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Journalists and technology writers are enamored with communications technology and tend to portray successful technologies as representing large scale trends. We are regularly presented with news stories and promotional materials about the rise of new technologies and about how their uses create social trend that are significantly altering society. The release of the new iPhone was recently featured on network evening news, Blackberry has been heavily discussed because its use by Pres. Obama, and Twitter has been featured in numerous television and newspaper stories. The impression given by coverage is that anyone who doesn’t have an iPhone or Blackberry and anyone who doesn’t Twitter is out of touch with the mainstream and being left out of modern society. These new means of communications offer interesting possibilities, but their consumption needs to be seen realistically. Blackberry, for example, has 14 million subscribers-- about 5 percent of all mobile phone users in the US. iPho

The Newspaper Revitalization Act introduced by Sen. Benjamin Cardin, D-Md., would permit newspapers to operate as not-for-profit entities under the tax code and is being heralded by some observers as a means of saving newspapers, much as was the Newspaper Preservation Act of 1970. Good purposes aside, it is useful to study the act to determine whether it will actually accomplish the goals that are stated as its rationale. The bill is a small bill, about 435 words, that would amend the IRS Code of 1986 to permit newspapers to be given 501(c)(3) status, thus obtaining tax exempt status and the ability to accept charitable contributions. Currently tax laws do not permit newspapers to be operated tax exempt, but they do have mechanisms that permit foundations to own them or support them financially. Paragraph (b)(1) of the bill would allow general circulation newspapers “publishing on a regular basis” to establish themselves as tax exempt organizations. The language does not limit periodic

Journalists keep raising the crescendo of the chorus that journalists are losing their jobs and journalism is suffering. They point to the fact that about 10 percent of journalists have disappeared from newspapers since the millennium when U.S. newsroom employment reached a peak of 56,373. It is true that cutbacks are pandemic these days, and that these employment reductions hit close to home for journalists, but some context is usually useful when considering the numbers and their impact. Let’s take a look at the U.S. numbers. The American Society of Newspaper Editors has conducted a newsroom employment census for 3 decades and it presents a telling story. According to the latest ASNE newsroom employment figures, there are 22 percent more journalists in newspapers than there were in 1977 (43,000 in 1977; 52,600 in 2007). Even granting employment losses of 2,000-4,000 since the last census, employment is still about 18 to 20 percent higher than it was in the 1970s. That doesn't see

Judging from the continuing panicked commentary by big media journalists and commentators, newspapers are dead and dying. They are comatose, the family is gathering at the bedside, and quiet discussions are taking place about whether to disconnect them from life support. Walter Isaacson writing in Time Magazine last week told us that “the crisis in journalism has reached meltdown proportions” and that we can save newspapers by starting to make micropayments for articles we read online. http://www.time.com/time/business/article/0,8599,1877191-4,00.html David Carr, writing in New York Times, this week tells us that a “digitally enabled free fall in ads and audience now has burly guys circling major daily newspapers with plywood and nail guns.” We need to start charging for news, forcing aggregators to pay, turn away from ad support, and start thinking about new ways of collaboration even if they require a new antitrust exemption. http://www.nytimes.com/2009/03/09/business/media/09carr.ht

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

I recently forged my way the myriad of news reports on networks, papers, and web sites and discovered lots of attention-grabbing stories: Reuters had a story about the death of Mickey Rourke’ 18-year-old pet chihuahua. CBS News reported on cart that transforms into a sleeping tent for the homeless. Associated Press told me that Twitter was limiting message length and intending to start testing ways to make money. The New York Times informed me about people walking and running in stairwells as a means of keeping fit. CNN reported that Lance Armstrong’s stolen bicycle had been recovered. The Los Angeles Times reported on a city council candidate criticizing a rival for being defense attorney that represented a client who was accused of shooting a sea lion four years ago. ABC News carried a story on its website about efforts to produce cola containing cow urine in India. MSNBC reported that Starbucks is increasing the products its offers in offers as part of an effort to improve its perfo

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