Arnold Kling  

The News Business

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Steve Boriss is not such a fan of the Associated Press.

First, while its members’ businesses are shrinking, the AP has used their fees to mushroom into a huge, full-service news outlet with more than 4,000 employees working in more than 240 bureaus worldwide. Second, last September after AP members made the foolish complaint that Google News was not paying them for words in the brief synopses linking to their articles, the AP made a deal with Google News to feature the AP’s version of the story, and ignore similar stories at the members’ own sites — a move that, no doubt, has cost members a good deal of online traffic. And just recently, the AP launched a program to make its stories available on iPhones, preempting its members’ necessary efforts to restore their ability to generate and deliver their own, valuable original content.

The point is that the AP is no longer the property of its members, the newspapers. Instead, newspapers are just one intermediary using AP stories, and in that regard newspapers probably are at a long-term disadvantage compared with other intermediaries.

I've been consistently bearish on the outlook for newspapers. I'll stand by the prediction that I made six years ago that they will survive on the subsidies of wealthy patrons.

But rather than worry about newspapers, suppose we worry about news per se.

In a conference presentation, Boriss argues that the printing press allowed governments to control news, using licensing to limit those who could print, prior restraint to control content, and libel laws to punish unfriendly writing. The American Revolution dramatically changed the relationship of the press to government, along the lines of Jefferson's vision of the press as a check on government.

Boriss goes on to argue that with broadcast media, government re-asserted control over media.

The Internet, he argues, is far less controllable by government. At the same time, it leads people to change their mix of news consumption. We prefer less of what he calls the "remote-impact" news of the local/regional/national variety. We prefer more news of family and friends or news with direct professional impact.

Also, note the comments here on the increased concentration of political news consumption--fewer people are taking in politcal news, but they are taking in more of it.

I would argue that the general-purpose regional newspaper or news broadcast is an anachronism. Perhaps general-purpose regional government is also an anachronism.

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CATEGORIES: Business Economics

COMMENTS (3 to date)
Dr. T writes:

I am not a fan of the Associated Press, but my dislike has little to do with its business practices. Too many AP stories are inaccurate, biased, or deliberately deceptive. AP has an increased market share, and its customers exhibit decreased skepticism (few newspapers fact-check AP stories). The net outcome is greater spread of poor news stories from a central source.

Ajay writes:

Yes, but do you think general-purpose news is dead? Because it is meaningless to say that the general-purpose newspaper or broadcast is dead if all you mean is that people will now get the exact same news over the internet, whether in text, audio, or video form. All the hand-wringing over the future of news annoys me to no end, as all the morons who do it seem to have no conception that what is coming on the internet will be far better. Just as nobody will say that the newspaper age had less or lower-quality news than the pre-newspaper age, we have far more and better-quality news with the internet and will have far more in the future. The business model hasn't been built out yet but once a micropayments system is deployed, it will be utopia for real journalists. The sniveling scum who've worked their way into important positions at newspapers through political means, even though they have no journalistic talent, will not fare very well however, which is as it should be.

Ethnic Austrian writes:

Austria subsidizes the press to the tune of about 13M Euros per year. This has been going on for ages. So it shouldn't be much of a problem for an american philantropist to foot the bill.

What seems to be odd about the USA, is that there don't seem to be strong national newspapers. The most popular austrian daily, the Kronen Zeitung is just a little short of the New York Times in terms of circulation (not quality).

Have the New York Times, the Washington Post and the Los Angeles Times ever considered a name change? Big towns and capitals are often hated and envied by much of a countrys population. All of these three citys have some negative connotations to them. These names seem to be a bad idea from a marketing perspective, if they are really going for the national market.

He disagreed with me about the grim outlook for newspapers. He pointed out that newspapers are a superior technology, because you can read them while sitting on the toilet.

But newspapers are still superior tech on subways and streetcars. There is actually a free austrian daily called Heute, which is distributed for free at subway stations. It has a circulation of about 500000.

So peak oil may come to the rescue.

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