We don’t get a lot of e-mail from Pulitzer Prize winners, so we were pleased and intrigued when David Cay Johnston sent a lengthy response to our recent comments on the shortcomings of American journalism schools. Johnston is a reporter’s reporter in the classic mold of “comforting the afflicted and afflicting the comfortable.”

In his career, Johnston has certainly done plenty of afflicting. Starting with a staff writer job at the San Jose Mercury in 1968, he progressed through reporting positions at the Detroit Free Press, Los Angeles Times, and Philadelphia Inquirer before landing at The New York Times, where he reported on economics and tax issues until his retirement in 2008. He was awarded the 2001 Pulitzer Prize for Beat Reporting “for his penetrating and enterprising reporting that exposed loopholes and inequities in the US tax code, which was instrumental in bringing about reforms,” according to his Wikipedia bio.  He was also a finalist for the prize in 2000 and 2003. Today, he writes, teachers and consults.

You can read much more about his accomplishments in the biography accompanying his book, Free Lunch: How the Wealthiest Americans Enrich Themselves at Government Expense (and StickYou with the Bill). It’s one of three bestsellers he has authored, a list that also includes Perfectly Legal: The Covert Campaign to Rig Our Tax System to Benefit the Super-Rich–and Cheat Everybody Else and Temples of Chance: How America Inc. Bought Out Murder Inc. to Win Control of the Casino Business.

Although Johnston considers himself to be an optimist, he’s anything but cheerful about the state of American journalism and its culture of celebrity-mongering, lightweight lifestyle pieces and regurgitation of factoids spoon-fed to junior reporters by executives and government officials.

“Young journalists need to learn techniques for getting people to open up and especially to check, cross-check and re-cross-check facts; they need to learn how to mine documents which J schools do a lousy job of teaching; they need to become adept at numbers, which goes virtually untaught; they need to learn the underlying principles of whatever issue they cover,” he commented in his e-mail to us. “Use your independent judgment and you stop letting sources tell you what is news.”

This 24-minute audio interview covers the decline of investigative reporting, hopeful signs from early philanthropy-backed experiments and the passive culture of many American newsrooms that has contributed to a dumbing-down of content. “I’ve discouraged a lot of young people from going into journalism,” he told us. But he also noted that if you can make a living in the field, “It’s fun, there’s a lot of freedom and a cachet to it.”

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Three new studies document the changing way in which journalists practice their craft, for better and for worse:

• New research by the Society for New Communications Research and Middleberg Communications finds that seven in 10 of journalists are using social networking sites for research and reporting, a 28% increase over the previous year. Twitter use was up 25% and two in three journalists read blogs. Maybe more importantly, 80% of the journalists surveyed “believe that bloggers have become important opinion-shapers in recent years” and more than 90% “agree that new media and communications tools and technologies are enhancing journalism to some extent.” Researchers surveyed 341 journalists but didn’t say if the sample base was US-only or international.
• Another new study, this one by media monitoring company Cision and Don Bates of The George Washington University, finds that nearly nine in 10 journalists use blogs for story research, 65% turn to social media sites and 52% tap into Twitter. Remarkably, the survey also found that 61% use Wikipedia despite popular doubts about the crowdsourced encyclopedia’s reliability. There’s a caveat, though. While reporters turn to social media for sourcing, they don’t necessarily trust the information they find there. Researchers noted that 84% of respondents said social media sources are “slightly less” or “much less” reliable than traditional media, with half said social media suffers from “lack of fact checking, verification and reporting standards.”
• Finally, a Columbia Journalism Review survey of 665 consumer magazines finds that online content isn’t fact-checked or copy-edited as rigorously as printed content. Nearly half the respondents to the survey said their copy-editing standards are lower for online content compared to print and 11% don’t copy-edit online material at all. More than one-quarter of the respondents also said they’re less careful about fact-checking the information they publish online. CJR researchers attribute this to the primacy of speed in the digital publishing world, which causes publishers to cut corners on little things like getting stuff right. On a side note: only one-third of the online magazines are profitable and of those that are making money, nearly two-thirds give away all their content. Here’s a link to the full report on the CJR site.

Miscellany

The University of Pennsylvania’s Wharton School turns one of its professors loose on The New York Times’ paywall plans. Marketing Professor Peter S. Fader says the Times shouldn’t have abandoned Times Select three years ago; it was a decent service that could have given management valuable experience in how to generate reader revenue streams. Now it’s starting from square one in a very visible and risky position. Fader thinks the Times is doing the right thing in making most of its content free to the casual reader, but announcing the pay wall a year in advance with so few specifics is a “terrible mistake.” The Times is “being completely vague about the pricing, about the specific timing, about the name of it, about what kind of content is or isn’t covered,” Fader says. It’s also focusing on the negatives – what you can’t read – as opposed to the benefits of a subscription system. However, he doesn’t offer up any benefits that the Times can talk about, other than the brand’s continued viability. It sounds like the short-term perspective is dominating the Times’ thinking, Fader says. “They need to be thinking, ‘How can we delight our customers three, five, ten years from now?’ as opposed to, ‘How can we squeeze revenues out of them to stay afloat over the next month?’”

