"< STRONG >Business Plan< /STRONG >"

With but a precious few profitable exceptions, most online periodicals today exists either simply to keep their New Medium directors and Web producers employed or else as loss-leading defenses against further erosion of their printed periodicals’ classified advertising revenues.

To that it distills. What else can you say about online periodicals that are now in their sixth to tenth year of publishing in the fastest growing ‘medium’ in human history, but that are still unprofitable (remove the accounting transfers from their parent print operations) and that are read less frequently and by less people than read the ‘dead tree’ editions that the online editions were by now supposed to supplant? Excuses that ‘It’s still early in this New Medium’ or ‘We’re still looking for the business model’ might have seemed reasonable in 1993 or 1996 or even 1999, but not now: ten years after Internet publishing began!

There are plenty of consultants who are industry cheerleaders: either Candides who try to see a silver lining in everything or else syncophants who think they’ll be employed more if they tell the industry what it hopes to hear. We are neither of those. We think it is scandalous that most (i.e., 98 percent) online publications aren’t profitable after all this time in so fertile a medium.

Look around you. Printed newspapers are dying. Their per capita readerships have been steadily declining for 40 years and that decline now accelerates. Classied advertising revenues — their most lucrative form of revenues — are steadily being eroded and will never return to previous levels. These trends clearly portend either a collapse or a trivialization of the entire U.S. newspaper industry between 2010 and 2020. Executives of newspaper companies place faith in a hope that because newspapers have for centuries been an integral part of the American scene, then newspapers will always be part of that scene in the future. It’s a comforting belief similar to that mouthed by railroad executives 40 years ago or by horse stable & livery owners a century ago, and just as indefensible.

The U.S. magazine industry is in somewhat worse shape than the newspaper industry but not so soon in danger of collapse, thanks to the less frequent publishing and advertising cycles of magazines.

Ten years ago, the New Medium was supposed to be the savior of these publishing industries. But it won’t be now if it still depends upon those declinging industries for cash and contents. Nor so long as it is used even less frequently by less people than those declining industries’ print periodicals.

We’ve been patient during the past years of the New Medium. We’ve listened to conference presentations that purport how meager earnings from paid access are superior to earning no revenues from half-baked plans for selling ads on a free site; that purport how a daily publication being read online only four times per month per user is heavy use; that purport how online newspapers that earn most of their revenues from classified ‘upsells’ from print publications are successful advertising-subsized news sites and not just cars, jobs, and property ad sites whose banner ad sales strategies have failed; or that purport how citizens equipped with camera-equipped mobile phones will revolutionize photojournalism or how citizen blogging will revolutionize journalism.

No, as Belo Interactive’s wise Director of Product Development Jay Small recently put it:

    “Fifteen minutes ago in Internet time, permission e-mail was the hot opportunity. Five minutes ago, everyone just had to have a Weblog. Right now, you’re nobody if you don’t have an RSS feed. Tomorrow, it’ll be mobile messaging and/or phone cameras and/or voice-activated Global Positioning System devices mounted on a Segway.

    “These are all means, not ends. And I’m tired of wasting cycles talking about how one or another of these virtual or tactile gizmos is going to change everything. It won’t. The Internet itself already gets credit as the primary source of cultural change in our time.

    “So I’m ready to focus my time on converting the organic success of the Internet itself into tangible success for people who have invested in it.”

We couldn’t agree more. The sole exception is that Jay is more polite than we are. Digital Deliverance is madder than hell that the online publishing industry has been unprofitably adrift for so long. We’ve now lost patience. Are we going to be harsh? You bet. Are we going to puncture sacred cows? Hear their gases escaping now. Will we risk not getting invited back to industry soireés and unintentionally making enemies? Indeed yes, but this job must be done. Complaisance is not a virtue.

One thought on “"< STRONG >Business Plan< /STRONG >"

  1. Your comments to Piriilo should be addresssed to the person who wrote the article. Piriilo is the forum. Have you heard of free speech ? Your attack is typical of ‘know it alls’ who write disparaging comments about someone when it’s obvious that they didn’t real the whole article.

    You should apologize.

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