From time to time, The Audit will interview thought leaders about both financial journalism and the finances of journalism. John Rose is a senior partner and managing director of Boston Consulting Group and co-head of its global media practice. Ten years ago, he dealt mostly with traditional media companies; these days his orbit includes telecom, technology, consumer and electronics companies, retailers and even banks. I talked to him about the future of newspapers. The takeaway: There’s plenty of time, so be creative.
The Audit: Are you as pessimistic as the rest of the world on traditional newspaper companies?
John Rose: I tend to think about it less as companies that tend to be collections of different types of papers, than what the issues are for different categories of papers.
So at one end of the spectrum you have the iconically branded papers - The New York Times would be one, The Washington Post itself would be another, certainly The Wall Street Journal. But there are others actually that are iconic for certain segments of the population, and the LA Times in the entertainment community is an example.
Those papers face interesting opportunities as well as challenges because on one hand within the context of their role as traditional newspapers - covering the broad set of news and information needs within a city or community - they have the same set of issues as another category of papers I’ll come to in a minute. But because they’re actually iconic in the context of a certain set of themes, really they have the ability to take advantage of a lot of the changes in consumer behavior and technology to break out of what has been a historically bounded world for them.
TA: So what can newspaper companies, iconic ones anyway, learn from this?
JR: Well the question is, how aggressively do they take advantage of other forms of distribution? The New York Times really does have the ability to be one of the two or three national newspapers of record, which I would argue it already is, but read by a much wider portion of the population than it’s currently read by. Even if
“read” means something different in terms of online distribution.
TA: What would an iconic company do that it’s not doing now?
JR: Well it has to find a path from its core focus on the local marketplace and eventually abandon local news in order to concentrate on what makes them iconic. Right now some of these papers are straddling two objectives—local news and some other core competency—which I don’t think they will be able to straddle indefinitely. The Wall Street Journal and The New York Times still to a certain extent manage that aspiration, versus you know, The New York Times saying simply I’m going to cede the New York marketplace to the New York Daily News. I went that far for the LA Times—I’m going to cede to The Orange County Register the local coverage of L.A.—stuff that’s not related to the entertainment industry, but I’m going to create a daily that every single person in the entertainment industry has to read.
So you have one class of papers that are those, and another class of papers at the other end of the spectrum where they’re still protected in the context of their ability to collect truly local information. Those newspapers again should focus on going back to the maintaining that core reporting and journalistic information-building capability and distributing it through the paper, through the web, through mobile phone. Because its very hard for new information sources to compete at that grassroots level. As long as they continue to make sure they’re not overlooking a distribution channel for information, because the marginal economics don’t look as good as the core newspaper business, they should be able to have a very rich, sustainable robust life.
It’s the guys in the middle that you get worried about. The guys whose territories are large enough so that there are legitimate, significant, alternative sources of information at a local level.
TA: What type of paper do you have in mind?
JR: Like The Miami Herald, The Philadelphia Enquirer, to a certain extent The Boston Globe, the San Jose Mercury News, The Hartford Courant. I mean, newspapers that are in cities but not - I mean what makes The Washington Post theoretically different is that it covers Washington D.C. [the government] in a way that no one else can and that can make it the U.S. political source of record with a brand that naturally attaches to that. If you look at Chicago or you look at Boston or you look at Hartford