American Culture

A newspaper's leap into the Internet pond: Will it sink or swim?

Long ago, in the beginning, a newspaper developed a Web site. Hundreds followed that lead. Now, one newspaper has only a Web site. In the end, what will there be? And what will be the consequences for readers?

A Wisconsin daily newspaper, whose readers have been increasingly shedding it, has now shed a significant expense — newsprint. The Capital Times of Madison, whose circulation has fallen from more than 40,000 to 18,000, said “-30-” to its printing press. It has become an online information enterprise around the Madison.com portal.

The 90-year-old newspaper — one of two serving Madison under a joint operating agreement — will only publish a tabloid-sized edition twice per week carrying some news, opinion and a weekly arts, entertainment and culture section. It will be distributed in its home-delivered partner paper, the Wisconsin State Journal.

It’s a dicey move, but critics like me have said for years that the Web-only newspaper will see its day come (which does not mean we have argued that online-only is a good idea). So what does this end-of-print mean for Madison and beyond?

Capital Newspapers Inc. owns both the formerly evening Cap Times and the morning Wisconsin State Journal (as well as 18 other newspapers and several niche publications in 17 counties). Revenue shared equally between the Cap Times and the State Journal has allowed the Cap Times to withstand shrinking circulation without severe cuts in staff. It remains an influential liberal paper, contrasted with the more conservative State Journal. Not surprisingly, the State Journal reported that it had “succeeded in garnering most of The Capital Times’s former subscribers and will see its average daily circulation rise from 89,000 to at least 104,000 …”

About 20 jobs will be lost at the Cap Times and another 20 in the printing and distribution divisions of Capital Newspapers.

Here’s what the paper’s editor, Paul Fanlund, thinks:

To become a “CNN.com for Madison,” The Capital Times will have reporters posting breaking news items to its Web site seven days a week, 18 hours a day, Fanlund said. The Web site will also be hiring a staff member to improve its visual and audio content, he said.

“I absolutely believe the Internet is the future, ” Fanlund said.

But many challenges exist for the remaining staffers (who had little warning of the change) who would presumaby provide that ’round-the-clock coverage, according to Sue Robinson of the University of Wisconsin-Madison:

The introduction of new technologies to a staff that hitherto has not had much training across media platforms. The welcoming of citizen interaction within the production process. The 24/7 wire-service-like deadline. What it means to maintain objectivity as a journalist who must be heard and seen in their audio recordings or video formats. There is a going to be a significant adjustment period, no doubt, and at the end of it, the CapTimes’ newsroom culture will be altered in a fairly fundamental way.

Given the content of the real CNN.com, why would Mr. Fanlund want the Cap Times to be a local version of that? That seems to be an inappropriate frame to be imposed on a local readership by a local journalism entity. Is that the only model Mr. Fanlund has to present to serve Cap Times readers? He “absolutely believes” the Internet is future. But how does he intend to articulate that future?

And consequences for the Cap Times‘ readers?

Who will reading the Cap Times online? It had only 18,000 loyal hard-copy readers. Most appear to have drifted to the State Journal.

A reader of an Internet “newspaper” such as the Cap Times must have an Internet connection, preferably broadband, and sufficient income to pay for that connection. But the latter does not guarantee the former. That’s because broadband access is not universal, particularly in rural areas where newspapers are delivered. (Well, used to be. Many newspaper are cutting back on widespread circulation because of delivery costs.)

About 57 percent of the nation’s approximately 105 million households have broadband access, according to an S&R interview with Andy King of Website Optimization, publisher of the monthly Bandwidth Report. (Those households average about 2.6 people.)

Of those 18,000 loyal Cap Times print subscribers, how many have broadband access to retain their relationships with the newspaper? If locally oriented newspapers wish to succeed as online enterprises, they need to assure their local advertisers of eyeballs on the papers’ Web sites. Without much wider broadband coverage, how can they do that? That’s why I’ve argued for a broadband version of the Rural Electrification Act.

Without wider, affordable broadband access, the newspaper industry becomes complicit in a subtle form of redlining. That’s a practice commonly thought of in terms of refusing mortgages or insurance based on geography. But a newspaper’s decision to go online may in fact practice discrimination based not on geographic location but on the presence or absence of broadband. Access is generally found in densely populated areas. Rural areas require greater expense to provide broadband with less opportunity to generate revenue for the provider. If a newspaper drops its print edition and goes online, what happens to the rural subscriber without broadband access?

What would the journalism be like in an online enterprise focused on its broadband readers? Because newspapers, or online “papers,” are so starved for revenue, it’s likely that their energies will be focused on the wants and needs of an urban, affluent, probably mostly Caucasian population. That may make for a healthier balance sheet, but that’s not necessarily healthy for a readership left behind by the switch to online publication.

