Background: James Robertson has recently written and linked items about the collapse of many ad-based businesses, including magazines. While my viewpoint is not quite the same as his, I have to admit that advertising-dependent businesses have a much leaner future ahead than they have had in the past sixty-five years.

Last year, I spent some time working in West Plains, MO USA. This is a small town, about thirty miles away from the Arkansas state line. I stayed in a hotel there, and drove seven minutes to get to the office each day. During that seven minutes, counting commercials on the radio, signs, billboards, bumper stickers, fliers stapled to utility poles, and business logos painted on doors, windows, and vehicles, I counted over 100 ads. That is an incredible number, but it tells us that advertising has gotten a reputation for drawing in customers, who spend money. But what does this proliferation tell me? It tells me that the number of advertisers is proliferating, as are the number of outlets or media which are being used to convey those ads. It tells me that these ads are necessarily less effective on an individual basis than they formerly were reputed to be, for we would all be in the worst possible financial shape if even 5% of these advertising touchpoints (that is, individual exposures of one ad to one consumer) resulted in a purchase.

Advertising is very much less effective than we have been told. As the number of possible ways to reach potential customers skyrockets, the number of advertisements increases and consumers are forced to become less and less susceptible to the wiles of the pitchman. Advertisers, in turn, become more and more desperate to cut through the clutter and through consumers' defenses, so they go to greater lengths to make ads "personalized" and invasive.

Think about it: you buy the newspaper, and it has dozens of ads, paid for by dozens of advertisers. Same thing for buying a magazine. You turn on the radio and they hardly even play music during the peak "drive time" hours, because they are hitting you with one commercial advertisement after another. There are billboards one after another, with advertisement after advertisement. You turn on the television after you get home and there are ads after ads. If you change channels, you can find whole programs that are one big ad and you can even find networks that are merely a series of ads. You go online, and every site (including some parts of this one) hosts ads. The result is that--out of necessity--people are becoming advertising resistant.

Now, the newspaper and magazine industries were once high-flying fields where there was plenty of money. The local newspaper had their own printing plant, the largest distribution network in town, and employees ranging from ten to seventy years old. The reason they could afford to do all those things was high margins, based around advertisers bidding up limited space within their pages. What we have seen over the past forty years is that newspaper advertisers started cutting back, as they moved into radio, television, and then cable television ads. At the same time, these other media began to erode newspapers' readership with their greater immediacy and richer content.

With magazines, I don't think we've seen the great magazine shootout yet, but within the next few years, a few large magazine publishers will try to "save the industry" by consolidating a number of independent operations into their own, offering advertisers single-point ad purchasing. Like with terrestrial (broadcast) radio, this strategy will thin out the varying points of view that was the industry's strong point, alienating readers (listeners in the case of radio) and beginning a steep descent into the abyss of bankruptcy.

Indeed, the newspaper business had done something similar. A few large companies had bought up many of the formerly-independent papers. Those companies, then, had trouble paying on the debt they ran up during the purchasing sprees. In order to cut costs, they then cut local reporters and concentrated on the same wire service stories that were available everywhere. It is almost like the industry is killing itself.

But getting back to advertising-dependent businesses, I think the over-pervasiveness of advertising is dramatically reducing the financial return to advertisers, which makes them want to pay less for each ad, which ultimately sends ad-dependent businesses (whole industries full of them) into the waste bin. Those who own and manage such advertising-dependent businesses should take heed to this warning and try to develop other revenue streams.

This is quite a surprise, but I guess it shouldn't be. His "Excellence" series wasn't about doing exactly what everyone else is doing, nor about conforming to the practices of the rest of your industry. Since people are the most important part of any organization, it behooves management to focus on developing great people and rewarding them for their contributions to the company's success and the prosperity of its shareholders. (This is yet another reason why executives should not be overpaid--it gives them the illusion that their minimal contributions outweigh those of the actual productives who make the company its money--nor should lower-level workers be underpaid, because it says that their contributions are not valuable.)

Now, most small, locally-owned businesses (SLOBs) do not have professional management, and it is up to the owner or manager to decide these issues on his or her own. Since SLOBs tend to have less of a capital cushion than their large, out-of-area corporations (LOOAC). The lack of formal management might even be a benefit here. Chances are, the owner or manager doesn't have a pre-printed evaluation form to use when rating employee performance. He (or she) has to rely upon his impressions, observations, and on his impression of what things are most important. Personally, I hate "squishy" rating systems. I'd much rather know what is expected of me. But the truth is, even in larger organizations, there are enough politics going on that your evaluation doesn't really reflect the specific criteria listed on the sheet. Instead, it reflects how well you succeeded at making your boss (and his / her boss) look good to higher bosses.

