Tag Archives: advertising

Can journalism get by without advertisers?

By Christopher B. Daly 

Why should journalism depend on advertising? There is nothing logical, necessary or inevitable about it.

Originally, advertising was a trivial source of income for 18th Century newspapers. Instead, readers supported those newspapers by subscribing for fixed (and pretty lengthy) periods. there were few if any newsstand sales. That model worked for more than a century.

It was only in the 19th Century that newspaper publishers began seeking and relying on advertising revenues. This coincided with an explosion of spending on ads, so there was plenty of money sloshing around to allow newspapers to expand. By the end of the 19th Century, many newspapers derived half or more of all their revenues from ads.

When broadcasting came along in the 20th Century, most radio and television operations could not find a way to get their audience to pay, so they became almost completely dependent on advertising income. (NPR and PBS are exceptions; they depend on a shifting mix of foundation grants, “sponsors,” a shrinking direct government subsidy, and the direct financial support of “viewers (and listeners) like you.”)

There, in broad strokes, is a big part of the current existential crisis facing all the “legacy” media with a foot in the pre-digital past. They arose under a set of conditions that no longer exist. Advertisers have reduced their spending overall, and they have reallocated the remaining ad buy so that they can buy a growing amount of space online. They are not coming back to print or broadcasting.

So, if advertisers cannot be depended on to fund journalism, who’s left?

One answer is pointed to by David Carr in his column today. Ostensibly, his column is about HBO and the success of such tv “auteurs” as the creators of The Sopranos and The Wire. Carr observes that HBO never depended on ads, so HBO’s executives never had to worry about what kind of programming advertisers would accept. Instead, the only constituency they had to please was viewers, who flocked to the better (if violent) programs. It was a case of “viewers to the rescue.”

From Carr’s column:

As it turned out, what had been holding television back was not the audiences, but the advertisers. HBO, freed of those bonds as a pay TV service, bet on a show about a fat, conflicted gangster who spent time in a shrink’s office when he wasn’t ordering up murders from the back of a strip club called the Bada Bing.

HBO had figured out that the strategy followed by broadcast networks — trying to please all of the people at least part of the time — was a losing formula for a pay service. Instead it began producing remarkable programming for a discrete audience that would pay a premium for quality. That audience has ballooned to some 30 million viewers and turned HBO into an A.T.M. for Time Warner, a lesson that was not lost on other cable channels. This revolution will continue to be televised.

In cable TV, unlike traditional broadcasting, money comes from “subscribers” — i.e., you and me and everyone else who overpays Comcast or Verizon or some other cable provider. All our monthly bills go into a giant pot, and cable providers turn around and dole it out to the suppliers of programming — X for ESPN, Y for all the NBC properties, Z for Fox, and so on. The details are the result of negotiations based mainly on who’s hot and who is bringing in the biggest audience.

HBO is just one example of a model that could be used to pay for all sorts of creative and valuable original materials. Consider: if I buy a song on iTunes, there is no jingle that I have to listen to first (or in the middle!). If I buy a book, there’s no ad on page 178. In those markets, I expect to pay the full amount, without a  subsidy from advertisers.

Can the journalism that has been brought to us by newspapers, magazines, and television be funded without advertising?

Stay tuned.

 

 

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How do you say “paywall” in German?

By Christopher B. Daly 

The answer is: “paywall” (probably pronounced payvall). That’s according to Google Translate.

The fuller answer is in this piece in the Times, documenting a trend-let in setting up paywalls in Europe.

Whatever they are called, paywalls are emerging as the salvation (if there is one) for journalism, because the growth in online advertising is painfully slow.

source: TechCrunch

source: TechCrunch

 

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There’s journalism and then there’s advertising

By Christopher B. Daly

Trouble is, in politics, there are no rules. The very virtue that journalists try so hard to establish and protect — credibility — is just another tactical advantage to political ad-makers.

According to John Harwood in today’s Times,

More and more this election year, campaign ads include footage from television news programs, further blurring the fading lines separating modern journalism and politics. The trend bothers practitioners of journalism more than those in politics.

I’m afraid there is really no remedy.

As the veteran political Joe Klein of Time said on TV recently: there is no answer; journalists just have to get over it.

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The glass is half-empty AND half-full

By Christopher B. Daly 

In light of the recent announcement that the New Orleans Times-Picayune will scale back the frequency of its print editions, the following chart bears studying:

This chart was part of a recent presentation by Mary Meeker of Kleiner Perkins. (I got hold of it through Poynter.)

So, what’s the takeaway? If you extend those trend lines any further, you can see that the revenue won’t be there in the future to support a printed newspaper. If newspapers want to stay in the news business, they better have a plan to get out of the paper business.

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Filed under Journalism, journalism history

Another one bites the dust

By Chris Daly

This is not another nostalgic piece about the demise of Filene’s Basement, prompted by today’s stories about the closing of the “legendary” discount retailer. (Fact is: I never really liked the place that much; in order to take full advantage of Filene’s Basement, you had to go there a lot, and I hate shopping, so it was not for me.) For people who care about the news business, the thorn on this withered rose is that there goes another source of display advertising for Boston-area newspapers.

When I was a kid delivering those newspapers in the 1960s, Filene’s department store (and not just the basement) did battle with Jordan Marsh from their proud flagship stores facing each other across Summer Street, and they competed with a slew of other department stores as well, including Gilchrist’s and some others I have forgotten. Back then, when those stores had “white sales” or wanted to tout their new fall fashions, or get ride of some extra mattresses, they took full-page ads in the big dailies.

Now, the area known as Downtown Crossing is literally a hole in the ground, from which no advertising dollars escape.

 

 

 

 

 

This is part of the reason that the Globe and the Herald are shells of their former selves. One of their most important revenue streams simply dried up — and shows no signs of ever gushing again.

Footnote: a whimper-out to Globe staff photographer Suzanne Kreiter for having her photo chosen to illustrate today’s story. The last-century photo dates from the heyday: 1988.

 

 

 

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