Or at least that’s the way I read it. My guess is that Jim is using the “leaky wall” strategy to access the rest of the Journal piece rather than using a paid subscription. But the writers seem to have made that deliberately oblique. Or perhaps they think their audience has zero interest in the minutiae of media economics.

And for the record: In addition to Dow Jones and The Wall Street Journal, News Corp. (NWS) owns this Web site.

Here’s the internal memo from Journal Editor-in-Chief Robert Thomson:

From: Thomson, Robert
Sent: Thursday, October 29, 2009 11:25 AM
To: WSJ All News Staff; Newswires_USERS
Subject: Boston

Colleagues,
Today we told our team in Boston that we are closing the bureau in its present form. The economic background to the closure is painfully obvious to us all. An investigative function will remain in Boston, but the core reporting team will be disbanded, though all nine reporters affected will certainly be able to apply for openings elsewhere on the paper. Coverage of the Boston mutual fund industry will switch to the Money and Investing team and we are creating an enhanced New York-based education team.

Any such decision inevitably stirs apprehension and uncertainty, but there are no plans, nascent or otherwise, to close any other U.S. or international bureau. Meanwhile, the Newswires bureau and the MarketWatch team in Boston will remain at their present staffing levels.

That there has been truly great reporting under the generalship of Gary Putka out of Boston over many, many years is not in doubt. But we remain in the midst of a profound downturn in advertising revenue and thus must think the unthinkable.

Robert

Tough times have forced many papers to rethink their circulation strategies. An obvious conclusion: Much of the money publishers were spending to print and deliver dead trees has gone to waste. New strategy: Print fewer copies, and charge more for the ones you do sell.

That’s a tactic, not a strategy, but in the near-term it might work.

In its last quarter, for instance, the New York Times (NYT),  saw its daily circulation drop by more than seven percent, but saw circulation revenue jump 6.7 percent, due to price increases. Last spring a single copy of the Times at a newsstand jumped from $1.50 to $2.00, and a Sunday Times now costs a staggering $6. But people are buying them.

Meanwhile, News Corp. (NWS), which owns The Wall Street Journal as well as this Web site, has been steadily increasing the WSJ price. And circulation revenue is up at the McClatchy (MNI) and Media General (MEG) chains.

Again, the industry can’t shrink its way to recovery. There are fewer people paying for news–on or offline–than there have been in decades, and there’s no way to paint this as a positive. But the people who still subscribe to papers value them, and it would be foolish not to capitalize on that. Editor & Publisher:

There are several reasons as to why circulation keeps dropping, aside from former readers who have kicked the print edition to the curb. Publishers have been purposely pulling back on certain types of circulation, including hotel, employee and third-party sponsored copies. No longer are they distributing newspapers to the outer reaches of the core market. The cost of delivery and the cost of materials have forced publishers to scale back.

Another shift has occurred: volume has taken a back seat to dollars.

Several major newspapers across the country have aggressively hiked prices of single-copy and home-delivered papers in search of circulation revenue and a renewed focus on loyal readers. Circulation is guaranteed to go down as prices go up, but publishers have opted to wring more revenue from readers as advertisers keep their coffers closed.

You’ll get the best sense of the ad if you head to the Times yourself, because it will auto-load, but if for some reason that doesn’t work, here’s a screen grab I took this morning:

I’m all for the industry trying new stuff, since my paycheck is at least partly dependent on ad dollars. And I think that outlets like the Times are more likely to succeed with extraordinary one-off presentations like the one that Apple (AAPL) ran on the cover of the Times and The Wall Street Journal a while back. And I’m also okay with publishers who allow advertisers to step between me and the stuff I want to see–within reason.

But the execution here seems off: When my screen turns from color to black and white, my first reaction isn’t “Cool, I wonder who sponsored the monochrome?” but “WTF? Is my MacBook busted?” My next reaction: “What happened to the headlines I was just reading?” And the next: “Maybe I should be reading a different site.”

That can’t be what Canon and the Times were hoping for, right?

