I blogged on this too yesterday:
Some papers in financial trouble are leaving the AP to cut costs
By Richard Pérez-Peña
Monday, October 20, 2008
For most of its 137-year history, The Columbus Dispatch has carried articles and images from The Associated Press. Like most big American newspapers, it supplements the work of its own staff with dozens of items daily from The AP.
That may end soon.
Unhappy with both the AP service and its price — more than $800,000 a year at a time when The Dispatch's finances are severely pinched — the paper on Friday took the once-unthinkable step of saying it would drop the service.
What had been a minor newspaper rebellion against The AP suddenly grew much more serious last week, when the Tribune Company, one of the largest newspaper chains, said on Thursday that it would drop out of the association, followed by The Dispatch's announcement. A handful of papers have made the same move over the last few months, but with the exception of The Star Tribune of Minneapolis, they were relatively small.
Tribune, in disclosing the plan to sever its ties with The AP, voiced no complaints about the service, saying only that it needed to cut costs. The move raised the prospect of major Tribune papers like The Los Angeles Times and The Chicago Tribune publishing without the aid of a wire service that has been an essential part of American journalism since the cooperative was established more than a century and a half ago.
But editors and publishers at some other papers have become vocal critics of the way The AP operates, saying that it charges more than they can afford, delivers too little of what they need and — particularly galling to them — is sometimes acting as their competitor on the Internet.
"They seem to have forgotten that they are there to serve us," said Benjamin Marrison, editor of The Dispatch.
That anger spilled into public view in April at a meeting in Washington when the president and chief executive of The AP, Tom Curley, discussed his plans to cut prices and add new services — and then watched as editor after editor stood to scold him.
The AP says it is trying to save money for its more than 1,400 member newspapers, and all the changes under way will benefit them. Kathleen Carroll, executive editor of The AP, said the protests came from a small number of papers and stem from "some element of misunderstanding about what AP is trying to do" and frustration over the papers' finances.
"I don't think any of us can ignore the economic circumstances newspapers are in now," Carroll said. "Being the editor of a newspaper in the United States right now is really hard."
Contractually, newspapers must give two years' notice to drop the service, so those that recently opted out have until 2010 to change their minds. AP executives say they suspect that some papers are using that notice as leverage to bargain for lower rates.
In addition to the papers that said they would leave the wire, others are considering it, and still others have set up regional cooperatives meant to supplant part of their relationship with The AP — a trial run for life after the wire service.
Newspapers are going through their most wrenching time since the Depression, with advertising revenue falling about 25 percent over the last two years. But the balance sheet of The AP, a nonprofit company, is healthy; last year its profit rose 81 percent, to $24 million, on revenue of $710 million, according to a financial statement issued to its members.
It remains to be seen whether defections become a major problem for The AP, the world's largest news-gathering organization with more than 3,000 journalists in about 100 countries. Without the rich diet of articles, photographs, audio and video it feeds its clients, most American newspapers would be much slimmer and their coverage less expansive.
Newspapers banded together 162 years ago to create The Associated Press. Only daily papers in the United States can be members, giving them ownership and a vote in elections for the board. The company has more than 5,000 other domestic clients — broadcasters, Web sites, weekly papers and magazines — and roughly 8,500 abroad.
In addition to the news that AP reporters produce, the wire also takes breaking news articles from its members and distributes them to other clients.
For many members, The AP is one of their biggest expenses.
"We pay in excess of $1 million a year to The AP, which is equal to 10 to 12 reporters in the newsroom," said Nancy Barnes, editor of The Star Tribune.
Several editors interviewed for this article said they could find other sources for written material — wire services like Reuters or Bloomberg News, or the news services sold by major newspaper companies. But other AP products, especially photography, would be harder to replace, they said.
"We thought, 'We have two years to try and figure this out,' " Barnes said. Her paper is one of the industry's most troubled; it recently stopped making payments on its debt.
This summer, dissatisfied with the way The AP handles local news, eight papers in Ohio formed a cooperative to share articles, and some of those papers say they might drop the wire service. Newspapers in Pennsylvania are exploring a similar arrangement.
"We're facing terrible economic challenges, so naturally we're looking at one of our biggest costs," said David Shribman, executive editor of The Pittsburgh Post-Gazette.
The editors in Ohio, in particular, say The AP has retreated from one of its traditional roles: producing a lot of routine, breaking-news articles.
The AP wants to make its work more engaging, with more enterprise journalism like features, investigations and analyses — but that is also the direction many papers are going.
