Monopoly Power?

by Russ Roberts on November 30, 2004

in Competition

The Washington Post reports that nationwide newspaper readership is down:

Newspapers_113004_3
The key chart is the second one.  Circulation has fallen from almost 80% of the adult population in 1970 to barely over 50% today.

Of course there are many reasons for this decline.  The most obvious one is the rise of alternative sources for news and information—cable television, free suburban papers and more recently the Internet.

But there is perhaps another reason, the complacency of the newspapers and the failure to understand the nature of their competition.  Since 1970, a lot of evening newspapers have folded leaving many cities with only a single newspaper.  I suspect the lone survivor of those newspaper wars saw itself as a monopolist.  After all, there was only one newspaper in town. Yet there was always plenty of competition from other media outlets.  Newspapers that act as if they are the only game in town are unlikely to thrive.

When I saw these data, I was reminded of a recent story in the Washington Post describing an internal meeting that was to focus on the decline in daily circulation at the Post, a 10% decline over the last two years.  But the meeting took an unexpected twist as the opening of the article reports:

Washington Post Executive Editor Leonard Downie Jr. met with hundreds
of newsroom staffers yesterday to outline management’s latest attempts
to combat declining circulation. However, the more intense discussion
at the meeting involved diversity at the newspaper, as several minority
staff members lamented that a white man recently was chosen over a
woman and a black man as the paper’s new managing editor.

Further on in the article, we see that the Post does care something about diversity:

    

Downie told staffers that the paper has made strides
to increase newsroom diversity in recent years, and said that of the
paper’s 30 to 40 top editors, "white males are in the minority." But he
said the paper needs to hire more minorities and to improve its
coverage of the area’s increasingly diverse population.

Downie and Bennett will hold a meeting to address diversity issues early next month.

Diversity probably is a good thing, but maybe they ought to hold a meeting on how to improve the paper and sell more copies.  Otherwise, all those minority hires will have to find work elsewhere.

 

 

 

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