Another problem: I’m not in the market for a printer (or is it a copier?) and I don’t know that I ever will be. I know that ad buyers don’t really care about that and that they’re generally trying to reach a very wide swath of people who fall into my general demographic profile.

But if you’re going to make it hard for me to get to the content I want, don’t you want to make sure you’re doing it for a good reason?

It doesn’t. Except when it does.

Contrary to News Corp. (NWS) CEO Rupert Murdoch’s comments earlier in the week, Dow Jones will not be charging customers who subscribe to both its Web and print versions a weekly fee to read the paper on its iPhone or BlackBerry apps.

But if you’re only subscribing to one version? That’ll be a buck a week, starting Oct. 24. The Journal will also start charging mobile-only users $2 a week, which is essentially the same price as a Web-only subscription.

That second charge makes some sense to me. The Journal has always said that it would start charging for the apps it makes for Apple’s (AAPL) and Research in Motion’s (RIMM) handsets. Right now these apps are gratis, which means you can either pay the Journal to read it in print or on the Web, or read it on your iPhone and pay zilch. That had to change at some point.

But while I have to be a tiny bit delicate here–Dow Jones owns this Web site, and I still have some aversion to insulting my employers in public–I don’t see how dunking paying customers a second time makes sense.

I do understand some of the impulse. Publishers of all stripes seem to think that while charging for content on the Web is tough, people are happy to pay for something delivered wirelessly. I think that many publishers are going to be very disappointed when they try this out in practice, but that’s another story.

And I also know that News Corp. has steadily been pushing Dow Jones to raise its subscription prices for the WSJ since it acquired the company, and this strategy sort of dovetails with that.

But seems to me that if I am paying for information, I will expect to consume it wherever I am, at the same price. And you’re starting to hear some publishers say the same thing–see Variety’s comments about subscription plans today in PaidContent.

I don’t actually pay for my WSJ subscription; my employers, who, I should stress, are truly excellent people, have hooked me up–so maybe I’ve got this wrong. Or maybe it’s merely a marketing issue: If you jack up my WSJ subscription and tell me you’re throwing in access to the mobile app for free, I might be okay with it.

But tell me you’re charging me an additional fee to read it on the go and it will stick in my craw. Let’s see if the paper’s paying subscribers feel the same way.

Even when the M&A market was shut down, Wall Street couldn’t stop speculating about GE’s intentions for its NBC Universal unit. And now that it’s deal-making time again, the chatter is getting very noisy.

Hence the flurry of coverage over yesterday’s remarks by Vivendi CEO Jean-Bernard Levy, in which he said…not very much.

But even Levy’s noncomments are important, since his company may have a good deal to say about the fate of NBCU. That’s because Vivendi owns a 20 percent stake in the company, and it looks increasingly likely to sell this year. And that could trigger a whole series of moves. The Wall Street Journal:

Vivendi, the Paris-based entertainment conglomerate, has an annual option to unload its NBCU stake which it is allowed to exercise beginning each November. The option was part of a deal made in 2003 when Vivendi sold its theme parks and television assets in the U.S. to GE for cash and stock.

If Vivendi exercises the option this year, Mr. Levy said, it will plan to offer the shares in the public stock market unless GE exercises its right to buy the stake.

If Vivendi says it will exercise the option this year, GE would have nine months to pony up an estimated $4 billion to $5 billion if it chooses to buy Vivendi’s stake at a time when it already is struggling to shore up its financial position. Otherwise, Vivendi’s minority stake in NBCU could be put in play, raising a host of potential complications for GE’s ownership of the media company.

Yet another option: GE (GE) and Vivendi work together to sell off all of NBC via a direct sale–Comcast (CMCSA) and Time Warner (TWX) are the names you always hear as obvious strategic buyers, though I’m not sure that’s the case–or even via an IPO.

Fair enough. But if you’re that confident in your model–which, in short, allows Web surfers to look in on the FT.com site 10 times a month for free but demands payment for anything more than that–what’s with the following message at the bottom of each story?

