The advent of search engines and algorithms have changed the way we consume information, resulting in a period of disruption in the newspaper industry.
As newspapers navigate the digital era to meet the evolving demands of the 21st century consumer, we ask the question – what does tomorrow hold for the newspaper industry?
In this month’s episode, our host Matt Sutorius speaks with Lars Haneberg, Senior Director of Finance at the Seattle Times, about the future of the newspaper and media industries.
The advent of search engines and algorithms have changed the way we consume information, resulting in a period of disruption in the newspaper industry.
As newspapers navigate the digital era to meet the evolving demands of the 21st century consumer, we ask the question – what does tomorrow hold for the newspaper industry?
In this month’s episode, our host Matt Sutorius speaks with Lars Haneberg, Senior Director of Finance at the Seattle Times, about the future of the newspaper and media industries.
Lars 0:00
I think that we're at a point where the industry is, you know, being disrupted and has been disrupted. And we're coming to the other side of that. So, all very fascinating, all very timely.
Matt 0:16
Welcome to Making change the CPA podcast that has nothing to do with accounting and everything to do with innovation. I'm your host, Matt Satori. So today we're speaking with Lars Hanna Berg, Senior Director of Finance at the Seattle Times on the future of the newspaper and media industries.
To kick it off, Lars Bing, give us a little bit about your background and how long you've been in the newspaper industry. And when you started working in the industry, and what your role is there today at the Seattle Times?
Lars 0:49
Well, it's interesting, you'd ask that question. Because it's a 12 year old, I actually took on my first what I call a real job. And that was at the Seattle Times, I needed to buy these shoes called Nike shoes, which my dad that I did some cheaper shoes. So I needed to figure out a way to get more money, and I was mowing lawns. And so Officially, the Seattle Times became that Savior point for me. Since that point, I became an auditor. So as much like you and with Clark nuber. And you have kind of two different pathways, you can go from there, continuing public accounting, or go into private, as we call it, and work for a company, which I did, and with several folks. And I've either been here in Seattle, and I also went overseas. So I felt like I learned a lot, love the international business side of it, but gravitated back to the Seattle area. And when the Seattle Times came with the brand name and everything and said hey, would you like an opportunity to be able to work here, and or help? In large part for these transitions that we're talking about? Right into the digital world, I thought it would be very fascinating to look at it number one. And number two, just thought of the brand name and how, how great it was, at least to me, and the influence that it had in my life. So rarely do you have a second chance to do things in life, especially work for somebody. And of course, it's in a completely different role. And I'm super excited that it's led me to this point in my life.
Matt 2:21
Were you a paperboy? Like did you ride on the bicycle and throw the papers out? Oh, I always wanted to do that job.
Lars 2:27
Yeah, that's exactly what I was saying. So yeah, I did that actually did it as a substitute. So I was substituting for rouse before I was 12. You're supposed to be technically 12 years old. I was 11 years and 11 months. Please don't tell human resources.
Matt 2:41
Yeah, we'll keep it just between us and our radar layer.
Lars 2:44
That's a true that's how excited I was to do that. Now, it's it's a completely different model. But here we said, Well, yeah,
Matt 2:52
and a lot of ways, then you're you're well suited to think about what has changed in the newspaper industry over the past couple of decades. What do you think the biggest thing is that you've seen in your time at the times are working around the industry?
Lars 3:06
Well, I think it's pretty obvious. I mean, this switch over to the digital side, you look at that, and you look at the situations where we are today, so much as digital. On the other side, the majority of our audiences still print. So you know, over 200,000, or print subscribers, we're at 5000, our dedicated digital subscribers. At the same time, some of the, you know, if you get the printed newspaper, you're also digitally involved or you can get digital. So we track all of those things. But really, you know, what you're looking at is a newsroom that one time relied upon their instincts, you know, for story chores, what they could look at, and what they would do. And you know what's going to get on the front page, et cetera, we now know what the readers are looking at. So it just drives us to be able to put in stories where people are interested in, I guess, for the lack of a better term. And the other side that I think is really interesting is our community funded journalism. We call them labs by short. And in essence, it means exactly what it says, the community we're asking the community to come in, and to donate to the Seattle Times for the journalism so that we can create curated content that's, you know, rich and alive. We have investigative journalism, we have Education Lab, which is my favorite. I think that everybody should have an education. We're introducing one called climate change. So they're all really contemporary projects, but it adds for more in depth coverage, which I think is what people yearn for.
