This is true for the current transition, I think, but historically it was only a quite short period that newspapers had any sort of monopoly-esque hold over particular geographical areas. The traditional business model didn't depend on that; rather, there were many newspapers competing, even in smaller towns.
The competing-heterogenous-information-sources model discussed here is actually closer to how the newspaper industry worked. Some of the competing newspapers were large companies, others were smaller or even a single editor/publisher; some were thick while others were barely a few pages; some were dailies while others came out less often; some were morning papers, while others came out in the afternoons or evenings; some relied primarily on subscriptions while others focused on retail or street sales; some were business-targeted while others were targeted at home readers, and still others were targeted at explicit political/interest groups; etc.
None of my friends under forty subscribe to a newspaper. But they want to know what is happening in their communities, they hunger for it.
Newspapers need to lose the national news, I don't need to read a story 24 hours after it has been disected on the web and cable channels.
I'd also say forget looking for a solution on the web. The answer is mobile with a twitter style continously updating feed of local news and sports.
People don't have or won't take a half hour to read a newspaper but they've got five minutes here and there throughout the day to see what is happening in their local area.
Want total anonymity? Then you can subscribe. Willing to fill out a profile so we can target ads, then your feed is free.
What advertiser wouldn't want to reach twenty something college educated women in Podunk? Fewer, more targeted ads inserted in stream that get better results.
As someone who produced a local tv newscast for five years, I largely agree, though not completely. You do need enough larger scope news for people to feel informed and educated, but it's clearly a secondary concern, you're right.
If I had my way, we would have had subdomains on our site for both geographical and categorical reading. Local tv news will always have SOME appeal, but not because we're doing our job better than national networks, but because we're local. It's amazing how many don't get that. Yes, Fox and CNN are our competitors, but if local news wants a chance, we have to fight them on our strengths. And it's the exact same with our websites and the websites of any other news outlets.
I find it really troubling that in a time when people want to be connected and informed like never before (and have the technology to be so) so many in smaller news organizations try to be every thing to all people, and end up failing spectacularly trying to out perform larger operations at games the larger operations are finely tuned for. Smaller outfits, especially those limited in geographic area, should play to their strong suits. In this case, they should do as much as possible about having LOCAL news.
Watch your local evening news, and if your station does the 5-6:30 model, it's almost certain that the 5:30-6 section will focus on national news, occasionally different anchors, and will have the lowest ratings. The three 30 minute sections' ratings usually follow this model: ¬_/
And news stations will tell themselves "Oh, we put national news in the middle because it has low ratings." I get that if you're forced to play the short view and juts have to fill time. But I do honestly think that if you put more effort into that, over time, you could cultivate a worthwhile news show there. Possibly even just make the 5-6 one hour, and use the expanded time to help flesh out the rest of your stories and make them all run an extra minute longer.
It's just as someone who's worked nearly all of my post-high school life (being 31) in local news, it's always frustrated me how only a few hours a day of local content are produced locally in most places. I think it's a vast misuse (unuse?) of available resources.
A friend of mine works for a small-town paper [0]. Between his articles in the paper and on the web, his facebook page, and his twitter feed, anyone interested in local sports is going to be pretty much up-to-the-minute. As far as I know, there are no alternative sources. Conversely, if you want to reach an audience in his small town, your options are either his paper or a big sign.
I'd say the solution is going to be a hybrid approach like they've taken. An aggregated "top stories" print solution, a web presence, and mobile presence all highly targeted at the local area.
What newspapers have is the trust of a powerful local brand--even Google gives local newspapers some of the highest PRs in these markets.
Smaller the market; better the brand. No one else has this and that's what Buffet is buying.
If I'm a local SMB in a small town, chances are that I'm not going to trust some big company with my SEM, SEO, retargeting, and Facebook ads. If local papers can offer these services, they can win local in aggregate better than any other company.
I was working in SEM, SEO, etc for small businesses when the transition away from yellow pages was happening.
About 50% of our customers had at some point been with Sensis (The yellow pages guys) or some other old media companies' attempt to start an online advertising consulting branch. Clicks were cheap back then but they were usually getting about $10 per visit in when the adwords rate was about $0.50. They were on yearly packages attached to their print stuff but basically so price wasn't really transparent but it was in the vicinity.
The reality is that these trusted local brands are good at running a local newspaper. They are as good at running adwords campaign as they are at making the next Facebook.
BTW, I would like to see where/if I'm wrong. Does anyone know of examples of local old media with an awesome online presence for local stuff? I'm sure there are some.
What gets me is the number of times I look at the local newspaper and the article about a local issue is written by a reporter from somewhere else. The only reason to go to a news website is that you feel they are an authority on a subject. The local paper needs to realize that their website and the local TV station's website and the local news radio's websites are all the same medium. They need to excel at putting down stories that go in-depth locally. I will read national networks for national news.