Like it or not, there are some fundamental changes going on in the workplace. These changes have been going on behind the scenes for a decade or more, but the very deep recession accelerated the transformation process. Already, there is little need for thousands of identically-trained high school graduates each year. College graduates are somewhat differentiated by their majors, but still suffer from the presumed equivalence of a B.A. program from one college to a B.A. program from another college. It is our differences that matter most in acquiring jobs--if you don't stand out, there are too many people just like you applying for the same job--assuming, of course, that you meet whatever the entry requirements are for that position.

Indeed, this is one of my chief criticisms of our K through 12 educational system right now. Our schools serve as education factories. Their product is "entry-level workers". As long as there was a more or less monolithic industrial base to consume said product, their output was acceptable. Beginning in the 1960s, the garment and textile industries slowly moved overseas. In the 1970s, the oil embargoes began, with each one producing an economic shock that closed more factories. During Jimmy Carter's presidency, we even had gas lines, which was the beginning of the end for the North American auto industry.

As industry after industry found that it no longer needed identically-trained factory workers (because the factory wasn't located in this country), schools redoubled their efforts to produce a higher-quality of identically-trained factory worker. State governments joined the process, seeking to use their powers to fund and to regulate schools to help them improve the quality of their product (which is still identically-trained factory workers). The federal government, too, is involved, and getting more involved every election. There was "no child left behind" under George W. Bush, and now we have Barack Obama pushing even more federal involvement in the school system. Such efforts are doomed to fail.

The problem isn't limited to the quality of the product, although there are some serious issues there. The real problem is that the product is no longer needed, and no one has any idea what to replace it with. There isn't a need for identically-trained factory workers, so the content that we are trying to teach isn't relevant to the students or their parents, which drags down performance.

The thing is, there isn't one single answer for our schools. The students of today are going to graduate into a world where traditional join-a-company-and-put-in-your-time jobs will continue to be scarce for some time to come. In some urban communities and among certain ethnic and age groups, the unemployment rate has been in double digits for many years. This will continue, only it will no longer be only Black teens and young adults that cannot obtain employment. This will affect every ethnic group, at both the younger and older parts of the age spectrum.

I don't see us preparing to deal with it. The schools need to be freed from overly hierarchical administrative structures, broken out of overly large "districts" and given over to hyper-local control. Hyper-local control means that the authority traditionally exercised by the board of education should be partially dispersed to parent councils at each school. Schools, however, should no longer be thought of as individual campuses, but as communities of learners who may spend part of the day at one or more campuses. Instead of a large clump of blandness, schools need to have emphases--math & science, literary & language arts, performing arts, fine arts, health & medical, mechanics, technology, media, and so on--and early on, students should select one or more emphases to pursue together with a common "core" subject matter outside their areas of emphasis.

The traditional one-teacher-lectures-thirty-students classroom is also past its expiration date. Most students' interests and needs are dissimilar enough that a fifteen student classroom is already pushing the limit of students' ability to derive the most benefit from instruction. Schooling is going to become more expensive, but part of that will be because we'll need a lot more teachers to implement the necessary changes. We'll also benefit from eliminating some of the administrative positions that soak up so much of the schools' budgets.

Like a lot of bloggers who are not at "A list" level,  a lot of my traffic used to come from a small number of alternative search engines that focus on the blogosphere. Specifically, Technorati used to bring about 5 - 10% of the traffic, IceRocket 2 - 5%, and occasionally Sphere or someone else would bring visitors to read the content.

With Technorati, it was frustrating, because I often found that someone else was able to get more links and traffic with my content. That is, spammer blogs and scraper blogs filled the results. So I was initially glad to see Technorati cleaning out its index. But something funny happened in the process. My work disappeared almost entirely from Technorati.

Now, I have to say that Technorati wasn't ever a place where it was easy to find relevant articles, simply because their pages for any "tag" you look for were always clogged with dozens of identical posts, to the point where it wasn't even possible to find the original. In other words, whenever I chose to use Technorati to search for blog articles about something, it was a long, drawn-out process of going through hundreds of results to try and find the ones that were someone's actual writing instead of a scraper looking for ad revenue.

