R.I.P. W.S.J.

By Reuters Staff
May 23, 2008

Let us pause for a moment of silence in memory of the institution that WAS the Wall Street Journal. As a long-time subscriber to the paper, I’ve noticed it’s devolution since Rupert Murdoch took over. Here’s a clue from the paper itself:

News Corp. Chairman Rupert Murdoch named Wall Street Journal Publisher Robert Thomson as the paper’s new managing editor, succeeding Marcus Brauchli, who left under pressure last month….The move is expected to speed the pace of change at the nation’s second-largest newspaper, creating a more direct pipeline from News Corp. to the paper’s editors….

For the first few months under the new ownership, Mr. Brauchli ran the operations of the paper. Mr. Thomson remained in the background….

Mr. Brauchli presided over a number of changes — more general news, a more urgent and splashy front page, shorter stories — but Mr. Murdoch decided that change wasn’t happening as quickly as he would like…..

Indeed. Now the news page is littered with “general interest” stories: daily updates on the Myanmar Junta refusing aid for cyclone survivors, multiple articles per day about the recent Chinese earthquake. We get it, the Burmese Generals don’t want aid and an earthquake killed lots of Chinese.

I don’t mean to make light of those stories. But the fact is, if I wanted daily updates on those topics, then I’d read the New York Times.

And that’s the point: Murdoch wants to move the Journal away from its roots covering all-things business so that it can compete with the Times more effectively in general interest news.

There are fewer and shorter articles about abstruse topics like the credit crunch. If you were a reader of the paper last year, you may remember 3-4 pages per day with a dozen in-depth articles covering the credit crunch. The Journal was an invaluable resource to understand what was going on.

Moreover, I simply don’t understand the business case for turning the Journal into a general interest paper. Take a look at recent statistics for daily newspaper readership:

The slide in U.S. newspaper circulation is picking up speed.

Daily circulation fell 3.57% from the same period last year for 530 U.S. newspapers…according to data released Monday by the Audit Bureau of Circulation.

Bucking the trend….The Wall Street Journal, the second-largest daily (after USA Today), which said daily circulation inched up 0.35% to 2,069,463.

Three points:

  1. At 2.1 million, the WSJ’s daily circ is nearly double that of the NYT’s 1.1 million. They must be doing something right.
  2. The NYT’s daily circ fell 4% from a year ago, while the Journal was up slightly. This despite the law of large numbers, which would suggest that a larger paper would find it MORE difficult to grow.
  3. The WSJ is still the only major newspaper able to charge a subscription fee for access to its website.

At a time when the economy is getting hammered on multiple sides, when there is a distinct need for in-depth reporting on all matters business and economic, it seems clear that a paper like the WSJ would do well.

And it has. See points 1, 2 & 3 above.

Maybe it’s missed Murdoch’s brilliant newspaper brain, but a big reason that “general interest” papers are on the decline is the commoditization of their product. General interest news is freely available through wire services like AP, Reuters and AFP. Why pay for it in a newspaper when I can get it free online with Google News or Yahoo?

Not so with the business news being published by the Journal. You won’t find Carrick Mollenkamp’s incisive and detailed reporting of busted structured finance vehicles anywhere else. No reporter can match Greg Ip for his detailed knowledge and thorough coverage of the Federal Reserve. The whole newsroom is chock full of such distinctive experts.

Why waste space that could be devoted to these folks’ detailed, totally original reporting with another article about Myanmar? Do I care that Ban Ki-Moon convinced the Junta to accept aid delivered by the U.N.? I don’t. But if I did, I can get that article:

  1. anywhere.
  2. for free
  3. and, with the web, faster than I could get it from a paper. Sure the WSJ website can get me general interest stories quickly, but why pay for commodity news? See again points 1 & 2.

I can’t get Mollenkamp, Ip or any of these genius financial reporters anywhere else. Them I pay for. In print AND online.

Here’s what I fear will happen to the Journal: Murdoch succeeds in turning the paper into a bastard cousin of the NYT. Circulation falls precipitously because no one’s interested in paying for general interest news, which the NYT will always cover far better anyway. With falling circ, the WSJ is forced to retrench like all other U.S. papers. Reporters get fired, pages are cut, original content is replaced with wire feeds. This leads to a less appealing paper and further declines in circulation, which in turn leads to more cuts in coverage.