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A new study funded by the Newspaper Association of America finds that newspaper sites are considered the most reliable sources local information, including classified advertising. Local newspaper Web sites were identified as “the top online source for local information” by 57% of the 3,050 respondents to the survey, which was conducted by ComScore. Four in 10 respondents also agree that the source of an online advertisement is an important factor in its trustworthiness and in that category, newspapers (36%) bested local television (23%) and online local portals (12%) by a significant margin. Newspapers also beat all other local channels in credibility and value information, although the principal challenger – television news – isn’t much competition.

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Rutgers professor Benjamin Davis wants to reinvent the inverted pyramid with a digital touch. In a piece in Online Journalism Review, the educator recounts some interesting historical facts about the news reporting style that places the most important information at the top and proceeded backward from there, including the fact that telegraph messages during the Civil War cost as much as a penny apiece. His “Digital Media Pyramid” still leads with the most critical information but then proceeds through layers of aggregated and multimedia content. It even accounts for advertising awareness, which Davis explains as teaching “the writer to be aware of any ads automatically placed near or inside a written story, so the writer can inspect a story’s presentation and seek to maintain objectivity.” We’re not sure what that last part means but trust that doesn’t involve pulling punches to avoid embarrassing and advertiser.

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Robin Good interviews three futurists about the evolution of journalists into what he calls “newsmasters.”  All three commentators agree that the problem that media was created to solve — lack of information — has been displaced by the opposite problem; we’re now swimming in information. This means that the role of media must change to provide aggregation and filtering rather than pushing out more original information. The best example of this evolution comes from educational technologies researcher George Siemens, who notes that when Microsoft was originally planning to bring its Encarta encyclopedia to market, it envisioned prices of over $1,000. When the company finally shuttered Encarta last year, it was charging just $19.95.

During fourth-quarter earnings calls, several newspaper executives tried to put a positive spin on their financial situation, noting that the rate of decline in advertising revenues has slowed. That’s true, says Martin Langeveld, but it’s still a dismal situation overall. Langeveld totes up the numbers from the five publishers who have reported earnings so far and forecasts that the US industry as a whole will show a decline of 16% for the quarter. That’s better than the average 28% decline of the first three quarters of last year, but the overall trend is still in the wrong direction. It’s even uglier when you look at the last five years in aggregate: Total revenues for 2009 will come to about $28.4 billion, compared to $49.4 billion in the boom year of 2005. That’s a decline of 43%.

Langeveld analyzes the earnings announcement so far and finds scant reason for optimism. Publishers are talking of “stability” rather than growth, which means that their dramatic cost cuts of the last year are finally generating some profits. The good news is that this will enable them to finally pay down some of their huge debt burdens, but any growth into new areas still seems a long way off given that most publishers still derive less than 15% of their revenue from online advertising. The sole bright spot was Media General, which reported that total revenues in December “were essentially even with December 2008.” Langeveld takes that to mean that they were only down in the single digits. Still, any stability is a good thing. There’s much more on the Nieman site.

In other good business news, McClatchy’s debt ratings were upgraded by two major credit ratings agencies. While the upgrades were small, they moved McClatchy out of the “highly speculative” category. The company just concluded a sale of $875 million of senior secured notes that pays off impending loans and stretches maturities out to 2017, giving it some breathing room.

Things are getting worse at the Boston Globe, though. The newspaper, which failed to sell for a reported asking price of $25 million last year, suffered a 20.3% drop in advertising revenues in the fourth quarter. Full-year revenue was down nearly 16%. The only glimmer of good news was an increase in circulation revenue, but the Globe, which has been frantically slashing costs since its near-death experience a year ago, continues to sink while it’s much smaller crosstown rival, the Herald, is reportedly earning a small profit.

Optimize Socially

“The old gatekeepers are disappearing. We’ve become our own and one another’s editors.” That’s one of the gems from Ken Doctor’s post this week on Nieman Journalism Lab in which he weighs in on Google Buzz and the rapid socialization of the Web. Noting that the bit.ly URL shortening service, which is one of about a dozen on the Internet, is now processing about 2 billion link referrals a month, Doctor suggests that news organizations must tap into the link-sharing patterns of social networks to identify new readers. “Are Facebook users of a certain kind more likely to convert to become regular users of NYTimes.com (or Dallasnews.com or VoiceofSanDiego.org) than Twitter users?” he asks, citing one example.

It’s an excellent point. Social network practitioners who frequently refer their friends and followers to content from the same source should, in theory, be more likely to become paying subscribers to that source. The tricky part is how to find these people. Amid the deafening social cacophony of the Internet, pinpointing fans can make the task of searching for a needle in a haystack look trivial.

Doctor cites an emerging discipline called “social media optimization,” that is about making content more appealing to people who like to share. This goes beyond packaging or optimizing headlines for search; it’s also about making stuff easily shareable and getting the content producers embedded into the networks that grow around their products.

The Death Watch on Facebook

Our day job is helping businesses understand and adapt to the social Web, so it seems only natural that the Death Watch should go up on Facebook. Well, here we are. We’ll use this platform to point to the many stories we read but don’t get  a chance to summarize in our occasional blog entries. We’ll also post some discussion topics and would like to hear your comments on the choices we make. Fan us! It’s hot in here.

Miscellany

Gerald Posner resigned from the Daily Beast this week amid a swirl of charges of serial plagiarism. In a post on his blog, Posner admitted that he had copied material from the Miami Herald, among other sources, but insisted that the plagiarism was inadvertent. Posner’s shame highlights a risk of the copy-and-paste nature of Web publishing, in which original information quickly becomes intermingled with notes lifted from other sources. While that’s not an excuse, it’s an explanation of how the need for speed, combined with the portability of printed words, can be a recipe for disaster. When in doubt, select the text and copy it into Google. You’ll quickly see if you’ve violated someone else’s property.

