It's clear that something isn't right in the news business, but in contrast to those who think that major news outlets are toast, I offer this prediction:
2006 will see important steps by news companies to turn the tide, re-invigorate their businesses and grow readership, and a few will even find a new formula to succeed at this for the long haul.
I think this may be fairly obvious, as MSM (Main Stream Media) firms have so many advantages that they don't exercise well enough. For starters:
- Journalists are paid to write
- Full time news gathering and editorial staff already in place
- Expertise in layout and printing of hard copy information
- Physical distribution nationally and/or locally
- Typically have established web presence
- Recognized and generally trusted brands
However - and this is the reason why blogs are sprouting up like weeds in an untended sidewalk - MSM has significant things that are working against it:
- By design, journalistic writing conventions are fragmented, repetitive and dull
- Major papers routinely confuse "quality" with length
- Multiple editors are one or more steps removed from writers and either err on the side of blandness or make errors that can only arise from not being familiar with a subject
- By seeking to be "definitive" on every subject there is inevitably a lot of hemming and hawing while one is "first" but incomplete on facts
- Articles are generally written with the assumption that readers don't know much about a topic
- There are unwritten, but widely shared "truth codes" about how topics can be discussed, and what can be said about them; journalists can be penalized severely for violating them
- Most journalists think that the primary way in which they fail to serve the public is their inadequate criticism of conservative politicians
That said, I think the problems faced by MSM firms have a clear source: an oversupply of institutional voices exhibiting the characteristics as above. This can be rectified as firms go out of business, consolidate, or figure out new approaches to communicating news.
There is a big opportunity for a mainstream company to buck the conventions of "how to talk about the news" and by setting new protocols, to win new readership. Love it or hate it, Fox News has responded to this imbalance of supply and demand, and provided an alternative. Now, Fox gets ratings that are greater than the sum of all its cable competitors in most of its time slots.
Although it is "cool" to say that Fox is propaganda, surely any investor worth their salt can appreciate that when a body is as monolithic in opinion as media is in the US, that there is something vital being overlooked. Blogs are evidence of this - a good blog is about meeting the need for interpretations of news and events, to spare readers from a doomed life of reading stale AP "toe-the-party-line" articles.
Certainly, it couldn't be hard for a news intermediary to figure out how to freshen up its writing, and to re-jigger its coverage such that they avoid putting us to sleep, or falling into the same old biases that characterize news media today. I think this is an issue of tweaks to a business model that otherwise has all the right infrastructure in place, right now.
Most of my news originates from MSM, as I expect it will 50 years from now. That doesn't mean the press will be exactly the same, but firms with an advantage today have every opportunity to retain that advantage tomorrow...if they want it.
The question for investors: which management team, at which firm, has the gumption to get this right? - Ed
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