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Newspaper staff cuts: Good news?

At the risk of being burned at the stake by my fellow journalists, I wanted to pass along a thought that occurred to me recently about the wave of layoffs and mass firings that has been rolling through newsrooms across North America — namely, what if this is actually a good thing? Please, hear me out before you arrive at my doorstep with pitchforks and torches.

In order to agree with me, you would have to admit that there are a lot of newspapers (and I know of many personally) that haven’t been moving quite as quickly as they might towards an online future. To a large extent, these papers have been insulated from the need to change by a healthy cash balance, a lock on local advertising markets, a magnanimous owner, a sense of entitlement, etc. (feel free to pick more than one).

What better way to force some change than by administering a large but hopefully non-lethal shock to the system?

With the advertising-revenue wolf clearly at the door, managers at these papers can and have moved swiftly to shed entire categories of sub-editors, to reconfigure the desk system, to merge Web and print duties where they might not have been merged before, and so on — many of these necessary and even crucial changes. Even papers with strong unions have been able to accomplish this, because the economic necessity is so obvious.

Many corporate executives argue at times like these that strong medicine is required, and that they have no choice but to engage in massive layoffs. Such excuses are often seen as disingenuous explanations used to cover up other agendas. But what if in this case those hidden agendas actually achieved a useful purpose — namely, the acceleration of evolution in the stodgy old print media?

The only flaw in this argument — one I am willing to admit up front — is that this presumes that newspaper managers and executives actually know what the proper course of action is, and are only cutting those staff and duties they no longer require, while strengthening those areas of the paper that need more resources. The reality, of course, is that many newspapers are cutting in what are arguably the wrong places, or pushing forward with a completely unrealistic view of what their paper’s strengths and weaknesses are.

I will admit that my theory requires a certain willing suspension of disbelief. And I’d like to note that I feel nothing but sympathy for the tens of thousands of journalists who have been and are continuing to be laid off. But in some cases — not all, I will admit, but some — those layoffs could be a case of radical but necessary surgery to help the patient survive.

                                   
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  • Kent Fischer

    “… moved swiftly to shed entire categories of sub-editors… ”

    I’ve not seen this happen. Not even close.

  • http://billdoskoch.blogware.com Bill Doskoch

    I’ll chalk this one up as a misguided attempt to be controversial.

  • http://www.mathewingram.com/work Mathew Ingram

    Not at all, Bill. I’m completely serious.

  • http://www.geekzone.co.nz/juha Juha

    Well, if it meant that incompetent and unproductive layers of middle management were shed instead of productive journalists, then maybe. If it meant that the debt-fuelled spending and acquisition spree that’s behind most of the newspapers’ problems was reversed, then definitely.

    Unfortunately, all I see is fewer people “producing more content” that’s not good and not of interest to anyone in particular, simply because they’re so under-resourced.

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  • Alain Sherter

    “In order to agree with me, you would have to admit that there are a lot of newspapers (and I know of many personally) that haven’t been moving quite as quickly as they might towards an online future.”

    What online future might that be, pray tell, and what makes you believe it will produce better journalism? I’m sorry, crowdsourcing doesn’t replace good reporting. There’s an argument to make that newspapers, like automakers, are dinosaurs. But let’s not dress up the economic realities by pretending that taking folks out of the newsroom will do anything to improve journalism.

  • http://www.mathewingram.com/work Mathew Ingram

    I agree, Juha — there is a certain, er… leap of faith required to agree with my argument. But I don’t think it’s entirely impossible that some of these cuts could actually be beneficial.

  • http://www.rjicollaboratory.org/profiles/blog/list?user=36e26mai28kw3 Allan Siegert

    Mathew -

    The problem is that advertisers aren’t confident enough to invest in online advertising. That’s the chasm that must be crossed. Cuts perpetuate the existing printed product – maybe for a while. But, even the highest quality newspapers can’t figure out how to convert to going 100% online.

  • http://bydanielvictor.com Daniel Victor

    Putting aside the fact that buyouts at my paper sliced off some of the most web-savvy journalists we had, even the stodgiest, anti-Web reporters are still feeding the print product, which at this point someone’s still gotta feed. When they leave, all the other reporters have to focus more of their own time on making up for those gaps in print. That includes the web-savvy ones who’d rather be spending their time focusing on innovation.

