Earlier this summer, Washington Post Co. sold Newsweek, once one of their flagship media publications, to tycoon Sidney Harman. The price: $1. To sweeten the deal Washington Post Co. even agreed to cover $10 million in the failing mag’s bills. Newsweek has, or had, one of the largest print circulations of any weekly magazine in the US, likely only second to Time. In the last few years it has hemorrhaged readers and its revenue has plummeted. Now the title is a liability. A big one. Forbes estimates the outstanding prepaid subscriptions around $40 million – a cost Harman will have to cover as he moves forward with the publication. Rumors are circulating that he may sell Newsweek to The Daily Beast, one of the most aggressively expanding and thriving of the new online news agencies. No matter where the Newsweek title ends up its pitiful sale is a clear sign that old media is having chest pains while new media is surging ahead.
In many ways, Newsweek has already died, and it’s unclear if and how it will be revived. Harmon, or the Daily Beast if that sale is more than a rumor, could simply continue the magazine under new editorial leadership – Jon Meacham has stated he is likely to step down after the reins have passed to new hands. But I doubt this could fix the drastic decline in circulation and revenue that Newsweek has faced in the past decade. No, Newsweek needs new interest, new readers, and new money. Where can they get that? New media. Focusing on online revenue is probably the only viable long term strategy to keep the brand alive.
We recently discussed the NY Times’ joking confession that they will eventually have to stop printing their newspaper and move completely online. It’s no laughing matter. Old media has to transition into new media, and find new revenue, or face the danger of collapse. Publications like the NY Times and Wall Street Journal are throwing up pay walls to mirror the subscription process they had with physical publications. That may or may not be a winning strategy, but at least they’re thinking about staying alive.
The Washington Post recently lost one of its more prominent columnists, Howard Kutz, to The Daily Beast. Kutz is to become head of the online publication’s Washington bureau. The Daily Beast has a Washington Bureau? Yep, and like other thriving new media outlets, its taking on the burden of primary source journalism with a vengeance. Many people lament the decline in journalism that seems to accompany the rise of blogs, aggregate news sites, and other low budget branches of the new media tree. Yet the trunk of that growing organism is taking on the duties of traditional media sources, and now has the financial strength needed to provide higher quality news. The journalism ecosystem isn’t getting poorer, it’s just changing – and becoming more diverse.
Everyday we see signs that old media titles are either losing ground to new media, or are fine tuning their strategies to become new media themselves. Newsweek’s too cheap sale is just one of many indicators that print titles need to evolve or die. On their remains we’ll build a new world of journalism that relies more on crowdsourcing, but that still seeks to find the quality high budget news we need. Old media is dead, long live new media.