Marrison of The Columbus Dispatch said that course had forced newspapers to devote more resources to small stories that used to be covered by The AP "Then The AP rewrites our story and sends it out," he said. "So we're sacrificing our enterprise so that AP can do its enterprise? No, no, no. We're the owners."
Carroll of The AP said it had only "trimmed back on things that weren't getting much use."
"We're not trying to absolve ourselves from nuts-and-bolts news, but we cannot survive if we are spending our day doing the mark-up of some legislative measure that is of interest to one part of the state but not another," she said.
The AP does not release details about what clients pay, but newspapers' fees vary based on their circulation and the services they receive. For the last three years, the company has held those fees flat. The AP says the fees are partly subsidized by the higher prices it charges to nonmember clients, which account for about three-quarters of its revenue.
The AP says that a new price structure, set to go into effect in January, will give papers a 10 percent price cut on average. But even that plan caused complaints, leading to multiple revisions since it was first announced last year.
Papers object to a requirement that they allow The AP to apply its electronic tags to the articles they publish in order for the papers to qualify for the discounted fees.
The tags are bits of computer code, invisible to readers, that are intended to make Web pages rank high in Internet searches. While The AP says that most member papers have signed up for the tagging program, the largest newspapers, including The New York Times, have developed their own tagging systems and so far have not switched to The AP's.
The AP recently introduced an ad-supported mobile Internet service, fed by its own work and that of newspapers in the tagging program. To some newspaper executives, the mobile service looks like a bid by The AP to make money from their work — and to compete with the papers' own mobile services.
"If you want our content, you should have to come to us for it," said Barnes of The Star Tribune.
Similarly, some editors and publishers dislike The AP's practice of selling a news service to aggregators like Google and Yahoo; they want their own articles on those sites instead.
Jim Kennedy, an AP vice president and its director for strategic planning, said that papers should not see The AP as a competitor. He said the mobile network would share ad revenue with participating papers — many of which do not have the resources to develop such services — and drive Internet traffic to those papers.
"We're trying to be the portal, linking back to the contributors," he said. "We know there are members who would rather we didn't license our content to Google," he said, "but the money The AP gets from that helps defray the costs that members don't pay."
By Richard Pérez-Peña
Monday, October 20, 2008
For most of its 137-year history, The Columbus Dispatch has carried articles and images from The Associated Press. Like most big American newspapers, it supplements the work of its own staff with dozens of items daily from The AP.
That may end soon.
Unhappy with both the AP service and its price — more than $800,000 a year at a time when The Dispatch's finances are severely pinched — the paper on Friday took the once-unthinkable step of saying it would drop the service.
What had been a minor newspaper rebellion against The AP suddenly grew much more serious last week, when the Tribune Company, one of the largest newspaper chains, said on Thursday that it would drop out of the association, followed by The Dispatch's announcement. A handful of papers have made the same move over the last few months, but with the exception of The Star Tribune of Minneapolis, they were relatively small.
Tribune, in disclosing the plan to sever its ties with The AP, voiced no complaints about the service, saying only that it needed to cut costs. The move raised the prospect of major Tribune papers like The Los Angeles Times and The Chicago Tribune publishing without the aid of a wire service that has been an essential part of American journalism since the cooperative was established more than a century and a half ago.
But editors and publishers at some other papers have become vocal critics of the way The AP operates, saying that it charges more than they can afford, delivers too little of what they need and — particularly galling to them — is sometimes acting as their competitor on the Internet.
"They seem to have forgotten that they are there to serve us," said Benjamin Marrison, editor of The Dispatch.
That anger spilled into public view in April at a meeting in Washington when the president and chief executive of The AP, Tom Curley, discussed his plans to cut prices and add new services — and then watched as editor after editor stood to scold him.
The AP says it is trying to save money for its more than 1,400 member newspapers, and all the changes under way will benefit them. Kathleen Carroll, executive editor of The AP, said the protests came from a small number of papers and stem from "some element of misunderstanding about what AP is trying to do" and frustration over the papers' finances.
"I don't think any of us can ignore the economic circumstances newspapers are in now," Carroll said. "Being the editor of a newspaper in the United States right now is really hard."
Contractually, newspapers must give two years' notice to drop the service, so those that recently opted out have until 2010 to change their minds. AP executives say they suspect that some papers are using that notice as leverage to bargain for lower rates.
In addition to the papers that said they would leave the wire, others are considering it, and still others have set up regional cooperatives meant to supplant part of their relationship with The AP — a trial run for life after the wire service.