Please Mr. Murdoch: Don’t fix it; it ain’t broke.

5 comments

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The Newsweek article you linked is excellent but it raises a question about tax. If the market is to decide then people should pay the market price and act accordingly. To increase taxes as the Europeans have done is contrary to this and admits that government can use taxes to accomplish something that has a positive result, which the free market school would say is not something the gov’t should be doing.I wonder about the ability of the market to decide about things that have long term consequences. As surely as the present value of a dollar in the future is smaller the more distant the time that dollar would be paid, can’t we also say that people act on the immediate situation – that the present value even of total disaster in the future is small?Americans have unquestionably said through their vehicle purchases, the market, that they will put aside the congestion, the pollution, the problem of parking, the waste of a single person driving alone, all for the sake their fondness for big and heavy vehicles.I say all of this because I think that as time goes on we will see more and more pressure for top-down authority – for gov’t to use taxes and laws to restrain individual behavior for the common good. It will not go down well in the United States. People will look back at the 20th century and realize that 1) they were never so free (coincident with cheap energy) 2) there was never so little self-restraint (cheap energy was squandered). In other words freedom was used without responsibility.Point? The market may not price things appropriately because the future cannot be adequately taken into consideration. People act on current market conditions though the consequences of those actions extend into the future. When the future consequences becomes present and start to hurt by way of the market, the consequences of earlier action cannot be easily reversed if they can be reversed at all.

Posted by Clif | Report as abusive

Yes, certainly tax policy can help “align private incentives with” social costs. Drivers don’t pay the full cost of their driving. Indeed, global warming is the SMALLEST of the costs they don’t pay. Taxes should be a tool for members of society to pay for the services of society that they use.This is essentially the problem with socialized medicine. If individuals use it but don’t pay for it, then everyone has an incentive to use as much as possible. It’s why public health care systems only stay solvent via rationing, via the government making decisions about what health care people may receive. That scares me more than an insurance company making those decisions…..Check out this link by Steve Leavitt

Posted by rolfew | Report as abusive

Rolf, well written column with the exception of the idiotic comments about Chavez/Venezuela. Using a nations resources to benefit the poor is hardly despicable behavior. Despicable is invading another country for THEIR resources and claiming it’s for security. Nevertheless aside from the idiotic polemic, your point is well made.

Posted by Oso | Report as abusive

Oso: glad you like the post, but please show me evidence that anything Chavez is doing is actually benefiting the poor of Venezuela. The only people benefiting from the Chavez regime are the well-connected oligarchs that support him. He’s a communist megalomaniac who steals elections, actively and directly supports FARC terrorists (see the lastest Interpol dossier) and has tried to rewrite the country’s constitution to make himself president for life.He also actively supports Iran’s attempts to not just achieve nuclear power, but to acquire atomic weapons–his was the only “no” vote on an IAEA resolution in September condemning Iran for failing to come clean on its nuclear activities.He’s a raging anti-Semite, having said in a Christmas Eve broadcast last year that “minorities, the descendants of those who crucified Christ (i.e. Jews), have taken over the riches of the world.” He’s also had his goons raid Jewish Day Schools that he claims were storing weapons. For whom, he didn’t say. The claims were never substantiated. All of this was a clear attempt to foment class hatred, which is a typical tactic of communist dictators. It’s pretty clear that’s what Chavez aspires to be, given his reverence for Castro and his regime.He is totally mismanaging the country’s natural resources after driving out “imperialist” multinationals. The WSJ reported in January: “With Venezuelan oil fields experiencing an annual depletion rate on the order of 25% and little government reinvestment in the sector, infrastructure problems are looming in oil”I could go on….

Posted by RW | Report as abusive

Our nuclear waste really isn’t waste at all and Yucca Mountain is completely unnecessary. The “waste” can be used in Integral Fast Reactor – Breeder Reactors to generate even more electricity.

Posted by Drew dowdell | Report as abusive