Sunday, February 1, 2009

The Future of Print

Reporters and bloggers sound off on a subject near and dear.

Posted on Sun, Feb 1, 2009 at 3:33 AM

Almost nothing has worked this year for E. W. Scripps, the parent company of The Commercial Appeal.

First, however, a little perspective is in order. The CA can and does still make money, although Scripps won't say how much or what its profit margin is at individual properties. The Scripps newspaper chain earned $58 million in profits on $431 million of operating revenue in the first nine months of 2008. Not great, but hardly a General Motors-style loss either. That said, the trend in circulation, advertising, and finance is not good.

The Wall Street Solution: A reverse stock-split and separation of the newspapers and network television stations into a new company in July was supposed to keep Scripps stock trading above $5 a share. Since that move was made, the stock has fallen from $11 to just over $3, and the dividend has been cut. Ownership of a newspaper in Memphis by a publicly traded company and its majority stockholders in Cincinnati who demand dividends and a rising stock price is not going to work.

The Web Solution: Shifting resources to the Internet is supposed to attract advertisers. But Scripps' papers get only 7 percent of their revenue from the Internet, reports show.

Hot News: The presidential election and the 2008 Olympics were an advertising boon to television stations but not newspapers. The Flyer and the CA provided broader coverage of local politics and both national conventions, but local television stations reaped the rewards of campaign advertising, especially from the Mississippi congressional races.

Turf Protection: Only about one in three households in Shelby County receives the CA. Internal documents obtained by the Flyer show that the CA's Sunday distribution, counting home delivery and newsstand sales, is 123,687, and average other-than-Sunday distribution is 99,958. Suburban papers are nimble, pay less, and don't have to be all things to all readers. Delivering papers to the suburbs is expensive when your printing press is in downtown Memphis. Combined circulation of suburban papers in Bartlett, Germantown, Collierville, and Millington is closing in on the CA.

Shrinking Your Way to Prosperity: Belt-tightening, like the 57 job cuts the CA made in October, reduces costs but also lowers morale and puts good reporters out of work. The recession is killing the businesses and classified ads that are the lifeblood of newspapers.

So, do print newspapers have a future? As I've written before, I think they do as long as there are coffee cups and bathrooms, but diehards will have to pay more for home delivery and news staffs will continue to shrink. I asked several current and former print journalists, broadcasters, and bloggers what they think of the future of print journalism. This is what they said:

Nevin Batiwalla is the editor of The Daily Helmsman at the University of Memphis. The senior from Germantown is majoring in — gasp! — journalism and works 12 hours a day, four days a week, at the paper. He was recently laid off from his part-time weekend job at the CA despite getting some positive references.

"I loved it. It was fun. It's what I want to do," says Batiwalla, who is getting married in June. "But now that I'm about to graduate, I see it's really tough to get a job right now. I can't sleep at night."

He thinks niche publications may be the future of print but personally likes the breadth of coverage and the mix of features and news in bigger papers.

"I read print newspapers, but I probably read more news online," he says. "There's something about holding a newspaper that I like. But other people my age ... I don't know anyone who reads a newspaper in print form."

The Helmsman gets a little subsidy from the university and can sell ads, but the paper has shrunk from an average of 16 to 20 pages per issue to 8 to 16 pages. The paper is affiliated with a college publisher that hosts its website for free but gets all the advertising revenue.

Blogger Thaddeus Matthews, whose mix of news, rumor, politics, and outrageous comments has won him a following, says there's decent money to be made on the Internet. Politicians are his biggest revenue category: "In a political month, I do real well. I average about $2,500 a month, but that is not really working at it. I spend more time on [getting] advertising for my radio show."

He does not subscribe to a print newspaper but is grateful for the boost he gets when his blog is mentioned in one. He says media coverage of the photographs he ran of the Lester Street murder victims "drove 100,000 people to my site in two days."

Unlike print papers, website visits are unaudited. But Matthews is confident in his business model.

"There's no overhead, except for the time you put into it," he says.

Blogger Tom Jones, a former print reporter, is the main author of the "Smart City Memphis" website, which provides serious analysis of local government, education, and fresh ideas.

"It's hard for me to see how newspapers survive," he says. "They're so heavily invested in their own legacy systems that I don't see them figuring out how to make the transition to the web."