Still, Technorati's best point was the size and breadth of its index and its focus on blogs, as opposed to corporate (and government) PR pages. By flipping through its pages, one could find a lot of content, whether good, bad, or ugly. I'm hoping that, now that they seem to have cleared out most of the spammers and scrapers, they'll have an awakening to the need to get back to broadening their index. I can get "A list" results by seeing who Scoble links on Twitter.

I should point out that IceRocket, which has always had a more focused, cleaner index than Technorati's, has also been more difficult to get into recently. For example, I write a lot about the effects of the econolypse here. If you were to search either Technorati or IceRocket, you would not see many posts from Owner-Managed Business appearing in the results. But I think that few of the others write with the same quality--borne of a long and difficult collegiate process in pursuit of my BA in Business--or the same consistent coverage of the topic. (Yes, I'd have to say that Robert Paterson does a better job by both measures. In fact, Mr. Paterson's blog is considered "recommended reading".)

Technorati (and IceRocket, for that matter), need to be on their toes. Google is already the number one general search engine. Their blog search is not well-promoted, but should they do so, the blog-specific engines will have to do a lot better than they already do (albeit IceRocket has always served a pretty accurate results set, even if it is only a subset of blogs out there).

I was discussing some work-related things with a young man recently. He was telling me that he could not get hired because he did not have this and he did not have that. He was missing some equipment that is used in his field, and he was also in need of transportation to get from place to place. I understand that lacking equipment does tend to limit your prospective employers, as does lack of transportation, but when I tried to give him suggestions of ways to start out where he is, I kept hearing the same things: I can't do that because I don't have ....

The truth is, your lack of stuff is not usually the real problem. If your field was janitorial, you might say, "I can't get a job because I don't own my own broom." If someone then gave you a broom, you'd say "I can't get a job because I don't own my own vacuum cleaner." The truth is, your attitude is the primary thing that keeps you from accomplishing anything.

When your desire is to start and run a business, it isn't your boss Mr. Slate that keeps you from doing it. It is your own choices--often made because of fear of losing a steady paycheck--and your decision to go along with the choices of those whose actions are helping to keep you where you are. When your desire is to obtain employment, your choice to spend the whole day playing World of Warcraft or The Sims will keep you from getting things done and getting a job. It isn't the fact that you don't have your own wrench set, because there are places that will put you to work on a trial basis while you acquire the tools you need. It is your decision that you won't accept the low pay and the expectation that you will consistently split off a portion of your pay to get the tools. In other words, you decide not to take a job because it requires you to sacrifice. You would rather sit at home and play video games than change your behavior in ways that can eventually get you where you want to go.

There is an old saying that everybody wants to go to heaven, but nobody wants to do what it takes to get there. This is clearly visible in your life and mine. You can see it by watching the choices and decisions that people around you are making. In a time where the government admits that one in ten workers have no jobs and that number isn't expected to decrease much for at least two years, what do you want to do? Sit around and cry about it? Or get up and find a way to contribute to the betterment of society and earn a living as well?

I think we have to stop being the whining sissies that Americans have become. This is a tough time, and it may last a while. Either be tougher, or you won't last through this time period. In a recent article on the My Wife Quit Her Job blog, Steve recently wrote about getting through the idea that perhaps 1% of all small businesses succeed. He writes something very profound.

The first thing that you have to understand is that your business idea doesn?t have to be the next Google, You Tube or Facebook to make money. If you are planning to start a company for the sole purpose of getting acquired for a billion dollars, then your chances truly are one in a gazillion. So instead of buying a lottery ticket, start something that you can make profitable within a short time frame.

A lot of times, we are paralyzed with fear of failure because we think that success is measured in how many millions of dollars we make. If you are paying your rent or house payment, regularly bringing home enough to feed and clothe your family, and you are not being harassed by credit card companies, you are successful. Believe me, a lot of people cannot say this right now. So rather than look for a full janitorial kit, start with a broom, a roll of paper towels, and a bottle of window cleaner. At that level, success is getting enough people and businesses to let you clean their floors and windows to fill your tank and your tummy and replace the supplies you used.

Most of us don't hit home runs with our business ideas or with our job applications, but we can hit singles and advance the baserunner. If your idea of success is the classic bottom of the ninth inning, two outs, bases loaded, down by three situation, you will naturally prefer to swing for the fences, even though the percentage of success there is much smaller than poking a grounder past the infielders and getting everyone safely to the next base. Instead of waiting for X, go ahead and do what you can with what you have available now. If you need X in your work, you'll find a way to get it if you're already doing the work. You first at-bat may seem scary, but if you learn to get on base frequently, just your presence in the lineup will change the balance of the game.

