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Summary:

Digital First Media chief executive officer John Paton says that paywalls aren’t the answer for newspapers, and that print is eventually going to go away — which is why the company needs to take more risks.

John Paton

A company with the name Digital First Media has a reputation to uphold when it comes to thinking about the future of publishing, and CEO John Paton didn’t disappoint in a recent interview with a reporter for one of his chain’s newspapers. Among other things, he talked about paywalls, and also about where he plans to take the company in the future. Here are a few excerpts:

  • On paywalls: “I don’t think paywalls are the answer to anything. If we’re swapping out print dollars for digital dimes, I think paywalls are a stack of pennies. We might use the pennies in transition to get where we’re going.”
  • On the future of print: “Newspapers in print are clearly going away. I think you’re an idiot if you think that’s not happening. I don’t think that news organizations are dying but are newspapers going to stop running in print? Yeah. Absolutely.”
  • On print vs. digital: “We have $1.3 billion in revenue. And of $1.3 billion, $900 million is advertising and $165 million of the advertising is digital advertising. That $165 [million] is going to have to more than double in three years. To do that, we’re going to have to take some risks on the print side. That’s the one thing that scares the [expletive] out of everybody.”
  • On newspapers: “I love newspapers. I’m a newspaperman. My father was a printer. I started off as a copyboy. I love newspapers. But they don’t love me anymore.”

Paton also talked about the bankruptcy of one of Digital First Media’s subsidiaries, the Journal-Register Co., which filed for court protection last year for the second time — driven by what DFM said were massive commitments related to pensions and other costs taken on when the newspaper industry was better off financially. A group of funds managed by Digital First’s financial backer Alden Global eventually bought the company’s assets back. Said Paton:

“The process allowed the company to shed a bunch of legacy obligations it could never afford that it incurred when it was a much bigger company. The Journal Register incurred most of its long-term debt, most of its pension obligations, most of its lease obligations when it was nearly twice the size the company that it is today, which is kind of what’s happening to newspaper companies.”

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  1. Cynthia & Bunny Monday, April 8, 2013

    Great quotes:

    On paywalls: “I don’t think paywalls are the answer to anything. If we’re swapping out print dollars for digital dimes, I think paywalls are a stack of pennies. We might use the pennies in transition to get where we’re going.”

    On newspapers: “I love newspapers. I’m a newspaperman. My father was a printer. I started off as a copyboy. I love newspapers. But they don’t love me anymore.”

    How can John be so smart, and the rest of them be so dumb?

    1. Paywalls may actually be THE thing. Rest I with the author.
      On why the author is smart and others dumb – Is because there are people who don’t to accept the new reality

  2. I guess Warren Buffett and others, including myself are idiots based upon Mr. Paton’s statements of “Newspapers in print are clearly going away. I think you’re an idiot if you think that’s not happening. I don’t think that news organizations are dying but are newspapers going to stop running in print? Yeah. Absolutely.”

    His company has filed for bankruptcy, twice and despite his attempts to reason away, those are the facts. Community newpapers that form partnerships with the digital platform will be here long after Mr. Paton is gone. Shame he has discarded the platform that still pays the bills and provides content, value, benefits and convenience better than any other source, both accurately and in-depth.

  3. Colin Crawford Tuesday, April 9, 2013

    John’s absolute candor is highly refreshing in an industry that has been known for playing defense (and losing) for too long. One of the best thinkers in the industry. One to watch closely.

  4. Mr. Paton’s reality is that his company can be successful only if it cheats stakeholders out of millions of dollars loaned his company in good faith. “Shedding debt” to him means screwing someone else. 2 bankruptcies in 2 years… and I’m supposed to believe his schtick? Not a chance.

    1. I thought his comment about shedding legacy very interesting. Walk away from pension obligations, debt. Classy much.

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