Jones thinks the most likely survivors will be the really big and really small papers. He thinks the rest will become niche operations, customized to particular groups of readers. He's working on a "Memphis blog with 30 or 40 innovative thinkers" that would become the place to look for Memphis happenings and ideas, but funding it is a puzzle.

"Is there any money in blogs?" he asks, rhetorically. "If there is, I haven't figured it out. It's definitely a loss leader."

Jon Alverson is publisher of the Millington Star, part of the West 10 Newspapers group of paid and free suburban weeklies that includes the Bartlett Express, Shelby Sun Times, and Collierville Independent plus the Shopper's News. The group prints 119,000 papers a week, or 19,000 more than the CA's midweek count.

Alverson, 33 years old, is a print guy. "Our saving grace is that we are going to get enough of bloggers. So many have written so much that so few read. We'll go back to someone who provides a salient, vetted, and fair news angle," he says.

The Star's circulation is just under 5,000. A year's subscription and home delivery costs only $22. Less than 10 percent of the paper's revenue comes from Internet advertising.

"We're not really in competition with The Commercial Appeal," Alverson says. "We serve a different kind of customer. We want to be the Millington newspaper."

Janice Broach is a veteran news reporter for WMC-TV Channel 5, one of four television news operations in Memphis. Newspapers may be losing classified ads to the Internet, but surveys show that television is where the majority of Memphians go for news. And like newspapers, they're investing in their websites.

"We are pretty lean, but television stations for the most part have not been cutting back," she says.

Broach thinks newspapers have a future because they can do longer and more in-depth stories: "We have to rely on video, and we only have so much time. They can talk more about the minutiae." As for newspapers adding their own video on their websites, "We are the masters of video, but better something than nothing."

Mike Fleming is a former Commercial Appeal reporter who made a successful mid-career transition to radio, where he hosts The Mike Fleming Show on WREC-AM 600. He is pessimistic about the prospects for his former employer.

"I don't think they have a future," he says. "The way we envisioned it is long gone. I can't get through the day without reading a paper, but I am in a vast minority. They have killed themselves by chalking off conservatives and Republicans and a broad spectrum of people. But I don't think anything could have saved them anyway. The Internet has eaten them alive. There may be a way to make money off it, but I'm not smart enough to know what it is."

Eric Barnes is publisher of the paid-circulation Memphis Daily News (circulation 3,000) and its free weekly edition, The Memphis News (circulation 11,000), launched last summer. The hybrid business model relies on veteran local reporter Bill Dries for news, a profit center of liens and licenses and other paid public notices, and a close affiliation with the Chandler Reports, a real estate data base that costs $25 a month and is heavily promoted in the company's papers.

"We think print has a future," Barnes says. "We have emphasized the web heavily for some time but see them coexisting. For us as niche papers, that makes a lot of sense. I don't envy the dailies trying to remain general-interest, mass-distribution papers."

The Daily News prints its own newspapers (unlike the Flyer, which is printed in Jackson, Tennessee). That helped them launch a new weekly in a bad economy. The papers get less than 10 percent of their revenue from online ads. Display advertising in the print papers is up 30 percent this year, Barnes says.

"It is not good for cities to have their newspapers so under pressure," he adds. "Love 'em or hate 'em, they're an important source of information."

Thursday, November 27, 2008

On Sports Survival

While Tiger basketball thrives, other Memphis teams stumble.

Posted By on Thu, Nov 27, 2008 at 4:00 AM

The golden age of sports is over in Memphis. It ended on November 17th when the Dow fell 223 points, GM and Ford begged Congress for a bailout that didn't happen, Dallas Mavericks owner Mark Cuban was accused of insider trading, and the University of Memphis drew 18,000 fans to FedExForum for a basketball game that began at 11 p.m. and was nationally televised on ESPN.

The Tiger basketball team will be fine. Not so the city's other signature teams or the leagues they play in.

Sixteen hours after the Tigers thrashed Massachusetts, the Memphis Grizzlies drew about half that many fans. Last in the NBA in attendance, the Grizzlies probably won't draw 18,000 people to any game this season. Memphis can't support two big-time basketball teams, one of which consistently loses while paying its players preposterous salaries while the other consistently wins while paying its players in college scholarships and television exposure. Either Grizzlies owner Michael Heisley continues to eat the financial losses or he eventually tries to move the team and lets the lawyers sort it out.

