Rupert Murdoch Plans a NY Times Killer: is the LA Times Next?

The Observer notes that Rupert Murdoch is planning a NY Times killer, with a "New York" edition of the Wall Street Journal. Planning on spending $15 and using the services of the former New York Sun editor, John Seeley, the paper will compete directly with the New York Times. Money quote:

“You could drive a truck through the space between the wonderfully titillating tabloids and the perceived self-seriousness of The Times,” said Stefan Friedman, a public-relations specialist at KnickerbockerSKD. “There is a need and a want.

“With the elimination of the metro section, space in The Times is extremely competitive,” he continued. “There are maybe eight stories in the metro section each day. Take away breaking news and you’re down to half that. That’s where you can reach lawmakers, and with the area being so crowded, [The Journal has] a real opportunity from the PR side.”

With the submission of two links from "the Awl" by a reader (who I will keep anonymous unless he/she wishes otherwise), I wonder if the LA Times is next?


The first link shows the LAT circulation as an "absolute horror show." The second link shows how badly magazines have declined both in advertising pages and circulation. The Financial Times also has a story citing figures of 383 magazines closing this year. As the accompanying picture from the print version (sorry, unlike the WSJ the FT does not provide graphics with their stories that appear in the print version) shows, revenues are down for each sector of advertising and for each forecasted year, though it would appear that forecasts call for digital to be up a bit, but not enough to cover the declines in overall revenue. The year 2007 had nearly $15 billion in revenue, compared to forecasts for 2010 of closer to $10 billion.


It is clear that the advertising market will not bail out the LA Times anytime soon. So will Murdoch make a move?

It would be consistent with what he knows: newspapers. The WSJ is printed locally in the LA basin. It can easily compete with the LA Times because the LAT has a terrible, politically correct paper that neglects local stories (Mayor Tony's affairs with developers, businesswomen, and reporters, the local ACORN scandals, the scandal involving Mark Ridley-Thomas, the Obama tape of his attendance at the Rashid Khalidi dinner, and more). The LAT does not even bother to cover Hollywood, much less the basic economics of the DVD and TV sales that drive studio profitability. Readers of the LA Times would be astonished to discover that Redbox and piracy threaten the studio business model.

Can Murdoch make an LA Times killer? Yes, easily. The lack of competition, and the potential readers, even with the economy in the dumps and White flight (Mexican origin people read mostly Spanish language newspapers if they read them at all), make this business case fairly positive. There are millions of readers not served by a newspaper rivaling the NY Metro area in size and wealth. Despite the negatives of print, the sheer ease of use of a newspaper, particularly with the breakfast table, or various waiting areas, or so on, make it valuable and desirable. The WSJ alone (see the link above) has done fairly well in making itself a "national" newspaper. Newspapers can be read in almost any situation, and often have handy information, such as sports schedules for local teams on TV and radio, and other things that add value. [One of my pet peeves about the LA Times is the lack of daily radio listings, including station name, format, and frequency, that the LAT used to print but dumped along with stock tables in the 1990's. In LA's fast-changing radio line-up, you'd think this would be a no-brainer, but the Times instead challenges readers to simply surf the frequencies themselves. The little things that add value to the paper went years ago.]

The only question is people. Can Murdoch find the people to create a local, LA version of the WSJ? The NY Sun provided the template and the people for the NY version, and Murdoch has shown he can take a decade of losses (Fox Broadcasting cost around $1 billion in net losses from start-up in 1986 through 1996 in operational losses, yearly) for a property that can make money long-term. But as his MySpace debacle shows, getting the right people to run it can be an issue. [Murdoch bought MySpace for about $580 million or so, and it quickly lost buzz and users to Facebook, which now outnumbers it by 350 million users to about 100 million users.] Unlike NY, there are few people in and around LA used to running a newspaper who can provide something different than the failed, two decade long decline of the LAT.

I am skeptical of the idea that a news-reader as outlined in the Financial Times article will be competitive with the price and ease of use of a newspaper any time soon. Lighting, battery, costs of the device, ruggedness, and so on are all issues, as is paying something like ~$200 or so for a reader and then daily fees for a e-version of the newspaper or magazine. Particularly in this economy. The potential profits of a LA version of the WSJ must be tempting to Murdoch and News Corp.

But there is the question of who will run it? Local bloggers like Mayor Sam's Sister City, or Luke Ford, do excellent reporting, but managing a newspaper with hundreds of employees, and hard print deadlines, is another matter, particularly balancing that with middle class tastes. The latter is probably more prevalent in bloggers than the market-failure newspaper management, but getting a paper out on time and on budget with quality is pretty rare and requires experience. As always, it comes down to people.

