Hollowed out by lobbying, politics working through media instead of face-to-face, shift to fundraising mentalityFederal government played role in promotion and proliferation of first newspapersWhile on national level the market may be large and diverse enough to support diverse news organizationsBut that is not at all clear for local and state mediaFinancingIn paper form, people looking for specifics (e.g., sports, comics, stocks) would at least skim front page and other parts of paperBut in online form, people can go straight to specialized sitesAssembling of a Public for the newsNewspapers have had resources to serve as check on politics and governmentLoss of coverage tends to increase chance of corruptionEffective means of political accountabilityThree aspects of current crisisState without a PublicChronic lack of news coverageNo large city to serve as news centerTwo largest cities lie outside its borders (NYC, Philadelphia)People in New Jersey know less about their state than people elsewhere in the country doMeans no competition in government coverageBiggest papers (Star-Ledger and Record) have merged Trenton bureausOnly means for politicians to reach populace is in TV ads in two of the most expensive media marketsWithout media matched to the state, New Jerseyians do not form a public on an on-going basisExample: New JerseyPaul Starr (Princeton University)"Who covers what and where? Coverage of local government by local media"Size: single town up to countyScope: TV, radio, cable, newspaper, and online coverageWeekly papers are huge in suburbsNewspapers and TV stations dominate in local news coverage while cable TV and citizen jouranlism sites contribute very littleLocal government receives much greater coverage in central cities than in suburbsMany suburbs don't have newspapers, especially in smaller MSAsFor weekly papers, esp., emphasis differs between central cities and suburbsBroadcast media and newspapers emphasize different types of local newsE.g., 5 of 15 TV stations in Chicago have newsIn markets with lots of stations, most broadcast outlets don't offer news, and even fewer are unique voicesOffering news does not equate to offering local newsNotable patterns:TV & Radio spend >25% of time on crime/courtsWeekly NPs spend almost half on Human/Community interestsBusiness/Economy almost 20% across all mediumsCentral CitiesDaily NP and Citizen websites join Weekly NP as spending >25% on human/community interestsSuburbsBreakdown by mediumNSF-funded studySteven Wildman (Michigan State University)"The Economics of Newspapers in a Digital Age"Economic fundamentals shape newspaper markets"Superstar" market for journalismViewpoint differentiation replacing geographic differentiationSubscriber funded content, advertiser funded bundlingGrowing market for content, shrinking market for subscriptionsTechnology changes fundamentals, transforms the market in predictable waysWelfare tradeoffsPolicy comments & conclusionsOverviewHuge fixed cost of producing contentHigh variable cost of distributionVertically integrated content productionAdvertiser finance & two sided marketsInformation externalitiesEconomics of Newspaper MarketsLarge cities have larger papers with higher readershipGroups with minority tastes may be poorly servedHigh "first copy costs" limits the number of papers that can survive in any marketFixed costs of content productionLisa George (Hunter College)Dimensions of the Challenge

Preserving Local Journalism

Friday, November 13, 2009

1:00 PM

Yale Law Journalism Conference Page 1

Lowers costs of producing content (data, facts, opinions)Journalists compete with academics, non-profits, citizensNewspapers compete with TV, radio, blogsOpens the market for supply of contentTechnology and transformationReduces the advantage to large marketsMore content satisfying minority tastesTechnology and welfareGeographic rather than viewpoint differentiationInternational comparisonsDistribution cost limits geographic range of newspapersZero distribution cost enlarges marketsLess geographic more viewpoint differentiation"Superstar" market for journalismTechnology and transformationMore people reading better stuff Fewer writers making more moneyTechnology and welfareDistribution costs and market integrationLow pay, lots of journalists, low risk of failureFew and costly links between writers and readers meant writers worked for newspapersEnables direct connections between writer sand readersMarket for "superstars" with high risk, high rewardReaders not papers make the superstars (Bruni/Pogue)Content type determines vertical integrationTechnology and transformationHigher returns to return to content producersTechnology and welfareVertical integration and the freelance modelNewspapers long earned monopoly rents from adsIncentives to produce content preferred by elitesAdvertisers value access to targeted consumersConsumer value of "bundled" content grows as sources proliferate, so does advertiser value for targeted readersNew entrants (Huffington, Drudge) are good at bundling and targeting, drive down priceDistinguishing bundling value from content value central to new business modelsTechnology and transformationTargeting with news is costly--cheaper ways to sell a watchDemocratization of advertiser financeTechnology and welfareAdvertising and two sided marketsConsumers, producers, votersPotential for exposure disciplines politiciansWhat you read affects what you doShift from local to national media = shift from local to national externalities (Localism vs Globalism)Shift to integrated markets reduces probability but raises consequences of corruption (NJ Rabbis)Technology and transformationCosts and benefits of attention shiftsTechnology and welfareInformation externalitiesFox newspaper?Declining readership for local content, even when freeFewer papers, more viewpoint differentiationEspecially for analysis, commentary, and expertiseMarket for superstarsExpanding freelance market for journalismSummary of trends and predictionsIf there is a breakdown between geography and media, then democracy suffers as a consequencesGeography matters -democracy organized geographicallyPeople need access to

information

, not just newsLocal media needs to make information available to populace for them to make own decisionsAccess -to broadband, skills, tools to be effective prodcures/consumers/interpreters of news/informationCivic engagementThree conversations that need to uniteReport: "Informing Communities, Sustaining Democracy in the Digital Age"Only 1400+ papers for 3000+ counties in countryDon't need saving, need creatingToo many externalitiesThere will never be enough revenues to support the quantity of local news organizations that are socially optimumQuestions "preserving" of local journalismAntagonistic cultural against intellectual authority, which was foundation of 20th century journalism modelCultural problemPeter Shane (Executive Director, Knight Commission on the Information Needs of Communities)Possible Solutions