This whole idea is based on a falsehood, that the availability of news on the Web is what is causing the newspaper industry to decline. Living in Southern California, I remember the demise of the Los Angeles Herald-Examiner in the 1980s. A lot of large papers around the country either folded or went into one of those DOJ-sanctioned cooperation agreements (where two competing papers join their printing and distribution operations into one as a way to cut costs and keep them both alive) in those days. Why? There was no public Internet in the 1980s, so why were papers folding and depending on special government forbearances?

Actually, the reason is clear. Newspaper publishing was a high-margin business in the past. This justified the high costs of publishing and distributing newspapers. Over time, new competitors, beginning with radio and television news, began to cut into those margins. Even in the 1980s, people got most of their news at no charge through the radio and television. It was a foregone conclusion that newspapers needed to dramatically cut their costs, even while improving their reporting and their coverage of local events. And, no, cutting costs isn't just about cutting reporters and editors. It means avoiding the corporate buyout (with its debt repayment headaches), getting rid of the shiny building, and very likely dumping most of the printed version, too.

In Los Angeles, there were two all-news stations, KFWB 980 AM and KNX 1070 AM, that reported the top stories every half hour. As traffic congestion picked up, they added traffic updates every ten minutes. KNXT (now KCBS) channel 2 added newscasts beginning at 4:30 PM (followed by 5 PM and 6 PM editions) MON-FRI leading up to the CBS network news. And let us not forget the 10 PM (small local stations) or 11 PM (network stations) news.

In Los Angeles, the afternoon Mirror-News was closed by the Los Angeles Times in 1962, when Hearst's Herald-Express was merged into the Examiner to form the Herald-Examiner. This was a classic shootout, with "this town's not big enough for the both of us"

So what we had was all the news we could stand via radio and television, and then, 8 hours later, the paper would come and rehash the same events. Now, in the 1980s, the quality of the writing was better (fewer misspellings). I can't tell you about the factuality of it because I really never had any personal acquaintance with the subjects covered. I do know that whenever I am acquainted with the subject matter these days, the news consistently gets important details wrong.

In addition, media bias is real and visible. Think about that the next time you read about "anti-abortion" protesters, or even worse, "anti-choice"; when you read about "climate change deniers", or whenever you read a story that uses a demeaning or pejorative term to describe those whose viewpoints the author / editor may disagree with. How trustworthy is news from an organization that intentionally "colors" or distorts the news to support a particular viewpoint?

So newspapers are failing because of:

1. Pricing: it costs me nothing to turn on the TV or the radio. They make enough money from advertising that I needn't pay any extra.


2. Timeliness: printed editions of the paper come out in the morning. I can pick it up on my way to work and hold onto it until lunch. On the other hand, I can turn on the radio and get news on the way to and from work. I can check the Web for news without leaving my desk and without violating company policy (try reading your newspaper or magazine, even one related to your work, on your employer's dime).


3. Cost: running those presses is very costly. In the old days, the return was worth it. These days, it isn't. An even worse cost is the debt repayment for those corporate buyouts that the industry went through over the past decade.
   
   
   • Printing presses
   
   
   • Distribution systems
   
   
   • Big, impressive buildings -- these were great in the 1950s and 1960s, even the 1970s, as a way to show everyone how permanent your paper was.
   
   
   • Corporate structures (that is, holding companies), multi-outlet ownership, and corporate buyouts
   
   
   • Vanity symbols such as owning a sports team or buying "naming rights" to a stadium.
   
   


4. Quality: I've already mentioned the bias and quality issues. Honestly, the problem is partly that reporters don't cover enough of one subject to develop any expertise. And partly, it is laziness. It is far easier to write an article from a press release than it is to actually research your subject matter.


5. Generic coverage: When a paper relies on wire services for much of their content, it means that their competitors all have the exact same story available to them. You cannot charge a premium for content that is available from competitors, because people will find whomever charges the least for it. Newspapers must focus intensely on their local areas, down to the level of writing up youth sports league games and water board meetings. Either that, or they must become subject matter experts. The Wall Street Journal is able to charge and people pay for it because of its expertise in its field.