Newspapers are going through their most wrenching time since the Depression, with advertising revenue falling about 25 percent over the last two years. But the balance sheet of The AP, a nonprofit company, is healthy; last year its profit rose 81 percent, to $24 million, on revenue of $710 million, according to a financial statement issued to its members.
It remains to be seen whether defections become a major problem for The AP, the world's largest news-gathering organization with more than 3,000 journalists in about 100 countries. Without the rich diet of articles, photographs, audio and video it feeds its clients, most American newspapers would be much slimmer and their coverage less expansive.
Newspapers banded together 162 years ago to create The Associated Press. Only daily papers in the United States can be members, giving them ownership and a vote in elections for the board. The company has more than 5,000 other domestic clients — broadcasters, Web sites, weekly papers and magazines — and roughly 8,500 abroad.
In addition to the news that AP reporters produce, the wire also takes breaking news articles from its members and distributes them to other clients.
For many members, The AP is one of their biggest expenses.
"We pay in excess of $1 million a year to The AP, which is equal to 10 to 12 reporters in the newsroom," said Nancy Barnes, editor of The Star Tribune.
Several editors interviewed for this article said they could find other sources for written material — wire services like Reuters or Bloomberg News, or the news services sold by major newspaper companies. But other AP products, especially photography, would be harder to replace, they said.
"We thought, 'We have two years to try and figure this out,' " Barnes said. Her paper is one of the industry's most troubled; it recently stopped making payments on its debt.
This summer, dissatisfied with the way The AP handles local news, eight papers in Ohio formed a cooperative to share articles, and some of those papers say they might drop the wire service. Newspapers in Pennsylvania are exploring a similar arrangement.
"We're facing terrible economic challenges, so naturally we're looking at one of our biggest costs," said David Shribman, executive editor of The Pittsburgh Post-Gazette.
The editors in Ohio, in particular, say The AP has retreated from one of its traditional roles: producing a lot of routine, breaking-news articles.
The AP wants to make its work more engaging, with more enterprise journalism like features, investigations and analyses — but that is also the direction many papers are going.
Marrison of The Columbus Dispatch said that course had forced newspapers to devote more resources to small stories that used to be covered by The AP "Then The AP rewrites our story and sends it out," he said. "So we're sacrificing our enterprise so that AP can do its enterprise? No, no, no. We're the owners."
Carroll of The AP said it had only "trimmed back on things that weren't getting much use."
"We're not trying to absolve ourselves from nuts-and-bolts news, but we cannot survive if we are spending our day doing the mark-up of some legislative measure that is of interest to one part of the state but not another," she said.
The AP does not release details about what clients pay, but newspapers' fees vary based on their circulation and the services they receive. For the last three years, the company has held those fees flat. The AP says the fees are partly subsidized by the higher prices it charges to nonmember clients, which account for about three-quarters of its revenue.
The AP says that a new price structure, set to go into effect in January, will give papers a 10 percent price cut on average. But even that plan caused complaints, leading to multiple revisions since it was first announced last year.
Papers object to a requirement that they allow The AP to apply its electronic tags to the articles they publish in order for the papers to qualify for the discounted fees.
The tags are bits of computer code, invisible to readers, that are intended to make Web pages rank high in Internet searches. While The AP says that most member papers have signed up for the tagging program, the largest newspapers, including The New York Times, have developed their own tagging systems and so far have not switched to The AP's.
The AP recently introduced an ad-supported mobile Internet service, fed by its own work and that of newspapers in the tagging program. To some newspaper executives, the mobile service looks like a bid by The AP to make money from their work — and to compete with the papers' own mobile services.
"If you want our content, you should have to come to us for it," said Barnes of The Star Tribune.
Similarly, some editors and publishers dislike The AP's practice of selling a news service to aggregators like Google and Yahoo; they want their own articles on those sites instead.
Jim Kennedy, an AP vice president and its director for strategic planning, said that papers should not see The AP as a competitor. He said the mobile network would share ad revenue with participating papers — many of which do not have the resources to develop such services — and drive Internet traffic to those papers.
"We're trying to be the portal, linking back to the contributors," he said. "We know there are members who would rather we didn't license our content to Google," he said, "but the money The AP gets from that helps defray the costs that members don't pay."
READ AN ALTERNATIVE IHT DAILY NARRATIVE AT
A PLACE IN THE AUVERGNE
A PLACE IN THE AUVERGNE
No comments:
Post a Comment