The true tragedy of newspapers is that collectively, they have almost no one who has both the skills needed to manage the production of a newspaper with the middle class tone of the content. Call this one of the many casualties of the "SWPL"-ification of the elites. Ladies and Gentlemen, I give you the New York Times Holiday Gift Guide for People of Color. Yes. It really exists.

Somali fashion, do-it-yourself henna kits, children’s books that draw inspiration from the lives of Barack Obama and Sonia Sotomayor: it’s not hard to find gifts created for and by people of color this holiday season. Here are some possibilities.

The sad thing is, this could have easily run in the LAT. Without importing ex-NY Sun editors, who will run a LA version of the WSJ?






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The LA Times and Green Jobs: Stupid, Lazy, or Politically Correct?

The LA Times on its home page had this story, by tiffany.hsu@latimes.com, with the headline "Job growth in California is going green" and the subhead "From January 2007 to January 2008 green jobs increased 5% while total jobs declined 1%."

The SF Gate version of this story noted that "Green jobs just 1% of total in California" and that furthermore, the report cited does not take into account jobs lost during 2008-2009. [SFGate.com is the web version of the San Francisco Chronicle.] The only question is, was the LA Times reporting stupid, lazy, or simply terminally politically correct.


The LA Times story itself, read the whole thing, seems essentially a re-write of the Press Release by Nextten.org. Reporters are notoriously lazy, never more so than in the present day, and the dirty little secret about most of the content in the major newspapers is that most of it is simply re-written (or not) of press releases from politically correct lobbying groups.

The core of the (brief) LA Times report by Hsu is that "green jobs" (which include things like carpentry and electricians) "grew" an astonishing 5% between January 2007 and January 2008, while the overall California economy lost 1% of jobs during the same period. Money quote from the LAT:

The industry is still too small to drag the state out of its jobs slump but could at least nudge the economy toward recovery.

"Green jobs are not a panacea," said Noel Perry, a venture capitalist and founder of Next 10. "But this is the foundation of the green economy, and all the trend lines are up."

In contrast, the SFGate story is solid. Money quote from the SFGate.com reporting:

But taken together, those jobs represent less than 1 percent of employment in the state, according to the report's authors. Green industries have great promise for employment, but they haven't delivered yet.

Reading the SFGate.com reporting, you can learn that report has implications for California's "Green" mandates in counting the jobs that (were) already there, but notes that they could have been destroyed in layoffs during 2008-2009. [They probably were, note how carefully the Next 10 Report avoids any 2008-9 figures, probably because they told a different story.] The Bay Area has mostly energy-generation jobs (7,003), tied to Bay Area research universities, particularly Stanford and Berkeley. The LA area has 1,072 people working on alternative fuels and vehicles. Nearly every job requires massive and continuous federal subsidies, the SFGate article noting that Bay Area solar panel manufacturer Solyndra Inc opened a Bay Area facility after getting a $535 million federal loan guarantee. A careful reader will note that "Green" requires federal "green" i.e. loan guarantees, grants, money to research universities, and employed less than 1% of the total jobs in the State before the recession really hit.

Indeed, the Next 10 report notes that California jobs "dropped" by 1% total while "green" jobs increased by 5%. What neither the LAT nor SFGate note, is that in actual fact, according the Bureau of Labor Statistics, California's jobs increased during that period for a total of 183,000 jobs, or 1%. [Without seasonal adjustment. With seasonal adjustment the jobs increased about the same amount, or 241,000 jobs]

Its hard to credit the report's accuracy when the basic data about California's jobs show an increase not decrease (for Jan 2007 to Jan 2008), and further that this can be determined by five minutes reading on the BLS website.

What then, to make of the LAT reporting? Lazy, stupid, or politically correct? Likely, a combination of all three. Reporters are lazy, and will take anything that is perceived as "authoritative" and simply quote it verbatim. You can see reporter Hsu simply quoted the press release, not even bothering to question any assumptions. Because it came from authority, and because the reporter did not bother to think, or even put any effort into the whole thing. SFGate's David R. Baker, at least noted for his readers the obvious (many of the "green" jobs could have been lost during the recession) and that they were in total less than 1% of the total jobs in California during that period. That simply put, "Green Jobs" will NOT employ enough people, ever, to replace the jobs lost during the recession. Indeed, though Baker does not say so (constrained by his own PC-straightjacket), the careful reader can note that the jobs created depend largely on federal funding and consist mostly of White Elephant make-work jobs at research universities out of "Ghostbusters," or unprofitable manufacturing subsidized by taxpayers at enormous expense. Nothing "Green" consists of growth opportunities for high-revenue firms.

Neither Baker nor Hsu ask, moreover, just who is Noel Perry and what does he want from this "report" (which we can see is inaccurate and misleading). A few minutes of Google reveals that Perry is the founder and manager of Baccharis Capital, with interests in various Green Travel and partnerships with REI. A reasonable person might ask, "does Perry have business investments that could gain money by public policy at the Federal and State level directed to Green tax expenditures?" This question was never answered by either Baker nor Hsu.

