Print Is Dead But No One Has Yet Replaced It Profitably

Includes: AOL, GHC, NWS, NYT, TWX
by: Dana Blankenhorn

The worldwide publisher for Time Magazine (TWX) has left to head a company that publishes blogging software.

The message should be clear if you haven't heard it. Print is dead. Newspapers are dead. Magazines are dead. Books are dead. As investments, they are worthless. If you own stock in a company that does this, they either need to be transitioning to electronic publication or you need to get out now, regardless of your loss, and live to fight another day.

It sort of saddens me to write this, because I majored in magazines at Northwestern's Medill School, class of 1978. But I had many arguments there about the future, about the inevitability of this change, and I continued to maintain this would, in time, result in more jobs for journalists, not fewer.

Fortunately most companies that were in this space started exiting it long ago. The Washington Post Co. (WPO) is no longer really a publishing outfit. It's an education company, the Kaplan SAT centers. That's where the profits are, that's where the money is. The rest will wither away.

The New York Times (NYT) and News Corp.'s (NWS) Wall Street Journal are trying to engineer a transition, based on the idea of people "paying for news." But the newspaper business was never, ever based on people paying for content. It was based on having the right readers, on having enough of the market trusting you so that advertisers would profit by attaching themselves to your credibility.

It's not that paywalls are wrong. But the key rule of the business press always was to make certain everyone who was really in the business was getting the magazine. We gave it away to those people, and saved the qualification cards filled out by readers who wanted it. This was our registration database, so we could tell advertisers that "80% of local TV executives read Electronic Media every week." We knew that, we could prove that, so syndicators ran big ads in our magazine, because they needed to get their shows in front of those executives.

Journalists talk about their "communities," or the "business community," or the "bicycling community." With the death of print, this takes on real meaning. It's more than having a discussion thread behind a column. It's actively monitoring and organizing that discussion into something meaningful for the people in the place, lifestyle or industry you serve.

The failures of current online publishers like America Online (AOL) should not blind you to the reality. This is the future of publishing. It's just that many people in this new world don't understand it, and others are just feeling their way around.

Someone is going to figure this out. Someone will be the Pulitzer of this new space, the Medill, the Annenberg. Those are the names on the country's leading journalism schools. They were publishers, not editors. When you see an online publisher doing things right and their stock is in the public market, grab them.

It's because no one has yet figured it out that the Time publisher, Kimberly Kelleher, left for Saymedia. She's as much a searcher as any of us.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.