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December 08, 2008
TribCo Ch 11
The irony is that the NYT story... is on a blog... and one that understands the web well enough to link to the actual filing.
Most would say this is no surprise.
Some clung to Barry Diller's notion that the film business - and thus, somehow, analogous industries - were making a mistake by "just" chasing profits at the cost of human talent. But what I see in both cases are mature industries that were overgrown with the revenues from areas that were not the core business... that are falling apart in a real way after showing an inability/unwillingness to adjust to the paradigm shift that did not come with "the next big new revenue generator."
Barry Diller is right when he suggests that killing off the middle management of studios without real cutting in other, more flagrantly excessive areas is wrong headed. (I'm pretty sure that's what he meant, even if others wish to extrapolate it into something grander.) But the truth is, both have to happen.
The film industry is grossly overbloated. Every single movie that a major studio makes costs too much. Some cost 5 or 10 times too much. Marketing has given up creativity - in many cases - for massive spending. DVD is dead... long live DVD. But while new delivery systems will grow and mature, they will not replace the huge bursts of revenue that sell-thru DVD did in the last sox or seven years... the money that made Hollywood into a fiscal crack whore desperate for its next hit of nine-figure-revenues, not matter how wonderful "the familty at home"/"movies that just made 10s of millions" was.
The part of the Diller speech that is less quoted is pointing out that studios have gone from a high-teens annual return in a good year to high single digits to, now, 4 or 5 percent... again, in a GOOD year.
The studios, whether they get it or not, have a vested interest in actors, writers, and on down the line to have a viable, working middle class again. There is plenty of money out there. Spending priorities just have to shift… and they are shifting already without intent, in an uncontrolled way, that does not benefit anyone.
In the newspaper industry, the infrastructure is incredibly valuable. And that includes layers of reporters. But the imagination to rethink how to use the resources that these papers can support just hasn’t emerged. It is a great challenge. But the companies that are in the very best position to make the conversion most effectively – like TribCo – are still working under the old paradigm of cutting instead of reshaping.
I was intrigued the other day by Anne Thompson suggesting that the job of transforming The Hollywood Reporter into a publication that can survive the next years was daunting. I would say that it is one of the great opportunities in media today. Because there is still infrastructure, even if the paper has become completely irrelevant. The truth is that Variety hasn’t become any more relevant, it’s just the bigger paper that worked harder and tougher to be the sole survivor. But they both still miss the core fundamentals of New Media… which, like it or not, is becoming the Mainstream Media. (Specifically, I would say that print, television, and radio are “Traditional Media” and “Mainstream Media” is a combination of many outlets, including some of the TM outlets as well as the internet outlets.)
Anyway… $5.4 billion in the hole, revenues on the decline, and filing Chapter 11 is not a fun place to be. It’s bigger than the often petty and personal attacks that line both the LA Times and the web.
In the end, the void that will be left by historical behemoths is bigger than anyone needs to fill. But not too many people or organizations are capable of giving up the ghost… until the fire is too hot to control. Unfortunate.
Posted by dpoland at December 8, 2008 11:19 AM
Comments
Sam Zell should sell advertising on his philtrum...
Posted by: mutinyco ![[TypeKey Profile Page]](http://www.mcnblogs.com/thehotblog/nav-commenters.gif)
at December 8, 2008 01:12 PM
Business Week columnist Jon Fine wrote this back in June: "Newspapers still do some things that can't be replaced. Unfortunately, we're about to find out exactly what those things are." Yeah, and it looks like we're going to find out a lot quicker than even the most pessimistic of us feared.
http://www.businessweek.com/magazine/content/08_25/b4089077266185.htm
Posted by: Joe Leydon at December 8, 2008 01:43 PM
Thing is, the things papers did will continue to be done... just by even fewer front line reporters. And that is what's dangerous.
As I wrote back in whenever, I expect 4 or 5 reporting agencies (including NYT syndicate, the AP, the WashPo syndicate... and I would still hope, TribCo) to exist when all this is over, feeding what is left of print and online. In terms of real national reporting, we haven't really had more than double that in recent years, so the narrowing matters, but it is also a little exaggerated.
Posted by: David Poland at December 8, 2008 02:14 PM
[It's at this point. Amazon.com created the KENDLE and changed newspapers forever.]
Seriously; the KENDLE is the way of the future. It's the future step into what a newspaper OUGHT to be from here to eternity. Sure, it will inventially be nothing more than cheap to produce foldable LCD paper with 700mhz connectivity to stay connected.
Right now however: the Kendle is a tool that represents what we will be doing in the future with this medium. We simply have to slowly transition to this medium. If not... again... screwed city. If so... reporting can be better than ever. The world can truly be covered in ways that it has never been covered before. That should be the goal.
The goal should also be the fucking Tribune company selling the Cubs as soon as possible. The team needs a bunch of key free agents, and this CH. 11 does not help one bit.
Posted by: IOIOIOI at December 8, 2008 10:17 PM
FYI, it's 'Kindle'. Like what you do with a flame.
Posted by: jeffmcm at December 8, 2008 10:24 PM
I don't want to set the world on fire,
I just want to start a flame in your heart.
Sorry, couldn't resist.
Posted by: Blackcloud at December 8, 2008 10:34 PM
Jeff: it should be called "ugly fucking white box", but I will call it what I want to call it. Deal with it Jeff, or I will make YOU FUCKING DEAL WITH IT.
Posted by: IOIOIOI at December 8, 2008 10:41 PM
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