    So I always viewed the print-focused reporters as enabling me to do the Web stuff we need. I understand your premise, and I’d love it if the industry changed enough that it became a reality, but it hasn’t worked that way here.

  • http://www.mathewingram.com/work Mathew Ingram

    I agree, Allan — that is something that has yet to be solved. But I think we are getting closer.

    And Alain, I don’t think I’m saying that crowdsourcing can replace journalism. I’m simply saying that in some newspapers, there may be too many layers of editors and sub-editors focused on the print product, and that cutbacks could (theoretically at least) allow papers to redirect some of those resources.

  • http://www.mathewingram.com/work Mathew Ingram

    Daniel, I think cutting the Web-savvy on your staff is definitely the wrong way to go, and that sort of reinforces my point about how cutbacks might be beneficial if directed in the right way, but are almost certainly the opposite if done the way you describe. Then you actually get the worst of both worlds, I think.

  • Alain Sherter

    Matthew–What’s your basis for claiming that newspapers have too many editors? In my experience, plunging into the online news biz requires more–not fewer–people (albeit with a wider range of skills). For better or for worse print still exists, so many newsrooms face the challenge of producing print- and online-specific content, even as Web publishing destroys the very meaning of deadline (since the goal is push a continuous stream of copy). How exactly does the idea of a smaller newsroom square with these realities?

  • http://www.mathewingram.com/work Mathew Ingram

    I think you put your finger on it, Alain. In my experience, what an online-and-print operation needs are editors with a broader range of skills, or possibly even writers who are also editors. That certainly means smaller ranks of old-fashioned newspaper-only editors with discrete duties, if not fewer editors period.

  • http://postlinearity.com gregorylent

    you look at what is falling apart, so much bad news …

    you look at what is being born, so much good news …

    enjoy the flow

  • Alain Sherter

    Gregorylent–Uh, huh. What’s falling apart is a journalistic establishment where people like John Crewdso, the Pulitzer-winning former investigative reporter for the Chicago Trib, are getting the axe. Taking its place is–drum roll, pls–The Huffington Post. As you say, enjoy.

  • Alain Sherter

    Gregorylent–Uh, huh. What’s falling apart is a journalistic establishment where people like John Crewdson, the Pulitzer-winning former investigative reporter for the Chicago Trib, are getting the axe. Taking its place is–drum roll, pls–The Huffington Post. As you say, enjoy.

  • Michael Skoler

    Bravo, Matthew, for raising the question that maybe part of today’s crisis in journalism has to do with us journalists. At a time of change and disruption, we should be asking tough questions of ourselves – like whether we provide enough value to the audience – rather than simply blaming our woes on external factors. The causes, and solutions, to today’s crisis are complex. Thanks for reminding us that as truth-seekers we need to look both out the window and in the mirror.

  • http://billdoskoch.blogware.com Bill Doskoch

    The “proper course of action” these days is to stay alive as a business.

    There is a short-term problem in that regard, namely the current recessionary climate. Ad revenues have taken a beating, and it’s not just newspapers.

    Longer-term, there will also be changes in technology, economics and audience delivery preference that will make the print edition increasingly less core.

    Problem is, so far as I can see, print still largely pays the bills — Vin Crosbie wrote in a July 22, 2009 posting to online-news: “If you eliminate the printed edition, you cut 35 to 40 percent of expenses but also cut 93 to 95 percent of revenues” — but online is where the growth is.

    However, online has its own problems. Some who subscribed to online-news may remember the thread about online’s poor performance with respects to visitor frequency (probably a function of having an almost infinite variety of choice).

    As a result, managing the transition has been the eexceedingly tricky problem for the executives to solve.

    Their hand has been forced by the industry’s revenue collapse.

    To me, the key question is what mix of print/online will allow a print-based news organization to return to profitability the fastest when the economy recovers — or survive in the meantime?

    Truly brilliant people might be able to map out both a survival strategy for now and a bulletproof plan for success in the future, but methinks that’s a tall order.

