The Unconditional Blog

The editorial in this week’s Listener titled “Feel free … don’t take media freedoms for granted”  lays down a challenge in the final paragraph:

“Freedom of expression is an individual right. But maintaining it is the responsibility of us all. Feel free, of course, to disagree.”

The article seeks to perpetuate a somewhat retrospective view that only mainstream media can uphold the principles of journalism and that the inevitable demise of newspapers is more than just a concern over financials and readers but actually brings into question the very principle of free speech and accountability for impartial reporting.

I would like to challenge the contention of such an article. As the writer of this blog I think I have both the justification and the experience to make a contribution to what I feel is a valid discussion – one that should be aired and debated. That actually in itself highlights a fundamental challenge I would make to the Listener. They are a pure print publication, whilst you can read this editorial online, I cannot comment directly on this article. If you want to comment on the editorial your only course of action is to write a letter in the limited hope that they will choose to publish the response. A blog like this though can engage and stimulate a valuable interchange of opinions which adds to the richness of the original editorial.

The editorial makes the assertion that blogs “serve a completely different purpose (than mainstream media)” – I would content that there are more than a few highly credible, widely read blogs that investigate and shine a light into the news – both political and business. To say that “no one except the media takes upon itself the daily role of observer and critic of institutions like the government, using the experienced staff and the recourse to lawyers they need to do the job impartially and properly” is an elitist statement that conveniently tries to marginalise and stereotype social media to be the embodiment of extreme political views written by those who border on libelousness without due care or consideration to legal obligations. Far from it I would content that many professional bloggers are enormously careful and respectful of legal and professional ethics – even more so as their readers are never more than a click away from an alternative source of opinion and insight – compare that to the switching alternatives of an annual subscription to a magazine or newspaper.

Accompanying the editorial is an article titled “Riders on the Storm” which examines the demise of newspapers. Sadly this article cannot be read fully online until the 16th May.

What I found interesting in this article is the view that newspapers whilst recognising that their readership is declining; and having attempted to create a business model online, report an adjudged failure of online versions which they typically suggest generate marginal revenue (typically 9% to 12% of the print versions). This would seem to indicate that online has been a failure, however this analysis is flawed. To compare the revenue online to the revenue of print completely ignores the massive legacy of cost inherent in newspapers.

The fact is that the advertising lead revenue of newspapers is not a function of market demand lead pricing, but is more a function of a carefully managed scarcity of advertising inventory which has been in the past leveraged to create an income stream to support an archaic manufacturing and distribution machine. Think of it this way; the costs of the major newspapers amount to many hundreds of millions of dollars per annum as they have to pay for the print and distribution of billions of pages of newsprint using massive and costly printing machines and fleets of distribution trucks – all those costs has to be paid for somehow – the cost of the paper to you or I goes nowhere close to recovering those costs and that is why they generate hundreds of millions of dollars from advertisers. Now consider for a moment a new model of a newspaper – no paper, no printing presses, no fleet of trucks – smaller simpler, still employing journalist and reporters but publishing online, suddenly that revenue stream from advertising from the websites today looks less like 10% of total revenue and looks more like a healthy return over vastly reduced costs of operation.

It would have been valuable for the Listener reporters to have read an excellent book I am currently reading by Jeff Jarvis challengingly titled “What Would Google Do?” – in it he dissects may industries and examines the impact Google is making on our commercial and social lives. Naturally he looks at the newspaper industry and makes the assertion based on rich analysis and investigative journalism (he is and has always been a journalist) that newspaper must and can survive the “paper” era. He quotes the London based Guardian paper as saying back in 2005 having spent US$150m installing new printing presses – that these would be the “last presses” they ever bought. He contends that the newspaper industry needs to ask the hard question – what business are we in? – the manufacturing and distribution business? – no longer; the information business? -not a sustainable place as it becomes commoditised (thanks to Google); the community business? – not yet. No the key recommendation is that the newspaper’s future lies in becoming a platform for larger networks of news – be part of the flow of news and share and link with bloggers and engage in the conversations of readers as part of the news.

So where you may ask is the contextual relevance to real estate? – well the real estate industry is one of the largest purchasers of print advertising and interestingly in the Listener article they quote a local newspaper executive as saying that “The main difference between advertising figures this year and last year is the drop-off in recruitment advertising”. This comment blew me away – has he not noticed the massive slump in the property market – the real estate industry transacted $42 billion in sales at its peak – 16 months later that has fallen to almost half – that directly effects the newspaper spend by vendors advertising homes for sale. I think the issue for newspapers is as home sales climb slowly this year and next, how much of that money will never return to print – rather it is finding a more cost effective and accountable home in the likes of featured property adverts on our site and other sites where agents and vendors can measure real performance metrics of adverts to monitor traffic.

The fact is newspapers don’t need to die and nor with it does the freedom of expression, newspapers will only die (and with it the freedom of expression) if the owners of those newspapers fail to see the importance of uncoupling the ‘paper from the newspaper‘.