First, the bad news

Nothing like a bit of Silicon Alley Insider gloom for a Monday morning. So here’s a piece about US newspapers experiencing their worst drop in paid advertising revenue for 50 years.

It serves as a reasonable opener to Eric Alterman’s excellent essay in The New Yorker: Out of Print: The death and life of the American newspaper. (Thanks to Nathan and Jim for the link.)

Alterman notes in the opening paragraphs that, “Independent, publicly traded American newspapers have lost 42pc of their market value in the past three years, according to media entrepreneur Alan Mutter. Few corporations have been punished on Wall Street the way those who dare to invest in the newspaper business have… The New York Times company has seen its stock decline by 54pc since the end of 2004, with much of the loss coming in the last year.”

He goes on to examine the impact of the web on newspapers.

“Until recently, newspapers were accustomed to operating as high-margin monopolies. To own the dominant, or only, newspaper in a mid-sized American city was, for many decades, a kind of licence to print money. In the internet age, however, no one has figured out how to rescue the newspaper in the United States or abroad. Newspapers have created websites that benefit from the growth of online advertising, but the sums are not nearly enough to replace the loss in reenue from ciruclation and print ads.

“Most managers in the industry have reacted to the collapse of their business model with a spiral of budget cuts, bureau closings, buyouts, layoffs and reductions in page size and column inches. Since 1990, a quarter of all American newspaper jobs have disappeared.

“The columnist Molly Ivins complained, shortly before her death, that the newspaper companies’ solution to their problem was to make ‘our product smaller and less helpful and less interesting.’ “

Along the way Alterman sweeps through the history of newspapers since their beginnings as political broadsheets and touching on the ideas that led to the press taking on the mantle of ‘objective’ recorders of important events.

And he does a good job characterising the somewhat fraught relationship between bloggers and newspapers, spending a good bit of time on the Huffington Post, as seen in this excerpt:

“In October 2005, at an advertisers’ conference in Phoenix, [New York Times executive editor] Bill Keller complained that bloggers merely ‘recycle and chew on the news,’ contrasting that with the Times‘ emphasis on what he called ‘a journalism of verification,’ rather than mere ‘assertion’.

” ‘Bloggers are not chewing on the news. They are spitting it out,” Arianna Huffington protested in a Huffington Post blog. Like most liberal bloggers, she takes exception to the assumption by so many traditional journalists that their work is superior to that of bloggers when it comes to ferreting out the truth. The ability of bloggers to find the flaws in the mainstream media’s reporting of the Iraq war ‘highlighted the absurdity of the kneejerk compairson of the relative credibility of the so-called MSM and the blogosphere,’ she said.”

Well worth a read.