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The Berkeley Daily Planet, which isn’t daily, will cease print publication and go online only, although the owners held out the possibility of a return to the newsstands. Distribution was only one of several problems the paper faced. The city of San Francisco’s recent ban on freestanding newspaper stands hurt distribution, and the Daily Planet’s often critical reporting on local businesses didn’t help with advertising sales. The newspaper also suffered from a campaign by a group of East Bay Zionists to dissuade businesses from advertising because of editorials that criticized Israel’s treatment of Palestinians.

And Finally…

Two amusing closing items today:

The funny folks at 10,000 Words are back with their collection of Valentines for journalists. Although vaguely suggestive, they’re mostly G-rated and should be good for a laugh if your beloved happens to end his or her love letters with “-30-.”

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It was 113 years ago yesterday that the phrase “All the News That’s Fit to Print” first appeared on the front page of The New York Times. The phrase was actually being used in marketing and advertising prior to that date and had assumed a modest place on the Times’ editorial page, but it was a slogan contest organized in late 1896 by publisher Adolph Ochs that catapulted the now-famous slogan to the banner. W. Joseph Campbell, whose 2006 book entitled The Year That Defined American Journalism documented the momentous events of 1897, recounts some of the entries that didn’t win the contest and its $100 prize.  They include:

• Always decent; never dull;
• The news of the day; not the rubbish;
• A decent newspaper for decent people;
• All the world’s news, but not a school for scandal.

We think Ochs made a good choice, though his choice of words probably didn’t anticipate the Internet.

Perhaps all those fresh-faced young journalism wannabes who are flooding J-schools across the country right now know something we graybeards don’t. While there’s still plenty of legitimate hand-wringing going on over the collapse of publishing institutions, some media seers are beginning to see promise where others see peril.

David Carr’s essay in The New York Times last weekend is drawing considerable attention and well-deserved praise for its glass-is-half-full perspective. Carr, who put in his time at the traditional media watering trough, observes that the technology-enabled young journalists he meets these days increasingly see the collapse of hidebound media institutions as an opportunity to make a name for themselves based upon merit rather than survival. “The next wave is not just knocking on doors, but seeking to knock them down,” he writes. “Young men and women are still coming [to New York] to remake the world, they just won’t be stopping by the human resources department of Condé Nast to begin their ascent.”

We found ourselves nodding vigorously as we read this piece. Carr expresses no nostalgia for an industry that was built on the inefficiencies of traditional advertising that are now being Googled out of existence. Career paths that relied upon young journalists doing “marginal jobs for indifferent bosses doing mundane tasks” are being vaporized and replaced by a meritocracy in which the best may not only survive but thrive. We’re still a long way from the Promised Land, and it’s a scary world if your job security is based upon having outlasted everyone else, but it’s invigorating if you’re young, energetic and enabled with all the trappings of today’s technology.

New York City venture capitalist Fred Wilson agrees. “I believe the move from a velvet rope model to a meritocracy is a good thing and that the new media business we are building in the wake of the old one will be a better media business; leaner, faster, and controlled more by users than media moguls,” he writes. Amen. As sympathetic as we are to the many people whose careers and lives have been thrown into chaos by the collapse of traditional media, we continue to see a much brighter future once the wreckage is cleared away.

AOL to Automate the News

America Online, which recently announced plans to lay off a third of its employees, is breaking some new ground in the newsgathering field. The company plans to use automation to crawl the Web looking for stories that its visitors have indicated they prefer through their clicks and page views. The robot will then advise a team of increasingly dehumanized editors when and where to publish what it finds. AOL will also use its new venture, Seed.com, to outsource assignments to an army of (presumably low-paid) reporters and photographers.

It sounds impersonal and even a little creepy. The idea of building a new site based entirely upon the preferences of viewers strikes us as a little like the model at Digg.com, which generates boatloads of traffic, but tends toward stories about video games and loopy kids. Digg isn’t threatening to upend CNN.

Writing on FastCompany.com, Kit Eaton makes an interesting case for AOL’s actions creating a revenge effect. If social media is actually adding more of a human element to interactions between groups, does a service that removes much of the human decision-making make any sense? Eaton proposes that readers today actually expect more of the human element in their news coverage rather than less. Of course, we haven’t seen the AOL technology in action and human editors could tweak the parameters over time to make its selections look more like The New York Times. But we doubt it.

Miscellany

Last week we told you about a new daily newspaper that is being launched into the Detroit market, hoping to fill a void left by the reduced publication schedules of the two major dailies there. Well, the experiment didn’t last long. The Detroit Daily Press published just five issues before hitting “a bump in the road” and suspending further operations until the new year. The suspension was blamed on “lack of advertising, lateness of our press runs and lack of distribution and sales,” according to an announcement on the publication’s Facebook page. This sounds to us like more than just a pothole, but we hope the owners, who have courted this market before, can overcome their troubles and come back in 2010. Photographer Rodney Curtis offers an insider’s perspective. Having lost his job at the Detroit Free Press earlier this year, he’s now a double-dip victim of the industry’s troubles.