  • http://www.mathewingram.com/work Mathew Ingram

    Thanks, Michael. And Bill, you are quite right about the need to survive as a business, and the fact that print still supplies the bulk of a newspaper’s revenue — but those financial pressures are all the more reason to look hard at the money that newspapers are spending on staff, and whether they are being smart about it. I don’t think the recession is the only issue here — there’s a systemic cultural shift going on as well.

  • http://www.timwindsor.com/ Tim Windsor

    Bill,

    Vin’s good, but he’s not a time-traveler. :-)

    And actually, I think the cost-savings of an online-only edition would be closer to 60-65 — and that’s assuming you keep the same-sized newsroom you had before whacking the print edition.

    Current online revs. are running toward 15% of total revenue — a number that would likely grow if some advertisers were “forced” to move to the online-only edition.

    I still think you lose money at first, but it’s not as dire as the Crosbie math above.

  • http://www.timwindsor.com/ Tim Windsor

    Matthew’s thought experiment is a good one, and certainly one that I’ve been thinking about a lot of late.

    Because the cuts ARE happening; the best we can hope is that good comes from them ultimately.

    As Andy Ihnatko noted in a slightly different context recently, The Great London Fire was a giant silver lining, allowing street grids to be redrawn in the wake of the devastation. The wider, more orderly streets and the upgrade in infrastructure played a big part in the emergence of London as a world capital of commerce.

    I think what Matthew is asking is whether the current firestorm similarly gives us the opportunity to rebuild with an eye toward the future.

    Stepping outside of the ideal, though, I’d have to say that the current panic is, in fact, slashing the younger, more digital-adept people in favor of a more traditional core, many of whom resent the pressure to “do more with less.” Obviously, that’s not the case everywhere, but it’s happening in enough markets to be of real concern.

  • http://www.geekzone.co.nz/juha Juha

    Another important is that while online certainly brings in the readers, this isn’t matched by increased revenues; they actually go down, if this story is to be believed:

    http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=99455

  • http://sellingprint.blogspot.com MichaelJ

    I think the issue is not how many editors or how many journalists, but what they do. I’m a Print evangelist so to me the idea that the web will replace Print as a revenue stream makes little sense.

    The real estate on the web is unlimited. CPMS are going to keep going down and down. The real estate in Print is limited. But it has to be invested wisely, not try to do general news or compete with “breaking news”. That’s for the web.

    I think it’s about great beat reporting. Choose your best reporter. Support her with a great inside person to cruise the internets. Get a great writer on the team to take the dots revealed and connect them in a great story. 3 people per beat. The writer on the team has to be responsible for copy editing. Everyone on the team is responsible for fact checking.

    Then publish those stories in niche Print publications with advertisers who are interested in being in front of the fans who follow that beat.

    I’m from NYC so ..for example medical care in the Bronx, in Brooklyn, in Manhattan. Then filled with ads for health care organizations in the Bronx, Brooklyn and Manhattan.
    Or education or small business.

    Zoned editions with focused stories with advertisers who are local.

    For me it passes the “why wouldn’t that work test.” But as I said, I’m a printer, not a journalist so I must be missing something.

    Thoughts?

  • http://www.mathewingram.com/work Mathew Ingram

    I agree, Tim — I think savings in a non-print world would likely be in the 60-per-cent range, and online revenue for most papers will probably continue climbing from the 15-per-cent level. Managing the gap between those two things is the difficult part.

  • Alain Sherter

    “The ‘proper course of action’ these days is to stay alive as a business.” –Bill Doskoch

    Hear, hear.

    Personally, I think we’re at a stage where the old media is on the decline, or at least struggling to change, and the new media (whatever that means) has yet to fill the void.

    In time, that may well change. For now, while I concede that dumping journalists might–temporarily–make a newspaper more financially viable, I fail to see how that improves the quality of its journalism. Can technology–a networked newsroom, or link reporting, say–compensate for reduced staff? Perhaps. But in the short-term eliminating journos hurts journalism. For instance, because of staff cuts only four U.S. newspapers still maintain a foreign desk. That may be good for the biz model, but it’s bad for the biz.

