too long.

--Mike Sato

Erecting the Paywall to Save the Product

The Seattle Times tried putting itself in the same class as the New York Times when announcing Sunday that, like the New York Times and 400 other daily newspapers, it would begin charging for viewing its online content next month. In putting its content behind a paywall, Fairview Fanny now puts itself in the same class as the McClatchy Papers (Bellingham Herald, The News Tribune of Tacoma and The Olympian), the Skagit Valley Herald, and the weekly Vashon-Maury Island Beachcomber. David Black’s Sound Publishing purchase of The Herald of Everett and the Peninsula Daily News may mean paywalls there may be coming soon, leaving only the daily Kitsap Sun as yet unaccounted for. (Up north, you will find paywalls at the Vancouver Sun, Victoria Times-Colonist and the Globe and Mail.)

Seattle Times executive editor David Boardman described the decision thus: “The reasons for this development are simple: The economics of the news business, and of the newspaper industry in particular, have changed dramatically over the past decade. More people than ever are reading our content in print and digital formats, but our primary source of revenue — advertising — is declining locally and nationally and no longer supports our costs to the degree it once did.”  ("Digital subscriptions needed to support quality journalism")

In December, the Bellingham Herald’s owner and publisher Mark Owings described his change this way: “Now, it's never fun to ask anyone to pay for something that has been free. But providing unlimited access across all platforms for a small amount makes sense. It also gives us the ability to protect our most valuable product -- our content. I know it really doesn't need to be said, but I'll say it anyway -- a business that gives away its most valuable product for free is doomed.” ("Pay-To-Read —What?")

Sadly, the online content of the local McClatchy papers and the Skagit Valley Herald are no different pre-paywall and post-paywall. How valuable was that product being ‘given away’ for free, and now is charged for? As I wrote in the December blog, “Let me rephrase Mark Owings’ dictum this way: “A news medium that doesn’t provide its most valuable product — its content— is doomed.”

Maybe the Seattle Times will become content rich in its online edition like the New York Times and it will be worth paying for access to online content, but I doubt they have the resources to do it, especially if they are relying on pay-to-read subscribers. Linda Thompson at MyNorthwest.com writes that the online-only subscriber rate will be $3.99/week, which comes to about $207/year. ("The state of Seattle journalism, as the Times puts up a paywall ")

Print subscribers will get access to online content included in their print subscription— which makes some marketing sense if the Seattle Times thinks they will build circulation by driving online-only readers to buy a print subscription in order to keep reading content online “for free.” Maybe they’ve done their market research and they’re carrying out a well-thought out strategy— including analysis that says the $3.99/week price-point will move their market.

I doubt they know and there is much desperation as advertising revenue shrinks in the digital age and the recourse is to start charging for content much like public radio with its marathon fund drives. David Boardman may want to say, “More people than ever are reading our content in print and digital formats,” but print circulation is down and print advertising revenue is down. If more people are reading content in digital format, digital advertising revenue has not  supplemented print advertising revenue. The business model of digital format being a digital version of print format hasn’t worked for advertising.

And, according to Derek Thompson in this month’s The Atlantic, the challenges for advertising in digital format will get worse. The market is moving beyond desktops and laptops to mobile devices: “For the next 10 years, as mobile penetration screams past 60 percent, 70 percent, 80 percent, this will be the trillion-dollar question: How do you build a thriving business selling ads on a four-inch screen—and what happens if you can’t?” ("The Incredible Shrinking Ad")

“One of the biggest problems with mobile advertising is that it’s not interactive, it’s just a passive ad,” Thompson quotes Scanbuy CEO Mike Wehrs. “We can make it a full interactive engagement: ‘Thank you for scanning. Do you want to watch a video? Are you interested in sellers nearby? Would you like to order it online?’ ”

Consider that kind of interactivity for mobile content across news, culture and entertainment platforms— and call that the new “newspaper.” That would not only be worth paying for, it would also be where advertisers might be looking to interact.

--Mike Sato

Pay-To-Read —What?

The McClatchy-owned newspapers in Puget Sound (The News Tribune of Tacoma, The Olympian and the Bellingham Herald) are all going to require paid subscriptions beginning this week to read their online content. Just like the big boys Wall Street Journal and The New York Times and just like the small time Skagit Valley Herald and Vashon-Maury Island Beachcomber.

Owner and publisher Mark Owings of the Bellingham Herald describes the change  this way: “Now, it's never fun to ask anyone to pay for something that has been free. But providing unlimited access across all platforms for a small amount makes sense. It also gives us the ability to protect our most valuable product -- our content. I know it really doesn't need to be said, but I'll say it anyway -- a business that gives away its most valuable product for free is doomed.”

The “small amount” for online access begins at an additional 46-cents a week for print subscribers when they renew and an “introductory rate” of 99-cents a month ($69.99 a year) for online-only subscribers.

Let me rephrase Mark Owings’ dictum this way: “A news medium that doesn’t provide its most valuable product — its content— is doomed.”

At the end of October, USA TODAY  reported: “The Wall Street Journal kept its position as the No. 1 newspaper. Its average circulation grew 9.4% to 2.3 million. USA TODAY was second at 1.7 million, followed by The New York Times at 1.6 million. Circulation at the Times grew 40% from a year ago. More than half of the Times' circulation was for digital editions.”

Now, by comparison, the average weekday circulation of the Bellingham Herald is 16,154. The Olympian’s average weekday circulation is 21,876 and the News Tribune of Tacoma’s is 74,826. By comparison, the Seattle Times’ weekday average is 221,665. (Alliance for Audited Media, 6 months ending Sept. 30, 2012)

The joke around our house is that the Monday Bellingham Herald is so light and small that if the wind’s blowing hard, go look for it in the bushes or in the street. But our household subscribes seven days a week— because we like newspapers, even when we have to search down the street to recover them.

The interesting, local news content at the Herald and The Olympian keeps getting less and less as news staffs get smaller and smaller. The bitter irony in news media has been the understanding that advertising dollars pay news salaries. Advertisers advertise because people buy newspapers. People buy newspapers to read the news. Less news to read or more news read, watched or listened to elsewhere— less readers of newspapers. Less advertisers, less revenue, good-bye newspapers.

The revenue generated by subscriptions is real money but not what makes a paper profitable. In the old days when there were service stations or even now with the gas’n’go mini-marts, the real profit doesn’t come from the gas that’s sold but from the tires, batteries and accessories that the service stations of the past sold and the beer, gum and cigarettes today’s mini-marts sell.

What’s sad about Mark Owings’ and McClatchy’s decision to charge for online content is that you will now pay for something you once got for free— without much difference in added value. Somewhat like once being able to use a public toilet for free and now having to pay a quarter to use the same toilet.

It should be instructive for Mark Owings and McClatchy management to take a good look at the reasons for the growth in The New York Times digital circulation. One reason is the aggressive marketing of its enhanced content. The other is the enhanced content itself, the breaking news, the multi-media presentations and background information that subscribers to the print-only newspaper don’t get.

That makes your online content valuable— and worth paying to read.

--Mike Sato