Friday, August 10, 2007

Paint-By-Numbers: Why Newspapers Are Screwed

From Silicon Alley Insider - It's easy to say that the New York Times and other newspaper companies are screwed, but sometimes it helps to actually run the numbers. Do you know why they're screwed? It's actually not the cost of paper, ink, trucks, printing plants, and other physical distribution expenses. Rather, it's the cost of content creation.

Senior New York Times reporters believe they are underpaid, and, relative to other highly educated folks at the peak of their professions, they sure are. But relative to the online revenue they generate, those talented reporters, columnists, editors, and researchers actually cost a fortune.

Newspaper content generates way more revenue in the physical world than it does online, because offline it can be packaged with classifieds and display ads and actually sold. In the online world, meanwhile, it has to be given away, and because classified ads are now run by classified sites and newspaper sites are only one of dozens of places where people get news, the advertising opportunity is comparatively tiny. | Read full article

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