The Tiger basketball team also managed to outdraw the Tiger football team, which played Central Florida on Saturday in Liberty Bowl Memorial Stadium before the "announced" crowd of 18,836. "Announced" is newspaper-speak for saying the crowd wasn't that big.

No one in a position of authority will say so, but the University of Memphis might be better off without football, which costs millions more dollars each year than it produces and requires the athletic department to spend a proportionate amount on scholarships for women's sports that produce little or no revenue.

Football is important to small colleges because it enhances the campus and attracts males, who are underrepresented relative to females, without the cost of athletic scholarships. It will always thrive at big universities like Tennessee and Ole Miss. Memphis is in some middle ground, in the heart of the Southeastern Conference geographically but stuck in third-tier Conference USA with an off-campus stadium and a coach making nearly $1 million a year.

One of the football models for ambitious have-nots is Rutgers University, which made it into the national rankings in 2006. According to The New York Times, Rutgers has embarked on a $100 million stadium expansion only to see donors and state funding vanish and public criticism mount.

After a decade of expansion in which Memphis built AutoZone Park and FedExForum, we're headed for years of contraction. Disposable income, an expanding economy, television royalties, corporate sponsorships, and new stadiums were the keys to sports prosperity. Now the sports business is about to meet the fate of the car business, the banking business, and big-box stores.

If General Motors can contemplate bankruptcy and Merrill Lynch can be absorbed by Bank of America, then we can expect to see some culling of the herd in college and pro sports too.

The flight to quality in spectator sports is happening in Nashville as well as Memphis. On Saturday, the University of Tennessee and Vanderbilt failed to fill 39,700-seat Vanderbilt Stadium, despite Vanderbilt being "bowl-eligible," the Holy Grail of college football. The Nashville Predators, which started playing in 1998, are third from the bottom in attendance in the National Hockey League. The Tennessee Titans, on the other hand, are doing fine 10 years after their one-season layover in Memphis and good-riddance move to Nashville. The Titans overcame a year in Vanderbilt Stadium and the bankruptcy of their new stadium's first namesake, Adelphia, on the way to numerous successful seasons, including the Super Bowl in 1999.

On Thanksgiving, the Titans will play the Detroit Lions on national television. The once-beaten Titans are the best team in the league, and the winless Lions are the worst. In any other business, the Lions would be out of business. The team has won one playoff game in 51 years. Not coincidentally, the Lions are owned by William Clay Ford. Yes, those Fords. The Ford Motor Company or some other member of the auto industry Big Three may not outlast the Ford football team.

Banks and car companies have to beg for a taxpayer bailout. Sports teams get their bailout in television revenue and new stadiums paid for with tax money. For cities like Memphis, there's more anxiety than hope in the proverbial "wait until next year."

Wednesday, November 19, 2008

The Future of Print

Reporters and bloggers sound off on a subject near and dear.

Posted By on Wed, Nov 19, 2008 at 4:00 AM

Almost nothing has worked this year for E. W. Scripps, the parent company of The Commercial Appeal.

First, however, a little perspective is in order. The CA can and does still make money, although Scripps won't say how much or what its profit margin is at individual properties. The Scripps newspaper chain earned $58 million in profits on $431 million of operating revenue in the first nine months of 2008. Not great, but hardly a General Motors-style loss either. That said, the trend in circulation, advertising, and finance is not good.

The Wall Street Solution: A reverse stock-split and separation of the newspapers and network television stations into a new company in July was supposed to keep Scripps stock trading above $5 a share. Since that move was made, the stock has fallen from $11 to just over $3, and the dividend has been cut. Ownership of a newspaper in Memphis by a publicly traded company and its majority stockholders in Cincinnati who demand dividends and a rising stock price is not going to work.

The Web Solution: Shifting resources to the Internet is supposed to attract advertisers. But Scripps' papers get only 7 percent of their revenue from the Internet, reports show.

Hot News: The presidential election and the 2008 Olympics were an advertising boon to television stations but not newspapers. The Flyer and the CA provided broader coverage of local politics and both national conventions, but local television stations reaped the rewards of campaign advertising, especially from the Mississippi congressional races.

