03/09/2009 05:12 am ET | Updated May 25, 2011

Con Games: Time For Newspapers Is Past

With all due respect to the estimable Walter Isaacson, who has had a journalism and writing career people like me can only dream of, his simplistic transactional solution to the woes of newspapers is way short of a load.

"Under a micropayment system," he writes in Time, where he was once managing editor, "a newspaper might decide to charge a nickel for an article or a dime for that day's full edition or $2 for a month's worth of Web access. Some surfers would balk, but I suspect most would merrily click through if it were cheap and easy enough."

Make no mistake: Isaacson, presently president and chief executive officer of the Aspen Institute, knows beyond a shadow that newspapers are going bankrupt even as they build larger audiences than ever online. All but a few face the Grim Reaper decision of going online-only, or pulling the plug entirely on their businesses. Bankruptcy is a real and present danger.

The savior is of course the same as Satan -- the World Wide Web -- and so Isaacson's suggestion of a micropayment system would make perfect sense if only the decision could be made from on high, perhaps by a newspaper czar appointed by President Obama. Failing that -- and even presuming said czar pays his or her taxes and employs a nanny gone legit -- the chances for content flowing through a micropayment system are next to nothing. It goes without saying that (a) the Web rewards free providers; and (b) the vast majority of content produced by journalist is not worth the nickel Isaacson suggests as payment for a single article.

But Isaacson's analysis also represents something of a mis-diagnosis. He is quite right to search for an additional Web revenue stream in micropayments, revenue not dependent on advertising. But the demise of the classified advertising cash cow thanks to the free Craigslist and other competitors -- revenue once representing 45 percent of sales for the typical newspaper -- is a more significant culprit, more important than the offline micropayments that produce a newspaper's subscriptions and newsstand sales. Would not it be equally logical to argue that we need a micropayment system to pay for classified ads?

The conundrum for newspapers is even more fundamental: when it comes to their online operations, they still rely on display advertising, nothing more that an inappropriate print model transposed online. Even as Web revenues grow, display advertising online is falling and faltering, according to Borrell Associates, who know stuff about these things. I was surprised to learn that the basic concept behind these ads came from Isaacson's shop when he was in charge of Time's online operations.

"We invented things like banner ads that brought in a rising tide of revenue," Isaacson writes, "but the upshot was that we abandoned getting paid for content."

Banner ads that don't include interactivity or a call to action are the real dinosaurs in the print jungle -- that's why they have stopped growing. But there's a more fundamental problem that comes from making your daily bread from a mass audience.

As a third-generation newspaper with 30 years in the online business -- starting pre-Web, pre-AOL, pre-everything -- the most fundamental problem is that print publications in general don't have a direct relationship with the individual customer. They don't know who their readers are and they don't know what they want. Instead they continue to sell a mass audience to advertisers who often can't track results.

Micropayments or not, that old model is a goner. Back in the mid-1990s, as Isaacson was running Time's online operations, I wrote piece after piece about the "Personal Newspaper" in Editor & Publisher, the trade magazine for newspapers -- to no avail. Now it's almost fifteen years later and the die is cast.

Where do newspapers go from here? Nowhere, in my opinion. As purveyor of the local blog Aspen Post, I would point out that we have news, a calendar, and many elements that exist in the newspaper model without the overhead of print. Bloggers have center stage and anyone could stand up on our soapbox.

Is that the future? Absolutely. Will people pay even a few cents for it? Absolutely not.