6. Voice of Moses attitude: Most newspapers act as though they are the voice of Moses coming down from the mountain with the true commandments. When printed newspapers were the leading medium, the letter to the editor was a primary way of getting a contrary view before an audience. These days, many news sites are not built to encourage discourse and conversation. For example, many of them place the newest comments first and do not have threading or nesting to make it easier to see what comments refer to what other comments. Then, too, newspapers tend to look down their noses at bloggers, Tweeters (microbloggers), and tumble-loggers. The papers themselves have blogs and Twitter accounts, but the papers act as though their efforts are superior to those of others. When news breaks, it no longer matters whether it come from a blog, a tweet, or a text message... get it verified and then get it posted! Be sure to give credit where credit is due


7. Copyright ugliness: People have always discussed what they've read in the paper. They've clipped articles to send to one another. They've used news stories as jumping off points for expressing their own opinions. If newspapers try to prevent this in the online world (or even worse, to charge for it), people will cut them out of the picture.

Neither Google, nor Yahoo!, nor Microsoft, nor Apple, nor CircLabs, nor any other company will be able to enable newspapers to again be the high-margin, high-profit businesses they used to be. As always when your profits are above average, competition and economic & social change and "substitute goods" will work together to reduce those profits back toward the mean.

Bozeman, MT Goes Phishing--Applicants Seeking City Jobs Must Disclose Usernames and Passwords : Los Angeles Business Litigation Blog

It's no secret that more and more employers are doing a quick Google search for a job applicant?s name as part of their background checks, but the City of Bozeman is taking it one step further.

In an article published yesterday afternoon, Montana's News Station reports that applying for a city job now requires turning over some fairly sensitive information. Specifically, the background check form for city jobs requires applicants to

list any and all, current personal or business websites, web pages or memberships on any Internet-based chat rooms, social clubs or forums, to include, but not limited to: Facebook, Google, Yahoo, YouTube.com, MySpace, etc.,...There are then three lines where applicants can list the Web sites, their user names and log-in information and their passwords.

So let me get this straight: in the pursuit of honest employees (see the link for more on that), the city wants applicants to break the agreements that govern their participation in sites like Yahoo, Google, MySpace, and Facebook? In most sites, the legalese contains something to the effect that your account is not yours, but the site's, including the username, and may be used by you only as long as you conform to their current terms of service. The terms usually include something along the lines of "keep your password secret", "do not share your password with anyone", and "change your password anytime you suspect someone else may know it". It seems mighty fishy to me that the city wants to hire people who cannot be trusted to keep their word.

In fact, it seems "phishy", too. Think about all those bad guys sending spam to try and trick you into revealing your usernames and passwords. Now all they have to do is get hired in the HR department of city hall and they can have their pick of account information. Why, I wouldn't be surprised if Bozeman, Montana, gets buried in resumes sent in by Eastern European hacker-type bad guys wanting the mother lode of phishing information. Sites like Monster are already overfilled with spammy multilevel scams

And finally (and most importantly), this is an egregious privacy violation. For even applying at work, one could be subjected to an unprecedented level of monitoring and spying, could have unscrupulous city employees using login information to masquerade as the applicant in various online communities and forums, and could have one's private (not work-related) e-mails and instant messages violated by a potential employer.

The update that says they've stopped doing this gives little comfort. It shows a profound lack of sense, decency, and commitment to the well-being of the city's workforce. It shows that no one thought about the dangers inherent in data-collection, and especially the collection of sensitive personally identifying information (PII). It was wrong from the beginning, yet no one in the city hierarchy stopped it from happening. Now that there has been a furor, they have shelved it for the time being.

If the people running the city cannot understand why the policy was wrong, if not illegal, they should be removed from office. First of all, for someone to propose such privacy-invading measures requires a complete lack of respect for the privacy of employees and prospective employees. It shows a willingness to trod into gray areas, too, which is quite a risky strategy when you report to the local voters. Secondly, for this to be approved shows a complete lack of integrity within the managers and politicians who reviewed this. Finally, for the policy to be implemented shows a complete lack of managerial controls, the kind of controls that prevent idiotic policies like this from chasing away prospective employees and generating lawsuits from current employees.

Know this: no small, locally-owned business (SLOB) could get away with something like this. Even if the owner-manager is integrity-challenged, he knows that this would hurt his business. Once the economy bounces back (from what I expect will be a double-dip recession) and the supply of labor tightens a little, anyone with options will speedily flee from such an employer, leaving only the least desirable employees.