edithhopegardenjournal

I opened my Yahoo home page today and read the news headline “Outgunned Kurds Beg US for Weapons to Battle ISIS” and its lead paragraph.   “Interesting,” I thought, so I clicked on the item, expecting an expanded story from a news agency. What I got was the Huffington Post.     “OK, they are becoming a decent news source,” I reacted. So I began reading, only to realize they gave me two paragraphs before redirecting me to Newsmax for the entire story.    Newsmax is a news site established with the aid of politically conservative political figures and journalists. That doesn’t preclude them from reporting news accurately, but can influence their news choice, analysis and opinion. Nevertheless, I read the 14-paragraph story written by Drew MacKenzie. It was a sound story. However, it only paraphrased a story by Washington Post reporter Terrance McCoy, “The strongest military left in Iraq has not stopped the Islamic State.” So I decided to read ...

Issues of transparency are not new, but have been magnified in the information society—often because of the scale and scope of information available— and because news media are increasingly part of the story, not merely, the storytellers. The roles played by leading newspapers worldwide—the New York Times , Washington Post, The Guardian, Le Monde, O Globo, El Pais and others—in reviewing and publishing stories based on disclosures by Wikileaks and Edward Snowden’s NSA files have thrust them into the debate about how much transparency society needs. Arguments over information they published and whether disclosures serves public purposes have been animated. These debates highlight differences in views about transparency in security matters, but they also are forcing society to address more fundamental issues about transparency involving many other issues. Transparency debates are not just a struggle over information and secrecy, but about the bases of human interaction and experienc...

The News Corp’s launch of the tablet newspaper The Daily in February 2011 was heralded as the future of news and revealing opportunities for major new entrants in the news market. After a year and a half of operation, the digital newspaper has lost more than $30 million, managed to gain only 100,000 subscribers—not a trivial amount but low for a global player, and has just announced that it is cutting 1/3 of its editorial staff and ending original production of sports news and commentary. Journalistically The Daily is not a bad news product and its app is facile and effective. So why hasn’t it been more successful? The fundamental problem is that the digital-only paper has been overshadowed by the success of legacy print newspaper brands in the market for digitally delivered news. The Daily has never been so brilliantly written and edited that it could gain the significant attention and acclaim needed to overcome the brand advantages of legacy news providers. Major newspaper—s...

Applications that aggregate articles based on what others in one’s social network are reading and reformat them into an attractive magazine and presentation formats are growing in popularity, but they are raising concern among some publishers. The processes build upon the referral and curating functions of colleagues and friends in social networks and reduce the need for users to go to multiple sites for content on their own. Some of the best known social magazines are Flipboard, Newsmix, Currents, and Pulse. Some publishers are starting their own social reading apps, such as New York Times that has a Facebook app pulling together stories that friends have read in NYT. Many publishers are fearful of these developments, however, because they represent another step away from publishers controlling when, where, and how readers use their content, reduce the impact of the publishers’ brand strategies, and diminish control over the presentation and marketing of their content. But publish...

U.S. newspapers are increasing their use of co-opetition practices, that is, cooperating with competitors to reduce costs, create synergies, or reduce risk in new markets. Such activities are permissible if they are not designed to create cartels or control prices for advertising or circulation. The latest example occurred this week when the Boston Herald announced an agreement with the Boston Globe for its competitor to print and deliver the Herald . The move creates cost savings for the Herald by allow it to cut printing, trucks, and delivery personnel, while simultaneously creating production and distribution economies and an additional revenue stream for the Globe --a win-win for both companies. Such service agreements do not violate antitrust laws because the papers remain independent, set their own prices, and create their own content. If papers were to engage in such actions they would have to apply for an antitrust exemption under the Newspaper Preservation Act (see John C...

The somewhat improving condition of the newspaper industry is permitting companies to move from merely paying operating expenses to finding ways to improve their balance sheets and looking for new opportunities. In recent weeks: The Gannett Co. has placed senior notes totally $500 million that will be due in 2015 and 2018. The notes financed at 6.375% and 7.125% will give the company some financial breathing space by being used to pay a maturing loan and revolving credits. In addition it negotiated an extension on $2.7 billion in revolving credit with Bank of America from 2012 to 2014. The New York Times Co. has cut its debt by 40 percent in past 2 years and is beginning to look at small investments in digital media that may position it for future growth. It recently provided $4 million in financing for Ongo, a start-up news sharing site that will aggregate stories from a number of newspapers. The Washington Post Co. announced it would repurchase 750,000 of its outstanding shares. Such...

