That brings me to where where we fundamentally differ: I don’t accept the premise—not yet—that great journalism and profits are now all but incompatible. I don’t believe that “investing in the Post would be money down a rathole,” as Shirky says I do. I believe it could be, but that’s a critical distinction. I also believe investing money in, say, Facebook could be sinking money down a rathole. But you know what? I don’t own the thing. If I owned a company, much less a critical institution like the Post, I would invest in it or sell it to someone who would. No single investment is a sure thing and newspaper investments these days are riskier than most. The truth is, we just don’t know what the Post Company could have done by investing part of the $1.1 billion it’s handed shareholders in the last four years. But we do know where it is now.
The New York Times, whose market position is unique but not radically different from the Washington Post’s, has not gutted its newsroom, and it is doing much better as a business. That’s no accident. Had the NYT halved its newsroom like the Post has, it would be doing far worse and it would be having a much more difficult time snaring lucrative digital subscribers. As David Carr writes on Twitter, Shirky “gives WashPo management a pass, failing to point out (dimunition) of asset sped downfall.” The fatalism that there’s nothing to be done, that chainsaws must be taken to the newsroom, that hamster wheels must be spun, that it’s okay to be sad that newspapers are dying but not to the point of actually doing even the minimum about it, like cutting the dividend, is harmful.
Actually, that doesn’t quite accurately characterize Shirky’s position, which calls for the Post Company to stop disgorging the cash to shareholders. It’s unclear to what purpose it should stop propping up shares, though, if there’s no place to invest that money. I suppose the Post could pay down its debt, but that’s an investment of its own sort.
Shirky looks at the admirable work of a DC website called Homicide Watch as an example of how the Post should transform itself. Homicide Watch covers every murder in the District with a staff of two, providing far more coverage of the issue than the Post does with its newsroom of 500-something.
But this is exactly kind of thing I’m talking about. Rather than handing its shareholders a couple hundred million dollars a year, the Post Company could have taken a couple hundred thousand dollars and offered to buy Homicide Watch or partner with it, or it could have built a similar site from scratch for the Post. That kind of investment would have helped increase the Post’s value to readers. Instead, the company has made its paper less valuable to readers and seriously harmed its long-term value.
DC Porcupine puts it this way:
Shirky is working from a pretty tortured false dichotomy here. The Post shouldn’t invest in its business because it’s screwed, he says, but it should create new models for business, which he seems to think wouldn’t be helped with investment money…
Homicide Watch and the Amicos do great work, and the Post should always be trying new stuff, but it’s not clear why Shirky thinks that whole innovative process wouldn’t be helped with some cash that the Post is otherwise throwing away.
Journalism will never again be (and should never have been in the first place) a 30 percent profit-margin business, and those Gannett papers didn’t produce much greatness anyhow. But can good newspaper organizations be at least slightly profitable in the medium to long term? I think so, and largely because digital subscriptions offer the first real possible path for a significant newsroom to a post-print future.