Copyright The Financial Times Limited 2009. You may share using our article tools. Please don’t cut articles from FT.com and redistribute by email or post to the web.

Anyone else think that strikes a weird tone between pleading and chiding? I’m told the note started showing up on FT stories about three weeks ago and that staffers at the paper are a bit confused about it as well. Here’s how FT spokeswoman Darcy Keller explains the message, via email:

The FT copyright simply protects our ownership of FT content. There is obviously a distinction between third parties referring to FT articles and linking back to FT.com and those that reuse and distribute our content without attributing it to the FT.

Obviously there is! But there’s also an obvious distinction between friends and colleagues who pass along an interesting article and, say, people who run sleazy “scraper” sites that publish other people’s copy in the hope of gaming Google’s (GOOG) search engine. Right? And more important: The people in the second category won’t be deterred by a copyright note–even a sternly worded one. Right?

Obligatory to-be-sure grafs: News Corp.’s (NWS) Dow Jones, which owns this (free) Web site, also charges for access to (some of) its Wall Street Journal. And it also tells people not to distribute WSJ.com stories without its permission. But in order to find that boilerplate language, you’d have to seek out the “Subscriber Agreement & Terms of Use” page, and slug your way through legalese until you got to section 6 (b)–“Limitations on Use.” Or you can just trust me. Does that make you less likely to copy and paste this story?

Quite a bit!

Job One has been overhauling MySpace, which is still very much a work in progress. But Miller’s full plate includes lots of other tasks too. Like trying to convince Google (GOOG) or Microsoft (MSFT) to pony up for a big search deal to replace the Google/MySpace deal that expires next year.

Equally difficult job: Trying to figure how to get consumers to pay for some of the content News Corp. currently provides for free on the Web.

The Los Angeles Times advances that part of the story this morning with a report that Miller is “believed to have met” with rival publishers–including those from the New York Times (NYT), Washington Post Co. (WPO), Hearst and Tribune Co.–about creating a consortium to charge for online news.

I believe it. My understanding is that while Murdoch has been vocal about his intent to start charging consumers to read his stuff, the more sober assessment within News Corp. (which owns this Web site) is that charging for news will only work if there is a critical mass of publishers trying to do it together. How many would that be? “Enough people so that it matters,” a News Corp. exec tells me.

Whether you could actually get enough big publishers to work together (something that start-up Journalism Online is trying to do, in its own way; so for that matter, is the Associated Press) is an open question, of course. And then there are the inevitable antitrust issues.

But I think the most practical problem for News Corp., and everyone else who works in the news business, is that from the consumer’s perspective, very little of the stuff we produce is worth paying for. That doesn’t mean you can’t figure out how to sell specialized bits of content (a la The Wall Street Journal or Consumer Reports). But a great deal of the stuff we make can be found all over the Web, with little to distinguish it, and the model that used to support this content–near-monopolies on eyeballs and ad dollars–has disappeared. Pay wall or no, that’s going to have change going forward.

And for the last several years, the New York Times (NYT) has provided excellent on-the-ground coverage, usually via Dealbook’s Andrew Ross Sorkin.

Not this year.

Reporters and media chieftains alike started arriving at the Idaho resort last night, but the Times is AWOL. If you want first-hand reportage on who said what outside the bar or by the duck pond, you’re going to have to rely on other news outlets.

Sorkin explained his absence via email to me:

For better or worse, I couldn’t make it out to Sun Valley this year because I’m chained to my desk for the next couple of weeks trying to finish my upcoming book, “Too Big to Fail.”

Given the market jitters–and resulting deal drought–we made the decision to cover the event from afar this year. I’m trying to stay up to date on the latest machinations out there by speaking with a half dozen of the invitees daily by phone and email–some of whom have already tapped out notes by Blackberry from inside this morning. (We actually might have a pretty interesting Sun Vally story up on DealBook in the next 24 hours.) We’re also running a series of Twitter feeds from other news organizations on DealBook’s homepage. And we plan to run several Sun Valley photo slide shows, as we’ve done in year’s past.

