THIS WEEK'S SYNDICATED COLUMN: NEWS DOES NOT WANT TO BE FREE

Three Cures for Ailing Newspapers

"I feel I'm being catapulted into another world, a world I don't really understand," Denis Finley told the Pew Research Center's Project for Excellence in Journalism. Finley, editor of the Virginian-Pilot, isn't the only newspaper executive who can't come up with a plan for the future. "Only 5 percent of [newspaper editors and publishers]," finds Pew's latest analysis of the nation's 1217 daily newspapers, "said they were very confident of their ability to predict what their newsrooms would look like five years from now."

Newspapers are in trouble. More people read them than ever, but most of them read them online, for free. Unfortunately online advertising rates are too low to make up for declining print circulation. A reader of The New York Times' print edition generates about 170 times as much revenue as someone who surfs NYTimes.com. (This is because print readers spend 47 minutes with the paper. Online browsers visit the paper's website a mere seven minutes--some of which they might not even be sitting in front of their computers.)

Newspaper executives don't know what to do. Papers are closing foreign bureaus and laying off thousands of reporters. No matter how many employees they fire, however, they can't slash or burn their way to profitability--there just isn't enough budget to cut in a future where income has dropped to 1/170th.

"Newspapers," writes San Jose State University business professor Joel West, "face two structural problems and have been unable to fix either one." One is the Web in general, which offers advertisers more, finely targeted access to readers. The other is news on the Web, which is free on sites like Google and Yahoo (which compile AP and other wire service stories), as well as the newspaper websites themselves.

"OK," argues West, "The New York Times or the big city daily has better news, but how much better? If it's $20/month (or even $10 or merely requires a login) will readers bother? Most won't. As with other commodities, better loses to 'good enough.'"

But it doesn't have to. If publishers take three audacious but absolutely essential steps, the print newspaper industry can save itself. All three of my suggestions are predicated on the simplest principle of capitalism: scarcity increases demand.

Newspapers have made news free and plentiful, which is why they're going broke.

First: newspapers should go offline. If the last decade has proven anything, it's that you can't charge for a product--in this case, news--that you give away. So stop! All the members of the Newspaper Association of America should shut down their websites. At the very least, papers ought to charge online readers twice as much as for print subscriptions--searchability must be worth something. Want news? Buy a "dead tree" newspaper.

Second, copyright every article in the newspaper.

"The majority of bloggers and Internet addicts, like the endless rows of talking heads on television, do not report," notes the invaluable Chris Hedges. "They are largely parasites who cling to traditional news outlets…They rarely pick up the phone, much less go out and find a story. Nearly all reporting--I would guess at least 80 percent--is done by newspapers and the wire services. Take that away and we have a huge black hole." And a lot of unfulfilled demand one can charge for.

Newsgathering requires extensive infrastructure. Beat reporters, freelancers, editors, stringers, fact-checkers, and travel cost a lot of money. (A week in rural Afghanistan costs at least $10,000.) Why shouldn't newspapers--the main newsgathering organizations in the United States--be compensated for those expenses?

Every newspaper article should enjoy an individual, aggressively enforced, copyright. Radio and TV outlets that currently lift their news reports out of newspapers--without forking over a cent--would have to hire reporters or pay papers a royalty. Paying newspapers for usage, even at a high rate, would probably be cheaper.

Step three on the road back to fiscal viability: cut off the wire services. Nowadays an article written for a local paper can get picked up by a wire service, which sells it for a ridiculously low reprint fee to other papers and websites like Google. At bare minimum, newspapers that originate stories ought to require wires to charge would-be reprinters the thousands of dollars each piece is worth. Better yet, don't post them in the first place.

There are a couple of problems with my prescription. First, my suggestions only work if every paper follows them. Aside from the cat-herding organizational hurdles, accusations of collusion and price-fixing might bring down the wrath of government officials assigned to enforcing anti-trust laws. Second and perhaps more daunting, the "information wants to be free" mantra, once the cry of wacko libertarians, has become state religion.

"Free" doesn't mean anything, and it obviously hasn't worked. But it's hard to purge a brain of a meme, no matter how moronic.

COPYRIGHT 2008 TED RALL