Winning the revolution

As Walter E. Hussman Jr., the publisher of the Arkansas Democrat-Gazette, addressed his newsroom staff in downtown Little Rock late on a Friday afternoon last month, it struck me that a large number of the reporters and editors who had gathered to hear him weren’t even born when I went to work for the Arkansas Democrat in 1981. That realization led me to reflect on the massive changes I’ve seen in Arkansas and in the newspaper business during the past 38 years.

Working for a newspaper is what I wanted to do since childhood. During high school, I worked for a weekly paper known as the Southern Standard at Arkadelphia. During college at Ouachita Baptist University, I was the sports editor of the Daily Siftings Herald. Most of the money I earned was spent on travel to sports events. I could obtain press credentials through the newspaper, but the Siftings Herald was so small it couldn’t afford to pay for the trips. So I paid for them myself.

I covered the Kentucky Derby, March Madness, Dallas Cowboys games, the Cotton Bowl, the Sugar Bowl, the Liberty Bowl, the Gator Bowl, the Independence Bowl, PGA golf tournaments and more. It was heaven for a sports-loving college student.

Still, I rushed to finish college in less than four years so I could go to one of the “big papers” in Little Rock, where a newspaper war was heating up. Wally Hall hired me to work in the sports department of the Democrat, where we took pride in competing successfully against what was then the larger Arkansas Gazette.

Having returned to the newspaper business two years ago this month after 21 years away, I’ve had the pleasure of traveling the state and writing columns about Arkansas people, places, history and the state’s culture. Those travels have convinced me that by far the most important story in Arkansas right now is the shift in the state’s population base. Although Arkansas’ population is increasing overall, two-thirds of its counties have lost residents since the 2010 census. The losses are particularly acute in the eastern half of the state.

According to U.S. Census Bureau estimates, eight Delta counties have lost more than 10 percent of their population since 2010. Those counties are Phillips, Monroe, Lee, Jefferson, Chicot, Desha, Mississippi and Woodruff. Another 10 east Arkansas counties have lost between 5 and 10 percent of their residents since the most recent census. Those counties are St. Francis, Ashley, Clay, Prairie, Cross, Jackson, Arkansas, Lawrence, Lincoln and Crittenden.

Large population losses aren’t confined to east Arkansas. In the southwest part of the state, the losses since 2010 are greater than 5 percent for Lafayette, Nevada, Dallas and Ouachita counties.

The losses are offset by strong growth in northwest Arkansas, in the counties surrounding Pulaski County, and in Craighead and Greene counties in northeast Arkansas. I see no end in sight for these trends. The state’s demographic upheaval alone would have necessitated changes in how a statewide newspaper operates. But add to that the total transformation of the business model for newspapers and the result is nothing short of a revolution.

Ayear ago, Hussman asked me to lunch to discuss the future of the newspaper industry. He had begun giving civic club speeches in counties where the Democrat-Gazette was converting from home delivery of a print publication to online delivery of a digital replica. He wanted me to speak to civic clubs that his schedule wouldn’t allow him to attend. That led to an intense period of study in which I came to understand the true extent of this transformation.

Now, the Arkansas Democrat-Gazette is carrying out the change to digital delivery (with a printed Sunday edition) in its 63-county footprint. Printed newspapers will still be delivered seven days a week in the 12 counties covered by the Northwest Arkansas Democrat-Gazette.

In 1980, while I was in college, U.S. newspapers took in just more than 31 percent of all ad revenue in this country. Television had about the same share. The remaining advertising was shared by all other mediums— radio, magazines, billboard, direct mail, etc. By 1990, newspapers’ share of advertising had declined to 28 percent. By the turn of the century, it was down to 22 percent.

“That was still plenty of advertising for newspapers to provide lots of news coverage and opinions, serve as a watchdog for readers and provide a reasonable return to the owners to make it a sustainable, attractive business,” Hussman says. “But around 2000, The Associated Press began selling news content to companies like Google and Yahoo who were willing to give it away free so they could sell digital advertising. Newspapers had begun giving away their news too, hopefully to realize a whole new source of ad revenues. As a result, news became a commodity, and many readers came to expect news to be free. “High-speed Internet was becoming increasingly available and popular, and the iPhone was introduced in 2007. People could not only get news on their computers but also on their phones. Newspapers continued to increase their revenues, though at a slower rate than other mediums like television, direct mail and Internet advertising. That was true until 2006. That was the year newspaper ad revenues actually declined for the first time in many years in a non-recession year.”

Newspaper ad revenues have now declined every year for 13 consecutive years. As noted, newspapers were getting about a third of all ad revenue in this country in 1980. The total is now less than 5 percent.

AHARVARD University study concluded that there were three times in human history when there was a transformational change in the creation and delivery of text. The first was when humans went from oral communications to writing things down. This led to the first written language. The second was the invention of the printing press in 1440. That allowed the cost of replicating text to drop by more than 99 percent. The third was in the 1990s. It wasn’t the invention of the Internet. It was the advent of the World Wide Web, which allowed regular people the ability to access the Internet. Again, delivery costs for information dropped by more than 99 percent.

“Newspapers have had their business model totally disrupted,” Hussman says. “Advertising previously comprised 80 percent of their revenue, allowing newspaper subscription rates to remain low. With these low prices maximizing circulation for the benefit of advertisers, this was a great business model for decades, but no longer.”

Newspapers across the country raised subscription prices, reduced the number of reporters, closed printing plants and eliminated outlying circulation. The Democrat-Gazette became one of the last true statewide newspapers, a publication that tries to cover every county of a state. In the midst of this revolution, I’m fortunate to work for a publisher who still wants to do just that.

“We believe there’s great value to a statewide newspaper, not just to the newspaper itself, but also to everyone in the state,” Hussman says. “It provides a way for everyone to stay in touch with what’s going on in the state Legislature, with their elected officials like the governor, with businesses in the state and, of course, statewide sports.”