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  • http://www.mathewingram.com/work Mathew Ingram

    Tim, I know that at some newspapers, the decisions about whom to layoff often get made based on seniority and union rules as opposed to which positions are really necessary, and unfortunately that sometimes means that younger staff — many of them on the Web side — are let go rather than older paper employees with more seniority.

    That is definitely complicating things (and I really like Andy’s metaphor about the London fire).

    And Michael, I think what you’re proposing is an excellent model, and one that is definitely worth thinking about.

  • http://billdoskoch.blogware.com Bill Doskoch

    Tim, I wrote July 22,2009 intentionally — to show the importance of copy editors! Thanks for the catch! :)

    I’m aware that arguments can be made about the cost savings to be made about shifting totally away from print.

    But I would also argue that you’re making a huge strategic bet if you’re making the decision that now’s the time to make that shift.

    For all I know, it might well be. I’m just a humble online journalist, not an expert on news economics.

    Anyways, Tim, what about the frequency problem I mentioned? I’m presuming it’s solved, given that it’s sunk back below the waves as a topic.

    As far as this canard goes about young, digitally-adept people being thrown overboard to keep the fossils, I shake my head.

    Unions seem to be blamed, but I’ve worked for non-unionized newspapers that made absolutely stupid staffing decisions in similar circumstances.

    Age and a willingness to embrace the new aren’t exclusive. I’m in my late 40s and I was the first in my newsroom to either have a blog or be on Twitter — to name two.

    Alan, throwing journalists overboard hurts a news organization’s ability to offer quality coverage, but if your revenues are collapsing or the parent company is drowning in debt because of bad business decisions, you don’t have many options.

    You can only provide the journalism that you can afford.

    My hope is that as we evolve into new business and journalistic models, we don’t lose that which was admirable and valuable about the old ones.

  • http://www.ojr.org/ojr/people/davidwestphal/ David Westphal

    Sure, it’s possible that a near-depression will prove to be good for journalism. It’s also possible that invading Iraq was a good thing for world peace. Possible. And impossible to know, right?

    My guess is the opposite — that the recession is coming at a time when there was going to be a severe shift anyway, and that the new information economy just isn’t ready for prime time yet. As Vin Crosbie says, we may be in for a Grey Age of Information of some period of time. (Vin says it’ll be brief.)

    Will this hasten the transition and so be a good thing? Possibly. Will it lamentably decimate the kind of journalism that helps make the USA work? Possibly.

  • http://sellingprint.blogspot.com MichaelJ

    Bill,
    I have to disagree with the conventional wisdom about ” the cost savings to be made about shifting totally away from print.”

    It’s exactly the low cost of entry on to the web that makes it much less valuable. The cost of entry into Print and distribution is much higher.

    From the point of view of aggregating eyeballs the web wins. If newspapers see themselves in the eyeball business it is rational. The problem is that the cost of eyeballs is rapidly going down to very close to zero.

    Until there was serious competition in the eyeball business, advertising earned easy profits. The problem is advertising, not journalism.

    The new opportunity is not saving journalism, but inventing journalism for a plethora of tribes of real people. It will grow by, among many other things, serving the niche, but rapidly growing tribe of people who read, instead of people who scan, search or view.

  • http://www.timwindsor.com/ Tim Windsor

    Bill D.

    Guilty: I used the lazy shorthand of age to stand for something much more complex. And, as a 49-year-old, I should know better. :-)

    Also, you’re right that the details of a real business plan are far from clear. I was simply reacting to what I thought were some less-that-realistic percentages on cost and revenue. But, yes, even if we were to stop the presses, save 60% of costs and keep 15% of revenue, the business would be a long, long way from the day when we all whistle jaunty tunes in unison.

    But the wrenching pain? It does compress a lot of moves that would have happened anyway into an intense, but shorter period. Shopworn but accurate metaphor: BandAid yank.

  • http://billdoskoch.blogware.com Bill Doskoch

    Michael J, would you suggest ‘Talking Points Memo’ as a model for the future? Josuah Micah Marshall has talked of a journalism of iteration and intimacy.