To be reasonably informed about "green" tax spending (either tax breaks or bonds or grants or all of these in combinations) requires an understanding of how many green jobs there are (answer: 1% of total California jobs, something you would know from the SFGate.com article but NOT the LAT) and what the cause of growth in the "green" job base really is. For the latter, the SFGate article will provide the careful reader with needed information, but only indirectly, so imprisoned are the reporters by PC dogma. Job growth in "green" sectors is almost entirely based on subsidies, and most of it is in various think tanks and universities. Lastly, it is reasonable to enquire just who benefits from the report, particularly the man funding it. Certainly there would be tremendous skepticism from any report issued by the NRA, or Focus on the Family, or Heritage Foundation, by any reporter covering the story. But because the report is politically correct, LAT reporters simply re-run the press release under their byline.

I will note in passing that Baker was not innumerate, quickly grasping that despite the 5% increase in "green jobs" over the period it was a tiny fraction of the overall employment in California. Since neither the report nor the press release itself mention the size of California's jobs during that period, it seems Baker spent a few moments on the BLS site to quickly apprise himself of the number of jobs (about 18 million) in California Jan 2007-Jan 2008. Hsu by contrast seems innumerate, unable to understand that a greater increase in job growth is fairly meaningless with such a tiny fraction of the job market. The "strength" of California's Green economy that she quotes is federal spending to prop up the equivalent of Dr. Venkman in "Ghostbusters." And the LAT wonders why circulation continues to drop like a rock.







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A Tale of Three Newspapers: The LA Times, Wall Street Journal, and Financial Times

The recent, and sad news that LA Times trans-sexual sports reporter Mike Penner aka "Christine Daniels" was found dead at home at the age of 52 cements the transition of the LA Times from popular, metropolitan daily newspaper to a specialized, "Stuff White People Like" (ala the book and blog by Christian Lander) daily appealing to relatively few while having mainstream costs. What is likely to happen is that the LA Times model of high costs but "select" readership will fail, spectacularly, the transformation of the Wall Street Journal become Rupert Murdoch's costly mistake, and the Financial Times remain the model for daily newspapers: tightly focused on premium content subscribers will pay for (because they cannot get it anywhere else).


As a long-time LA Times reader, it was a difficult decision to cancel the subscription. But, the failure of the paper to deliver, well, news, made the decision easier. Gone were mainstream, middle class, middle of the road columnists such as Jim Murray, Jack Smith, and Scott Ostler, dead, retired, or moved on. Gone too was any desire to even approximate news reporting (instead of propaganda and news suppression), with story after story being broken by local bloggers such as Luke Ford (LA Mayor Tony Villaraigosa's affair with a Telemundo reporter covering him) or Mayor Sam's Sister City (the various goings on in LA council districts). But the deciding factor was the sports page.

Penner's story, and the paper's promotion of it, became a freak-show instead of a refuge from daily life. Sports are supposed to be about entertainment, rather than the Oprah-Jerry Springer circus that infest daytime TV talk shows. With the LA Times being unable to fathom the tradition, customs, and respect of the sports world, the transition was complete. Into a new, politically correct paper that won the approval of gay and women's groups, but left male sports readers cold. Sure Jim Murray could write about Howard Jones (the USC football coach not the 80's pop singer), or Ben Hogan, or Red Sanders, long-dead but not forgotten sportsmen who shaped the modern sports world (but were politically incorrect, being dead straight White males). Though long-dead, they formed the tradition of sports which being mostly a male section of the paper, was important. But the paper had other things on its mind, most principally being a politically correct, three ring circus (frankly, exploiting Penner/Daniels), guaranteed to win the plaudits of people who did not read the paper anyway, and alienate the White middle of the road, middle class that did.

The LAT is planning another 40 layoffs according to Deadline Hollywood Daily's Nikki Finke. The Washington Post will close it's LA bureau entirely by Dec. 31st. The problem is that there is not enough "Stuff White Like" to make a daily newspaper profitable. Particularly when the paper refuses to cover notable stories and retains a high cost structure. Daily Kos and the Huffington Post probably don't make money, but they probably don't lose much either and their backers make their political statements on the cheap. Much of their contributions come in for free, and their only real cost is likely server space and bandwidth charges at their hosting company.

