The Tribune Co., owner of eight major daily newspapers, including the Los Angeles Times and the Chicago Tribune, as well as a bunch of local TV stations, is filing for Chapter 11 bankruptcy. The news will undoubtedly serve as the hook for another anguished round of hand wringing about the fate of the newspaper industry and the future of journalism. And I don't mean to say that it shouldn't. Historic changes are transforming the media industry, we don't know how it will all play out in the end, and anyone who earns their living in the business -- whether as blogger, reporter, columnist or editor -- has a right, and responsibility, to be worried.
But while I do feel concern for my own ability to earn a livelihood, every single day, in the midst of these uncertain waters, I am still not alarmed about what this epic transformation will mean for society. One key reason: I've yet to see any evidence, yet, that society's ability to inform itself has been irreparably harmed by the changes catalyzed by the Internet. Quite the contrary. The evidence, so far, proves the exact opposite. We suffer from information overload -- we have access to more analysis, more reporting, more primary sources, more debate and more data than ever before. To take just one almost trivial example -- I can stay infinitely more informed, while living in Berkeley, about daily life in Taiwan today -- economics, politics and culture -- using a score of English-language blogs as filters for all Taiwan-related information, than I could when I lived on the island 20 years ago. The same is true for economic analysis, sports, entertainment and, of course, politics.
Another point to bear in mind when reviewing the horrible balance-sheet statements of newspapers and other media organizations is that recessions are always hard on businesses that depend on advertising as a critical source of revenue. For those with short memories, we only need to look back at the savage culling of business and technology magazines, both online and off, that ravaged the industry in the wake of the dot-com bust. And yet, somehow, despite all the carnage, we currently are experiencing no shortage of business and technology news. So, yes, on the one hand, the news about the Tribune Co. sends chills down the spines of people who make their living working for daily newspapers, but it's also part of the natural order of things. In a really severe recession, companies with unworkable business models are going to go out of business.
Which leaves a third question: What's the business model for a major media empire these days -- public or private? Sam Zell took on so much debt in his leveraged buyout of the Tribune Co. that he, in effect, set himself up to be sucker-punched by the combination of a recessionary economy and a super-competitive landscape. To make his model work, he needed big profits. But there is no fundamental reason why a newspaper should be hugely profitable or should be of huge size, especially today. Once upon a time, owning a string of daily newspapers in big cities might have meant economies of scale. Now it just means that they all cannibalize each other while operating Web sites featuring the same AP news feeds, stable of columnists, cartoons and ever diminishing classified ads. Bigger is no longer better -- and that is also true for publicly owned media companies that depend on hefty stock prices and big returns on investment to keep shareholders happy.
As any freelancer knows who has watched pay rates stay essentially the same for the last 30 years, it's hard to make a buck as a writer because you are competing with a vast labor pool willing to give away their labor for free or close to it. You have to differentiate yourself by being better, or quicker, or quirkier, or all three. What we are witnessing right now is a massive shakeout that will cull every news media organization that does not clearly offer that kind of differentiating value.
We will not lack for content. Since reporting and writing are seen by many practitioners almost as a vocation, and not an assured path to riches, there will always be writers and reporters telling us what is going on. And there will always be an interest in and hunger for news. And where there are eyeballs, there will be advertisers. In fact, when this current economic downturn ends, there will probably be more advertisers than ever before, online. Which means that there will be business models for individuals and organizations that figure out how to attract readers to their content.
So what about the endangered investigative reporters? The single most common complaint about the new media landscape is that no one will pay for costly investigative reporting in a world of instant-gratification blogging and snark and razor-thin profit margins. I will believe this when I see it, but I'm prepared to admit it as a possibility. But I'd also like to ask: Since when has investigative reporting ever paid for itself? It has always been subsidized, one way or another, whether by classified ads or the millions of readers who are far more interested in the sports section, cooking section, entertainment news or comics pages than they are in the hard-bitten investigative exposés.
My bet on the media future: Fewer media empire dinosaurs, like the Tribune Co., and a lot more lithe, scampering little mammals. Smaller salaries, but more practitioners able to survive. More filters, of every kind, helping to steer readers to the good stuff. And more information, analysis, context, data and opinion than any of us can possibly consume. One thing there might not be a market for, however, is media moguls hoping to make obscene profits by consolidating monopoly control over a Pandora's box that has been busted wide, wide open.
Shares