Matt 4:51
Right. Let it make sense to me the newspapers and media but especially local newspapers have always occupied this is In between place in society where it's a business, but you also serve such an important purpose in the community, educating people and informing them of what the news is. And yeah, it makes a lot of sense to me that the the times that other papers would do things like that. One of the things I've seen in the past 20 years, even from when I was in college to now is that you used to only be able to get your news from the newspaper or Sunday night news shows. Now everybody has access to Google and search engines and algorithms and get how does the paper like the Seattle Times? How do you respond to that change and deal with the fact that everyone in the world has unfettered access to all the news they could possibly want to see 24 hours a day?
Lars 5:46
Well, I think that we look at it. And first of all, it's all encompassing, it's a little mind boggling. I have the same thought processes. When I was delivering the newspapers as a kid, you know, really, people were waiting for it. In fact, if the paper was late, they were calling my mother was, you know, picking up the phone, now you have so much information out there. So I think that that kind of cuts both ways. And what I think the newspaper was doing when I first came to Seattle Times, and to get a baseline is basically a decade ago. And that's when we first started looking at this print versus digital model. And modeling us all out. What we've come to discover during that time period is that people really valued, curated, vetted information, because there's so much information out there, and so much misinformation. Now we look at it today. And there's these labels of fake news, and, you know, all sorts of different things going on. I think that one thing that we can rest our hat on a little bit is, is that people still like local news and trust it, I think that's the other element that really comes in. And at the end of the day, we have this, you know, research that's been out here that people hear nationally, and that people don't really respond or, for lack of a better term, their trust level is low in news. But that's national news, where I think there's more programs on now, that is not necessarily news. But it's more entertainment for lack of a better term. So people are turning it on. And and they're looking one way or the other, and that a lot of times is geopolitical. Whatever your preferences are there, I still think and believe and we believe through the research that we're getting through like the Knight Foundation, that people trust local news. Yeah, I
Matt 7:40
tend to agree with you, there's a real distinction to be made between sites, like our news shows on Fox News and MSNBC that have to cater nationally, if not internationally, and operate, you know, as infotainment in a lot of ways. That's not really the same as a local newspaper that's producing news content on a daily basis. And although we kind of lumped them together, sometimes when we talk about media and different personalities in the world, talk about media and encompass everything, it's really a very separate thing. And you got to think the trust of a local paper is significantly higher than a national news program, or even some of the national other media sources we have. And that's
Lars 8:26
another really good point, those, you know, those TV stations you're talking about, they're relying upon their advertising dollars to come in, and their advertisers. And they're making a lot of money from that vantage point. From our side, we're seeing less and less advertising, that's just become a reality. When I was looking back at the history, I mean, you know, literally 90% of the revenue at 90% was coming from from the advertiser. Now it's the majority coming from the subscriber, which is a really, really big change. Another thing that you were talking about a little bit earlier, the same time now that you if you look at it from that vantage point, the advertisers are going to have a lot to say about what that content is, which is basically the reach and the entertainment side of it. So as entertainment really news, I mean, you know, yes and no, but at the same time, I believe that we have a place and a purpose. And I think our subscribers recognize that and recognize the value there too. So for us, I think it's a matter of a value proposition.