    Tim, ‘BandAid’ yank? I’ll be feeling the burn all day thanks to you. :)

  • http://sellingprint.blogspot.com MichaelJ

    I only have a conversational knowledge of journalism. My passion is Print. But…as I understand it, Politico makes most of their money for a Print edition sold to a very small tribe of fans. I don’t know if they have an advertising at all.

    But could well imagine who would want to reach Politco fans.

    There is tech coming together..a couple of months away that would allow any blogger to produce about 500 copies of a 16 page full color glossy magazine at a reasonable price.

    My theory is that TPM could do very well with that, then if it grows, they could go mainstream with the magazine. Sell print ads or maybe get google to deliver adsense. And keep getting some clicks through web on the side.

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  • Alain Sherter

    Bill–Agreed, many financially newspapers these days have little option but to dump staff. Although in the case of publicly held papers, it’s important to remember that costs are “contained” to sustain profit margins set by shareholders, as opposed to stakeholders. Obviously, lots of people, including me, have tdoubts about whether that approach is compatible with maintaining a vibrant press.

    My comments are intended mostly as a corrective to the notion–bandied about rather gleefully by evangelists of online journalism, for some reason–that technology not only makes print obsolete, but also spells the end of all those “stodgy” old medianiks who stubbornly impede progress. This sentiment seems to betray little interest in the basic function of newspapers, which is to keep people informed and, lest we forget, help regulate democracy (I know, I know–that sounds hopelessly stodgy).

    A lot of the current media analysis centers on how to keep newspapers afloat, and for good reason. But I think an intrinsic part of that discussion must be how to preserve papers’ traditional function. It’s insufficent, in other words, merely to ask whether papers can remain financially viable by jettisoning their printing presses, and journos (and this is not directed chiefly at Matthew’s interesting and provocative post). The question is what economic models enable newspapers to survive AND provide quality journalism.

  • http://sellingprint.blogspot.com MichaelJ

    Alain,

    I must respectfully disagree with “the basic function of newspapers, which is to keep people informed and, lest we forget, help regulate democracy.” I most definitely do not think it’s stodgy, but the necessary distinction is between the function and the realization of that function.

    I think the fact is that newspapers have informed only the very top of the information pyramid in whichever region they evolved.

    The NYT talks to the top of the pyramid in civil society. The Washington Post talks to the top of the pyramid in government.

    Bloomberg, the FT and the WSJ talks to the top of the pyramid in finance.

    I would assume, but don’t know for a fact, that every significant paper in almost any region is focused on the decision makers in that region.

    I think the new situation is that for the first time the press is being called upon to fulfill it’s function for the middle and the bottom of the pyramid.

    The reality is that they have never been organized, at least in the United States, to do that job.

    Making money is a related but different question.

  • http://www.nospinpr.com Ruth Seeley

    Here’s another take: what newspapers have done in the last decade hasn’t worked. Consolidating ownership of newspapers so you see the same article in The National Post, The Vancouver Sun, and The Province (but with different headlines slanted at each paper’s particular demographics), only makes me angry at all three papers. Consolidating the products – and being open and honest about the fact that that’s what’s actually happening, may well be a part of the solution.

    As for union seniority leading to retaining the wrong folks – that’s where buyouts come in.

    I think what CBC has done is amazing – creating not a print outlet, but an online outlet that adds to the content it’s already generating. And yes, I know CBC is an anomaly – but it’s still a news-generating organization that has to stay within a budget, with a lot more handicaps on its revenue-generating base than most for-profit news organizations.

    Kirk LaPointe made a good point a few weeks ago in one of his blog posts about newspaper branding issues – and that the humble newspaper box is a far more powerful branding tool than any other. And yet it’s become an almost meaningless branding, since the papers in the boxes are no longer distinct entities.

    When The National Post first launched, there was much talk about whether Toronto could ‘support’ four newspapers. It looked like the answer was going to be no until it bought a readership base by acquiring the by-then daily Financial Post. I wonder how many former FP subscribers are pleased with what they’ve ended up with – I can’t imagine many.

    Book publishers have always used a self-subsidy model: they’ve been able to publish good books that weren’t likely to sell much by publishing the surefire bets as well, with the bestsellers subsidizing the quality offerings. Perhaps that model could be adapted to newspaper publishing. After the great fire of the new London has taken place, of course.