The LA Times is sitting (according to Mayor Sam's Sister City) on the brewing scandal with Mark Ridley-Thomas, with ties to SEIU and perhaps, ACORN (if it is true he is being questioned by Federal Prosecutors). The LA Times has not covered the ACORN story, other than to take at face value the ridiculous claims (proved false by Breitbart's release of damning video) that the duo of James O'Keefe and Hannah Giles (posing as pimp and prostitute) were turned away from LA ACORN offices (they were not, with the spokeswoman herself offering to help with the importation of child prostitutes). The LA Times has still not released the tape of Barack Obama and Michelle Obama attending the Rashid Khalidi going-away banquet (their conduct must therefore be truly appalling). There has been little coverage of the dramatic fall in LA Port traffic, or the business flight from LA under Mayor Tony Villaraigosa's "progressive" agenda. It is no wonder then, that the paper is bankruptcy proceedings (and has consistently failed to make money for years, even before parent Tribune Company's highly leveraged purchase).

The lesson is simple. There just aren't enough SWPL in the LA Basin to make the LA Times profitable, and the reporters and editors are incapable of producing anything approaching a mainstream, middle class appealing newspaper.

The Wall Street Journal, purchased by Rupert Murdoch in 2007, is likely to also fail. For much the same reasons. Murdoch, has long been rumored to be a potential buyer for the New York Times though some predict he will instead buy the New York Daily News. The New York Times, as the "nation's newspaper" (the standard setter for all other newspapers even if the broad public does not read it outside New York), has served as a (failing) model for most other newspapers, and Murdoch seems intent on making the Wall Street Journal into a national competitor for the Times.

To the detriment, I might add, of the Wall Street Journal's reporting and coverage of events.

This move to compete with the New York Times in it's own SWPL image, is consistent with Murdoch's inevitably failed strategy to de-list itself from Google Search and ally itself with Microsoft. The Wall Street Journal, as part of that strategy, has tried to remake itself in the New York Times image. With many SWPL sections on fashion, "colorful" doings in Third World hell-holes, and movie and entertainment sections that crowd out serious business news. The "lifestyle" sections and other content are clearly aimed at the terminally politically correct crowd that reads the New York Times and is terrified of being caught out in an politically incorrect thought or word. The coverage of Barack Obama by reporters and editors is nearly indistinguishable from the worshipful, rainbows and unicorns from his ass, tone found in other newspapers. Mark Morford's column from the San Francisco Chronicle about Obama being a "lightworker" and "spiritually enlightened being" would not be out of place in many articles about Obama in the Wall Street Journal. To be fair, the editorial page is still mostly conservative (though appalling on immigration). But the daily tone and content of the Wall Street Journal's reporting crowds out the otherwise excellent business news for fluff and Politically Correct Dogma.

One of the worst offenders is Joe Morgenstern. A frequent movie commentator on NPR (which says something right there), Morgenstern is an admirer of Dogma 95 and has devoted both columns and NPR spots touting it. Basically, Dogma 95 (a set of rules drawn up by Lars Von Trier [Dogville, Breaking the Waves] and others) specifies a lot of joy-draining dictates: no artificial lighting, jump cuts, make up for actors, action, stunts, special effects, sound tracks, or anything else that makes films exciting and fun instead of a misery-inducing bore-fest. In other words, SWPL central, for a film devoid of enjoyment but filled with status (that you've seen it and endured it). SCTV famously parodied this sort of Bergman-esque idiocy in "Whispers of the Wolf":



Shrumpken!

Here is a sample of Morgenstern's latest reviews.

The problem with Murdoch's hope of creating a pay-wall for content (which the New York Times tried and found created a great loss in traffic) is that it is only successful for specialized content a few customers are willing to pay for. Business News, which used to make the Wall Street Journal's core content, is one such specialized content. The Wall Street Journal's daily circulation is now 2.1 million, only recently surpassing USA Today's circulation (the latter losing free copies in hotels and travel spots). This compares to the New York Times circulation of 928,ooo daily. However, the desire to create a mass market newspaper is doomed. Despite gains in circulation, the Wall Street Journal faces the same problem all newspapers face: the people who create it have a huge chasm in terms of attitudes and beliefs from the mass-market. The film "Up" had according to Box Office Mojo, a box office revenue of $293 million. The animated film "Monsters Vs. Aliens" had $198 million in revenue. Both are miles away from the bleak, unhappy "the Road" with it's SWPL status mongering misery. As commentator Bernard Goldberg noted, the media elite looks down up and hates, really, those people who eat at Red Lobster. But most of America, the potential customers for a mass-market, truly "national" newspaper, would think a meal at Red Lobster a fine affair. Rather than the elite's dream, of eating at Thomas Keller's "French Laundry" or Momufuku, which the Wall Street Journal celebrates, appeals only to the terminally status-mongering trendy.

