Warren Buffett says papers “are toast”

Even a civic-minded billionaire who owns newspapers now sees the demise of the industry:
Warren Buffett Sees Most Newspapers as ‘Toast’ After Ad Decline

 

If this is the quality and caliber of breaking news in Buffet's paper, then, yeah.

 

Not all papers are doomed, though. The New York Times, the Washington Post and the Wall Street Journal will survive, he said.

Why will they survive?

 

National audiences, including digital.

 

What Slacker said ... national audiences, digital presence.

Also, they actually put reporters to work and haven't slashed and burned to cut their way to profitability. Yet ... they've made money, informed the public and haven't tried to asked to public to pay significantly more to get significantly less. Imagine that.

 

Interesting video. The "funny" thing or interesting thing is I'm assuming Buffett has not yet sold his newspapers or shuttered the doors yet. I'm assuming he like everybody else in charge is trying to bleed every possible cent before completing killing the individual newspapers. For instance, it takes a while I'm sure to sell the buildings and make as much money as possible there. Once the buildings are sold, is there a compelling reason for newspaper owners to keep the newspapers running? You've got Buffett saying the business is "toast." Ok ... Gannett, you get it started. Let's start killing the print product and speed up this next phase.

At least Buffett blamed the death on the newspaper business where it belongs: The ad departments and the suits for not figuring ways to sell ads online and in the print paper. The newsroom usually gets blamed for everything. Nice to see Buffett tell the world the real reason. Newspapers can't sell ads (can you imagine the quality of sales person working for newspapers nowadays? Any sales person with an ounce of sense would rather sell suits and ties at a nice clothing store than try to sell ads for dysfunctional newspaper suits.

 

Does Fredrick see Buffett as one of the suits?

 

I got so sick of retiring news execs posting their ridiculous "I still believe in newspapers" memos when Romenesko was still a thing in the 2000s. Most papers blew it by keeping their ad rates high, when they should have been going for volume and keeping people advertising. I don't know if even that would have helped much now with so many big box retailers biting the dust in the last five years. If not for obits....

 

No, because he is more of a billionaire "observer." He doesn't really care that nobody can sell an ad anymore. Like I said he's one of the guys to profit from the sale of the physical newspaper property. He's one of the guys who is just sticking around bleeding every penny he can from the industry then he'll just announce closings of the newspapers when no more money is to be bled. A suit is somebody who had a chance to keep the business alive on a daily basis and went after the newsroom rather than the ad departments. Like Buffett said, news means nothing; it's all about the ads.

 

The suits never saw this coming. They thought this new thing called the Internet newspaper Website would be a runaway hit, thus they gave it away for free. They saw this as a chance for an entire country to read their work and what opportunites ($$$) would come from an entire country reading our stories?? Instead everybody gave away the news for free and 10-15 years later tried to charge for it. Too late.
Just watching Buffett, he knows newspapers are "toast." Right now they aren't hurting his company much just sitting there doing nothing. Eventually they'll be discarded like the little pests they've become to Buffett.

 

In a perfect world - news execs would have parlayed their margins into cable companies (some did), you roll that into the internet/wifi and the newspaper is expanded into a local cable news provider providing content. The print product probably shrinks away to nothing, but your news org could expand into lifestyle/home and garden/food and sports (high school, pros, college) content on-line and on TV.

 

There is a professor at Harvard, Clayton Christenson, who has studied innovation and its effect on industries. He found that when a truly disruptive innovation hits an industry that the leaders of the old industry rarely adapt. He said there are two reasons:

1. The innovation is outside the frame of reference of the executives of the old industry. They just don't understand the innovations, its capabilities and its effect on the market.
2. The management of existing firms is trying to transition between the old technology and the new technology. The upstart company that is pushing the new technology is probably going to win a race against the company that is also trying to protects its old market.

How many of the main frame computer companies made the transition to PC's? And the guys who were running a main frame computer company were a hell of a smarter than the typical publishing executive.