Newspapers have seen their financial ability to produce a marketable product eroded by revenue losses and gutted by staff cuts in response to those losses. Yet newspaper managers want their decreased staffs to adjust happily to a greater burden producing more (and innovative) news products. That has consequences, according to John Morton, who writes about the newspaper business for the American Journalism Review. In “Enough is Enough,” he says:

Still, even small newspapers are cutting back. I recently had an e-mail colloquy with an editor of a small-town daily in the Southwest. He loves his town and his newspaper, but he is troubled by a significant reduction in his staff at the same time his publisher is urging him to develop new editorial products to gain more readers and advertising.

“How am I supposed to do this?” he asked; he wondered if I knew how other small-town editors had coped in similar circumstances. I had little comfort to offer. I told him that his staff, in addition to the traditional burden of paltry pay, would now have the additional burden of being overworked. Editors at large dailies have the same problem, but at least they are able to spread the burden over a larger number of staffers. When the entire staff has ten or twelve people, there is much less running room.

Says Editor & Publisher’s Joe Strupp about the Cap Times‘ decision:

It’s not a surprise because the Web has become such a major factor for newspapers and I think clearly the way they’re going to survive is do more and more on the Web. That doesn’t necessarily mean everyone’s going to go Web only in the next five to 10 years.

But has the Web become a major financial factor yet for newspapers? No, says Mr. Morton:

Newspaper executives point to the Internet as the future of newspapers, arguing that a combination of online and print products will assure newspapers of a profitable future. Yet last year newspaper Internet revenue amounted to only 7 percent or so of total advertising. Moreover, growth in Internet revenue, which in earlier years had been 30 to 40 percent a year, has dropped to about 20 percent.

What this portends is that a successful Internet-print future will be a long time coming. And if newspapers embark on this future with lesser journalistic products, less circulation, less standing in their markets, the profits of the future likely will be much less than newspapers are accustomed to.

This is the economic and journalistic sea into which the managers of The Capital Times have leapt, perhaps blindly, perhaps too optimistically.

Let’s check back in a year and see how they — and their readers — are doing.

6 replies »

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  2. I still say that pubs like this one need to keep the paper, but shift its emphasis to something more magazine-like. The news outlet that makes the Web move work first, I suspect, will be in a tech-saturated urban area (Seattle, Denver, SF, Boston, etc.) but I’m glad to see a publisher taking the plunge, at least….

  3. Thanks, Dr. D., for another important post on the subject. It’s a learning experience for me.

    All I have to offer is that, in the end, local newspapers, whether they morph into Web sites exclusively or magazines as well, are more likely to resemble traditional newspapers, where the emphasis is on objective dissemination of events obviously not reported nationally.

    National news sources echo each other. The growth there, one would think, is in partisan, or at least op-ed-oriented, papers or sites to hook today’s jaded readers, for whom objective reporting on national issues seems dry.

  4. 1) The Capital Times is not subject to market forces, considering that they have lost money for decades yet remain in operation through their profit sharing with the Wisconsin State Journal. They’ll just be losing less money now than they did before by shedding paper, printing, and delivery costs, along with newsroom and other job cuts — bigger than they claim, with newsrooms at other Capital Newspapers publications being cut as well. Whatever happens to the paper, though, is not indicative of anything larger with the industry considering their special situation.

    2) The Wisconsin State Journal did not actually acquire all of the Capital Times’ subscribers. Rather, all were given 3 weeks free of the State Journal, a bait and switch so the entire company can look like it’s not shedding overall circulation.

    3) You’re spot on about the redlining.

    4) Ultimately, it’s all about the money. Capital Newspapers is shut out of the weekly market in Madison, hometown of the Onion, and this is its gambit to trim the fat off a money loser while rededicating resources to its primary unexploited print media niche in the region.

    5) In the end, there’s no business model for an online daily publication, particularly one with 40 plus employees. For people in Madison, this is merely the latest and an expected step in the long, slow decline of The Capital Times as its corporate partner Lee Enterprises gradually assumes a monopoly market position. Enough with the Web 2.0 fantasizing, it’s not 1999.

  5. I’m hoping more small town papers switch to an online presence and phase out their print versions. It may actually increase their “circulation” being online. Former residents would be able to check in on their once-local paper. As would regular visitors & vacation home owners. My parents wouldn’t pay for a deliver subscription of the Durango Herald, but they would read it online. My mother misses that police blotter “May 30, Someone needed assistance removing a guinea pig from behind a stove” (not kidding).

  6. Madisonian:

    Thanks for the update. I’d been hoping someone with more intimate knowledge would chime in. You make Madison and Lee sound like Salem, Ore., and Gannett of a few decades ago.

    Lara:

    I live in a rural area and no longer subscribe to the local paper of the “larger” neighboring town because it simply does not provide what I need about the town I live in. But because I have no ‘net access other than dial-up, I’m semi-redlined.

    I’d also like to read my hometown paper (where I worked for 20 years) as you suggest. But without widespread broadband, I’m unable to do so.

    “Small” generally means “a lot of rural.” And that often means “no broadband.”

    Thanks to all for their comments.