In truth, it’s debatable whether any news outlet has to be at Sun Valley: Some of the moguls use the opportunity to hold briefings with the press there. Google’s Eric Schmidt (GOOG) has been particularly talkative in years past. But anything truly important generally happens away from the scribes and usually comes to light well after the fact, so you could argue that real-time coverage is overrated.

On the other hand, last year Rupert Murdoch, who owns this Web site, enlisted the help of the press corps to help him find his wedding ring after an evening at the bar. That was a pretty great story.

And in any case, there are still plenty of other outlets on the ground. Among them: The Financial Times, Reuters, Bloomberg, the Los Angeles Times, CNBC, the New York Post, and our colleague Julia Angwin from The Wall Street Journal.

A quick perusal of Google News will keep you up to date, and if you want second-by-second stuff, there’s a Twitter stream, of course. And sure enough, Sorkin’s Dealbook has a nifty widget that lets you toggle between different Twitter feeds. It’s worth checking out.

Cheers to the paper for allowing itself to be savaged by “Daily Show” correspondent Jason Jones. I particularly enjoyed watching Executive Editor Bill Keller gamely explaining the news business while managing to get a dig into Google (GOOG), The Huffington Post and Drudge Report.

Crave more? Here’s an interview The Wall Street Journal’s new “Speakeasy” blog conducted with Jason Jones about the bit. Excerpt:

How’s the mood at the Times these days?

Edgy? No. It was really quite lovely. Let me tell you this, movies have severely misled me on what newspaper rooms should look like. There was no paper stacked six feet high on people’ desks. No one’s yelling stop the presses.

What are people up to over there?

I think people are using the Internet to look for new jobs. There are lots of great Web sites out there: Monster.com; Craigslist is great.

There are plenty of problems with this plan, and I think the biggest one is that there’s simply too much commodity content on the Web — stuff that doesn’t have any particular value to anyone, or at least not much more or less than something easily available somewhere else.

(Aside: The scenario above is great for Google (GOOG), which helps you find the commodity stuff no matter where it is, and bad for most publishers, who used to have control over their distribution. But I don’t see how you can blame Google for that.)

There are a couple exceptions that have worked so far, like the Wall Street Journal (which is owned by News Corp (NWS), which owns this site), and Consumer Reports. And even the New York Times (NYT) was able to convince some of its readers to pay to read the likes of Maureen Dowd via an experiment a couple of years ago and may try something like that again. But how many New York Times, Wall Street Journals and Consumer Reports are there?

But for argument’s sake, let’s say your local newspaper does indeed have some stuff that you can’t find anywhere else, and it wants to sell it to you. How would it do that?

Enter Journalism Online, a startup founded by media veterans Steve Brill, Gordon Crovitz and Leo Hindery that wants to provide a backend service for papers that want to sell their wares. A few weeks ago I talked to Crovitz, who is the former publisher of the Wall Street Journal, and let him make his pitch.

They key point is that Crovitz and his colleagues don’t expect everyone to pay for everything on the Web — they figure that something like 5 to 10 percent of a publication’s readers will value the stuff enough to pay for complete access to everything, and that everyone else will be content to graze for free. That still sounds optimistic to me, but I’d love to be proved wrong.

If you’re looking for more details, here’s a link, via the awesome NiemanLab, to a deck from a presentation that Brill made to the hush-hush newspaper conclave in Chicago last week.

]]> http://mediamemo.allthingsd.com/20090603/how-much-will-you-pay-to-read-your-news-online/feed/ 1 http://mediamemo.allthingsd.com/20090529/secret-newspaper-cabal-agenda-sort-of-revealed/ http://mediamemo.allthingsd.com/20090529/secret-newspaper-cabal-agenda-sort-of-revealed/#comments Fri, 29 May 2009 14:55:28 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=7808 So what exactly were the 24 newspaper publishers who gathered in suburban Chicago yesterday talking about? We don’t know, because the meeting was held off the record and participants like the New York Times (NYT), Gannett (GCI) and Hearst aren’t talking about it. Except we do know, sort of.

