Lowering Overhead?

[DouglasB]

One way to attempt to keep the bottom line stable is to lower overhead. In these bad economic times, that has = lay-offs.
At what point is the product damaged so much that this "addition by subtraction" concept actually begins to turn in negative results? In other words, how far can you cut? An example: At some stations they are not giving away stuff on-air as much because nobody is there to take the calls so they're telling listeners to log on to the website and register to win.

A good example of your point is daily newspapers. To meet the profit expectations of Wall St, large investment firms, and private owners, newspapers took the easy way out and cut expenses, rather than improve their product with compelling content. Year after year through attrition, job consolidation and layoffs, media giants like Knight-Ridder were able to continue to cut their operations to the bone to satisfy bottom line expectations. Somewhere along the line the public and advertisers noticed. Soon there was no where more to cut, and Wall St called in their money and Knight-Ridder is no more.
Is the same scenario occurring in radio? Maybe. Who knows? Radio is a business, but it's a business that many years ago was run by broadcasters, not Wall St hotshots who don't know anything but the bottom line. We'll see.

 

[TheBigA]

newspapers took the easy way out and cut expenses, rather than improve their product with compelling content.

The issue was never about improving their product with compelling content. These are newspapers that have won Pulitzer Prizes and report the stories people want to hear. So the content has never been the issue. They HAVE great content. The issue is declining ad base, rising costs of home delivery, collapse of the Classified area, and new competitition from amateur reporters and bloggers who aren't restricted by the same rules or ethics. THAT, my friend, is the issue.

When you can't make money with Pulitzer Prizes, and you're competing against amateurs working in their pajamas, the only recourse is to cut expenses. They were losing money long before they started cutting costs. If you're driving an Escalade, and you can no longer afford high test gasoline, then it's time to start looking at Accords. The marketplace has changed. This is not a content issue. If it was, it would be very simple.

 

[SirRoxalot]

What chance do you have to make money when your content is THE SAME as "amateurs working in their pajamas"?

People want more reliable content from talented people. They're willing to pay for it if the price is reasonable, and the delivery is convenient. There's a big gap between and Escalade and an Accord.

 

[PTBoardOp94]

In 2020, when only the New York Times is left printing a newspaper, the Pulitzer Prize will almost certainly still be awarded. It may go to Perez Hilton for best coverage of Congress, but it will be awarded to someone for something. The presence of awards does not mean the content quality has remained consistent.

 

[TheBigA]

What chance do you have to make money when your content is THE SAME as "amateurs working in their pajamas"?

It ISN'T the same. It's clearly very different. Compare it, and you will see the processes and results are very different.

People want more reliable content from talented people.

I'm not sure about that. They want content they agree with, regardless if its reliable. If a blogger says Barack Obama is a Muslim terrorist, and that's what they believe, then that is the news, and they will tell you with a straight face that the reason MSNBC won't report that story is because of a liberal conspiracy. It has nothing to do with reliability, and it has killed the Fourth Estate in this country because, as I said, serious established journalists work under different rules and ethics.

They're willing to pay for it if the price is reasonable, and the delivery is convenient.

Home delivery of the New York Times is not very expensive. Less than the price of a cup of coffee. But subscriptions have dropped by more than 50%. The paper itself hasn't cut back its quality. But it's credibility has been attacked. The reporters are still among the best in the country, and they create lots of original content every day. Their web page is very popular. They experimented with a second tier system where people could get additional content for a monthly fee, and it failed.

There's a big gap between and Escalade and an Accord.

Quality costs money. Car companies sell more of the lower priced cars than the higher priced ones. Top quality stores are losing sales to Wal Mart. Large groups of consumers are not motivated by quality but by price. Ad-supported media is driven by audience size. If that large audience is moving away from high quality content, with large staffs of highly educated people who follow rules and guidelines, to people working out of their homes with lower overhead (getting back to the topic of this thread), maybe that's what the audience wants. They don't care as much about the quality as they do about satisfying their particular need. If they can buy a no-name LCD flat screen TV for $500 at Wal Mart, made in Malaysia, and it looks about as good as the $900 ProScan they'd buy at Circuit City, then they go for the cheaper TV.

 

[TheBigA]

In 2020, when only the New York Times is left printing a newspaper, the Pulitzer Prize will almost certainly still be awarded. It may go to Perez Hilton for best coverage of Congress, but it will be awarded to someone for something. The presence of awards does not mean the content quality has remained consistent.

Wow. I think that line of thinking has given a lot of credibility to those who create content on their home computers, and has put those who work for major media outlets in office buildings on the same playing field.

Quality is subjective. Having the world journalistic community say your work is the best is subjective. But consider the judges.