Turf Protection: Only about one in three households in Shelby County receives the CA. Internal documents obtained by the Flyer show that the CA's Sunday distribution, counting home delivery and newsstand sales, is 123,687, and average other-than-Sunday distribution is 99,958. Suburban papers are nimble, pay less, and don't have to be all things to all readers. Delivering papers to the suburbs is expensive when your printing press is in downtown Memphis. Combined circulation of suburban papers in Bartlett, Germantown, Collierville, and Millington is closing in on the CA.

Shrinking Your Way to Prosperity: Belt-tightening, like the 57 job cuts the CA made in October, reduces costs but also lowers morale and puts good reporters out of work. The recession is killing the businesses and classified ads that are the lifeblood of newspapers.

So, do print newspapers have a future? As I've written before, I think they do as long as there are coffee cups and bathrooms, but diehards will have to pay more for home delivery and news staffs will continue to shrink. I asked several current and former print journalists, broadcasters, and bloggers what they think of the future of print journalism. This is what they said:

Nevin Batiwalla is the editor of The Daily Helmsman at the University of Memphis. The senior from Germantown is majoring in — gasp! — journalism and works 12 hours a day, four days a week, at the paper. He was recently laid off from his part-time weekend job at the CA despite getting some positive references.

"I loved it. It was fun. It's what I want to do," says Batiwalla, who is getting married in June. "But now that I'm about to graduate, I see it's really tough to get a job right now. I can't sleep at night."

He thinks niche publications may be the future of print but personally likes the breadth of coverage and the mix of features and news in bigger papers.

"I read print newspapers, but I probably read more news online," he says. "There's something about holding a newspaper that I like. But other people my age ... I don't know anyone who reads a newspaper in print form."

The Helmsman gets a little subsidy from the university and can sell ads, but the paper has shrunk from an average of 16 to 20 pages per issue to 8 to 16 pages. The paper is affiliated with a college publisher that hosts its website for free but gets all the advertising revenue.

Blogger Thaddeus Matthews, whose mix of news, rumor, politics, and outrageous comments has won him a following, says there's decent money to be made on the Internet. Politicians are his biggest revenue category: "In a political month, I do real well. I average about $2,500 a month, but that is not really working at it. I spend more time on [getting] advertising for my radio show."

He does not subscribe to a print newspaper but is grateful for the boost he gets when his blog is mentioned in one. He says media coverage of the photographs he ran of the Lester Street murder victims "drove 100,000 people to my site in two days."

Unlike print papers, website visits are unaudited. But Matthews is confident in his business model.

"There's no overhead, except for the time you put into it," he says.

Blogger Tom Jones, a former print reporter, is the main author of the "Smart City Memphis" website, which provides serious analysis of local government, education, and fresh ideas.

"It's hard for me to see how newspapers survive," he says. "They're so heavily invested in their own legacy systems that I don't see them figuring out how to make the transition to the web."

Jones thinks the most likely survivors will be the really big and really small papers. He thinks the rest will become niche operations, customized to particular groups of readers. He's working on a "Memphis blog with 30 or 40 innovative thinkers" that would become the place to look for Memphis happenings and ideas, but funding it is a puzzle.

"Is there any money in blogs?" he asks, rhetorically. "If there is, I haven't figured it out. It's definitely a loss leader."

Jon Alverson is publisher of the Millington Star, part of the West 10 Newspapers group of paid and free suburban weeklies that includes the Bartlett Express, Shelby Sun Times, and Collierville Independent plus the Shopper's News. The group prints 119,000 papers a week, or 19,000 more than the CA's midweek count.

Alverson, 33 years old, is a print guy. "Our saving grace is that we are going to get enough of bloggers. So many have written so much that so few read. We'll go back to someone who provides a salient, vetted, and fair news angle," he says.

The Star's circulation is just under 5,000. A year's subscription and home delivery costs only $22. Less than 10 percent of the paper's revenue comes from Internet advertising.

"We're not really in competition with The Commercial Appeal," Alverson says. "We serve a different kind of customer. We want to be the Millington newspaper."

Janice Broach is a veteran news reporter for WMC-TV Channel 5, one of four television news operations in Memphis. Newspapers may be losing classified ads to the Internet, but surveys show that television is where the majority of Memphians go for news. And like newspapers, they're investing in their websites.