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Some local television stations are now crowdsourcing the news assignment process. Broadcasting & Cable reports on stations in Milwaukee, Lancaster, Pa. and Little Rock that are opening their daily news budget meetings to outsiders through video, live blogs and Twitter. News directors say the experiment has been a mixed bag, since audiences that sometimes number over 100 can get stuck on gossip and minutia instead of general interest stories. However, they say the open-air meetings have also resulted in solid news tips, such as the WITI (Milwaukee) story on a father surprising his son at school upon returning from Iraq. The boy’s teacher had clued the station about the visit.

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Add MediaNews and A.H. Belo to the short list of newspaper publishers who are considering joining Rupert Murdoch in his crusade against Google’s evil empire. Executives at both companies were quoted recently saying that they may withhold some paid content from Google’s search spiders. However, they indicated that they would not block access to free content. These statements are a minor blow to Google, which says it can work perfectly well with paid content and that publishers using paywalls need Google even more to make their content discoverable.

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The Hopi Tribal Council has decided to close down the Hopi Tutuveni, which is the primary newspaper covering Hopi lands. The 6,000-circulation paper, which has been publishing since the 1970s, was called “ineffective” by one tribal Council maker and didn’t merit continued funding by the budget-pressed group.

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It’s the end of an era, of sorts, at the Washington Post. The paper plans to close down its last three domestic bureaus – in New York, Los Angeles and Chicago – at the end of this month in a significant retrenchment that focuses on the Washington area. The move continues a recent trend toward embattled big-city dailies shutting down the remote offices as they attempt to go hyperlocal. David Carr quotes Post Executive Editor Marcus Brauchli as saying “We are not a national news organization of record serving a general audience.” The Wall Street Journal announced plans to close its Boston bureau last month.

The debate over whether search engines are friend or foe to the newspaper industry continues to grow and become more complex.

Rupert Murdoch says he will really go ahead with his stated plans to remove his portfolio of publications from Google’s search index. Jonathan Miller, News Corp’s chief digital officer, told the Monaco Media Forum on Friday that the company would begin blocking Google’s search spiders within a few months. Miller said Google brings in an army of one-click visitors who are “the least valuable traffic to us…You can survive without it.” He also said Murdoch intends to lead the industry in the just-say-no campaign. A Google spokesman responded that the search engine sends about 100,000 clicks to news organizations every minute. TechCrunch estimates that Google drives about one quarter of the total traffic to The Wall Street Journal.

While there’s no doubt that Murdoch is serious about drawing a line in the sand on this issue, the decision to talk about it this far in advance indicates that this is a negotiating tactic. Much as Hearst and the New York Times Co. wrung concessions from unions by threatening to close the papers they own, Murdoch may be looking to extract some kind of licensing deal from Google in return for backing down.

The Journal and the Financial Times are the only two daily newspapers that are having any success with a paid subscription model because both provide information that subscribers see as essential to their business. Few other newspapers can make that claim, which is why paywalls have been so difficult to implement.

Miller’s comment about drive-by visitors is worth noting. Publishers and auditors tend to look at traffic as the ultimate metric of success, but there are different kinds of traffic. Sex and celebrities drive page views just as they sell newsstand copies, but that kind of traffic is undesirable to most advertisers and extremely hard to monetize. If Murdoch has decided that his core base of paying and print subscribers are sufficient to run the company, he may be choosing to press his advantage while he still has leverage. The Wall Street Journal was the only large US newspaper to show any growth in the recent Audit Bureau Of Circulation report and Murdoch may have decided that he doesn’t need the casual visitor in order to be successful.

The Bing Factor

Media entrepreneur Jason Calacanis thinks Murdoch wants to do a deal. He suggests that the publishing tycoon could strike an exclusivity agreement with Microsoft Bing. This would have the win-win effect of driving revenue from Microsoft’s deep pockets while also upping the ante in the search wars. It’s an intriguing idea, and few other companies have the throw weight to pull it off.

Bing appeals to news executives as a foil for Google. TechCrunch reported last week that Microsoft held a secret meeting with representatives of some of Europe’s largest newspapers to discuss throwing its weight behind ACAP, a protocol that provides a variety of access controls over content. TechCrunch says Microsoft told the European publishers that it’s ready to commit £100,000 to fund development of ACAP, which permits search engines, for example, to index the full content of an article while displaying only part of it to a casual visitor. The report speculates that Microsoft may be hoping to use publishers as allies in a flank attack on Google by striking deals that give Bing exclusive or semi-exclusive access to their content.

Bloom Fading from User-Generated Content Rose?

Is user generated content beginning to lose some of its shine? Current TV, the cable channel founded by former Vice President Al Gore is in the process of retooling its content model to emphasize acquired and compiled programming while cutting back on standalone viewer submissions. The company will lay off 80 people in the process. Current TV says that while it’s as gung ho as ever on user-generated content, it will shift to a style of programming that sounds more reminiscent of America’s Funniest Home Videos than full length amateur documentaries. Chief Operating Officer Joanna Drake Earl also said “viewer-created ad messages” have been a huge success, with viewers preferring them by a 9-1 margin and advertisers reporting higher recall rates.

The Current TV downsizing bookends a year that began with the shutdown of another prominent user generated media company, 8020 Media. That publisher had a brief moment in the spotlight when it produced two print magazines consisting entirely of submissions from readers. The experiment proved that user-generated content is no panacea, however. The task of sorting through thousands of articles and photographs and turning them into professional-looking copy was little more efficient than working with professional journalists. The advertising downturn didn’t help.

