bruce oren
Internet overtakes newspapers as news source
For the first time in a Pew survey, more people say they rely mostly on the Internet for news than cite newspapers.
Founder Hoffman in, CEO Nye out at LinkedInLinked
In a major executive shuffle, LinkedIn founder Reid Hoffman is back in the CEO role and has brought in former Yahoo Jeff Weiner in as interim president. Out: Dan Nye, who’s held the CEO post since Hoffman recruited him in 2007. That’s less than two years on the job for Nye.
Nye’s departure comes as a surprise given that LinkedIn has been doing quite well under his leadership. The company raised a whopping $70 million in 2008, and has a valuation north of $1 billion. LinkedIn is projected to close 2008 with close to $100 million in revenues, in part from its ad network and from content and functionality partnerships with media providers like CNBC.
Incoming president Weiner currently serves as entrepreneur-in-residence at both Accel Partners and Greylock Partners (one of LinkedIn’s backers).
Newspaper, TV fundamentals still strong? Yes …
There are many parallels in the challenges newspapers and local television broadcasters are facing: Fragmentation, loss of audience(s), increased competition from interactive media and other sources, high cost structures, etc.
But there’s another parallel that people tend to forget. Andy Fisher, retiring president of Cox Television, pointed it out in an interview with Broadcasting & Cable magazine:
“TV stations remain a high-margin business that will continue to be the envy of a lot of American businesses,” he told B&C. “TV stations are operated by just a few hundred people, but they create revenue flow in the [billions] of dollars.
“During the transition to digital, owners have been rattled. It’s been a period of time where people have had to readjust. But for folks who are going to be in the business for a long time, it’s just another adjustment.”
Go back through those paragraphs and substitute “newspaper” for “television” — and even magazine for television — and you’ll still have a factual statement.
What’s lost in all of the disastrous news about newspapers (and believe us, we know they’re in tough times, and will continue to face tough times) is that most newspapers in the United States are still profitable. Many are very profitable. The troubles now are partly because they’re not nearly as profitable as they used to be; because too many newspapers were purchased in highly leveraged transactions at a peak in the market; because there is a perception (right, in our opinion) that audience erosion is accelerating and users (advertisers, readers, others) are shifting to interactive media, and that radical changes are inevitable.
But make no mistake about it. Fisher says, “It’s been a period of time where people have had to readjust.” So too are newspapers having to readjust.
Some are making baby steps; some are taking radical changes, like the layoffs throughout the media world, and the types of restructuring announced in January by The Gilroy (Calif.) Dispatch and this week by the Detroit Media Partnership.
But never forget: Even now, newspapering is a great business. A challenged business? Absolutely. A business in turmoil? No doubt. A business where a lot of people are being dislocated, to everyone’s detriment? Certainly. But a terrible business? No way. Just a business that for 10 years that has needed radical restructuring, and is undergoing a sudden painful reconfiguration when more foresight and investment (and less leverage) would have allowed a much more measured approach.
(Newspaper analyst John Morton expounds further on the profit numbers in a post on AJR.org.)
Hearst’s Irish retiring; Swartz succeeding him
George Irish, one of the principal architects of the Newspaper Consortium — and one of the first senior newspaper execs to truly “get it” when it came to the impact of interactive media — is retiring. And since he’s the guy who literally put Classified Intelligence in business, we’ll hate to see him go.
It was in late 1997 or early 1998 when we got a call from Henry “Buzz” Wurzer, who was then heading interactive media services for the Hearst Newspapers. He and George Irish believed that one day, this thing called “The Monster Board” (later Monster.com) would have a major impact on the Hearst newspapers. Would I — then a fledgling consultant — be willing to follow The Monster Board and the dozens / hundreds of other similar services? Sure, I replied, and Classified Intelligence Report was born.
Irish and Wurzer followed the developments in interactive media — and saw the current collapse coming. (Wurzer was followed by Ian Murdock, another really bright guy, and then by Lincoln Millstein, who now oversees Hearst Newspapers’ interactive-media operations and is one of the linchpins in the Newspaper Consortium.)
