Today the Washington Post announced a plunge in net income:
(From Seeking Alpha)
"Another quarter, another decline in revenue at the Washington Post's print media division. The Post reported a net income loss of 6.7% in its most recent quarter as continued weakness at its newspaper and magazine publishing divisions hurt strong results in other segments.
"Revenue at its educational division which includes the Kaplan Test Preparatory service rose 18% (43% of total revenue) while revenue from its affiliated cable television channels grew by 14%.
"On the other hand, revenue from newspaper (Washington Post) and magazine (Newsweek) publishing fell 2% and 3% respectively. Post shares fell $3.24, or 0.42%, to $766 on the earnings report. In other news, the company set its regular quarterly dividend at $2.05 a share."
As a current Kaplan customer and former Newsweek subscriber, I can attest that there is a big difference between the two. The difference is that Kaplan is focused on the core needs of its clients (passing tests) and does that well. A few years ago Newsweek decided that its customers (who subscribed to a news magazine) were probably more interested in having a smart ass celebrity infotainment magazine mailed to them every week rather than a magazine about news. I'm sure that a lot of other people like me canceled their subscription to "News"week.
Unfortunately now the infotainment trend is in full force, much of the space that isn't taken up by ads in the Journal is filled with silly cartoons, pictures and graphs a la USA Today. The typical reason given is that the papers are trying to "update" to compete with online news sources.
Ironically, if you look at most news, politics or finance sites on the Internet they have a smaller percent of their overall space filled with ads and probably have fewer silly graphics than most major papers.
Instead these sites have...text...news...analysis, you know, the things people used to read NEWS papers for.
The simple fact is that most people are kind of stupid and would rather look at a cartoon or a picture of Paris Hilton than read anything. It is a tough sell to convince those people to pay for a newspaper, because no matter how many graphs you have, you can't compete with US Weekly or TMZ.com of that is what people are looking for.
For many years the Journal's circulation numbers held strong because they didn't play the USA Today game. While people canceled Newsweek and their local Knight Ridder paper, they kept their Journal subscription because every day they could count on five columns of hard news text and one column of feature on the front page and a whole lot of news in the middle. Now the Journal has shrunk the paper, cut a column and made 75% of the paper colorful ads, not what they typical Journal reader is looking for.
The Post's number's today were bad, and the sad thing is that nobody in the media is going to learn anything from them.
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