"We are pretty lean, but television stations for the most part have not been cutting back," she says.

Broach thinks newspapers have a future because they can do longer and more in-depth stories: "We have to rely on video, and we only have so much time. They can talk more about the minutiae." As for newspapers adding their own video on their websites, "We are the masters of video, but better something than nothing."

Mike Fleming is a former Commercial Appeal reporter who made a successful mid-career transition to radio, where he hosts The Mike Fleming Show on WREC-AM 600. He is pessimistic about the prospects for his former employer.

"I don't think they have a future," he says. "The way we envisioned it is long gone. I can't get through the day without reading a paper, but I am in a vast minority. They have killed themselves by chalking off conservatives and Republicans and a broad spectrum of people. But I don't think anything could have saved them anyway. The Internet has eaten them alive. There may be a way to make money off it, but I'm not smart enough to know what it is."

Eric Barnes is publisher of the paid-circulation Memphis Daily News (circulation 3,000) and its free weekly edition, The Memphis News (circulation 11,000), launched last summer. The hybrid business model relies on veteran local reporter Bill Dries for news, a profit center of liens and licenses and other paid public notices, and a close affiliation with the Chandler Reports, a real estate data base that costs $25 a month and is heavily promoted in the company's papers.

"We think print has a future," Barnes says. "We have emphasized the web heavily for some time but see them coexisting. For us as niche papers, that makes a lot of sense. I don't envy the dailies trying to remain general-interest, mass-distribution papers."

The Daily News prints its own newspapers (unlike the Flyer, which is printed in Jackson, Tennessee). That helped them launch a new weekly in a bad economy. The papers get less than 10 percent of their revenue from online ads. Display advertising in the print papers is up 30 percent this year, Barnes says.

"It is not good for cities to have their newspapers so under pressure," he adds. "Love 'em or hate 'em, they're an important source of information."

Thursday, November 13, 2008

Report Card Time

Teach For America is at a third-year milestone in Memphis.

Posted By on Thu, Nov 13, 2008 at 4:00 AM

Supporters of Teach For America say the program can help close the achievement gap between city and county schools that is glaringly apparent in state report cards that came out this week.

Report cards from the state education department delivered straight A's to the 46,500-student county system. The city system got mostly C's and D's.

But there were encouraging signs at several schools, and Memphis City Schools superintendent Kriner Cash promised to be "more aggressive about our expectations."

The release of the state report cards always raises questions about the validity of test scores and what works and what doesn't work in public schools. Teach For America, in its third year in MCS, has the same goal that Cash does: to make city schools as good or better than Shelby County schools or suburban school systems in Nashville. There are 122 corps members and alumni working in schools.

"If I were principal of a failing school, I would hire as many TFA corps members as possible," said Memphis entrepreneur Bob Compton, whose documentary film, Two Million Minutes, highlights the shortcomings of American high school education in comparison with top schools in India and China. "I am more concerned about children getting a good education so they can be financially self-sufficient than I am about hurting the feelings of principals or teachers' unions."

The problem, Compton says, is that isolated school reforms are tantamount to "watering the desert." The Memphis school that made the biggest commitment to TFA is Kingsbury High School, where 14 corps members taught last year and eight are teaching this year.

"Three first-year corps members at Kingsbury led 92 percent of their students to pass the Gateway with 59 percent of their students scoring in the advanced range," said Brad Leon, executive director of Teach For America.

The previous year, only 45 percent of Kingsbury students passed the Algebra 1 Gateway and only 13 percent scored advanced.

Can those results be replicated?

"Without any doubt," said Terrence Brown, the principal at Kingsbury last year and now one of four regional superintendents in MCS. "It's a matter of focusing on the problem and executing the plans that you make. There is no reason we cannot do as well if not better than suburban systems. It's a two- or three-year process."

One problem Brown had was unqualified math teachers. He got rid of them, moved up some strong middle-school teachers, designated a veteran teacher as the "math coach" for the new teachers, and consigned some students who were new to the United States and struggling with speaking English to a lower-level course. He admits that helped raise the test scores, but he says it was only a small group and that the students are now taking Algebra I.

