NYT Regional Edition: A New Driver of the “New Local”
Important Details: Metro dailies are getting some unexpected competition. Friday, the New York Times launched a new regional edition for the San Francisco Bay Area. The Times’ existing 10-person Bay Area bureau will now produce additional regional coverage. That coverage is now found on several pages within the Times’ local Sunday and Friday print papers, and is included online.
The Times made clear in its announcement that it will pick and choose its coverage, offering “local stories as only the Times can report them.” It also noted that it continues to have discussions with local news producers in the Bay Area, including public radio station KQED, which will probably end up bolstering its daily and weekly output there (see Insights, New San Francisco Independent News Site Unsettles Status Quo, Oct. 2, 2009).
Importantly, the Times noted that the Bay Area regional edition won’t be its only one. It chose a region where it does particularly well in print, selling more than 45,000 copies daily and about 65,000 on Sundays. Plans are underway to launch products in other markets as well, including Chicago. The Times won’t be alone. The US’s other top national daily, the Wall Street Journal, has signaled a similar intent, both in the Bay Area and in other cities as well.
The plans mark an escalation of the head-to-head competition between the Times and the Journal, one that has picked up considerable steam since News Corp’s purchase of Wall Street Journal parent, Dow Jones, in late December, 2007.
News executives of the Hearst-owned San Francisco Chronicle and the MediaNews-owned San Jose Mercury News both pointed to the their newsrooms numbering in the hundreds, comparing it to the small Times’ presence, while noting that the Times will indeed offer new competition.
Implications: The Times’ foray, coming in the same week that pulled its Boston Globe property off the market, tells us much about the re-mapping of the news world.
Metro dailies have long dominated U.S. journalism. While in UK, Europe and Japan, multiple national dailies dominate the press, in the far-flung U.S. only three newspapers are truly national. Gannett-owned USA Today is the largest with more than 2 million circulation. Its short-form-oriented paper emphasizing news for travelers, while the Times (1 million daily) and Journal (2 million daily) are the ones that drive the print national news agenda.
Both the Journal and Times have long been must-reads for an American elite keyed to politics, business and culture. Their readers usually read the metro daily as well, the papers that the masses depended upon for their full servings of national and international news, sports and business news, and lifestyle and entertainment coverage.
The web has blown apart that whole metro package, as niche providers of all kinds – from ESPN to TMZ to Poltico to Marketwatch — offer deep vertical coverage.
Now the Times and the Journal see potential in this era of creative destruction. Though the Times just announced further cutbacks of 100 in the newsroom, both papers have cut their staffs proportionately less than most metros, maintaining more of their reporting strength and brand equity through the depth of recession. Now, by focusing locally-oriented staff, and through creative local partnerships, they see the ability to become the singular and remaining print read longer-term. Such a strategy would allow them to continue their reader pricing strategies – and importantly, maintain a strong print-based ad revenue stream, even as they transition their businesses for the digital future.
Out of the many implications pouring out of this announcement, Outsell sees these as most vital:
- Metro dailies are newly vulnerable. The past several years have seen the growth of small-shop ankle-biters, mainly non-profits, and the revving up of commercial broadcasters. Now public radio news stations, aided by foundation monies, are doubling down on local news. Add the efforts of the Times and the Journal in sussing out a regional strategy, and you’ve got lots of competition for readers, and of course, for advertisers.
- Print circulation retention remains a top priority. The Times says it doesn’t expect to gain lots of new print customers with its regional push. That’s probably true. As true, though, is the importance of holding on to its print customers as long as possible. With 85% of revenues still derived from the print product across the daily newspaper industry, companies – national and regional – must hold on to those readers and that revenue for as long as possible.
- Regional editions are about the digital future as much as they are about the print current. Clearly, the regional edition retention-and-small-growth strategy is key. The ability, though, to tailor digital regional news products – and target advertising accordingly – will provide a long-term pay-off for the Times and the Journal, if they execute well. The Times began in the last year to offer web readers a choice of editions: its standard national edition, or the new “Global Edition,” activated with a toggle switch. While it does not yet have enough content to offer a Bay Area (or other) Local Edition, we can see how that day may be far off. While the Times owns a tiny share of readers in major metro areas (2.2% Sunday in Washington, D.C., 3% Sunday in Hartford, 2.3% Sunday in the San Francisco Bay Area), online getting readers to switch is much easier to do and less expensive than print “sales pressure”.
- The news fraternity is increasingly frayed. While the Times continues to sell its wire and syndicate products, it is now beginning to compete head-on with its customers. We’ve seen the end of the L.A. Times/Washington Post wire recently (Insights, Bloomberg, Washington Post Moves Highlight Business News Challenges, Oct. 8, 2009) and the beginning of a new Post/Bloomberg relationship. As we come out of the recession, it’s everyone for himself, with strange bedfellows to be expected. The New York Times is both friend and enemy of the regional press – the classic “frenemy” of the web world.
Overall, it’s a New Local we’re seeing created. The Times and public radio pushes are part of that. The Dallas Morning News’ push to expand local news covearge is part of that. The efforts of the Seattle Times, Miami Herald and Charlotte Observer (Insights, Daily Newspaper Sites Re-Knit the New Local, Sept. 1, 2009) to partner with hyper-local sites is part of that.
Local isn’t what’s left when you take away traditional national news, business and sports franchises. It’s a vital part of readers’ lives and advertisers’ strategies, and it’s getting its own makeover into 2010.