by Dana Blankenhorn
  Volume IX, No. XIII

This Week's Clue: Time to Put Newspapers out of Their Misery

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This Week's Clue: Time to Put Newspapers out of Their Misery
SSP (Shameless Self Promotion)
Best of the Week
The American Diaspora
ZDNet Open Source
Clued-in, Clueless

Dana Recommends The Blankenhorn Effect offers a powerful, positive message for our time. Once you understand how Moore's Law impacts every part of your life, how powerful it is, and how irresistible a force it truly is, you will have the power to predict the future and know how to change it. Buy it today, and make 2004 a better year for yourself, your business, and your family.


For the Week of March 28, 2005

I have a love-hate relationship with newspapers.

The business has been at the heart of my "profession" for a century. The whole idea of a journalist as a professional is also a product of this business. I took my graduate degree from the Medill School of Journalism. Joseph Medill was the old reprobate who built the Chicago Tribune empire.

But as I've said many times here this whole idea of a "journalism profession" is a fraud. Professionals can make it on their own. Journalists can't. If you don't have a job you are not part of the fraternity. Even if you build a journalism company based on your vision of what the profession should be, you are always nothing more than a businessman.

The New York Times recently quoted a newspaper consultant as saying ( "For some publishers, it really sticks in the craw that they are giving away their content for free."

Here in one sentence we have the utter cluelessness of the industry. Here is an opportunity waiting for someone to exploit it.

Newspapers have always given away their content. Always. The money you pay for your daily paper goes only toward its distribution costs. The ink, the paper, the printing, and the entire editorial budget (which is just 8% of the total, although publishers act like it's the whole thing) -- that comes from advertising.

Where does the money come from? Many sources:

  • Display ads next to copy, which papers now know how to get online.
  • Help wanted ads, lost to specialist sites.
  • Real estate ads, lost to specialized sites.
  • Automotive classifieds, lost to specialized sites.

Then there's a very, very important type of ad, the advertising insert. Newspapers haven't even tried to replicate this online, although they could.

When newspaper publishers say they want to end subscriber "freeloading," they are showing an enormous ignorance of their own business, not just the Web.

They have already hurt their circulation dramatically by requiring registration of all users. This also causes a lot of people to lie, to trade registrations, and lowers the value of the papers' registration database. It can cut online circulation as much as 60-80%.

Add a toll gate to your stories and you cut that circulation again, another 90%.

So what newspapers are in the process of doing is destroying their circulation base, using backwards logic, and providing a wide opening to any competitor who can maximize online ad revenue and keep the gates open.

Of course, they've been doing this for years, based on the assumption that they each hold a "monopoly" within their markets.

Nothing could be further from the truth.

TV has taken away their market for breaking news. Most cities have business weeklies. Many also have legal weeklies, sports weeklies and entertainment weeklies. My own area also has an ethnic paper (African-American in this case) and two neighborhood papers (filled with real estate ads), which are tied to my mailbox or thrown on my lawn (depending), free and regularly.

That's just the print competition.

Now, thanks to their own Cluelessness, newspapers are offering you this once-in-a-lifetime chance to take their last niche through the online world.

How can you make money?

  • Maximize circulation. Use cookies to define your audience for advertisers. Don't put anything in the way of someone's getting everything you've got.
  • Create news that is vital not only on the Web, but on mobile phones, in our daily lives.
  • Use the news as an "extra" and build your business model around the reader's need for advertising.
  • Make it interactive. Encourage cell phone users to SMS you about traffic accidents and celebrity sightings. Give prizes for the best news tips about local issues.
  • Advertise. Buy ads on buses with instructions for accessing your site, via PC or mobile.
  • Build campaigns. Get the newspapers' best advertisers on your side with campaigns that build prospect lists.

The age of the local Web is here. Get on board, close off the papers' last hope of a niche, and you may just kill them for good. Then you take over the market by using your online effort as the heart of a print product.


Shameless Self-Promotion

I'm now helping to produce a special blog on Open Source for ZDNet.

I work as a freelance writer in Atlanta, and am on the development team for EgoScout, a new kind of mediator for mobile phone users.

My last non-fiction book, "The Blankenhorn Effect" won the Computer/Internet category in the 2003 Independent Publisher (IPPY) awards. Write me for a PDF copy of my latest novel, "Baptists are for Dunking."

