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Editors in Spokane contemplate life after ap
Diana Smith is executive editor of Reed Brennan Media Associates in Orlando, Fla.
The Associated Press responds with more rate cuts as newspapers court other vendors
IN A YEAR OF JAW-DROPPING NEWS, it was still a shocker when the Tribune Co. gave notice to The Associated Press that its nine daily newspapers planned to drop the news service, the first major chain to do so. Tribune filed for bankruptcy two months later.
More than 100 U.S. newspapers, some citing the AP's high cost and other issues of contention, are under a required two-year notice of cancellation. The news cooperative has about 1,500 U.S. daily newspaper members, a market that provides 27 percent of the AP's annual revenue.
Faced with rapidly shrinking ad revenue and news hole, editors at many daily newspapers are wondering aloud whether they need - or can afford - AP service in the future. A major metro daily in the United States likely is paying rates in the neighborhood of $1 million a year, an amount that can't be ignored in times of economic distress.
Newspapers and chains have created in-house committees to explore their options and courted vendors that can provide content at lower prices. Reuters, CNN and PA SportsTicker, among others, have stepped forward eagerly to fill the gap.
In response to newspapers' financial difficulties, the AP's Board of Directors voted in October to provide all member newspapers access to all AP text content at no extra cost. It also voted to approve a moratorium on the rate increases in 2009. AP estimated the steps would save newspapers another $9 million, on top of nearly $21 million in savings previously announced. The board met again in late January to refine proposals to provide added relief to the industry in 2010, including changes that might give newspapers more options about tailoring content to their needs. The board will vote on the proposals in April.
The question is whether the changes will be enough to persuade newspaper members to stay.
"I think we can address many of the concerns and make the structure, the products and rates workable for members during this period," said Sue Cross, AP's senior vice president for media markets, Americas.
Editors aren't so sure. They contend that the news service's rates are still too high considering the financial crisis confronting newspapers and many feel their coverage needs are not being met.
Steve Mullen, managing editor for The Bakersfield Californian, said his newspaper gave cancellation notice because of the cost. "They offered us a 10 percent, 11 percent reduction in our fee. It just wasn't enough," he told the APME Gazette, a newspaper published during last fall's Associated Press Managing Editors conference.
The Ohio News Organization formed a year ago to give structure to what many newspapers have been doing informally for years - sharing costs and responsibilities for statewide coverage.
"Our initial gathering was not focused on or initiated because of AP. Instead, we got together to see what we might do collectively to help each other get through these unprecedented challenges in our industry," Ben Marrison, editor of The Columbus Dispatch, wrote in an e-mail.
"While we discussed content sharing, we began talking about our frustrations with AP. We were angry that AP didn't give us adequate credit for our work but instead spent time 'matching' our stories under their bylines. We were angry that AP stopped covering nuts and bolts stories that it had traditionally covered, forcing us to shift our resources from enterprise reporting to more routine news, such as legislative hearings, court proceedings, etc. In essence, we agreed that the major metros had become wires services to the wire service. AP was shifting its resources to do enterprise, leaving us to essentially cover the beats. It was a role reversal that we consider unacceptable.
"And with newshole being squeezed as it is, many of us don't have the space for enough of our own enterprise, let alone AP's enterprise.
"And we were also disappointed that AP hadn't cut its rates more, given the financial climate newspapers live in. Holding rates flat, as AP stressed, wasn't good enough when revenues were falling in the double digits and newsrooms were being pressed for cost reductions."
The dissatisfaction with AP has created opportunity for content providers such as Reuters, CNN, Politico.com, Agence France-Presse, GlobalPost, PA Sports-Ticker, Bloomberg, McClatchy-Tribune, Los Angeles Times-Washington Post, The New York Times News Service, Newscom and others.
Reuters and The Politico recently announced a collaboration to offer political and business news coverage from both sources. The vertical advertising network launched last September by Politico will be expanded to offer Reuters' news to its 60 newspaper and 40 broadcast partners via a revenue-sharing arrangement. Any media company can join the network in exchange for allowing Politico to sell online advertising on its site.
In addition, Reuters will incorporate Politico's coverage of U.S. politics, Congress, lobbying and the White House into its subscription-based news wires.
"As a news agency, we are constantly evolving to anticipate the needs of the media industry. Our collaboration with Politico is part of a larger effort to address U.S. newspapers' and broadcasters growing need to obtain quality content at the right price," said Christoph Pleitgen, managing director of Reuters News Agency.
Meanwhile, digital start-up GlobalPost has launched an international news service described as "a bold journey to redefine international news for the digital age," according to its Web site.
Newspapers also are contacting established news services in an attempt to cobble together a network of content providers that will fill their needs.
"We're getting a lot of inquiries about what we're doing in the future as a result of the AP," said Laurence Paul, executive editor of The New York Times News Service and New York Times Syndicate. Paul said it was too early to predict whether the trend would translate into additional clients. But for editors seeking broader global content, The New York Times and its partners offer "some of the best journalistic content in the world," he said.
PA SportsTicker currently is working with more than 50 newspapers that have expressed interest in the sports news service, said Jim Morganthaler, director of content and strategy. "Everyone is looking for an edge, an opportunity to save money and remain competitive and viable," he said.
When the New York Daily News began using SportsTicker more than a year ago, word of mouth spread in the newspaper industry. "It showed that life can go on without the AP," Morganthaler said.
Although SportsTicker has the advantage of being more flexible and providing custom solutions, Morganthaler said AP's strengths should not be underestimated. "It's a very large organization with a cooperative structure. They're able get places and do things that others can't," he said.
At the APME conference in Las Vegas last fall, AP executive editor Kathleen Carroll said the news cooperative hoped to work through problems with newspapers that may not renew their contracts because of the new pricing structure. Carroll also said cancellation notices from member newspapers were common, but not usually public knowledge. She said in most cases the news service and newspaper were able to work out the disagreement.
"The squeeze is on editors and we understand that," she said. "The problems are very important to us, and it's not something we blow off."
However, during a question and answer session with editors, Carroll said the AP's priorities and strategy had changed. "The newspapers are always very important to us, but they aren't driving us, so we have to find out other revenue streams," she said.
The Post Register in Idaho Falls also has announced plans to cancel the service. In addition to costs, Executive Editor Dean Miller said there was a problem with the AP's search function for finding content on AP Exchange, the online tool for accessing stories, pictures and graphics.
"I want a feed where anything that affects Idaho Falls I put on a search terms list, and every two hours I get ... any story that mentions my topics," Miller said. "I need something that feeds me all the member stories from 300 miles around me in every state."
"I'm not angry or opposed to the AP, but I'm kind of slavishly interested in what readers need and want," Miller told the APME Gazette. "And right now, we're rethinking all our content, and that includes the AP. Everything is changing really fast and we have to be thoughtful about where's our loyalty. My loyalty is to the reader and that may or may not allow me to stick with AP." *
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Editors listen to CNN"s wire Pitch!
Oh, no, they did it
Compiled from reports by Kurt Franck, managing editor, The Toledo Blade, the APME Gazette, Business Week and interviews.