The Deal from Hell: How Moguls and Wall Street Plundered Great American Newspapers by James O'SheaMy rating: 3 of 5 stars
O’Shea is a journalist, author, and editor with broad experience in journalism. He was editor and executive vice president of the Los Angeles Times and managing editor of the Chicago Tribune, where he spent many years overseeing the Tribune’s national/foreign news and investigative reporting staffs. I am not particularly interested in those papers or their period of join ownership. However, he was in leadership positions during a fascinating time to me when information printed daily (atoms) begam to give way to the bits of the internet. Indeed he points to a pivotal meeting where the opportunity to go with the technological current was forgone:
...Brumback realized before most other newspaper executives how the computer and its attendant technology would transform the newspaper industry. After Tribune invested in America Online, in the early 1990s Brumback created Chicago Online, putting the Tribune Company at the vanguard of media and the Internet. He ordered Chicago Tribune content to be placed on the Internet and charged anyone for access to the stories unless they subscribed to the newspaper. He also tried to spread the gospel to the entire industry by promoting something called the New Century Network, or NCN, a consortium of the nine largest newspaper groups in America, to pool their content so they could “monetize it,” or make money. Brumback had zeroed in on what would become a devastating problem for newspapers as the Internet began to thrive. “Charlie had a good idea but it wasn’t the right answer,” said James Cutie, a onetime head of online news for the New York Times and an NCN board member. “The group was too large. It was composed of nine newspaper companies all sitting around the table with the same skills. If someone had had the balls to charge for our digital copy, it would be a whole different ballgame today.” Brumback later told me that he had also encountered opposition from the Chicago Tribune’s circulation department, which viewed the new technology as a threat to its ability to attract print readers. Within three years, the NCN folded, an entrepreneurial dream plagued by differing philosophies, internecine warfare, big companies, and even bigger egos. “Charlie was trying to get Silicon Valley to invest in it, and some guy from Kleiner Perkins [Caufield & Byers] wanted to invest $5 million,” said Cutie. “Can you imagine getting all of that premium content for $5 million. We had this big meeting of all the major newspaper companies to vote...
The excerpt describes the early digital media strategy of Charles Brumback, former Tribune Co. CEO, and the New Century Network (NCN). Recognizing early on that computing would disrupt journalism, Brumback positioned the Tribune Company as an early internet pioneer following an investment in AOL. He launched Chicago Online in the early 1990s, implementing an early paywall model that charged digital readers unless they held a print subscription to the Chicago Tribune. Seeking an industry-wide solution to monetize digital news, Brumback championed the NCN, uniting nine major American newspaper publishers to aggregate digital content. James Cutie, former digital news director for The New York Times and an NCN board member, noted that the consortium was hindered by its unwieldy size, overlapping skill sets, and a collective hesitation to charge consumers for online articles. Domestically, the Chicago Tribune's circulation staff resisted digital expansion, fearing it would undermine physical print readership. Hobbled by competing publisher egos, conflicting philosophies, and corporate infighting, NCN dissolved within three years.
What was happening was an M&A approach to growth along with shady (unethical if not illegal) distribution reporting to mislead advertisers. Meanwhile, internet ventures like Craig's List where eroding crucial income from classified listings. Also, doom was foreshadowed by a decline in newsstand sales as separate from subscription sales.
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