Murdoch could scour the planet, and not find enough reporters and editors who have even a nodding acquaintance with tastes, morals, values, and desires of the average American. Hollywood also has this problem and outside Pixar and Dreamworks Animation, has not been able to consistently make films that people enjoy and pay money for. Murdoch aims to make money. So far, he's been successful with lots of leverage (debt) in risky ventures like the Fox Network, and Satellite TV, most aimed squarely at the middle class. Murdoch accurately senses the gap between the regional dailies, and the "national" newspapers the New York Times and Washington Post, and the desire for most people still to have a newspaper in the morning at breakfast. However, the Wall Street Journal at best can produce a paper with business news and lifestyle features aimed at the business class and those interested in business news (and willing to pay a premium for it). Unlike Fox Network in the mid 1980's, he faces little growth opportunities, because he has no one to execute a mass-market strategy. Worse, his likely successor as CEO, son Lachlan Murdoch, has no ability whatsoever to understand middle class life. While Murdoch was well-off, his upbringing in traditional Australia in the 1930's and 1940's giving him an entirely different perspective than his son raised from birth in celebrity and massive, modern wealth.

Which leads to the Financial Times. With a of only 432,000 internationally, the paper is much smaller in reach, compared to either the Journal or New York Times. However, it focuses mostly on financial news, and to a much greater extent than the Wall Street Journal, on international finance. While editorially the paper is appalling, signing on to every lunatic idea from global warming to the International Criminal Court, the news content is quite good, focused on business reporting. Unlike the Journal, the coverage of US economic policy has been quite critical, though again the editorial positions of the two respective papers are as reversed, mirror images of each other.

With the Financial Times available online as well as in various major US cities, it stands to pick up potential business customers wanting business news and not another copy of the New York Times SWPL manual. Coverage of the purchase by India's Central Bank of 200 tons of gold (equivalent to $6.7 billion), selling dollars to buy gold, has been excellent, as has the coverage of the US Mint's suspension of gold coin sales. Indeed the "gold section" at the Financial Times is better, more specialized coverage than what you will find in the Journal. The Financial Times has also covered the Dubai shock in more depth than the Wall Street Journal.

The FT will never become of course, a mass-market newspaper. But it is likely to sustain itself in moderate profitability in reporting business news. Because its relatively small global readership will still pay a premium for solid, business reporting and analysis.

The Journal is likely to prove an expensive, and given Murdoch's News Corp. deep pockets, slow-motion failure. In aping the failed New York Times, which has lost money consistently for a good many years, Murdoch can make the SWPL elite happy, but not investors. Because despite the media power and considerable wealth the SWPL crowd enjoy, their numbers are slim, and further thinned by the recession.

The LA Times is the most abject failure, and the easiest to see. Quite likely it will soon be an online only "publication" like the Seattle Post-Intelligencer. Competing for the same page views as Daily Kos and the Huffington Post, at much higher costs.

The new "morning newspaper" is sadly, going to be online only. A new venture by someone like Breitbart, or another entreprenuer, who understands middle class values and desires, and meets them with an informative, fun, and news-filled site. America will miss the feel and pleasure of a printed newspaper, but not the SWPL PC enforcers that turned the sad journey of one individual into a public spectacle, and cheapened the relief of the sports pages from the hectoring tone of the PC enforcers.
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Media's Collapsing Advertising Rates Everywhere (but the Internet)

Recently, the Wall Street Journal ran a story on the collapsing advertising rates for radio networks prompting the highly leveraged radio nets to ask lenders for renegotiated covenants (since the radio networks are unable to maintain cash levels). Clear Channel, for example, is expected to barely squeak by in meeting its debt covenants.

But buried in the story is an interesting graphic showing how advertising is decisively moving to where audiences and readers are: the internet:


[Click Image to Enlarge]


Radio is down 27% from 2007 numbers, television down 11%, and newspapers down a massive 42% but the internet has seen an increase in 83%.

Part of this shift is cost-based: per viewer, the internet is cheaper than almost any other means of advertising. Part of the shift is based on the advantages internet advertising has: there is no question as to how many viewers/readers the advertising reaches, and often additional information can be gleaned (from IP address information and "User Agent" information). Geographic location, browser and operating system, allow at least rough guesses about demographic information. But much of it is based on the growth of people using the internet to get information.

Radio, other than conservative talk radio, has been hit hard by consumers using Ipods to create their own customized playlist of music versus whatever commercial ridden vanilla offerings commercial radio stations offer. Even Spanish language stations find fewer listeners (with illegal aliens unable to find work returning home) and those that remain economically stressed.

Compared with other slumps, "this decline has been so much greater," says Jeff Smulyan, chief executive of Emmis Communications Corp., an Indianapolis-based company with 22 radio stations. "In a normal recession, if you re down 5%-6%, that's a lot." Emmis recently had to renegotiate agreements with lenders because of declining revenue.

Television, clearly, is under stress from sites such as Hulu.com and other online offerings of time-shifted TV series that draws viewers from the traditional live viewing pattern. Clearly, just as with music/radio, consumers wish to view scripted entertainment on their own terms, on their laptops and computers, on DVDs, and on Ipods and mobile phones.

