Role of Journalists and Dangers They Face
Internet and Electronic Media, The Profitable Future???
By Allister Sparks
Last week ZimJournalists Arise, carried Part 1 of a presentation by Allister Sparks, published in last week's Standard newspaper. The presentation was made at the MISA Awards Dinner some weeks ago. This week's issue carried part 11, which we have reproduced.
Background: Sparks is world reknowed South African journalist and editor, with 40 years experience. Sparks has also written several books and is a Pulitzer Prize nominee.

THE migration of readers and advertisers to the Internet, following on the early migrations to television, and combined now with rising costs and falling revenue, is threatening the financial well-being - even the very existence - of many newspapers, including some of the oldest established and respected among them.

This trend is not yet being fully felt here in Southern Africa where the business side of the Internet has not yet taken off as fully as it has in the developed world. But the migration of readers is already there, and some early consequences are already being felt.
US Experience
To get a foretaste of what is coming, one needs to look to the developed world and especially to the United States. The most striking event there was the death earlier this year of one of America’s biggest and best newspaper companies, the Knight-Ridder Group, a chain of 32 daily newspapers with a combined circulation of 3,7 million and with 18 000 employees.The question is how and why a fine newspaper company with relatively high profit margins and a proud record of having won 85 Pulitzer Prizes came to be wiped off the media landscape.The answer is instructive.

Knight Ridder was quoted on the New York Stock Exchange, and as investors saw the ballooning growth of the Internet they assumed that newspaper stocks would start to decline. Now in the investment world, ASSUMPTIONS and PERCEPTIONS become facts. Self-fulfilling facts. So the investors started to withdraw their money and Knight Ridder’s share price began to fall even though it was still making good profits.At that point aggressive shareholders began to demand cost-cutting to keep profits margins, and thus the share price, up.

Knight Ridder’s CEO, Anthony Ridder, resisted for a while but as the pressure on him increased he began to cut - and as invariably happens in these circumstances, he cut editorial staff.The problem is, when you do that you inevitably cut the quality of your product – which in turn affects sales and revenue, and so a downward spiral begins.That is what happened to Knight Ridder.

As the share price weakened further, one of the aggressive shareholders, Bruce Sherman, head of the McClatchy Company bought out Knight Ridder. But he quickly found the same cycle of pressures hitting his new acquisition, so that he, too, cut staff and has now sold off 12 of the newspapers he bought.The warning is there for all of us to see. Jim McNaughton, a former editor of Knight Ridder’s most famous newspaper, the Philadelphia Inquirer, who quit in disapproval when the company started paring the editorial staff, has had harsh words for the CEO who started the cuts. "The real story of the decline and fall of Knight Ridder," he said the other day, "is the notion that you can continue whittling and paring and reducing and degrading the quality of your product and not pay a price.""Tony’s legacy," he added, referring to CEO Anthony Ridder, "Tony’s legacy is that he destroyed a great company."What this whittling and paring does is to cut out the heart of good journalism, and thus of the newspapers they work for.

As staffs grow smaller there is less and less time for reporters to practise good, well-researched, well-rounded journalism. They start having to hack out too many stories, which means the reporting becomes shallower and shallower. When you reach the point, already evident in some newsrooms in this country, where individual reporters have to handle five or six stories a day, it becomes what I call Microwave Journalism. A quick telephone interview with a single source and you hack it out to get on with the next one. No time to check, no time to amplify, no time to flesh out the implications.Such shallow journalism degrades both the product and the democratic role it is supposed to serve.
SA Co Goes Electronic
The answer, as at least one newspaper company in South Africa, Naspers, has discovered, is two-fold.Firstly, protect the company from shareholder pressure by having a two-tier stock structure, with a special class of voting stock that is separate from the traded non-voting shares.Secondly, diversify, diversify into the profitable new electronic sectors of the media, into television and cellphones and the Internet, so that you can support the print media and maintain their editorial quality which is vital for their long-term survival and the democratic role they need to play.

I hope more of our newspaper companies learn these lessons. We have the answers here. Don’t let’s go the Knight Ridder route.So let me leave you with those thoughts, my dear colleagues and friends, so that you can get on with the important business of announcing MISA’s Press Freedom Award.