Forbes tells a story about the media business. I shake my head. Cycle repeats.
Welcome to the news media business, where newspapers are becoming passé and, I hope for their own sakes, common employees might be beginning to realize -- as I regretfully but realistically had done in 2003 -- that so-called traditional media is coming apart, and the ranks are tightening, not loosening, for true innovative thinking in the leadership ranks. There's a tough road ahead for content creators in print media. News media. Daily papers, to be specific.
Old school is stubborn and refusing to alter the overall business culture in order to accept life as it is, based on what I've seen over and over in the business I wanted to be in for my whole career.
That Sam Zell ended up being as bad or worse as the prior folks running this failed business operation is shocking. The operation was a failed one as their business concepts and operational approaches were, in my view, functionally illogical, some policies were at times simply cruel and unfair (in the legal sense) to lower employees, snortily overconfident, and misinformed. They hired yes men, and built up these yes men, I suspect, and didn't allow real innovation to take hold.
I believe that gross arrogance and innovation can only survive in new ventures. Once a business is off and running and expected to perform, if innovation is required, it takes hard work, long hours and true smarts, not a pack of butt-kiss usual suspects attempting to be innovative
How Zell Killed Tribune - Forbes.com
Bad economy or not, if it wasn't for Zell and the enormous debt load he packed on the company, Tribune Co. would be trundling along profitably. It hauled in operating cash flow--which is net before taxes, depreciation, amortization and interest--of $90 million on $1 billion in revenue in the third quarter. In the six quarters before that, Tribune Co. was hauling in $200 million to $270 million per quarter in cash flow.The company was struggling, for sure, before Zell stepped into the situation. He added to the indebtedness of the company, which he ought to have not. Clearly.
Sure, lots of that comes from the company's sports and broadcast arms. But even Tribune's publishing group, which includes those oh-so-old-fashioned newspapers, pulled in $13 million in operating cash flow on $654 million in revenues last quarter.
Zell blew it by treating the purchase of this august newspaper company like, well, like just another real estate development.
What's going on? I think a significant part of it is that news media is crumbling under the weight of a systemic fear of major change -- real change. The relative sustenance of radio, TV, Internet, email, even billboards and other outdoor print advertising, plus the emergent mobile marketing industry are competing for dollars that used to be rather heavily devoted to newspapers coffers.
The prospect of selling ads on pages is expensive, especially for daily papers, seeing their impermanence. This is ironic in a world going news brief and sound bite, you could argue, but really, it is not ironic. It costs a huge sum for a full-page ad in a daily. That same sum could be used on TV in a targeted cable market segment campaign. In some areas, at least, too many are deciding it is too expensive to pay for an ad in, for instance, the Daytona Beach News-Journal, rather than posting an ad for free on daytona.craigslist.com and in some freebie pickup ready-made for interested buyers, such as a Home & Land or Auto Trader publication.
It breaks my journalist's heart, in a way, to see daily papers get trounced, but business is business. That's what I was advised when I got the boot from a company I helped start, after working the longer hours, and determining the processes and how-tos, for more than two years at a daily startup which began in 2000.
I don't feel bad for alleged managers who (not all, but certainly some) have no heart to bleed for smart, movable, devoted employees that get tossed, due to tough budget cuts or mere cliquish infighting. Selfishness reins, it seems, in media. It is almost as vain as the film and TV industries. I suspect that in some ways, and in some circumstances, news media is more vain.
I hope the scoundrels running these continually failed enterprises (it is not good business to cheat people of their overtime then feel good about meeting budget, for instance) get to spend some time unemployed -- but scoundrels are always working. That's what scoundrels do, and there is always someone sucker enough to hire them, since they beat people into some sort of mental submission. Seen that, disgusted by it, had to tolerate it, hopefully I can avoid having to tolerate it some day.
The current flowing away from dailies and to the variety of electronic media also piques my intrigue and my we-are-too-dependent-on-electronic-media opinions. But the fact of the matter is, there are fewer and fewer folks who remember newspapers without Macs and laptops, and there are not many who even recall doing paste-ups prior to using PDF technology and direct-to-plate printing, either. So, when it comes down to it, newspapers ARE electronic media. It'll be good for media executives to consider that the printing press might be the thing that needs to go, not the content and creative employees.
Stick that in your pipe and smoke it, Tribune Company execs. It might do you -- and your low-paid employees who can hopefully survive this -- some good. Now that the second shoe has dropped, I hope you get through this. We need media, even if they choose to be biased and oddly
- Jon O
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