A Newspaper Paradigm Shift?

If you go to school for journalism, one of the tenets drummed into your head is the sacrosanct divide between the editorial and business sides of a newspaper. There is supposed to be almost no communication between the two sides, and certainly no collusion: i.e., you don’t want an investigative series on a failed chemotherapy drug to be sponsored by a pharmaceutical company that makes a rival drug.

This firewall hasn’t always been so strong, and it is probably stronger in the U.S. than anywhere else in the world. You can feel the friction every time some newspaper announces it is going to sell ads on its front page: critics respond as if the Vatican had just announced it would be selling birth control.

But these are getting to be desperate times for newspapers and, to quote Shakespeare:

Diseases desperate grown

By desperate appliance are reliev’d,

Or not at all.

So it was fascinating to read this article from the L.A. Times about how the Times itself is trying something new:

Searching for new sources of revenue, Los Angeles Times Media Group is getting into the real estate business.

On Monday, Times Media Group and other partners will launch ZetaBid, a business that will auction foreclosed homes and other properties. The company would also run a web site where the properties could be viewed.

The other partners are London-based GoIndustry-DoveBid, an auction specialist, and CataList Homes of Hermosa Beach, a real estate brokerage. The partners will share fees paid by the buyer on each home sold.

The venture is the latest effort by the struggling media company to tap additional revenue streams beyond newspaper advertising. The media group also operates revenue-sharing ventures through its Cars.com and Apartments.com classified-advertising enterprises.

Newspapers are, above all, collectors, synthesizers, and purveyors of information. In past decades, the demand for information has skyrocketed, as have the channels of distribution. The former would seem to have benefited newspapers, but their business models couldn’t properly take advantage; the latter has definitely harmed newspapers, but there is no reason, really, that it could not be turned around to help them.

Sam Zell is the brash and contrarian new owner of the L.A. Times (and other papers) — and many journalists see him as a half-brother of Satan. With moves like these, however, I wonder if he will instead someday be viewed as a messiah.


echoclerk

"This firewall hasn’t always been so strong, and it is probably stronger in the U.S. than anywhere else in the world."

um based on what? I would gyuess that media in the USA is one of the LEAST objective or unbiased in the 'free' world. in the USA advertising is news...

Que?

@9, To which objective foreign presses are you comparing American objectivity or lack thereof?

I'm a recent journalism college graduate and can assure you that objectivity and showing no personal preference towards subjects or ideas were drilled into our heads with the ardency of learning The First Amendment and the difference between "its" and "it's."

What certain unnamed extremely politically polarizing broadcast news television and radio programs decide to include in their program isn't representative of the American news media as a whole. Real journalists daily strive to reach ethical decisions about content.

Russ Yarrow

I used to work in the newspaper business (pre-Internet days) and was always dismayed by the antipathy displayed toward the "business" side. I think that mindset helped inform (or misinform) the industry's glacially slow response to the Internet's disintermedation of its core business. That opened the door to entrepreneurs like Sam Zell. Editorial still needs to understand that revenues are driven by advertising and other business ventures, not the brilliance of their writing.

Katie

They will have to compete with anyone else who does it...why not? Our local paper (owned by large regional company) has a recycling company. That makes more sense to me than real estate, but whatever. They are competing with 3-4 other providers and it seems are doing pretty well.

Mark Wolfinger

Great idea! I hope he brings it to the Chicago Tribune.

Shibl

While the venture could be a great idea in itself, and the shareholders could benefit by reassigning their assets from a failing business to a new one. It really has no synergy with the newspaper business.

They are not using the specialized skills, assets or goodwill they have in any way.

DJH

It's not exactly "front-page advertising," but here in CT for a year or so the Hartford Courant has had these peel-off stickers on the front page, that they slap on the top over the name of the paper and sometimes its headline.

Of course, their reader representative, to whom people complained about the stickers when they first appeared, is gone ... a casualty (unfortunately) of Sam Zell's budget-cutting axe.

Gary

It seems rather odd that based on a search of the LA Times, they never mentioned Sam Zell before he bought the LA Times... ever. That's kind of odd.

My Dad works in the newspaper business. In alot of ways, what I've seen at his paper is very similar to the more public problems we see at the automakers. A lack of game changing vision, management that firecly protect the old school methods, and unions that fiercly protect jobs that in the current news environment are irrelevent.

Daniel Cochran

As a Messiah? He's done for journalism what Godzilla did for Japan.

Damon

If the papers want a new reveue stream they should all charge the 24 hour news networks a large royalty each time they read an artical on the air instead of do their own journalism.

sarahmas

I don't care what the heck Sam Zell does or sells or advertises, as long as he doesn't change the name of Wrigley Field.