The troubles of these prominent experiments shouldn’t be seen as a referendum on citizen media. Scores of other ventures are ongoing and an increasing number of events are being reported first through channels like Twitter. The most viable models appear to be those that combine citizen reports with moderation by professional editors. Perhaps America’s Funniest Home Videos had this all figured out years ago.

Miscellany

If you’re following this Twitter thing that everyone is so excited about, you should check out a couple of new resources. Twitter Times is “a real-time personalized newspaper generated from your Twitter account” and it’s a pretty good metaphor for the way trust is awarded in the new world of democratized information. The service chooses news and blog posts mentioned in the Twitter streams of people you follow. The result is a digest that looks like a newspaper, only the stories are selected by your friends.

The algorithm behind Twitter Times is obscure and the site appears to be the work of a single Russian programmer named Maxim Grinev (right). While it doesn’t try to capture every recommendation from trusted sources, its constantly changing selection of content pretty much reflects the topics we are interested in. Users can share personalized home pages with each other and, of course, follow tweeters mentioned therein.

Also check out MuckRack.com. It’s a collection of jounalist Twitter feeds set up by a small group of people who call themselves Sawhorse Media. Journalists have to apply for inclusion and list a publication they are affiliated with before being added to the list. The qualification criteria seems a bit outdated to us in this age of citizen media, but the resulting list is a pretty good lineup of media pros. MuckRack is one of 16 identical sites that run the topical gamut from beauty to beer. It seems that lists are all the new rage on Twitter.

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The wrangling over Philadelphia’s two bankrupt newspapers continues to grow more bizarre. A Federal district court judge last week ruled that the creditors trying to take control of The Philadelphia Inquirer and Philadelphia Daily News must make a cash offer for the papers rather than simply taking control of them from the bankrupt Philadelphia Newspapers, LLC. The two parties have engaged in months of legal wrangling, even trading accusations of document theft. The new ruling opens the bidding to third parties as well as current ownership, with the courts apparently trying to steer the matter toward a resolution that keeps both newspapers operating.

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Publishers can take heart in recent numbers from Scarborough Research that indicate that newspapers continue to be at the center of American reading habits. Writing on Media Post, Scarborough’s Bob Cohen cites the following 2009 stats:

• 74% of adults read a paper in print or online during the past week. Newspaper readership in some markets reach upwards of 90%;
• 19% visited a newspaper website during the past week;
• 70% of American adults read a printed newspaper during an average week.

Scarborough’s numbers jive with other data that indicates that newspaper readership — online and in print — continues at all-time highs. The problem is monetizing the low-value web traffic. Cohen suggests that publishers need to do a better job of selling the centrality of their products to the audience’s daily habits. “Aggressive self-promotion, while not a natural inclination of this culture, could go a long way in these unusual times,” he writes.

Implicit in the hand-wringing over the death of news organizations (one guest on last week’s Hobson & Holtz Report podcast wondered if PR professionals should even bother tracking newspaper coverage any more) is the concern that good journalism will vanish from the Earth. We’ve always argued that the problem with newspapers today isn’t that they have no value, it’s that they no longer have a sustainable business model. The need for good journalism hasn’t changed but good journalism needs to find new ways to support itself.

Check out two new resources in this area. Jeff Jarvis articulates a future for journalists in an exceptionally cogent summary of his recent work with the City University of New York’s New Business Models for News project. Jarvis sees tomorrow’s journalists as entrepreneurs who create business models around selling their services to those who will pay for them.

We like the analogy to people who work on Hollywood movies. Studios don’t employ legions of camera operators and set designers. They hire that talent as needed for a project. Everyone comes together and works for a few months and then the team breaks up and goes on to other things. Lots of people make their livings that way. Some of them do very well. That’s the way things work in a competitive, entrepreneurial environment.

The skills that journalists will need to survive in this decentralized market are very different from the skills they need today. For one thing, young journalists won’t be expected to spend a decade toiling away for pocket change while learning at the knee of some cranky city editor. They’ll be able to make a good living much faster if they have the smarts and skills to compete.

Political skills won’t matter for much because most journalists won’t work for big organizations. Journalists will succeed or fail based upon the quality of their work and their ability to sustain mutually beneficial relationships with multiple employers. Social skills will matter more than political ones. Self-promotion will be essential. There’ll be less time spent in pointless meetings and bitching about the boss at the local bar because, well, there is no boss any more. Journalists will reclaim vast amounts of time that are now spent on organizational bullshit. They’ll spend their time making money instead of covering their asses.

Risky Business

This future is going to look scary to some people because there’s no job security or benefits. But who’s got job security anywhere these days? And benefits plans are being hacked to pieces as businesses downsize. In the future, working for an organization isn’t going to have many advantages over independence. There will still be company jobs for those who prefer them, but a lot of energetic and resourceful journalists will find that life is better on the outside. It’s amazing how productive you can be when you discard all the overhead of working in a big organization. Trust us on that. We left corporate life four years ago and have managed to produce three books and maintain two active blogs while still making a decent living.

