Hey publishers! Did you see those Bear Stearns guys?
Newspaper executives claim that no one saw the current crisis in the industry coming, so taking on enormous amounts of debt to erect buildings, buy presses an gobble up other papers was prudent business back when publishers were doing such things. Back in the good old days. A year or two ago.
Now that this unforeseen crisis has hit, the only solution is to shed journalists as fast as possible. And, of course, to boost CEO pay to retain top talent. The thing is, the CEOs are the problem, and the journalists are the only viable solution.
Let’s be blunt. I told you so, at least those of you who had the misfortune to work with me or attend a seminar with me. For more than 15 years, I’ve been telling anyone who would that this crisis was inevitable. So have many others. Our biggest mistake was thinking the crisis would hit sooner than it did.
The poor, pitiful, blindsided publishers are lying to their staffs, their investors and their creditors. The rise of the internet with its inherent disintermediation has been coming for years. Google, eBay, craigslist and others didn’t just spring up last night.
The writing was on the wall about display advertisers as well. The folks making the buying decisions were geezers who missed the revolution right along with publishers. Those geezers are quickly being replaced by people who have grown up digitally and never had the newspaper habit.
Penetration has been plummeting for years. No, decades. Major advertisers have been consolidating for decades. Research firms have been pimping their seemingly too-good-to-be-true “readership” numbers to placate advertisers for decades, and publishers have been complicit (should we talk about TMC numbers?). The environmental movement has been gaining steam for decades right along with the price of natural resources.
For the past decade, publishers have been fooling investors about the profitability of the print side of the business, stubbornly refusing to acknowledge that the web, not print, was all that was keeping classifieds alive.
Today we’re watching Bear Stearns executives being led away in handcuffs for misleading investors. There just might be some newspaper CEOs and CFOs who are squirming a bit watching this spectacle. At the very least, boards should be firing these guys right and left, not increasing their compensation.
But who suffers? Mostly the journalists who get laid off. But also the readers, who have fewer and fewer reasons to pick up the paper every day.
I don’t think the death of newspapers is inevitable.
Unless, of course, the current generation of executives stays in place.
Tags: Classifieds