On my Mooreslore blog I've written a new novel, "The Chinese Century." It's a story told in real-time, with real characters, but entirely fictional, dealing with the consequences of the falling dollar. I'm beginning a sequal, "American Diaspora," exploring the themes of the first book but with more fictional characters. It's a true alternate history, but set in the present day.

You are encouraged to forward this newsletter widely. And if you have trouble subscribing let me know. Remember: it's journalism that keeps the Clues coming...


Best of the Week

The New ILECs

Cellular companies used to be the small, scrappy, second-tier telecomm carriers. They're now morphing into ILECs, like the Bells.

VOIP Hot Now, Not Later

This summer will be the peak of the Voice Over IP (VOIP) boom.

So Now You Notice...Why?

Who is to blame for the vapid nonsense of celebrity journalism? To some extent, you are.

Fixing the MSM

There is a solution for this malaise, and it's ironic that a national audience caught it first on a comedy show. The solution is "boots on the ground," as Tom Fenton told The Daily Show's Jon Stewart this week.

Can SMS Save MMS?

One of the biggest problems we face in cellular data is the lack of MMS interoperability. CTIA didn't answer that challenge, but it turns out CeBIT in Germany did .

Microsoft adCenter Ignores 90s Lessons

Back in the 1990s a lot of companies drew a lot of venture capital promising to target ads based on who you were rather than what you were looking at. It turned out the cost of targeting exceeded the premium advertisers could charge for the space. So Microsoft actually took a step backward this week when it launched adCenter, which targets based on users' use of Microsoft resources, plus Experian credit scores.

Bloggers Are The New Stasi?

Dem's fightin' words, ma'am.

Google News Tilting Blog Playing Field

On Google News a news story is something that appears in the Main Stream Media (MSM), nowhere else.

OJR Still Clueless

How else do you explain this, a long whiny piece from Mark Glaser moaning over a professional journalist's decision to shutter a personal site due to his conflict of interest. Instead, Glaser cries censorship, acts like there's nothing to be done, and downplays the very-active role other Indian bloggers are taking in publicizing what has happened and working around the problem.

Alternate Attention

You don't give 100% of your attention to your mobile device, and for the most part you're not going to. A TV picture requires your eyes on it to be useful, and that's too much attention for most of us. This has always been the battle. It's hard to get both hands, plus the eyes, onto a mobile device. Each time we move in that direction, we're pulled away from it by the market. Time to start listening to the market.

Who Killed ROKR?

There is a move afoot among the world's mobile (or cellular) carriers to keep absolute control over all the money to be made with cellular (or mobile) broadband. It's not just the users they seek to control, and not just the phones.

IBM Suit Demonstrates Hollowing of Military

Readiness is dead. The military is being systematically hollowed-out. America's days as a great power are sunsetting. No one with an ounce of sense is going to ever join the Guards or Reserves again thinking it's weekends, vacations, and stay out of trouble, as it was when George W. Bush himself "served."

The Tech Tax Proposal Sucks (There's a Better Way)

In practice, this proposal sucks. It sucks big time. Here's why. Where's the money going?

Apple Suit Reporting Is Wormy

While the company won the initial court ruling, the fight is far from won. And the decision wasn't germane to bloggers, as the actual story made clear. Trade secrecy, in other words, gets more protection than national security.

Spectrum Law Is Not Property Law

The debate boils down to science and markets. What treatment of spectrum best serves the market, that of a government-owned monopoly or a carefully-managed resource?


The American Diaspora


Table of Contents

ZDNet Open Source

Linux Contradictions Between Google and EDS

Big Consultants Building a Mystery on Open Source

BlueGlue is Closed Source Defense for Open Source Shops

GPL, Not Linux Violations Found by Welte

Upgrades to Google, the World's Biggest Linux Application

Are Compiler Alternatives Available?

The Meaning of License is Also Open to Interpretation


Clued-in, Clueless

Clued-in is Jose Canseco, who put the beat-down on former teammate Mark McGwire by simply understanding how you need to appear on TV. (Note: the link is to a satire site. I didn't say I liked Canseco.)

Clueless is John Berresford, who pretends to have no influence on policy even while he's justifying bad policy.


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