Most journalists we’ve talked to are fine with this idea except for one thing: The thought of selling advertising terrorizes them. They have reason to be nervous. Most journalists we know would be lousy salesman (we tried it for a year and hated every minute) so it’s likely that business models will emerge to manage the business details for them. We told you about one of them – GrowthSpur – back in August, and there no doubt will be many others. As news organizations collapse and journalism opportunities disperse out to a million topical blogs and hyperlocal foundries, new ventures will spring up that aggregate opportunities and provide a variety of other services ranging from promotion to ad sales to accounting.

Read Jarvis’ essay for an optimistic perspective on the future opportunities for journalists. No one is suggesting this transition will be easy, but it will result in a market that is vastly more efficient than the one we have known. Journalism schools today should be training their students in the skills of small business management. Those that continue to preach the virtues of working one’s way up through a newsroom hierarchy are doing their students a disservice. Perhaps J-schools will evolve to become subspecialties of colleges of business. That wouldn’t be a bad thing; just different.

Thriving in the Free Economy

To hear some new ideas about how organizations can profit from the emerging free economy, listen to this Churchill Club podcast titled The Free Economy: How Companies Make Money From Giving Things Away. The panel was moderated by Chris Anderson (left), whose new book,  Free: The Future of a Radical Price, paints a picture of economic change brought about by the availability of cheap digital distribution. Anderson hosts a panel of entrepreneurs who are making money with businesses that give away all or part of their services for nothing.

Newsday will join the slowly growing ranks of newspaper publishers that charge for access. Beginning next Wednesday, the Long Island daily will begin charging a $5 weekly fee for access to most of its content. Subscribers to the print edition or to owner Cablevision’s Optimum Online service will continue to get Newsday for free. A limited amount of Newsday coverage will still be free online, including the home page, school closings, weather, obituaries, classified and entertainment listings, but nearly everything else will go behind the paywall.

Newsday is keeping an open mind about the idea, saying it will listen to reader feedback and quickly adjust the free/paid mix accordingly. “If there is something that is of critical need for Long Islanders to be aware, we would give them access,” said Debby Krenek, managing editor and senior vice president/digital media. She added that the pay wall won’t be a major issue to local readers, since 75% of them subscribe to either the paper or Optimum Online already. Newsday said readers are taking the announcement in stride, but responses to its news story would indicate otherwise. Of 20 comments posted this morning, not a single one supports the paywall move.

Glynnis MacNicol performs an interesting non-scientific paywall-related experiment based upon comments on The New York Times’ coverage of its own layoffs. She notes that of the 502 comments on reporter Richard Perez-Pena’s blog entry about the news, nearly one-third offered to pay for access to Times content. Some said they had actually volunteered to pay in the past but were told they couldn’t. We’re going to take her word on the math.

The Boston Herald would like to charge for access to its website but says it probably won’t do so unless rival Globe does the same. The Globe says it’s unlikely to take that plunge. Any cooperation on that front between Boston’s only two dailies would undoubtedly invite government scrutiny.

Miscellany

Nearly half of all newspaper journalists believe their newsrooms are moving too slowly into the digital age, according to a report by Northwestern University’s Media Management Center (MMC). While the majority of the 3,800 respondents still work in print, only 6% were characterized as “Turn Back the Clock” journalists who wish digital would just go away. Half of the respondents would be happy to work in digital as much as in print and 12% are true digital enthusiasts. Surprisingly for an industry that’s experiencing so much turmoil, 77% said they’re satisfied with their jobs and two in three say they expect to be working in the news business two years from now.

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It’s been a busy couple of weeks for the New York Times Co. Just one week after taking the Boston Globe off the market, the company announced plans to lay off 100 newsroom employees and a nearly 17% drop in third quarter revenue. The drop was driven by a 26.9% decline in advertising revenue. Circulation revenue actually rose 6.7%. The stock jumped, however, on a positive outlook by CEO Janet Robinson: “We have seen encouraging signs of improvement in the overall economy and in discussions with our advertisers,” she said.

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“Content-sharing is now moving into its next phase by bringing stories online and looking at ways to share revenue,” writes Craig Silverman in a MediaShift article on a new round of agreements between major content providers. The trend began in Ohio last year, when a group of non-competitive newspapers started swapping articles for their next day’s edition. Similar informal consortia were later set up in Florida, Tennessee, New York and New Jersey. Now Bloomberg and the Washington Post have done a deal to create the Washington Post News Service With Bloomberg News. The novel part of the arrangement is a revenue-sharing agreement that will create a co-branded online business section on the Post’s website in the first quarter of next year. The two companies will share ad revenue from the venture.

In addition, a group of members of the Associated Press Sports Editors will soon launch a federated content-sharing alliance. Members will be able to reprint each other’s stories without special permission, but online excerpts will be limited to 150 words with a link back to the original source. About 60 newspapers have expressed interest in joining the consortium, which plans to launch the service in November.

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The Minneapolis Star Tribune is replacing its Saturday edition with one that could be called “Sunday light.” The edition will be delivered early on Sunday and will include the content that subscribers usually get in their Saturday edition plus Sunday’s comics and ad inserts. It will be priced at 50 cents, or the same price as the regular Saturday edition.

Don’t celebrate the reinvention of news as a nonprofit model, writes Slate’s Jack Shafer. Although several prominent experiments in philanthropy-funded news have sprung up lately, Shafer says it’s a case of “substituting one flawed business model for another. For-profit newspapers lose money accidentally. Nonprofit news operations lose moneydeliberately,” he points out.

