Lessons from the (failed) Rocky Mountain News

The newspaper industry today talks a lot about the need to get paid for its content online. But in the late ‘90s, Denver was an experiment in essentially free newspapers. By the peak of the newspaper war, more than 400,000 subscribers to the two Denver papers were paying a penny a day for home delivery. The Rocky was bleeding money and the Post was heading the same direction. So the owners called a truce, asking the Justice Department to approve what’s known as a joint operating agreement, which allows newspapers to merge business operations while maintaining separate and independent newsrooms.

The agreement, written in 2000 under the direction of two seasoned newspaper executives – William Burleigh and Dean Singleton – didn’t even mention the Web. Yet another sign that the Web was an afterthought all along. The Web wasn’t perceived as central to the success of the new business. It was believed that savings from combining the business operations of the two papers plus the ability to raise advertising rates would produce very healthy returns for both owners. Instead, what happened was that classified revenues dropped by more than $100 million a year from the start of the JOA to the end, and national and display categories tanked, too.

This is an amazing speech, written with such absolute clarity from a newspaper leader that ended up losing his job along with everyone else at the Rocky Mountain News in Denver.

These kinds of warnings have been written for the newspaper industry for a long time now, with special urgency over the last 5 years. But the analyses and recommendations remain largely unheard.

So-called journalists seem to deeply misunderstand their role in society and all the executives are leading the industry, company by company, to oblivion.