New York Times Co., Gannett Co., Media General , and McClatchy Co. have all reported profits in the second quarter and the results have led to share prices doubling and tripling. The developments must come as a surprise to those who saw the poor performance of recent quarters and convinced themselves that the newspaper industry is dead and gone. Admittedly, the positive results in the past 3 months were achieved through restructuring, reducing news staffs to their 1970s levels, heavy cost cutting everywhere, and postponing reinvestments. But it shows there is still life in the industry and that the industry can be expected to recover in the coming year if economic conditions continue their current rate of improvement. As I have said many times, a industry with $50 billion in revenue is not going to ignore that revenue, close the doors, and disappear overnight. Many have viewed the poor company performance in the past 2 years and then mistaken the steep concurrent drop in advertising as...

Family owned and controlled businesses face challenges because of difficulties in passing firms on to succeeding generations of the family. Tax issues are a common problem, but the biggest challenges involve finding effective managers among the family and the needs for new capital that diminishes family control. How family members view the company over time create problems for sustainability. Individuals who establish firms tend to view it as a business enterprise; their children tend to see it as supporting the family; and multigenerational family businesses tend see it has providing status in the community. These latter priorities can interfere with profit and reinvestment objectives and endanger long-term sustainability. As a consequence of these kinds of factors, only about 30% of family firms are passed to a second generation and only 13% reach a third generation. This brings us to the challenges facing media firms. Three big companies—News Corp., Viacom, and New York Times Co.— a...

Financial pages are full of developments and changes at newspaper companies and these are being commented upon anxiously by those in the industry. Unpleasant conditions certainly abound, but these development are not indications that the industry is dead or dying in the near future. What they signal is that things which worked in the past are not working now, that newspaper companies are badly in need of restructuring, refocusing, and renewal, and that the boards of the companies and the company managers are taking badly needed action. The techniques for restructuring are no mystery. First, you need some cash. This can be obtained by attracting new capital through investment or loans. New York Times Co. did this recently by borrowings $250 million from Carlos Slim. Other firms are looking for friendly investors with liquidity. Another way of raising cash is by turning assets into cash. A classic move made by many types of firms is the sell their building and lease back any space that i...

There is one upside to all the advertising disappearing from newspapers……Consumers can now really see what they are paying for. Opps, that’s a BIG downside. With the effects of economic downturn clearly hitting retailers everywhere, they have slashed their advertising budgets and are advertising as little as possible. For the first time in my lifetime it means you can turn several pages in many newspapers without seeing an advertisement. When I read the Boston Globe on Tuesday (January 7), it essentially had 2 pages of ads in the 10-page A section, 3 pages of ads in the 16-page B section, and 1 page in the 8-page C section. It had no ads on page 1 (although it has been announced they will start doing so soon) and the daily classified section is no longer being published on weekdays. What was left was editorial content. Unfortunately, what was there wasn’t pretty. In reading the paper I realized that about half the stories were from news agencies and services and that I had read many of...

First it was record companies suing Napster and peer-to-peer file sharers, and then it was media companies such as Viacom, Universal Music Group, and Agence France Presse suiting Google, YouTube, and Facebook for distributing content whose rights they owned. Now GateHouse Media has filed suit against another newspaper firm, the New York Times Co., for publishing content from its websites and papers on Boston.com. That media companies are suing each other is a sure sign of the maturation of online distribution and that money is starting to flow—albeit slowly and at levels far below that of traditional media, which still account for more than two-thirds of all consumer and advertiser expenditures But the lawsuits really point out the weakness of revenue distribution for use of intellectual property online. In publishing, well-developed systems for trading rights and collecting payments exist. In radio, systems for tracking songs played and ensuring artists, composers, arrangers, and musi...

Recent weeks have not been kind to newspaper company finances, with lost value and unhappy investors plaguing publicly traded firms. The Journal Register Co. was delisted from New York Stock Exchange because it share price remained below $1, reducing its market capitalization about $12 million, less than one-fifth the capitalization required to be traded on the big board. The Sun-Times Media Group stock also continued trading below $1 and its market capitalization dropped to $61 million, drawing a delisting warming from the New York Stock Exchange. Although those firms have hardly been notable as the best managed firms in recent years, their problems in inspiring investors are symptomatic of difficulties facing newspaper firms in the market. Meanwhile, Moody’s Investors Service lowered the New York Times and McClatchy Co. debt ratings and lowered the Gatehouse Media even further in the junk category. Other firms are also having problems with capital related issues. Rumors are rampant t...

The introduction and suspension of media services is becoming a regular occurrence and the combined effects of multiple false starts is creating turmoil in the marketplace and making consumers wary of new services. Let me give some examples. Wal-Mart recently announced it is halting its online video download service after only a year of operation because Hewlett Packard Co. has discontinued its underlying technology due to poor market performance. The New York Times has one of the most successful newspaper websites but has changed its business model several times, most recently abandoning Times Select consumer paid model for an advertising-based model. Sony created a CONNECT Player for its Walkman, PSP, Clie and VAIO that was so plagued by problems that it ended support for the product and advised owners to use another music player and library manager instead. These are only a few of the hundreds of starts and stops of services that have occurred in recent years. The primary reasons fo...