The problem is that deep-pocketed sugar daddies almost always have an agenda, and the news outlets they fund invariably become mouthpieces for their political goals. Think Sun Myung Moon and the Washington Times. “Having just evicted the usual gatekeepers, how many readers are going to be eager to have philanthropists reset the news agenda?” Shafer asks. What’s more, nonprofit ventures may compete with, and weaken, existing for-profit media organizations, which is a loser for everybody. Shafer correctly points out that the most prestigious news organizations in the world all have commercial motivations.

One of the nonprofits Shafer mentions is MinnPost and local media reporter David Brauerhas issues with Shafer’s comments. It’s true that philanthropist’s agenda does influence the staff who write the stories, he says, but can’t the same be said for advertisers’ influence on profit-making entities? MinnPost’s goal is to subsist on reader subscriptions and “I’d rather be subject to the tyranny of members than advertisers.” Texas Tribunefounder John Thornton has even harsher words for Shafer. Newspapering has only been an absurdly profitable business for about 40 years, he writes. Prior to that, it was a street brawl with very little profit for anyone. We’re just getting back our roots, he suggests.

Reporters Need Not Apply

Rick Burnes used to be an editor in Moscow and at The New York Times online. Now he’s in marketing at search-engine optimization firm HubSpot, which has a very well-read blog. Burnes wants to hire a top journalist to tend the blog, but he thinks it’s unlikely a journalism veteran will get the job. Why? Most journalists don’t believe businesses can produce high-quality content, they are repulsed by the business side of publishing and they don’t understand the link- and promotion-driven culture of the Web. Burnes would like someone to prove him wrong, but at this early stage, he’s skeptical anyone will. “As a hiring manager (and a former journalist) with one chance to hire the right person, I’m wary of somebody with a background in news.”

Or if the HubSpot job doesn’t interest you, try applying at Los Angeles Kings, theLos Angeles County Supervisor’s office or Major League Baseball. Those are just some of the organizations that have recently hired journalists. “All think the news media no longer cover the universe — or their corner of it — adequately and all have hired journalists of their own,” writes James Rainey in the Los Angeles Times.  County Supervisor Zev Yaroslavsky’s new deputy for special projects, Joel Sappell, used to work for the Times. Now he’ll be writing about “little-known county programs and issues” for his new boss. Major League Baseball has employed journalists as beat reporters covering the league’s 30 teams since 2001.

Miscellany

Simon Owens focuses on cartoonists who are making it on the Web. But making it doesn’t necessarily mean raking in the dough. Howard Taylor creates his own books of his Schlock Mercenary comic and sells them out of his home, which resembles a publisher’s warehouse. Many other artists run the comics as a loss leader and make their money on t-shirts. The good news: You can make a living. The bad news: It’s really hard.

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Ebony magazine is for sale. Its ad pages are down 35% this year and it’s in the third consecutive year of decline. Ebony’s sister publication, Jet, is in even worse shape. Ad revenues there have fallen 40% this year. Ebony was the first African-American magazine and Johnson Publishing is the world’s largest African-American-owned publishing company. It’s not clear whether Johnson can survive as an independent entity, though. The company is reportedly looking for partnerships, rather than an outright sale, it’s likely that control will pass out of the Johnson family’s hands.

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Newspapers have dramatically reduced subscriber churn rates and improved circulation profitability through a combination of price increases, outsourcing and better promotions, the Newspaper Association of America reports. The percentage of subscribers who cancel subscriptions fell to 31.8 percent in 2008 from 54.5 percent in 2000. The improvement appears to reflect publishers’ efforts to refocus their circulation promotion on high-quality readership rather than just adding names to the list.

Lawmakers are holding hearings on Capitol Hill to try to figure out solutions to the newspaper industry’s troubles. U.S. Rep. Carolyn Maloney (D-N.Y., at right), who chairs Congress’s Joint Economic Committee, has proposed a bill that would allow community and metropolitan papers to become nonprofit organizations. Similar legislation has also been introduced in the Senate.

At hearing last week, Newspaper Association of America President John Sturm said handouts aren’t the solution but that the government should allow publishers to charge current losses against past profits in order to claim retroactive tax refunds. “Newspapers need cash now to preserve jobs next year,” he said. “It’s really that simple.” Sturm also dismissed an outright government bailout as inappropriate, given newspapers’ governmental watchdog role.

In a statement to the committee (PDF), Princeton University professor Paul Starr noted that government support of the media is nothing new. Starr pointed to pre-First Amendment legislation adopted in 1792 that gave newspaper publishers “cheap, below-cost rates for sending copies to subscribers and a franking privilege that allowed newspaper editors to exchange copies with one another through the mails at no postal charge.” To this day, federal and state governments mostly exempt newspapers from sales taxes, he added.

While scrupulously avoiding the term “newspaper” in his recommendations (subsidies “should be platform-neutral—they should not favor print media over online media, for example”) Starr argued for government subsidies and regulatory relief that would make it easy for media organizations to become nonprofits if they so chose. He also made the case for extending tax benefits uniformly to media companies without regard to their business model or political bias. This model is apparently working well in Scandinavia, the population of which is about 8% that of the US.

Seed Money

Or we could just leave the job to private philanthropists. Alan Mutter tells of a new Bay Area nonprofit that was just funded to the tune of $5 million by a local investor. The startup capital from Warren Hellman is considered “seed money” for a venture that’s being launched in collaboration with public broadcaster KQED and the Graduate School of Journalism at the University of California at Berkeley. Mutter suggests that if the venture could raise money at the same rate as an earlier experiment in Texas, the Bay Area initiative could surpass the size of Pro Publica, which has an annual budget of $9 million and which employs 32 full-time journalists.