Matt 9:31
When part of the reason the The Seattle Times and other print media, local print media is able to do that is because you do have those editors, and you have professionals that are doing the work. They're professional journalists. Now, it's so easy for anybody with a cell phone to hop on tic tac and make a 15 second video about the news or, and you know, you read these studies from Pew that talked about how 10% of all people are getting their news from Tik Tok. ACC, which seems crazy to me, honestly, but clearly it's true. And for Gen Z, it's even 30 closer to 30%. Higher than that. How does that worry? You? Like, what what do you think the natural let's the evolution of that trend is going to be? Well,
Lars 10:15
I mean, I think it's like everything else is kind of a wait and see I'm hanging out if I was to forecast, you know, what was going to be popular or not popular, you know, 1015 years down the road, I think we'd be surprised. I mean, we, you know, we've seen so many things come and go over the years, you know, AOL, you just think about the different things that you think would never ever go away. I mean, those, you know, we try to experiment on those platforms, like tick tock, we realized, you know, that there is a concentration of some consumers are there tend to be younger, but like everybody else, I think they tend to shift and change. So we try to take a look at it, we take opportunities to do some small experiments, but we're not really trying driven out there, to try to figure it out, and to get our ROI from there. And don't look at as necessarily competition, just another way for people to get their information, etc. But if I was to make a fairly bold prediction, I don't think it is going to be a future. And I don't, I don't think it's going to be the future of those younger people, as they as they come, you know, they change ages. But we're aware of them. And I think there's nuances of everything that we can integrate in, we do a little smaller experiments, we look at kind of, you know, what they're doing, and, you know, in small ways, like the animated graphics, and you know, etc, we might just take them off there, and you know, right to license them to our own. And that's a huge cost. And that's evolution. And that's just changed in, you know, small appetites. But try to make a wholesale change to that I don't think is worthwhile for us, at least at this point. But it's always very interesting. As I said, I think there's always elements of any technology that comes out, that becomes good in in reference points, if we utilize them for our benefit moving down the road, and it makes sense.
Matt 12:22
You know, when I think about when I was in college, I went to the University of Missouri, which is a really big journalism school. I didn't study journalism, but was around those people often lived with journalism majors. And it back in 2004 2005, they thought the end of the world was upon the industry that there would be no print journalism in 15 years. Obviously, we're not there. It seems like really good, trusted local papers and national papers like the New York Times and LA Times, they seem to be doing really well right now and growing their subscriber base. What do you think changed? Like, obviously, the doom and gloom scenario didn't happen. So what what has leveled out for papers like the Seattle Times?
Lars 13:08
Well, I mean, kind of switching back to, you know, digital and print, and I'll, I'll walk through both sides of it. But we, when we launched the digital solutions, there was real pushback from the consumers on the idea of paying for content on the internet. I mean, we've talked about this before, right? That's dramatically shifted, and people are willing to pay for it. I also think that people value newspapers and and the proofs in the numbers, or subscribers are resilient, they're loyal, and particular art prints, subscribers, they're, you know, they continue on there have responded by saying, we're going to take the newspaper, the way it's coming, we like the way it's moving. And we'll continue to do that. I think that the organizations that keep their heads down, listen to their subscribers, we certainly do that or listen to their audience, which we do. are the ones that come out ahead?
Matt 14:04
What is the Seattle Times for similar paper look like? And in 2030, or 2040? How different are things going to be?
Lars 14:13
When you look at the Scarborough report, so we do analysis, and you know, we look at every 10 years, it's really interesting, our reach is still about the same, you know, between 59 and 66%, if you look at 25 to 3535, to 45, and so on down the line. So that means that you know, we still have a lot of influence or so it depends upon how how they look, what we, what we noticed is, you know, the physical newspapers, resources becoming a little bit less a little bit less. You know, it's hard to gauge that because we can't track when somebody puts their fingerprints on the newspaper versus the digital and we track the digital engagement of far more but sitting there. We do know that in our surveys and like I said, working through Scarborough, that the millennials still enjoy the Sunday edition I think that's a little bit different. And so when I look at the future, I see a newspaper group. And if you think about what's different on Sunday or a weekend, we're actually experimenting with Weekend Edition. What's different? Well, people on Saturday said that they have time off, right? You know, people tend to work Monday through Friday, so they have more time, they have more time to sit down and look at a physical newspaper. That's a different experience for them. So that's where I see it. I see, I see the newspaper industry becoming less physical, but I think some form of a physical newspaper will come out. I think a Sunday edition, or what I would call a weekend edition will probably be with us for a very, very, very long time.
Matt 15:43
I think there's something at least I find this to be true. It's very aesthetically pleasing to sit on a Sunday with a cup of coffee and an actual newspaper. Whereas during the week, when I'm working, I do just want to see Alright, what's going on, and going on my phone or going online and looking at it digitally is fine, but I like the aesthetics and the vibe of holding a paper on a Sunday. It's it's just pleasant. Well, Lars, thank you for coming on the show today. It's been a pleasure talking with you what you're doing is important what the Seattle Times does is important. Thanks again for your time. Appreciate it. And that's our show. Thanks to Lars for speaking with us and to you for listening in. Join us next month as we discuss innovation and change management with Mark Edmondson president and CEO of inflow