FiveBooks Interviews

Richard Tofel on the Changing Business of Journalism

General manager of the non-profit newsroom ProPublica and former assistant publisher of the Wall Street Journal tells us his predictions for the future of news

Am I right to think, from the books you’ve chosen, that newspapers really are in big trouble now and that there is a fundamental transformation going on?

Yes. That doesn’t mean news organisations are all doomed, but I do feel quite strongly that print distribution is going to fade much more quickly than most people today believe. As we’ve seen, print circulation has been falling for many years. What people sometimes miss is that the print distribution of newspapers is a classic 19th century, economies-of-scale business. What that means is that, as circulation falls, it becomes less and less efficient. There are diseconomies-of-unscale, in effect, and the cost of producing each individual copy starts to go up very quickly. There is no way for the publishers to recoup those costs, so there comes a point, as circulation falls, where publishers will seek to accelerate it. They will need readers to switch to electronic delivery. We’re not there yet, but I think that we’ll be there sooner than people think. At that point the industry will try to drive a process which, for the past 15 years, it’s been trying to retard.

For a traditional newspaper, what percentage of total costs are printing and distribution compared to hiring good journalists?

Very significant. Total newsroom costs are probably around 15% for a really good newspaper. Some of the other costs are for sales and marketing, but the largest single expense is printing and distribution.

It does seem as if we are reaching a point where many people are comfortable with not having a physical newspaper, with just reading it online.

Yes, and clearly there are all sorts of changes going on where publishers are trying to recover more costs from readers, which makes a lot of sense. That’s going on in the UK and now increasingly in the US. We’ll see how it plays out. That is the big question of this year – will people look back on the initiatives taken last year at The Times of London, and this year at the New York Times and judge those to be successful or not? That is a very significant fork in the road.

The first book you’ve chosen is Losing the News, by Alex Jones. Is his main concern that the media is being overtaken by opinion and puff pieces, and that the real hard news, the actual reporting – say on the war in Iraq – is going out the window?

That’s right. Everyone sees there has been this enormous proliferation of information and of publishing. What people sometimes miss is that while the number of opinions is exploding, the number of original sources of fact is contracting. In the US, for instance, the number of reporters working for US organisations based outside the country has collapsed. Many, many news organisations that used to base some people outside this country no longer do. The New York Times has, I think, the largest staff covering general news outside the US for an American audience, and they have 40 people. The US broadcast television networks base almost no one outside the US. They tend to just have a very small flying squad that runs to any particular point of crisis.

And is it the same for serious reporting within the US?

Yes. Here is the problem. Editors are not people of bad will, they are not people who are trying to deliver less to readers. They’re trying their very best. But if you force people to cut news budgets, they will pare away. There are certain basic things they feel they have to do, and there are other things they feel they can live without. So international news is one that gets cut, investigative reporting is another one that gets cut (which gives rise to ProPublica where I work). A third one that gets cut, and this is a particular issue in the US, is statehouse coverage. I’ve concluded that a principal reason for that is an accident of 19th century American history. The state capitals of most of the largest states are not population centres. So you have Albany instead of New York City, Sacramento instead of LA or San Francisco, and Springfield instead of Chicago. That’s actually true for eight out of 10 of the largest states in the US -- the consequence of which is that when you have to cut back, the state capital is not local and you adjust accordingly. In Britain, it’s as if important government ministries were located in Manchester and if they were, they would be covered less.

Are these the kinds of issues Alex Jones looks at? Tell me a bit more about the book.

To a considerable extent they are, yes. Alex Jones is a distinguished reporter, a Pulitzer Prize winner. He covered the press for The New York Times and, with his late wife, wrote a history of The New York Times. Earlier, he wrote a book about a family that owned a once great newspaper in Kentucky, the Binghams, which is the story for which he won the Pulitzer. My one reservation about the book is that it strikes me as excessively nostalgic for the newspapers of yesteryear, and excessively convinced that the salvation of newspapers is the principal issue. I don’t want to caricature his argument, but I think his view is that the news is going to rise and fall with our leading newspapers. I’m not completely convinced that is the case.