Irish will be succeeded by Steve Swartz, who will be an SVP of the Hearst Corp. and president of the newspaper division. He became EVP of Hearst Newspapers in 2001 after serving as president, CEO and editor-in-chief of SmartMoney magazine.
Irish spent 29 years with Hearst Newspapers, including service as publisher of the Midland (Mich.) Daily News, the Midland (Texas) Reporter-Telegram, and the San Antonio Light. He became president of Hearst Newspapers in 1993.
We wish him the best in retirement.
We need a great sales exec … know anyone?
We’ve lost one of our great sales execs at the AIM Group / Classified Intelligence, and I hope you know someone who’d be a good fit.
Here’s the background:
We’ve been in business for almost 12 years, and have made it through the dot-com bust and the current recession. Our business is shifting — we’re picking up more international business, and doing more consulting work than ever before. We’re adding new products, and expect to have a very good year in 2009. We’re not Pollyanna — it’s going to be a very difficult year, especially since the newspaper business is struggling, and automotive and real estate are still very weak. However, we still get very solid leads every week, and we have a lot of clients and prospects who are actively looking for our help. This is not a role that requires much cold-calling; it’s mainly building (and strengthening) relationships, and determining needs of our clients and prospects.
We need a high-level, high-quality sales rep. Ideally, he / she would understand classifieds and related Web services, like online directories, city guides and social / professional networks; newspapers, dot-coms and technology providers, and online and mobile advertising.
She or he should be good at listening carefully to prospects and developing specific, analytical proposals for services to meet their needs; writing expertly crafted proposals, and following through precisely.
We’ll be creative in pay, with a combination of retainer, commissions and other incentives to appropriately compensate the ideal candidate. For information about compensation, location, etc., please be in touch.
In the spirit of the season, and to help those affected by the recession / (depression?), we encourage you to pass this on to anyone who might be interested.
Anyone interested should reply to peterz@aimgroup.com. Please tell them to PASTE their resume into the e-mail and NOT send it as an attachment.
Detroit changes: Pushing digital over print
Will the fundamental, structural changes announced today at Detroit Media Partnership lead to the death of the Detroit News and the Detroit Free Press? Or are they brilliant moves that will preserve the two newspapers and make them healthy again?
Frankly, I’m betting on the former. I think the changes are a way to defer the death of print for a few years, but they will hasten its demise.
A 10-second synopsis: The News and Free Press will push readers online and radically curtail both print publication and home delivery, limiting home delivery to Thursday, Friday and Sunday. Weekday papers will be slashed to 32 (broadsheet) pages, or so. A weekday digital edition will be sold to online subscribers (ugh!) and digital publishing will become a focal point.
(More coverage here from the News and here from the Freep. Independent coverage here from the Poynter Institute and here from Editor & Publisher.)
What impact will this have on classifieds? Maybe no real impact because the Detroit classifieds are already dead on weekdays? They’ll certainly have to sell differently, although they can pretty much sell the same value propositions as they could now by focusing on Cars.com / CareerBuilder.com / Apartments.com and their real estate product (powered by Classified Ventures’ Homescape).
Retail advertising? Realistically, it may have the same limited impact — because of the decline of weekday retail advertising.
Readership? IMHO, it will decimate their print readership — and I doubt that it’ll lead to commensurate growth online. (Both print pubs still had great circulation, with the Sunday Free Press at 600,000 plus, the daily Freep averaging almost 300,000, and the News at about 190,000.
CEO Dave Hunke said neither newsroom would be lose any more staff as a result of the changes. He admitted the change would be “disruptive to a lot of people and very loyal customers,” adding, “Lifestyles and technology have … changed the way most people use the Detroit Free Press or any form of media.”
The changes will take place in spring; the company expects to cut about 190 employees as a result.
“We can’t continue to do all the things we’ve done for decades,” said Freep VP / editor Paul Anger. “The digital future is now.”
This could lead to the death of one or both papers. But one thing’s for sure: With the auto industry in a depression, Detroit real estate off-the-chart-awful, and print struggling not just in Detroit but everywhere, you’ve got to give ‘em credit for trying. Personally, I think it’s a terrible decision. But a decision, any decision, was better than the paralysis that’s killing so many newspapers today.
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