Weekend read: BlackBerry’s home town decline

It’s a little after 5:30 p.m. on a Wednesday night, and I’m sitting in a freezing rental car outside the BlackBerry headquarters in Waterloo, Ontario, looking for signs of life.

Five years and several billion dollars ago, these buildings would have been full, and the windows would have been dotted with busy silhouettes. But today, it’s a ghost town.

The life, death, and rebirth of BlackBerry’s hometown – Kevin Roose, Fusion (8 February 2015)

Do read the full piece: it’s absorbing and also a little more uplifting than you might expect given Blackberry’s fortunes.

The internet did not kill newspapers

Yeah, right. But not so fast. Matthew Gentzkow of Chicago University says they were dying anyway.

His full paper Trading Dollars for Dollars: The Price of Attention Online and Offline is restricted to academic subscribers and you’re not fussed enough but The Guardian had a look and says his reasoning is that we make three mistakes in our assumptions:

Fallacy one: Online advertising revenues are naturally lower than print revenues, so traditional media must adopt a less profitable business model that cannot support paying real reporters.

“This perception that online ads are cheaper to buy is all about people quoting things in units that are not comparable to each other—doing apples-to-oranges comparisons,” Gentzkow writes.

Online ad rates are typically discussed in terms of the “number of unique monthly visitors” the ad receives, while circulation numbers determine newspaper rates.

Several different studies already have shown that people spend more time with newspapers and magazine than the average monthly visitor online, which makes looking at these rates as analogous incorrect.

By comparing the amount of time people actually see an ad, Gentzkow finds that the price of attention for similar consumers is actually higher online. In 2008, he calculates, newspapers earned $2.78 per hour of attention in print, and $3.79 per hour of attention online.

By 2012, the price of attention in print had fallen to $1.57, while the price for attention online had increased to $4.24.

Fallacy two: The web has made the advertising market more competitive, which has driven down rates and, in turn, revenues. That, says Gentzkow, just isn’t so.

Fallacy three: The net is responsible for the demise of the newspaper industry. No, writes Gentzkow, the popularity of papers had already significantly diminished between 1980 and 1995, well before the internet age.

And, he finds, sales of papers have dropped at roughly the same rate ever since. He concludes: “People have not stopped reading newspapers because of the internet.”

Newspapers’ decline not due to the rise of the internet, says professor – Roy Greenslade, The Guardian (13 June 2014)

That looks to me like fallacy #1 had some work done on it and the other two were just chucked in with a so there.