Information wants to be free, reporters want to be paid, Part 10

New York Times columnist David Carr joins the host of navel-gazing journalists trying fathom a financially sound future for the news business.

Like many already dithering over this problem, Carr flatly states that setting the price point for news at free makes no sense.

In fact, blogger Alan Mutter, a former newspaper columnist, calls the free model “the original sin.”

Sure a few pundits have pointed out that free has actually been the news model for the past century. Newspaper advertisers covered the expense of the newsroom while subscribers merely paid for the newsprint and delivery. Radio and television relied on ads to cover the expenses. Cable is charges for delivery and the free stuff and then provides a conduit for some premium for-a-fee entertainment channels.

But online advertising fetches pennies compared other media, and many question whether online ad revenue can ever support a viable news gathering operation.

But Carr throws out another suggestion: “Throw out the Newspaper Preservation Act. Regulatory reform will allow the industry to consolidate to an economically feasible model and preserve newsgathering. Does Seattle need two newspapers? Did Denver? Sure, it’s preferable for all kinds of reasons. But one is better than none.”

The Las Vegas Review-Journal and Sun have a joint operating agreement made possible by the Preservation Act, which allowed newspapers to skirt anti-trust laws when there were two papers in an area and one was failing. With Justice Department approval the papers could join business, printing, advertising functions to save money and still operate two independent newsrooms and editorial pages. It thought to preserve some modicum of competition.

When the R-J/Sun JOA first started in the early 1990s the Sun was an afternoon paper. When the Sun’s circulation continued to decline, it became a section in the R-J.

There are troubled JOAs in Detroit, Seattle and Tucson. Denver had a JOA until the Rocky Mountain News closed, as did San Franciso until the Examiner closed. There are numerous other examples.

To punctuate the danger ahead, Time magazine has published an article titled “The 10 Most Endangered Newspapers in America.”

The article suggests eight of the 50 largest papers in county could be out of business in the next 18 month.

The papers include the Philadelphia Daily News, Minneapolis Star Tribune, Detroit News and San Francisco Chronicle. These have been widely speculated on.

But it includes some that might surprise: Fort Worth Star-Telegram and Miami Herald, to name two. Both are McClatchy papers, both are sole survivors, both have long histories in their communities, having survived fierce competition.

On another front, wealthy philanthropist Eli Broad is pondering once again the idea of buying the Los Angeles Times, but this time he considering a nonprofit foundation to do so.

"Newspapers ought to be owned by foundations, not look for great financial returns. …” Broad is quoted as saying during a recent speech on philanthropy. "If several foundations are involved there is likely to be journalistic freedom."
NYT’s Carr concludes: “What is under attack is the fundamental machinery of the Fourth Estate, not just the local newspapers that some love to hate and others, including many young consumers, are indifferent to.

“Whatever the solution, the capacity to produce accountability reporting, investigative journalism and robust coverage of public officials is not sustainable under current revenue models. And that is not a business problem; it’s a civic one.”