Brown said he prefers that good teachers stay in the profession as a career, but he welcomes TFA's two-year commitment.

"It is always better to have a strong teacher than a weak teacher without regard to time," he says.

John Barker, head of research for MCS, said that while annual state report cards generate a lot of attention, the data is now new. He was pleased with the large number of students moving from below proficient to proficient — a measurement of "value added" that shows the district is "moving in the right direction." But the rising dropout rate and falling graduation rates, he agrees, are "not acceptable." Cash has made the 30,000 "overage" students who are at least a year older than their classmates one of his top priorities.

Since its inception nearly 20 years ago, Teach For America has become nearly as difficult to get into as an Ivy League college by fostering a sense of mission and, some say, providing a career-building springboard to other professions. Criticisms of the program include teacher retention and the implicit challenge to the public school status quo.

"This system wants long-term solutions," Leon says. "That's a reasonable concern. My opinion is whether you are a 30-year veteran or a first-year teacher, you get one year to do the most you can with your students. With TFA, you are very likely to get an outstanding teacher."

Thursday, November 6, 2008

Potty Patrol

City inspection blows the lid off of Beale's secret scandal.

Posted By on Thu, Nov 6, 2008 at 4:00 AM

On Election Day, with the future of the presidency and perhaps the fate of the world hanging in the balance, John Elkington was supposed to be worried about toilet seats.

Specifically, toilet seats on Beale Street. Loose toilet seats. Dozens of them. According to inspectors hired by the city and a legal team led by Ricky Wilkins and being paid $47,000 of public funds a month, they are "hazards" to the welfare of Beale Street's millions of visitors.

Pardon the expression, but it's turned into a real pissing contest between the city and Wilkins and Elkington's Performa Entertainment Real Estate, the manager and leasing agent for Beale Street for the last 26 years.

"That's exactly what it is," Elkington said. "On this historic day, I'm sitting here talking about toilet seats."

Wilkins and the team of crack inspectors are going to get to the bottom of this one. They're going to flush away corruption, and nobody is going to put a lid on this scandal.

Somebody call Joe the Plumber. We've got another Watergate on our hands.

To recap the crisis in the can:

In October, Wilkins' office received copies of the city's inspection of Beale Street properties.

"The inspections revealed several fire/safety hazards," wrote Sharon Harless Loy. "Please pass this information along so that these hazards are corrected as soon as possible."

The hazards were uncovered by teams of plumbing and electrical inspectors hired by the city to assess the condition of Beale Street properties as Elkington and the city attempt to reach a settlement that will remove him as manager. Elkington says he's ready to go, but the city feels it is owed a share of the profits. And before a divorce is granted, the condition of the worldly goods must be determined.

And that means everything, including the kitchen sinks and the toilets.

Quoting from the reports, inspectors found the following:

"Toilet seat loose" at 152 Beale, the Blues City Café, and several neighboring properties.

"Lavatory faucet drips" at 144 Beale, "women's toilet stopped up," "women's lavatory drains slow," and a "broken lavatory handle" at 152 Beale, "flush valve loose on urinal" and "kitchen sink loose at wall" at 152 Beale, and a veritable epidemic of loose toilet seats.

The seat scofflaws include Bud Chittom, owner of Blues City Café and other properties in the 100 block of Beale. Elkington took draconian action last week, sending Chittom and other club owners a no-nonsense letter.

"I cannot emphasize enough the importance of the toilet seats," he wrote. "During the next month, I will be spot-checking all the restrooms on the street. The problem is not going to go away, gentlemen. Let's tighten it up."

City inspectors also noted leaks in air conditioners, exposed electrical wires, clogged gutters, leaky roofs, cracked walls, broken exit lights, and a "light switch cover missing east of disco ball" in Club 152.

So what does Chittom have to say for himself?

"I think we need to weigh these people getting on these toilet seats," he said. "It might not have been fair to the seats. There should be some kind of standardized seat test."

He said he and his managers will address the electrical violations and will work with inspectors.

"We work diligently to make our places safe and well-maintained," he said. "Comparatively, we are probably in better shape than the courthouse."

As for the loose toilet seats, Chittom said he could have fixed them for a lot less money than the city paid Wilkins.

"Those seats on Air Force One didn't cost but, what, $1,300?"

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