You would think with how word heavy the internet has been, newspaper writers would have thrived.
Classic case of an industry that has controlled the broadcast of content for over a century and now they've lost control and can't seem to adapt. Music and TV industries are in this boat too. We all know the music side isn't going to end well for them and it looks like the TV thing won't either, although they have been able to fend off change better than other industries.
..Over the last few years I've regularly been cornered by nervous publishers or broadcasters or journalists or film makers and asked about how I think computers will affect their various industries. For a long time most of them were desperately hoping for an answer that translated roughly into 'not very much'. ('People like the smell of books, they like popcorn, they like to see programmes at exactly the same moment as their neighbours, they like at least to have lots of articles that they've no interest in reading', etc.) But it's a hard question to answer because it's based on a faulty model. It's like trying to explain to the Amazon River, the Mississippi, the Congo and the Nile how the coming of the Atlantic Ocean will affect them. The first thing to understand is that river rules will no longer apply..
..Television companies are not in the business of delivering television programs to their audience, they're in the business of delivering audiences to their advertisers. (This is why the BBC has such a schizophrenic time - it's actually in a different business from all its competitors). And magazines are very similar: each actual sale across the newsagent's counter is partly an attempt to defray the ludicrous cost of manufacturing the damn thing but is also, more significantly, a very solid datum point. The full data set represents the size of the audience the publisher can deliver to its advertisers...
..Now I regard magazine advertising as a big problem. I really hate it. It overwhelms the copy text, which is usually reduced to a dull, grey little stream trickling its way through enormous glaring billboard-like pages all of which are clamoring to draw your attention to stuff you don't want; and the first thing you have to do when you buy a new magazine is shake it over a bin in order to shed all the coupons, sachets, packets, CDs and free labrador puppies which make them as fat an unwieldy as a grandmother's scrapbook. And then, when you are interested in buying something, you can't find any information about it because it was in last month's issue which you've now thrown away. I bought a new camera last month, and bought loads of camera magazines just to find ads and reviews for the models I was interested in. So I resent about 99% of the advertising I see, but occasionally I want it enough to actually buy the stuff. There's a major mismatch - something is ripe to fall out of the model...
Then he starts to go downhill in the same way that most people do/did when they were framing the question wrong. DNA was the best at seeing if the question was framed wrong, but even he apparently fell for it sometimes. Basically he predicts unobtrusive, helpful ads on digital magazines & micro-payments for content.
It's all very well to say that papers should have seen this all coming a long time ago and we can have a great time talking about it. I think the reality is that see it, don't see it.. it wouldn't have mattered in most cases. They aren't Microsoft missing out on tablets carriage makers that should have started making auto parts. They were horse breeders. The fanciest breeders probably though they were safe at first. No Lady is going to travel to London in one of those crazy horseless carriages. Local donkey breeders too. Horseless carriages are hardly going to plow a field?
Content for readers was never the business they were in true. But it was always their core competency. They were never experts in advertising that could have figured out how to keep delivering to their real customers regardless of the medium. Pre web print was a major channel through which one can do quality advertising. Now it is a small channel that one can do poor advertising, one step above mailbox spam. If you are looking for a camera you're not going to look in a magazine.
I've heard that the terms of this deal make the investment more like a loan. Maybe it is. But if Buffet is buying these newspapers thinking they have a long profitable future ahead, I think he's wrong. They're rivers in the ocean, camel trains in the age of railroads, pick your metaphor.
There aren't many "hard truths" in this world. I would say after reading this article that newspapers have hit a bottom. Look at Warren Buffet's recent investments. The future of paying for editorial, premium content is for groundbreaking work (like NYT, WaPo, The Atlantic) and local. "Monopoly" is a relative term, and what is and isn't a newspaper is changing, the real value is the content.
I can't necessarily disagree with Buffett's thought process here. Roger McNamee may be right in that we are seeing a return of premium content due to the monetization problems with mobile advertising and the consumer's dislike of them. Of course, I do have my concerns with some like Mary Meeker whom believe otherwise.
There are holes that aggregation sites like the Huffington Post simply cannot fill and I do believe that consumers are looking for something more. It may be because the they are becoming accustomed to paying for applications on mobile devices.
The competing-heterogenous-information-sources model discussed here is actually closer to how the newspaper industry worked. Some of the competing newspapers were large companies, others were smaller or even a single editor/publisher; some were thick while others were barely a few pages; some were dailies while others came out less often; some were morning papers, while others came out in the afternoons or evenings; some relied primarily on subscriptions while others focused on retail or street sales; some were business-targeted while others were targeted at home readers, and still others were targeted at explicit political/interest groups; etc.