If winning awards and doing work the right way doesn't mean anything, then why follow the rules any more? Why pay people salaries, hire staffs, rent office space, and send people to Washington (all at great expense) to cover Congress when Perez Hilton can do the same thing from his home office in California?

These are the questions we all need to ask ourselves. Because we are at a point where we can all do radio from home studios. We don't need to have licensed frequencies, studios, staffs, or anything. All that is secondary, and the real question is does any of that contribute to quality when all the public wants is to hear their favorite song. The sound quality isn't even as important, because they're happy with overly compressed mp3 quality through ear buds. Why are we wasting all this money on stuff that doesn't matter just because we've always done it? That is the question confronting all organized media companies, big and small, right now.

 

[davideduardo]

A good example of your point is daily newspapers. To meet the profit expectations of Wall St, large investment firms, and private owners, newspapers took the easy way out and cut expenses, rather than improve their product with compelling content. Year after year through attrition, job consolidation and layoffs, media giants like Knight-Ridder were able to continue to cut their operations to the bone to satisfy bottom line expectations.

That's an inaccurate and simplistic view of newspapers and their issues.

Circulation has been flat or declining since the 70's. Some blame it on Viet Nam, the first war waged on television. The paper became "yesterday's news." Younger people found they did not need a paper and did not want someone else's oped page telling them what to think.

That's the group that gave CNN its opening, and which accepted, later, the Internet.

But the two single factors that decimated print were the move of classifieds to the web and the malaise in the auto business which has been bubbling under for over a decade. When you lose a third or more of your revenue, there is no choice but to cut.

This has little to do with Wall Street. The revenue moved and there is now a generation of Americans who just don't buy a paper regularly... and many in other demos have better sources for news than just a paper (I can prodly say I have not bought an LA Times in over 10 years, and throw away the free copies they leave me). Many of us have developed a distrust of the medium overall, exemplified by inaccurate reporting by papers as suposedly reputable as the NYT.

Declining readership and disruptive changes in revenues are the problem, not Wall Street.

 

[johnbasalla]

I want to generally agree with Mr. Eduardo. Some of the movement away from some traditional (particularly print) media are due to self-inflicted wounds leading to mis-trust amongst the readership/consumers. A good example was that news paper photo a few years ago which was photo-shopped to falsely show an American GI pointing his weapon at a crying little child. I think it made it to the front page of one of Los Angeles' major daily papers. Yes, the zealot who did this despicable thing was fired, but by then it was too late. The papers credibility was damaged, so it has a harder time convincing people that it's any better then "guys in pajamas".

 

[DouglasB]

That's an inaccurate and simplistic view of newspapers and their issues.
This has little to do with Wall Street.

Innacurate and simplistic? Sounds like TV news, but that's another thread.
I agree with most all of what you are saying. I was concentrating on the fact that most newspapers, including the Knight Ridder newspapers I worked for, were, in my opinion, was too focused on cutting overhead (the topic on point) and jeopardized their standing with readers and advertisers. From personal experience, I saw cuts in newsrooms staff, to the point of where my last paper (a Pulitzer winner) had to resort to the sin of running wire stories on the front page. Something that had never been done before.
Your assertions about declining readership and sharply increasing advertising rates are correct. Further, newspapers erred in not growing younger audiences to replace those who were dying. Then there’s the issue of charging your audience for content or providing it for free.

 

[adma]

This has little to do with Wall Street. The revenue moved and there is now a generation of Americans who just don't buy a paper regularly... and many in other demos have better sources for news than just a paper (I can prodly say I have not bought an LA Times in over 10 years, and throw away the free copies they leave me). Many of us have developed a distrust of the medium overall, exemplified by inaccurate reporting by papers as suposedly reputable as the NYT.

There may be parallels with what happened to old-school mass appeal pop radio--a "distrust of the medium" that led to certain genres and realms to form microclimates that could be perfectly lucrative and valid without being preoccupied with (and compromised by) "crossover" pretensions.

An early classic case being what happened to country in the early 90s: artists like Garth Brooks were megasellers-of-the-year without a smidgen of attention--heck, without even inviting a smidgen of attention--from pop radio. And as we can tell from many radio message boards (i.e. the endless lamenting over why on earth NYC can't support a country station), post-1990 country probably hews closer to the musical inclinations of a lot of AM Top 40/oldies oldtimers than post-1990 CHR. (Though IMO it probably also helps explain why what was left of AM Top 40 tended to suck lemons by the late 70s.)

 

[TheBigA]

Further, newspapers erred in not growing younger audiences to replace those who were dying.

How can you grow an audience that doesn't read?