We know that, in general, the papers have been talking about ways to make more money from their products, including subscriptions and microtransactions, and have been talking about this for months. And we know, via the Atlantic’s James Warren, that the subject of yesterday’s meeting was “Models to Monetize Content” and that the agenda included sessions titled “Journalism Online: Presentation on proposed service to charge for access to newspaper content and to license that content that (sic) online aggregators” and “Fair Syndication Consortium/Attributor.”

That first session sounds pretty straightforward. What’s that second one about? I asked the PR firm that reps Attributor, the content-tracking service referred to in the session’s title, and it declined comment. But it did refer me to the Web page for the Fair Syndication Consortium, which it turns out is the name for the Attributor-led program that wants to get the likes of Google (GOOG), Microsoft (MSFT) and Yahoo (YHOO) to share some of the ad revenue they make when they sell ads against copyrighted content.

You can read more about that in this Wall Street Journal story published in April. See? Not so mysterious, after all.

]]> http://mediamemo.allthingsd.com/20090529/secret-newspaper-cabal-agenda-sort-of-revealed/feed/ 0 http://mediamemo.allthingsd.com/20090526/why-the-new-york-times-took-carlos-slim-over-david-geffen/ http://mediamemo.allthingsd.com/20090526/why-the-new-york-times-took-carlos-slim-over-david-geffen/#comments Tue, 26 May 2009 08:00:15 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=7729

The New York Times turned down a chance to borrow money from Hollywood mogul David Geffen last winter, and went with Mexican billionaire Carlos Slim instead.

So says he New Yorker, which has an extensive profile of Slim in this issue. Writer Lawrence Wright says that when Geffen learned that the Times was working on a deal to borrow $250 million from Slim, he offered to make the loan on the same terms, but was rebuffed by  Arthur Sulzberger Jr.

The Times chairman, Wright says, told Geffen’s people he preferred to work with Slim because the telco billionaire already owned Times shares and because “he was reportedly also worried about Geffen’s ambition to take over the company.”

Where would Sulzberger have gotten that idea? From Geffen, of course.

Wright also reports that Geffen offered to buy the publisher outright last September; he says Geffen made the offer via Steve Rattner, the media banker turned Obama adviser who is one of Sulzberger’s closest confidants.

The pitch: Sulzberger would oversee the New York Times’s (NYT) editorial operations, Geffen would handle the business side, and eventually the entire business would be handed over to a nonprofit foundation. Obviously, Sulzberger turned that one down.

Wright’s piece–which is behind a pay wall, so it will be interesting to see how much of the story gets circulated via the Web–is first and foremost a profile of Slim, and secondarily about the Times. So it doesn’t spend much more time on Geffen or the notion of other white knights for the paper, a la Google (GOOG).

But in just a few paragraphs, the article does seem to sketch out Geffen’s desire to associate himself with the Times in whatever way he can: Buying it outright, lending it much-needed money or buying some of its stock (via Harbinger Capital).

For now, the Times is controlled by Sulzberger and his extended family, who have repeatedly insisted that they’re not interested in parting with it. Then again, that’s what the Bancroft family always said about Dow Jones and The Wall Street Journal. And those properties are now a part of Rupert Murdoch’s News Corp. (NWS)–as is this Web site.

If the Times ever does need a deep-pocketed buyer, Geffen has made it very clear he’s available.

]]> http://mediamemo.allthingsd.com/20090526/why-the-new-york-times-took-carlos-slim-over-david-geffen/feed/ 0 http://mediamemo.allthingsd.com/20090522/will-facebook-say-da-to-russian-investors/ http://mediamemo.allthingsd.com/20090522/will-facebook-say-da-to-russian-investors/#comments Sat, 23 May 2009 00:46:07 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=7683 Here’s the newest twist in the Facebook valuation/funding saga: Russian investors have reportedly offered to sink up to $350 million in Mark Zuckerberg’s social network–at two different valuations. The Wall Street Journal says investment group Digital Sky Technologies has offered to spend $200 million on a chunk of the company’s preferred stock at a $10 billion valuation and to buy up to $150 million worth of the company’s common stock at a $6.5 billion valuation.