Newspapers are in free-fall, with respect to advertising revenue. As Ed Driscoll writes, the media and particularly newspapers are in the business of news suppression and propaganda, not actual news reporting. With alternative viewpoints and links to video and text of actual speeches and more of public figures just a click away at Drudge Report or Instapundit, newspapers have dug their own grave.

Of all the media, television, having the least amount of advertising revenue erosion, is best placed to find its own destiny in new media, as I wrote in The Shift in Entertainment. However, all evidence suggests that television executives have no more ideas on this than newspaper executives.

It is quite likely that the economic pressures of a sustained (and perhaps double dipping) recession will force the shift in advertising dollars to the internet at a faster pace. If this does happen, it's likely that all the traditional media will largely collapse, as the bankruptcy filing by Orange County Register Parent Corporation Freedom Communications presages. Expect the Tribune Company, parent to the LA Times and Chicago Tribune, as well as part-owner of KTLA-Los Angeles and WGN-Chicago, to follow suit eventually, along with most of the major newspapers. Clear Channel, one of the largest Radio network with 800 stations, has $20 billion in debt, how long it can keep out of bankruptcy is an open question.

In many ways, the future in entertainment belongs to those who can seize the opportunities inherent in new media, i.e. the internet. Not to provide specialized and limited content, replicating the old "Brandon Tartikoff model" of a few high income yuppies generating premium ad-rates, broken by the recession, but broad based content appealing to men, women, old and young. Such a "re-massification" of culture would be a positive first step in arresting the cultural decay found in the West, a good deal of it caused by a culture built on fragmented and fractured elites who despise the people.
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Failure of the Media Part Two: The Lingering Death of the LA Times

By all accounts the LA Times should be doing well. Absent the leverage demands of the parent company Tribune Media, the potential readership of the LA Times should be large. After all, the US Census Bureau shows 9.8 million people in Los Angeles County alone, and the Metro Area of LA (including Los Angeles, Riverside, San Bernadino, Orange, and Ventura Counties) offer no serious competitor to the LA Times. [Thanks to Google for the excellent graph at the link.] For people interested in reading about sports, entertainment, or anything else to do with the Los Angeles metropolitan area, there would seem to be no real alternative to the LA Times. It should be a perfect world, both plenty of customers, and no serious competitors. Even local blogs such as LA Observed or Mayor Sam's Sister City (the latter joking "written" by long-deceased Mayor Sam Yorty) offer no serious competition for the broad categories of sports, news, local happenings, and entertainment and few financial resources to compete in those broad categories.

Why then is the LA Times in trouble, with an ever declining readership, ever declining advertising base, ever declining staff, and morale at the paper at rock bottom? The answer is of course, demographics. Simply put, there are not enough upscale, Liberal White newspaper readers to make the LA Times profitable.


It's worth noting that the LA Times circulation peak was in 1988, with 1.1 million readers, daily. The LA Times has been declining in circulation ever since, down to 739,000 daily, as the chart below makes clear. [Data from the Wikipedia cite, see also here]


[Click Chart to Enlarge]


Yet even as the paper has been mired in one controversy over another, from the carefully timed release of sexual harassment allegations regarding then recall candidate for Governor Arnold Schwarzenegger (two days before the vote), to the suppression of the video of Barack Obama at PLO operative Rashid Khalidi's going away party and controversy over revenue sharing of an LA Times published magazine celebrating the Staples Center, population has been increasing in LA County. The increase is 14%, from 1988 to 2008, while the decrease in circulation is fully one third, at 33%.


[Click Image to Enlarge]

It's useful to recall, how under fully 14% fewer people in LA County alone, the LA Times reached it's peak circulation of 1.1 million daily. The featured Sports columnist was Jim Murray, not J. A. Adande. Batting Cleanup for Murray was the sarcastic Scot Ostler. Pat Morrison, from PBS, was not a columnist, while Jack Smith was. The newspaper, while fairly socially liberal, had a moderate to conservative political bent, was oriented towards serving it's mostly older, male readership in the things that mattered, local Sports, politics, and entertainment. The paper spent comparatively few resources on hip/trendy, but unread music columnists like Robert Hilburn, or tragically hip (but unread) movie critics like Carina Chocano. Angry Hispanic chauvinists and Liberals like Al Martinez and Steve Lopez were largely kept under wraps. Knowing that readership of the LA Times was mostly White, Male, and conservative.

This focus changed, even before Otis Chandler relinquished day-to-day control in 1995, as senior editors began to focus not on what their customers wanted, but on competing with local NPR stations they'd listen to in the drive over to work. Despite, of course, all those NPR stations being subsidized affairs that required massive fundraising efforts quarterly and relied upon being license holders of valuable broadcast frequencies, through government largesse. The success of NBC, nationally, with the Brandon Tartikoff strategy was no help either. Tartikoff's strategy, was to trade absolute number of viewers at NBC in favor of young urban professionals, the yuppies. In the go-go 1980's, the strategy worked as advertisers clamored to get in front of people with money. For the LA Times, however, this strategy was disastrous.

