Wednesday, August 20, 2008

Idaho paper gives AP notice

We're probably going to see more of this in the next year or two -- AP getting cancellation notices from its members in protest of its fees, even though the wire service promises an aggregate $21 million in savings with its new pricing plan. This one is from the Idaho Falls Post Register, which says its new fee structure won't change under AP's new "basic" package.

Editor and Publisher Roger Plothow says his assessment at this approximately 30,000-circulation paper is $114,000 a year. That's probably the equivalent of about three staff members -- a significant number. Plothow says he's willing to take a quarter of the content for half the price, and I figure that's actually a pretty good gauge of what AP faces, a majority of members outside the major metros who value the wire service at about $1.50 to $2 per subscriber per year.

It will be interesting to see who follows Plothow's lead (letter from the story in E&P). It again raises that feared word on 10th Avenue - "cafeteria." The reality is that AP probably cannot survive on a cafeteria or "a la carte" model.

Update 8/20: Four more papers give the AP notice, including the Bakersfield Californian and Spokane -- and Spokane's Steve Smith says that paper may not honor the requirement for a two-year notice. Smith says Spokane's rate is almost $400,000 a year at the 100k-circ paper, or in line with the $3.50 to $4 a subscriber that Idaho Falls pays. Again, I think the reality out in the hustings is that most are willing to pay half that.

Meanwhile, there is agitation at another Washington state paper to dump AP as well.

Bakersfield has about 60,000 circulation. If those kinds of papers are dumping out, AP is in a world o' hurt.

Meanwhile, in one of the largest loads of crap: Sue Cross, AP senior vice president/U.S. media markets, called the number of papers giving notice "pretty small so far." "The last time we had a big rate structure change was in 1984, we had cancellations then," Cross added, saying the news cooperative is not keeping count of those seeking to drop. "My impression is that it is a very low percentage. The positive feedback has outweighed the negative. Balderdash. Having been there and done that, unless AP has totally changed its culture, even the slightest hint a member wanted to drop set off alarm bells that made a nuclear alert sound like kindergarten recess. Rest assured a detailed list is being kept.


Tom Curley
The Associated Press
All members of the Board of Directors
Select member newspaper publishers

Dear Tom, et. Al.,

At long last, our cooperative has released its new fee plan. Under this structure, which I don’t pretend to begin to understand, the Post Register’s 2009 rate will be the same as for 2008, if we do not choose the “AP Complete” package.

We’re glad not to get a rate increase, and we appreciate all the time and effort that undoubtedly went into creating the new plan. However, it misses the point.

When you were gracious enough to visit Idaho shortly after you were named the Associated Press’ president, you and I spoke briefly about the need for the association to adopt a “cafeteria” approach for its members, allowing us to pay for what we use. This new plan isn’t it. I’ll repeat now what I said then: We want to receive about a quarter of what we now get from the AP and pay about half of our current fee. A quarter of the product for half the price seems fair and doable. (We’ve made the same offer to our subscribers and some have taken us up on a Sunday-only or a Wednesday-Friday-Sunday package.)

All we want is a version of the business model that cable TV came up with decades ago. Offer us a several levels of basic and premium packages, price them accordingly, and let us choose. Is that really so hard?

Given the AP’s historical inflexibility (particularly when it comes to small, independent newspapers), I fear the implications of what I’m about to write, but I can’t think of another option. I wish to give notice of our intent to cancel our AP contract effective August 15, 2010.

I’ll put my cards on the table – I’m not sure how we’re going to pull this off. While the AP’s value to us has been severely diminished over the years, it still does provide a handful of services that we haven’t been able to find elsewhere – yet. I’m betting, however, that it’s only a matter of time. More likely, we’ll use that time to become essentially 100 percent local, which is probably where we’re headed eventually anyway.

What I’m really hoping is that the AP’s management and board will come to its senses and make it possible for us to stay. But you leave us no choice except to start the clock ticking.

For now, the $114,000 assessment for 2009 represents the worst value for anything we purchase, since we use so little of what we’re paying for. I admit that I look at that money and think of all the other things we could do with it – add reporters, enhance our web site, maybe even give a raise or two to deserving under-paid employees.

Of course, my greatest fear is that 24 months from now I’ll have found no antidote to the AP and come crawling back to you, and you’ll either send me away or offer me an even worse deal. On the other hand, this might be just the motivation we need to really come up with a workable alternative.

My Post Register colleagues and I have the greatest respect for the journalists and other members of the Associated Press team. They do great work. We believe they are being let down by their board and management. Tom, with all due respect, you’ve got to do better.

Warmest regards,

Roger Plothow
Editor and Publisher, Post Register
Vice President, Post Company



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