New York Times CEO: We Know What’s Wrong With Our Business. But We're Not Sure What to Do About It

Good news for everyone who’s been insisting that the New York Times (NYT) needs a radical overhaul in order to survive the digital era: CEO Arthur Sulzberger Jr. agrees with you.

The bad news: It’s 2009, and he doesn’t know what that overhaul should be.

Back to the good part. In a thoughtful speech he delivered at Stony Brook University in Long Island last week, Sulzberger did a nice job of laying out how the Times got to the position it’s in now — watching print dollars shrivel up while online dollars trickle in. Can’t argue with any of this:

* Let us start with the fact that a deep, cyclical downturn has dramatically affected key areas of commerce, including the real estate, employment, automotive and retail industries, the lifeblood of American newspapers and local television.
* The Internet has proved to be a far superior advertising platform for listings. The classified businesses are disappearing from newspapers and are unlikely to migrate in any significant way to news Web sites.
* Selected display categories are also subject to secular shifts as users move from print to digital consumption. Beyond that, marketers are growing skeptical of the ability of display ads on any platform to capture the consumer’s attention in a fragmented media landscape.
* And, Internet businesses have proven incapable of replicating the economics of print. Few people have been willing to pay for online news. Advertising rates for online inventory are relatively low. And news Web sites are poorly organized to take advantage of the contextual advertising model that dominates the Internet.

So what to do? Alas. “It is a little bit like the banking crisis. We know there is an answer out there somewhere, but we are not sure what it will turn out to be.”

Sulzberger does say, as his employees have mentioned before, that the Times will probably need to start charging some people some amount of money for its online product. But he also suggests that the bulk of the Times will remain free online, because “we do not want to take any steps that significantly reduces our presence on the Web.”

He also makes a vague reference to “the protection of intellectual property”, though I think the paper has recently been demonstrating what that means. And he also insists that the paper won’t give up its print product, because “it is still a popular and profitable medium.”

In the end, Sulzberger basically punts: "What we have learned over the last decade and half is that the Web has very few generally accepted rules for financial success, and they are inevitably overturned by the next digital cycle and next breakthrough algorithm."

The rest of the speech, available here, is well worth reading. But if you’re one of the people who despairs about the paper’s future — or finds delight in the notion of its demise — you may not find anything here that changes your mind.

Original post

Comments

[petyaczar]

IMO

Pushing electrons around is much more efficient than chopping down trees and inking carbon. - faster too.

There is no going back, just ask the monks who used to handwrite the news on parchment in their cloisters.

Newpapers are dead, print is dead, I read it on the internet Where I get my news 24/7 IMMEDIATELY and for free.

Can't compete with that.

IMO

2009 Mar 15 10:48 AM

[Midwest]

Print is dead? That's been said for more than a decade with no real movement toward that realization. Ad dollars are migrating online only because it's so cheap for advertisers. Otherwise, it's a huge waste of money.

The internet's ability to deliver ad revenues is anemic and for good reason. Advertising online is a fully measurable endeavor and yet no venue for advertising online trumpets the click through rate because they're abysmal. Internet advertising is crap and will remain that way permanently because the method of delivery is so scattered that it is horribly ineffective.

It's efficient to push electrons? Of course it is. That is is unquestionable but the internet requires a computer, an ISP and a monthly fee. A printed piece only requires light to read it by and there will always be a place for that in this world.

The only industry that lost out on technological changes were the town criers who were replaced by print. Print did not lose out to radio and radio did not lose out to TV. Each claimed its own portion of the market and each will survive but with different proportions of the business.

The newspaper industry is in a tailspin ONLY because it decided to give the news away for FREE online. What kind of idiot decides to give their product away for free? The vast majority of the news is not gathered by the newspapers themselves but rather via news services who are not adequately monitoring how their news stories are being disseminated and reused across the web. This is a case of massive copyright infringement going unpunished.

If people want the news, then they should have to pay for it and once the yahoos who decided to give it away for free realize that their new model is killing them, they might find a foothold and stop their slide toward oblivion.

I get my news from all sources, like most of us do. I read the paper, magazines, troll the web, watch TV and listen to the radio. The web will not own it all when this is all said and done unless providers totally capitulate and keep giving their lifeblood away for nothing. Advertisers are free to put all of their ad dollars online but I guarantee you the results will kill their business.

How do I know this? Because I work for a large publisher with highly successful websites, print and TV outlets. The company HOPES to get to 10% of our revenue from the web at some point. Right now, we've sputtered out at a little more than 5%. That means 95% of our revenue continues to come from print and TV (a billion dollars in print revenue alone).

If you get your news or information from only one source (web, print, TV or radio) you are an outlier. Average people are connected to multiple media and no single one will dominate.

As the web matures, it's starting to look a whole lot like cable TV. We've gone from simple text, to some images and text, to more images and text to video to a whole lot of video and multiple outlets (channels) online. The web will just be one giant cable network before long and the newspapers will survive IF they change their ways.

2009 Mar 15 12:55 PM

[yellowhoard]

Although I don't subscribe to the New York Times, I do borrow my neighbors old papers. They line the bottom of my bird's cage. For dispensing and catching crap, no one comes close to the Times.

2009 Mar 15 03:53 PM

[relaplan1]

The CEO dosen't know what to do??

How stupid can "liberals" be???

2009 Mar 15 06:58 PM

[Mad Hedge Fund Trader]

If the NYT dies, a little of me will die with it. :(. The economic crisis is accelerating the demise of print journalism, whose migration to the Internet was already well underway as cash hemorrhaging owners desperately take a hatchet to costs. Advertising by car dealers has almost vaporized, and revenues from retailers are off by half. The Seattle Post-Intelligencer is in the process of downsizing from print to online only, and early indications are that 85% of the staff will be laid off. If you extrapolate these figures nationally, 37,000 of the 44,000 full time employed journalists in this country are soon to be fired. Newly laid off investment bankers, brokers, and hedge fund managers hoping to build second careers as writers are jumping out of the frying pan into the fire.

2009 Mar 15 08:42 PM

[loftguy]

The CEO and President of NYT is Janet Robinson. Arthur Sulzberger, Jr. is the Chairman.

2009 Mar 16 09:24 PM