Because locally, Los Angeles was changing. The increase in population, as seen in my post, Radio and the Death of Indie 103.1, was mostly Hispanic/Mexican. Whites were actually a declining part of the population, and there was not enough wealth being created to drive upscale advertising. Even worse, by it's very nature, paper newspapers cannot track the type of people reading it's content (and ads). While NBC and other broadcast networks could proudly tout through the Nielsen reports, just how many women 18-34, or other coveted demographic slices, were watching the shows and ads. Advertisers with the LA Times had no way of knowing if the ads were reaching the wealthy few of Marina Del Rey, Malibu, Santa Monica, the Venice Canals, or people in Torrance, Tarzana, or Culver City, decidedly less wealthy and therefore not worth paying extra for to reach.

Meanwhile, forces were brewing that would devastate LA's economy, create White Flight, and conspire to help mortally wound the LA Times. The forces had two names: Bill Clinton, and Rodney King.

Under Bill Clinton's leadership, the LA area lost175,000 jobs at a minimum. Losses accounted for fully 45% of all high tech jobs in 1998, the near peak of the Dot-com boom. The biggest losses in that sector since the end of WWII, affecting nearly 12,000 firms in the LA basin. As shown in this WSJ article, rosy projections by Clinton and his people about changing over to entertainment from aerospace proved a mirage. High paying jobs, and the ability of those high-paying jobs to sustain a White middle class (that read newspapers like the LA Times) in a region of high housing costs, taxes, and energy costs, collapsed with Clinton's defense cuts. As others have noted, particularly Steve Sailer, LA's geography does not lend itself to living just anywhere. Weather is brutally hot (and smoggy) in low-cost areas such as Riverside, San Bernadino, and the Antelope Valley. Meanwhile job centers are located in nice to live in coastal areas, making commutes brutal. Key coastal areas that have decent climates and easy commutes are off-limits because of huge concentrations of crime-ridden non-White populations, making gentrification a joke (Watts, South Central, Bell, much of Long Beach, and East Los Angeles all fall into this category). Parents have to spend considerable sums of money to live in school districts that are merely acceptable, where their children do not face gangs or anti-education populations. All of this was sustainable as long as high-paying jobs in either the assembly line or engineering staff and large supporting structure of ancillary firms continued to exist. By 1994, that structure was gone, and families unable to afford LA's high cost of living fled elsewhere. To Texas, Arizona, Nevada, Idaho, Utah, and Colorado.

Few were inclined to stick things out, because of the impact of the Rodney King riots. The riots, and the inept, politically driven response by the LA and State leadership, lost the confidence of LA's middle class. The riots, occurring just hours after the Not-Guilty verdict in the trials of LAPD officers Koon and others, on April 29, 1992, killed 53 people and left substantial parts of the city (most of it located in Black/Hispanic South Central) in burnt out ruins. However, the beating of Reginald Denny, by a Black mob, as the LAPD and other law enforcement authorities retreated, shocked middle class Whites in the LA area. As did the televised gun battles between Korean shop owners and marauding gangs of mostly Black looters, with the law enforcement authorities absent entirely.

Here was unmistakable evidence that when it came to public safety or suppressing a mob of Black (or Hispanic, just as many if not more of the rioters and looters seen on TV were Hispanic/Mexican), the political leadership, from Republican Governors like Pete Wilson down to the LAPD Chief Darryl Gates, and Black Democratic Mayor Thomas Bradley, would choose to sacrifice public safety instead of crack down hard, on mobs of non-Whites. While expedient politically in the short run (avoiding hugely negative press coverage which was for the most part solidly pro-rioter, and predictably anti-police) this series of choices to sacrifice mostly White (and Korean) public safety in favor of avoiding criticism for shooting and mass arrests of Blacks and Mexicans, had predictable results.

Besides increases in gun ownership among Whites, those who could leave Southern California did so, for states that were noticeably more White, and committed to public safety. Loss of confidence in the entire class of leadership, Republican and Democratic alike, when it came to public safety, had the Los Angeles Basin White middle class ready to leave when economic hardship hit in the form of Clinton's defense cuts that destroyed the economic basis of the White middle class.

As a result of the White flight from the LA basin, the LA Times began to lose readership, and potential readership, year by year. All the while, more immigrants, legal and otherwise, crowded into the LA basin. However, nearly all of these immigrants were non-English speakers, and preferred their newspapers, if they read them at all, in their native languages. Further eroding the LA Times financial position. In response, the LA Times leadership, created more and more liberal coverage. Not just on the opinion pages, but in the coverage of everything from Sports, to Entertainment, to News.

