BOB GARFIELD: And I'm Bob Garfield. Newspapers are dying. The newspaper – dry your eyes – will soon be dead. Or maybe it just seems that way because the media, as we've heard before, only report the bad news. So says a new website called the Newspaper Project, started by a handful of media executives, including the publisher of The Philadelphia Inquirer, Brian Tierney. The site hopes to balance what it calls, quote, “negative gloom-and-doom stories” about newspapers so prevalent in the press, because the real story, says Tierney, is just not getting out.
BRIAN TIERNEY: What’s being missed in the confusion out there is the audience story. I mean, the fundamental challenge that everybody in media is dealing with now is one of competition. I saw this great quote from Lorne Michaels a few months ago saying that – you know, somebody asked him, what’s the competition for Saturday Night Live? He said, Guitar Hero. The fact of the matter is that the newspaper print readership audience is holding up a lot better than other types of media, for instance, broadcast television, radio, etc. And when you add in the online audience of newspapers, we have more consumers of our journalism today than we had ten years ago. But for whatever reason, it seems like newspapers take more of the flak than others do.
BOB GARFIELD: For absolutely obvious reasons, because newspapers are laying off 10, 20, 30 percent of their newsrooms. They're retrenching in many ways, closing bureaus, missing debt payments, selling for dimes on the dollar compared to what they sold for three years ago. This is an industry that is financially in extremis in a way that other media aren't yet.
BRIAN TIERNEY: In many ways I think there’s a structural challenge to the story. There’s probably, let's say, 15 publicly-traded newspaper companies and they release their earnings four times a year, so that’s 60 times to talk about the financial aspects of the newspaper business. It’s not a chance to talk about the audience aspect. Now, when NBC’s advertising revenues are down or ABC Broadcast Network’s advertising revenues are down, that is a rounding error inside the General Electric quarterly numbers or the Walt Disney Company’s quarterly numbers. So, there’s fewer broadcast networks. Their advertising revenue numbers and their decline in audience is buried inside of a much broader number. And I was joking with one person. I said, I could see you being upset if you were holding our debt, but you’re just selling shoes. So aren't you pretty happy with the amount of people that pick up the paper to read about your shoe sales? And he said, yeah, I am.
BOB GARFIELD: You talked about how your overall audience is actually growing thanks to online readership. But the problem, Brian, unless I'm completely missing something, is that you simply cannot generate the kind of revenues with an online audience that you could with your print product. Isn't that the crux of your problem, that and, of course, the loss of almost all of your classified advertising revenue?
BRIAN TIERNEY: That is the crux of the financial challenge. I mean, for instance, when we got here, our Web traffic, our online traffic, was 20 million page views a month. This was two and a half years ago. It’s now 60 million page views. You could add up every television station, radio station and newspaper in the market and they don't have 60 million page views a month. Clearly a free Internet model online - if you build it, they will come - I don't think is working for media like ours. We have 400 journalists here. You could add up all of the media properties in the marketplace, they don't have 400 journalists. We have a value that others don't have, and I think we're going to have to start to find a way to charge for it and not just rely on advertising. I'm told that in the '60s, in the early '60s, the newspaper model was such that 40 percent of the revenue came from subscribers and 60 percent came from advertising. You know, a lot of papers have allowed that subscription number to get down to 20 percent. We, quite frankly, are up in subscription revenue over the past year because we're charging more for it and we're getting it. And I think we're going to have to figure out how to charge people some amount of money online as well to get our valuable content, because nobody else has it.
BOB GARFIELD: The question is, how do you succeed at extracting money from people who have shown in the past, at many other newspapers, that they're just unwilling to pay it?
BRIAN TIERNEY: You've seen newspapers that have been able to charge it – out in Little Rock, the Arkansas Democratic Gazette. You saw The Wall Street Journal was going to walk away from their 100 million dollars or so of online revenue subscriptions and decided that didn't make sense. The other thing is, you will see, I think, an increase in the paid subscription price for the printed paper. We've jacked our price up from 50 cents to 75 cents, and all my competitors did the same thing, and they probably felt like carrying me around in a sedan chair when I did it. And I think you'll see more of that. The research we did for that was – I was in a local convenience store called a Wawa, and I saw somebody [LAUGHS] pick up the newspaper, pay $2.40 for something called a Sizzli, $1.59 for coffee, 50 cents for our paper and only kept the sports section, gave everything back. And I thought, wow, if this guy thinks it’s worth 50 cents, I think I can get 75. Newspapers have to kind of be a little bit more aggressive and a little bit savvier about what they have. And if somebody says to me, well, you know, I can get my news on Yahoo! or Google, well, if you go into Yahoo! and you type in “Philadelphia news” the first 25 stories are mine. There’s no Yahoo! reporters running around Philadelphia.
BOB GARFIELD: [LAUGHS] I want to come back to the Newspaper Project and I want to come back to it by way of reminding you of the early days of the collapse of the housing market. I'm just guessing that you were getting phone calls from real estate brokers, your advertisers, who were saying, what’s with all this doom and gloom, man? It kind of reminds me – in fact, it absolutely reminds me of the tone of the Newspaper Project, which seems to begin from the assumption that the media are exaggerating the industry’s woes. I mean, it all sounds very familiar to me.
BRIAN TIERNEY: Well, I'm not sure I agree with that, Bob. Thirty-four percent of 18- to 34-year-olds in Philadelphia picked up a newspaper today. Our industry just isn't used to spin. There’s something unseemly to promote ourselves. I mean, I have to remind my newsroom that when we send somebody behind the lines in Afghanistan, we have to put in the article, “an Inquirer exclusive.” That marketing sense just isn't in our DNA. Over time, I do believe that if your audience is growing, we'll find ways to fix the financial part of the house.
BOB GARFIELD: Well, Brian, as someone who reads both of your papers every single day online for free, I wish you the best of luck.
BRIAN TIERNEY: Well, get the printed product, too.
BOB GARFIELD: Brian Tierney is the founder and CEO of Philadelphia Media Holdings.