Section front ads, maybe even the front page!

By Greg Michael

First The Wall Street Journal, America’s last true freedom loving, free enterprise newspaper, will be putting ads on section fronts. (Hello? USA Today has been doing that for 20 years). A day later, the Chicago Tribune announces it will even “dirty its hands” and put ads on some section fronts. The move is just another indication that the editorial elites are trying to appear “business oriented” to stockholders. Imagine, they will even allow precious inches on their sports section!

Meanwhile, YouTube has banner ads across the top of its page and gets 100 million video views every day. In the next day or two, the New York Times editorial-centric management (picture them in togas) will decide to allow some real ads on their section fronts, as well.

But the investment advisors will be calling their clients, saying “Time to sell. This is a joke.” These section front ads are just some of the papers’ ad inventory moving up a page. They are fooling themselves if they think they will get incremental revenue gains from the move. This stratagey is not unlike the newspapers’ shallow Web advertising models. They just cannibalize their print ad inventory by spreading a small fraction of their loyal customers’ ads from print to the Web. But the advertisers don’t increase their budgets, most often, they decrease them. The big audience numbers in national and regional media have shifted to Google, AOL, Yahoo, YouTube, MSN, and FOX.

Newspaper editors didn’t do very well in business or math classes. You think?

Honey, We Shrunk The Times

By Greg Michael

The New York Times plans to narrow the size of its flagship newspaper and close a printing plant, resulting in the loss of 250 jobs, in a move to stop the decline of its stock value and keep major shareholders from a revolt or from bolting altogether.

The changes are still a way off, why report that now?

It may be because The Times will be reporting some mediocre financials in the next day or two. This tidbit on the lowly production job cuts are meant as red meat for shareholders. The cuts are planned to take place in April 2008, including the closure of a printing plant in Edison, New Jersey. The company will consolidate its regional printing facilities at a plant in Queens. The newspaper will be narrower by 1 1/2 inches. Some of their loyal high-end advertisers will wonder why they are paying the same rates or even more for a smaller space, but  most of the ad agencies are used to the new format. USA Today has  used that slim format for more than a decade.

The reports it expects the changes to result in savings of $42 million (over what time frame? Is this proper disclosure under Sarbanes-Oxley?).

The narrower format will reduce the space the paper has for news by five percent, Executive Editor Bill Keller said in an online article (Is that all Mr. Keller? What about the space for the advertisers who help pay for your summer home in the Hamptons?) 

Actaully, the Times was one of the last holdouts on the standard, slimmer format. The Times will in two years, join with most major papers that made the switch several years ago, including The Washington Post, San Francisco Chronicle, Houston Chronicle,  Chicago Tribune and . They have reduced their size as they cut newsprint and other production costs and try to stem the continual loss of readers and advertising to the Internet and other media.

Years late and several million dollars short in making the change, due to an editor-centric management culture unique to The Times, rather than a business-led organization.

Imagine if Disney would let artists run the company and own all shareholder voting rights. Goofy management decisions. The Times has created the two-tiered stock scheme with voting rights preserved for a small inner-circle of family members and elite editors. The lion’s share  of stockhoders are  just happy little dwarfs.

Another chief indicator was reported, that Times Chief Financial Officer Leonard Forman will retire in 2007 after the company names a successor. (He’d leave for the Hamptons today, if he could).

Getting out while the getting is good

Forman was president of The New York Times Magazine Group from 1998 until it was sold in 2001. Analysts believe Forman was in charge of cleaning up the books and window dressing the magazines that were sold at about the same time that the paper was sold.

The Gray Lady doesn’t have much more to lose.

Web 2.0 sites like Digg.com use ‘social networking’ to rank the news, from both mainstream and citizen journos

By Greg Michael  

The times, they are a changin’. The next shoe to drop came a few weeks ago, when Michael Arrington, a blogger on new Internet businesses  http://www.techcrunch.com/, caused a few more grey hairs at the Old Grey Lady (a nickname for the New York Times) when he said http://www.digg.com/ looked like it  was close to equaling The New York Times in one measure of online readership.

“Digg is looking more and more like the of the Web,” Arrington concluded in a post on his popular blog. According to Alexa.com, which tracks Web traffic, the news-aggregating site begun in late 2004 also has more online traffic than The Washington Post, the Los Angeles Times, The Wall Street Journal, or USA Today. This, reported by  Gregory M. Lamb of The Christian Science Monitor.

Numbers, of course, can be counted several different ways, just ask your friendly local newspaper circulation manager. Whatever the most accurate readership figures turn out to be,  this and other  jaw-dropping new media news has caused  a shockwave across media analysts, stockholders and the no-longer-ivory-towers of newspaper executives.  Those tracking the future of the news media are asking their  doctors for anxiety-reducing drugs. 

The Times stories are of course, chosen picked by editors, journalists trained to decide what is “All the News That’s Fit to Print,” (supports politics and slams ) as the Times’s slogan promotes. At , visitors recommend items they find of interest online. Other Digg visitors then vote for the story by clicking “digg it” or disapprove of it by clicking “bury story.” Items that are “dug” the most become the top stories on the entry pages. Stories that receive too many “bury it” votes drop off the site. Digg is among a growing group of Web sites leveraging “social interaction” made famous by MySpace, YouTube and WordPress to news gathering. The site grabbed more attention last month when it expanded from tracking only technology news to such topics as world and business news, science, entertainment, videos, and gaming.

That move came just as media giant AOL announced plans to give its Internet portal http://www.netscape.com/ a drastic makeover, turning it into a similar visitor-powered news site (though Netscape says some human editors will monitor the site). Today, readers can choose between the unedited Digg and the edited NY Times models.

http://www.digg.com/ is simply tapping the “wisdom of the crowd,” says Kevin Rose, the founder and chief architect of Digg. That phrase is taken from a 2004 book by James Surowiecki, “The Wisdom of Crowds,” which argues that, in the right circumstances, the collective knowledge and expertise of a large group of people lead to better decisions than those made by individuals and what is becoming clear to many, elitists with political  agendas. “I think people will flock to sites like Digg to supplement their traditional news diets,” says JD Lasica, cofounder of Ourmedia.org, which also lets visitors post and share their original videos, photos, artwork, and writing.”Digg started on a shoestring a year and a half ago, and it’s astonishing how popular it’s become in such a short time,” says Lasica, a former editor at the Sacramento Bee who now writes about online media. “Like most big ideas, it starts with a ‘duh’ realization – that users want to be part of the editorial process, and that readers want to see news stories from a wide range of sources.” He continues, “Like it or not, most people just want to read a story and don’t really care which news organization first reported it.”