  • Jeff Pappone

    Here’s a crazy thought: Invest in your newsroom while all others are cutting. If newspapers are actually businesses that need to make money, any smart businessman will tell you that the smartest investing happens in times when it’s cheapest and gives you the most bang of the buck. Like now.

    Build your newsroom, grow your brand, increase your credibility, keep your subscribers, and widen the gap to competitors. By the time the recession ends, you’ll be way ahead of the pack.

    And, when people look to spend their extra cash on a subscription or a single copy of a paper, they will buy yours. More importantly, when advertisers get back on their feet and need to buy space, they’ll be fighting to get into your pages.

    Call me crazy, but if newspapers want to be businesses, they need to start acting like them and do what a smart business does in a buyer’s market…

  • http://www.mathewingram.com/work Mathew Ingram

    That’s a great idea, Jeff. You are entirely right, I think — businesses of any kind that spend the money to invest while others are cutting inevitably come out of a downturn in better shape than those that cut to meet some pre-defined profit goal. I hope some newspapers take your advice.

  • Alain Sherter

    MichaelJ–I suspect we’re speaking at cross-purposes here, but newspapers are intimately–and historically–bound with a well-functioning civil society. As Jefferson said, “Were it left to me to decide whether we should have a government without newspapers, or newspapers without a government, I should not hesitate a moment to prefer the latter.”

    Of course, Jefferson also said that the most truthful part of newspapers are the ads, so go figure. (:

    My fairly banal point, which perhaps I expressed badly, is that the ongoing debate over the future of the news biz is a civil, not merely economic, issue. When I speak of the imperative to maintain an active and vigorous press, I’m not just talking about the major league pubs you cite. Equally important, to belabor the obvious, is to keep community and other smaller papers alive and kicking.

    And on that score the numbers are mildly concerning. There are were roughly 20% fewer papers in 2003 than in 1950 (http://www.naa.org/info/facts04/dailynewspapers.html). Not enough to sink the Republic, of course, and obviously new media have emerged. Bears watching, though.

  • http://sellingprint.blogspot.com MichaelJ

    Alain,
    I know we agree about the two aspects. One civil and one business.

    But consider.

    Re: declining number of newspapers:
    The number of dailies between 1880 and 1900 went from 850 to 1,967. By 1910, the bureau of the census reported 2,600 daily publications. and general circulation weekly newspapers were appx 14,000. Between 1910 and 1930 the population of the US increased 30 million, daily circulation went from 24 million to 40 million. but, there was a net loss of 258 daily newspapers in the 20 years…(this comes from Press and America by Edwin Emery.)

    My little point only is that the number of papers is related to more to business issues than civil issues.

    The other more interesting to me point is that readers are a niche market. I mean to say readers distinct from those with the ability to decode letters to derive meaning.

    I’m trying to distinguish people who engage with reading as a primary way to get information about themselves and the world. The good news is that this market is growing. Journalist discussion often assumes this is a mass market. It complicates talking to the business side.

    To Ruth’s points above: Exactly. An unintended consequence of measuring the value of a newspaper by it’s stock price coupled with “if it works here, scale it everywhere” worked okish, as long as there was no competition.

    Newspapers and journalism has not served the Republic well in the last 50 years at least. I think what I’m seeing is that the next 50 years look a lot brighter. The cost of entry is steadily being driven down by the Internet so many new players are entering the game.

    The remaining trick is how to free the stores of talent in legacy organizations to realize and monetize their true value.

    The other trick is how to reorganize newspapers to be sustainable businesses.

    I think your point about the civil/business distinction is very useful in getting some clarity on this.

  • http://sellingprint.blogspot.com MichaelJ

    Alain,
    Sorry I couldn’t resist re Jefferson..
    “Of course, Jefferson also said that the most truthful part of newspapers are the ads, so go figure. (:”

    So maybe he’s right! People with stuff to sell need to get their information across. Especially local business. They don’t have the resources to brand or spin.

    Think original Sear Roebucks catalogs.

    So maybe that means there should be an editor of advertising. People love advertising. The shoppers continue to do very well.

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