Reached for comment, Facebook spokesperson Brandee Barker offered up the boilerplate no comment: “Facebook is a private company, so as a matter of policy, we don’t typically share details about our financial plans or comment on rumor and speculation.”

But everyone else has been speculating about the value that Facebook and outside investors place on the company, and whether Facebook needs to raise any money at all.

We do know that in 2007, Microsoft (MSFT) beat out Google (GOOG) for the right to invest some $250 million in the Facebook, placing a $15 billion valuation on the company’s preferred stock. Preferred stock is typically more expensive than common stock because it gives owners the ability to recoup their money before other investors. Facebook later raised another $60 million from Hong Kong billionaire Li Ka-shing and $10 million or so from the Samwer brothers of Germany.

And various reports have suggested that employees and others who own Facebook common stock have been recently selling it on the private market for prices that value the company in the $4 billion range.

Facebook has repeatedly said that it doesn’t need additional cash to keep going and that it expects to generate $500 million in revenue this year and begin breaking even in 2010. Last year, the company felt flush enough to offer to buy Twitter for $500 million–$100 million of which would have been in cash.

]]> http://mediamemo.allthingsd.com/20090522/will-facebook-say-da-to-russian-investors/feed/ 2 http://mediamemo.allthingsd.com/20090514/david-geffen-thinks-the-new-york-times-is-a-charity-case-so-what-does-he-want-to-do-about-it/ http://mediamemo.allthingsd.com/20090514/david-geffen-thinks-the-new-york-times-is-a-charity-case-so-what-does-he-want-to-do-about-it/#comments Thu, 14 May 2009 13:10:28 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=7358 More fallout from this week’s Fortune story that disclosed David Geffen’s interest in the New York Times. We’re now seeing a series of stories that say that Hollywood billionaire thinks of the paper not as an investment but a charity case.

BusinessWeek’s Ron Grover says Geffen “doesn’t so much see this as a business venture, but rather as a civic investment.” Newsweek’s Johnnie L. Roberts goes further, suggesting that Geffen would literally turn the Times into a nonprofit if he bought it.

Both Grover and Roberts are longtime media reporting pros, so when they cite sources with knowledge of Geffen’s thinking, I believe them. What I still don’t understand, and what observers and investors I’ve talked to are still puzzled about: How does Geffen plan to do that?

To reiterate: Geffen has reportedly tried to buy the 20 percent stake in the Times now owned by Harbinger Capital, though the two sides couldn’t agree on price. But even if they did, the transaction would only bail out Harbinger, not the Times.

And because the Times has a dual-class stock structure that keeps control of the company in the hands of the Ochs-Sulzberger family, taking on Harbinger’s stake doesn’t give Geffen a foot in the door to the company. It gives him the right to appoint two representatives to the company’s 14-member board of directors, but nothing else. Just ask the Harbinger folks.

Again, there are two plausible ways to acquire the Times:

1. Buy the super-voting shares outright from the Ochs-Sulzbergers, who have said they have no intention of selling. But then again, that’s what the Bancroft family said about Dow Jones, which owns the Wall Street Journal and this Web site. And News Corp.’s (NWS) Rupert Murdoch was able to overcome their objections by offering a 60 percent premium to the company’s share price. Maybe Geffen could try that.
2. Establish a large debt position with the company and exercise the power that comes along with that in the event of a restructuring. The problem: Billionaire Carlos Slim has already done that.

So. Anyone close to David Geffen want to explain what he’s really thinking? I’m all ears.

]]> http://mediamemo.allthingsd.com/20090514/david-geffen-thinks-the-new-york-times-is-a-charity-case-so-what-does-he-want-to-do-about-it/feed/ 0