Completely absent from the LA Times pages were the growing influence of the MS-13 gangs, their ability to push westward from Downtown LA into MacArthur/Westlake Park, and the flight of Blacks southward into Long Beach out of South Central and Compton as superior numbers of Mexican immigrants (and gangs) pushed them out of native turf. That many of the gang-related murders in the LA area each year were related to these struggles were never mentioned in the LA Times. Meanwhile, it was by no means unusual for LA Times movie critics like Carina Chocano to query film-makers/producers like Judd Apatow on why fat White Guys get all his jokes (Apatow responded that political correctness dictated that only Fat White Guys be funny, the subject of jokes) in PC-inquisitions. Much of the content of the LA Times resembled a PC inquisition, into the state of mind of any (White Male only of course) person who might harbor racist, or sexist, or homophobic thought (crimes).

Naturally, subscribers edged ever downward. To their current level, a third less than the 1988 peak. Now with a heavy debt load acquired by the leveraged purchase of the Tribune Company by owner Sam Zell, the LA Times seems circling the drain like the Seattle Post-Intelligencer and other newspapers that might cease publication altogether in favor of online-only limited content.

The environment for Print Newspapers is dire. Newsosaur notes that young people (and there are few of them to begin with, at least White ones, due to the birth dearth) do not like to read newspapers, and the percentage that do has declined from 40% or so in 1999, to around 30% today. This is consistent with other findings. Older (White) Americans, age 65+, read newspapers the most (above 70% in 1999, to about 65% today). While ALL groups have declined, only ages 45 and up both started and finished above 55% in reading newspapers regularly).

Even worse, ad sales slid an appalling $2.6 billion last quarter or fully 28.3%. There is not any prospect of an upturn in the economy bailing out a failed strategy of appealing to ever younger, more liberal readers, who don't read newspapers in the first place, while alienating older, more conservative readers. The collapse of the housing industry and banrkuptcy of GM and Chrysler, means that ads for houses and autos, mainstays of newspaper advertising, are largely gone. Not to be replaced or revived any time soon.

Clearly, the LA Times, and parent Tribune Company, is only a few short steps away from bankruptcy, and perhaps cessation of the print publication of the LA Times. I doubt many readers will miss them.

So what is ahead for papers like the Times?

They can probably soldier onward, zombie-like, as glorified blogs. Costs for electronic versions are astonishingly low, but there remains the problem of getting people to read their content. The LA Times certainly could have driven millions of viewers to it's website by the simple expedient of putting up the video of Barack Obama at Rashid Khalidi's going away party. That it did not speaks volumes about it's desire to present ideological purity and propaganda (news suppression) over providing content someone might actually want to read. But simply producing a glorified "professional" version of LA Observed without the style and critically, the content of that website is not going to produce profits. Merely lower levels of losses.

Newsosaur, a Silicon Valley entrepreneur, believes that his "ViewPass" will allow newspapers to charge prices content on array of mobile devices a sort of me-too operation in the way that the NFL or MLB charges for games streamed onto mobile phones and the like. I don't think that will succeed. Simply because newspapers are unable to provide anything worth reading.

Lost in all of this is the generational change of leadership in newspapers and indeed nearly all media. Old-line editors were like columnists such as Jack Smith or Jim Murray. They understood, and shared, the likes, dislikes, prejudices, virtues, and flaws of most of their readers. Because they were like their readers: older, Whiter, more conservative, middle class, and well, male. They certainly were not part of the liberal hothouse of academia and the media that exists today, advancement was through apprenticeship and demonstrating that stories generated readers (and thus money), not through "correct" ideology and gender, race, and sexual orientation membership. It would have been unthinkable in the Jim Murray era for the LA Times to employ a Sports Writer who openly had (a publicly celebrated in the LA Times pages) sex change operation. It simply would not have been tolerated, the risk of canceled subscriptions was too high, and the paper's purpose was to turn a profit, not push a social agenda (one alien to most of it's readers).

When the agenda of "celebrating" the transformation of Mike Penner to Christine Daniels takes precedence over providing an enjoyable Sports section for the morning breakfast table, newspaper management has lost all ability to connect with it's potential readers. A "ViewPass" can provide all the centrally managed mobile content that can be created, potential readers won't pay for Sports content provided by trans-gendered folk, even if said content is free.

Newsosaur is quite skeptical of the ability of the government to provide bail-out money. The losses are too deep, and the taxes required too onerous, to provide a complete Pravda model. While it's certain bailouts will be proposed, the ability to push them through in hard economic times when readers have already voted with their wallets (not to subscribe) is questionable.

It's quite likely, instead, that various bloggers, and conglomerations of bloggers, locally, will provide content, and that as newspapers like the LA Times shrink down to LA Observed / Mayor Sam's Sister City size, those bloggers or people like them will grow upwards. After all, it's all about content.




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