We still talk about circulation because circulation still counts

In a letter posted to Romenesko (no comments allowed, otherwise I'd just post this there), Matt Baldwin of MediaNews Group wonders why there's so much focus on reporting declining reporting newspaper circulation instead of celebrating the much more robust overall audience, including online, which has been exploding with growth in recent years.

He's right, to a point. We do tend to dwell on the audited newspaper circulation numbers when they are reported twice yearly. But we do it largely because those are numbers that can directly affect a news organization's ability to grow revenue. If circulation is up, newspapers traditionally have been able to charge more for ads. If it's down, as it has been consistently in recent years, it adds to the revenue crisis by devaluing the printed product.

I'm a cheerleader for interactive, probably to a fault. After 12 years building the business, that's my bias. But as much as online growth matters, print circulation matters just as much at the moment. Yes, digital audience is growing and digital revenues will carry news organizations forward, but due to the competitive environment online, there's currently not nearly enough online income to make up for the shortfall on the print side.

So circ. matters, and I think it's right to pay attention to the numbers.

But I'm puzzled by this piece of Baldwin's argument:

Judging a newspaper by the number of copies in the market makes no more sense than counting the number of television sets to evaluate a TV station. To paraphrase a recent United States President, "It's the audience, stupid!"

Counting distributed copies strikes me as the best - if not only - way to judge the effectiveness of the printed paper in reaching an audience. It's not at all like counting TV sets; that analog would be counting newsstands or newspaper trucks. Counting circulation counts consumption of the print product. Whether a paper is paid or free, it's essentially valueless until someone picks it up and reads it.

Newspaper companies have finally been reaching new people in new ways in the past decade, people who are establishing habits that may not include the printed newspaper at all. Interactive continues to be a substantial success and a growth engine in most markets. I get as frustrated as Matt Baldwin does that the stories about circulation declines - often written by print newsrooms - neglect to mention the enormous upside opportunities. But it's far too soon to ignore print circulation - and its associated revenue - unless we're ready to make the leap to an all-digital future.

And that's a post for another day.

From the outside, the answer seems obvious

Mark Andreessen - Netscape and Ning founder, Facebook board member and investor in live-video site Qik - interviewed on Portfolio.com, looks at the current newspaper revenue and circulation crisis and sees... opportunity:

If you were running the New York Times, what would you do?
Shut off the print edition right now. You’ve got to play offense. You’ve got to do what Intel did in ’85 when it was getting killed by the Japanese in memory chips, which was its dominant business. And it famously killed the business—shut it off and focused on its much smaller business, microprocessors, because that was going to be the market of the future. And the minute Intel got out of playing defense and into playing offense, its future was secure. The newspaper companies have to do exactly the same thing.

The financial markets have discounted forward to the terminal conclusion for newspapers, which is basically bankruptcy. So at this point, if you’re one of these major newspapers and you shut off the printing press, your stock price would probably go up, despite the fact that you would lose 90 percent of your revenue. Then you play offense. And guess what? You’re an internet company.

Newspapers: Unlock the vaults to readership and revenue

Go to a lot of online news sites and search the archive, and you'll soon hit a pay wall. If you want to dig into the history of a city, the richest repository of that information usually wants you to pay for the privilege, with one shining exception - The New York Times - which opened up vast swaths of its archive to free browsing.

For years, the argument that was floated against making news archives free was that newspapers had too much revenue at stake. People would surely pay a few dollars for access to articles they wanted. Once that was put to rest (the numbers, relative to even just the current online revenue at most papers are small), we moved on to another argument: It's too expensive to store all those articles.

Upon some poking and prodding, though, the expense turned out to be not the archiving of the articles and photos - after all, storage is as close to free as it's ever been, and getting cheaper every day - but backing them up. The expensive hosting providers many news organizations use for their reliability and speed also charge usurious bandwidth rates for backup. And when you're backing up years of data every single day, that does, in fact, get expensive.

So why not this: Don't back it up. Or, just back it up monthly or quarterly. Having a 99.9% chance of an article from 2003 being available is infinitely better than not having it available at all, which is the case now when many newspapers simply throw away old articles after a few weeks.

Anyway, TechDirt (via Journerdism) has an interesting look at what opening up the archives has meant for the New York Times. There's not a lot of new data here, but the conclusion is still valid: newspaper archives are a readership (and, if you're doing your job right, revenue) goldmine.

Greenslade: Don't blame newsrooms for the decline in readership

The Guardian's Roy Greenslade often can be counted on for an interesting and accurate take on the state of journalism.

Just not today.

Today, in a stunning and sweeping mea non culpa, Greenslade, a journalism professor and former reporter and editor, looks at the shrinking audience for newspapers and echoes The Washington Post's Paul Farhi in a clear and ringing voice: "Don't blame us!"

There cannot be any doubt that journalists themselves - the reporters, sub-editors, photographers, feature writers, columnists, page designers - cannot be held responsible for either the financial woes of the industry nor for the public turning its back on the "products" that contain their work.

In case that's not clear enough, here it is more succinctly, in his own words: "It isn't our fault."

Greenslade correctly points out many of the other factors that come into play - including the general economic turmoil, bad management and changing media-consumption habits - but for him to say that the content itself has no part - no part at all - in the decline strikes me as ludicrous, and a marker for how deluded some still are.

Any other business with declining market share since The Eisenhower Administration would at least consider that the product might be part of the problem.

Otherwise, you're just blaming your audience for being too stupid to appreciate all you've done for them.

UPDATE: Steve Yelvington, as usual, has a thoughtful and reasoned take on this topic:

The deck is stacked against the newspaper, but newsrooms are not powerless victims in the grip of some irreversible cosmic force. There is still high demand for effective local mass advertising solutions. Newspapers can be that solution -- in fact, they could be the last mass medium standing.

But you can't do it with a 20 percent market penetration, and that's what you'll have if you continue producing a 1968 newspaper in 2008.