For example at ProPublica, where you are general manager, you’ve been able to specialise in investigative reporting by going down the non-profit route.

If you look at this as an economic matter, all the phenomena we’ve been discussing are a series of market failures in certain areas of high quality news. Everyone is beginning to realise that these market failures are very, very likely to persist. When you have a market failure, the good, assuming its creation is desirable, becomes a public good. And in the case of news, it’s more than desirable, it’s essential to democratic governance. So then certain kinds of news need to be funded in the way that public goods are. Investigative reporting is one of those areas that, particularly in this country, has increasingly been revealed to be a public good -- and in the US, the funding of that comes largely through philanthropy. Britain has a different tradition in this respect, and a different culture [BBC news is funded by a licence fee payable by television owners]. But while there is some public support for public radio and public television in the US, it is increasingly under attack. If public television and public radio had not yet been invented in this country, today they could not be.

Could you see ProPublica being able to survive as a for-profit?

No. We’ve begun to accept advertising and you can garner a certain amount of money that way. You may be able to charge partners for a certain amount of content. But ProPublica exists because of a market failure, not because there is a business opportunity. Take, for example, the economics of charging partners. In the US, pretty much the most that anyone will pay for a long and incredibly well done story is about $50,000. That would be an unusually high price, but there are a few times and places when people will pay that much money. The cost of the kinds of stories that we’re talking about producing – and it’s not just us, there are a number of other entrants in this field – is often a very, very significant multiple of that. Which again just points out the problem.

Your next book is -30-: The Collapse of the Great American Newspaper. What is -30-?

-30- is what journalists used to type at the bottom of their stories when the story was over. It was the journalistic equivalent of the cinematic "The End".

And is it “The End,” according to the book?

Yes, particularly of newspapers. This book is an anthology. But it is an especially well-crafted anthology that reflects the writing of some of the best short-form writers on this subject, including David Carr of The New York Times, Jack Shafer of Slate, Michael Shapiro, who now teaches at Columbia University, and Ken Auletta of The New Yorker. The book surveys the field by doing case studies. Some of them are functional -- about readers or circulation -- and some of them publication-specific, about The New York Times, The Philadelphia Inquirer, The Los Angeles Times or The Chicago Tribune. It gives a very, very strong portrait of where we have come to in this decade and how we got there in the two or three decades before it.

Is there a story or fact in there that particularly took you aback?

Jack Shafer’s piece on the Newspaper Preservation Act [of 1970, which exempted newspapers from certain antitrust laws], the mergers and disappearance of a whole raft of American newspapers 30 to 40 years ago, was, I thought, very smart. America used to have a substantial multiple of the number of newspapers it has now, and part of what happened was all the afternoon newspapers disappeared. There was a time when the afternoon papers were stronger, then that shifted. Many of them merged with the morning papers. The upshot of all this is that people have been talking about the sky falling for newspapers for 40 years now. One unfortunate consequence is that when it actually starts to fall people miss it, or underestimate the danger, because they feel like they’ve been warned about it too many times. It’s the story of the boy who cried wolf.

And that’s where we’re now at, you think?

I do. I don’t mean this year, or in the next five minutes, but sooner than people would be inclined to believe.

Tell me your thoughts about a specific newspaper. Say The New York Times – what’s your feeling about its prospects?

If the metering works, The New York Times is as well positioned to make the transition as any. The bar is getting higher in terms of quality of content, which plays to the Times’ strengths. It’s the run of average papers that are going to be in the most serious difficulties. Particularly if charging for online content turns out to be the test – and I think it likely will be. It’s already clear that readers will not pay for most content. Whether they will pay for particularly excellent content remains to be seen, but I think there is some reason to hope that they might.

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About Richard Tofel

Richard Tofel is general manager of ProPublica, an independent, non-profit newsroom that produces investigative journalism in the public interest. He was formerly assistant publisher of The Wall Street Journal. He is the author of a number of books, including Restless Genius: Barney Kilgore, The Wall Street Journal, and the Invention of Modern Journalism

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