Hellman’s decision was motivated in part by McKinsey research that found that newspaper employment and coverage of local news have both fallen by half in the Bay Area over the last five years. The as-yet-unnamed new venture will be different from others in its focus on local news. A base staff of professional journalists will provide the meat and potatoes coverage. Berkeley students will contribute information from a series of hyperlocal blogs they have set up and broadcast partner KQED will contribute its own content as well as rebroadcast the work done by the nonprofit. Hellman said he originally considered buying the distressed San Francisco Chronicle but passed because “the business model may not be there to put a sustainable, for-profit economic foundation under quality, professional journalism.” Comments on Mutter’s blog indicate some skepticism about the venture’s chances of success

Sunset for Sun-Times?

Two weeks ago, Sun-Times Media Group CEO Jeremy Halbriech sent a memo to members of the paper’s unions warning them that if they failed to ratify a proposal for a 15% cut in compensation, the company’s prospective buyer would pull out of the deal and the Sun-Times and its affiliates would close immediately. “No other bidder has emerged who will purchase our assets.  If the current Buyer withdraws its bid, we will shortly run out of cash and we will be forced to shut down all of our publications and Web sites and liquidate the business.  This will result in the loss of all 1,800-plus jobs across the Company,” he wrote.

Well, the union said no. Unlike unions at the Boston Globe and San Francisco Chronicle, which caved in to threats from the parent company, the city of big shoulders likes a good fight. Tomorrow is the deadline imposed by suitor James Tyree for the union to agree to terms. However, Tyree has made it clear that this is a take-it-or-leave-it offer. “I do not want to get into a negotiation,” he said. The unions want to negotiate. The staring match has gone on for two weeks. Presumably, no one is watching more closely than staffers at the rival Chicago Tribune, which would enjoy a business boost from the failure of its competitor.

Miscellany

Judy Sims has a few hundred words of practical advice for creating a profitable hyper-local publishing model. It starts with putting four people – an online product person, an online advertising sales person, an editor and a web developer – in an office that’s completely separate from the print operation. Then get them focused on giving readers stuff that’s hard to find out – such as which emergency room has the shortest waiting time – and crafting packages for advertisers that include a lot more than just display advertising. If you’re thinking of starting a localized news operation, use Sims’ outline as a basis for your business plan.

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The executive board of The Boston Globe’s largest union has canceled president Daniel Totten’s union credit card, suspended his check-signing privileges and ordered a ”comprehensive external audit” of union finances after learning of apparent violations of its financial rules. Totten presided over disastrous negotiations between his union and management at Globe owner New York Times Co. in which the union first rejected a series of concessions in a proposed contract and then settled for an even worse deal after the Times Co. threatened to shutter the paper.

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From a graphic on Mint.com. You can find the whole image here.

Two Century-Old Weeklies to Close

The Calhoun City (Miss.) Monitor-Herald will shut down Dec. 31 after 110 years of publication. Its circulation of 811 was no longer enough to sustain it in a battle against the much larger Calhoun County Journal (circ. 4,700).

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The Lemoore (Calif.) Advocate published its final issue last week afer 121 years. The staff tapped community contributions to tell the story of Lemoore and of its own rich history as the longest continuously operating business in town. The brief history of the Advocate online has these words about the role of local newspapers:

Small town newspapers seldom cover such mega events as tidal waves, auto industry bailouts or global warming. Small town newspaper staffers are too busy telling readers about lawn watering schedules, a sale at Mom’s Pie Shop and weather hot enough to melt the ice in your lemonade…Small town newspapers write stories that mean everything to their readers. And readers clip those stories to paste into scrapbooks filled with touchdowns and weddings, obituaries and births, yesterdays and tomorrows. There are no scrapbook stories about teamster strikes, golden parachutes or the polar bears’ plight.

Obits

Longtime New York Times columnist William Safire died at 79 of pancreatic cancer. The Pulitzer Prize-winning expert on speech and language was a bulwark of elite conservatism, a speechwriter for Richard Nixon and the author of Vice President Spiro Agnew’s famous phrase, ”nattering nabobs of negativism.” He won the Pulitzer Prize for commentary in 1978 for a series of columns about Carter White House budget director Bert Lance’s financial affairs.

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The daughter of slain newspaper heiress Anne Scripps Douglas apparently leapt to her death from the Tappan Zee bridge. Anne Morell Petrillo jumped from the same bridge  her stepfather chose to commit suicide after killing her mother with a claw hammer 15 years ago. Police have yet to make a positive identification. The Douglases founded the Detroit News.

There is a new book out about media disruption and transformative effect of online communities on the way organizations relate to their constituents. The target audience is marketers, but its observations and recommendations are relevant to every single person who works in media.

The book is called The Chaos Scenario, and it’s both devastating in its portrayal of the state of top-down media and intriguing in its examination of new models of communication. What’s more, it’s funny as hell. We haven’t enjoyed reading a book this much in quite a while. The author, Bob Garfield, is a veteran ad critic, a capable journalist and a ruthless tell-it-like-it-is essayist. Here’s our review.

Get this book. Share it with your colleagues. Ponder its conclusions. Prepare for a new world.