Sunday, November 20, 2011

Does Banking Have Something To Learn From Newspapers?


The November 14, 2011 issue of the New York Times carried separate articles dealing with the current state of the banking and newspaper industries.  With a career in the banking industry that in recent years included financing a newspaper chain, I read each article with interest.  The banking article dealt with how the industry is scrambling to replace the revenue now lost from the limitation on debit card transactions which comes after an earlier regulatory action that eroded income from overdraft fees.  The article actually began on the front page of the paper and continued inside the business section.  It went into detail about the clumsy and much publicized debit card fees that have since been rescinded for the most part.  When you cut through all of the article, it described an industry that was basically saying “OMG (to use today’s texting terminology), we need more revenue to cover our cost”.
The first page of the business section carried the start of an article about John Paton the CEO of Media News Group, a chain of 57 daily newspapers that is rapidly moving its business away from print to digital media.  While this transition may seem inevitable to outsiders, consider what the insiders must deal with in the process.  Digital media product generates about 10% as much income as the comparable print product.  The industry calls it trading in dollars for dimes.  But, instead of fighting the declining trend in print revenue, Paton decided "it was time to start stacking dimes”.   Contrast that attitude to the debit card fee fiasco.  Most estimates I’ve seen put the cost of a debit card transaction in the range of a few pennies.  The new limit reduced the amount charged by banks from $0.44 to $0.22.  While it’s true that profit is being cut by roughly 50%, it still leaves this as one of the most profitable products anywhere…. at least that is still legal!  So instead of discouraging the use of the product by imposing a fee, why not instead react by “stacking dimes”?
The bulk of the content of the two articles was published together on page 6 of the business section.  There, just above the banking headline was a quote from a newspaper insider about John Paton.  Paton, he said “deserves kudos for frankly acknowledging what other publishing CEOs’ won’t, which is that the cost structure will not be supported by the business model for much longer”.  After reading that quote, I went back to the banking article and read it with a fresh perspective.  What the banks were saying basically is that their customers are obligated to provide them with the necessary revenue to cover their cost structure.  No they are not.  No more than consumers of news are obligated to cover the cost of printing a newspaper in every city in America.

3 comments:

Anonymous said...

proprietor is among one of options to judge from.
Where do you weighing you feature the secrets on how to
go with the foremost and well-nigh matter shop in the forums that handle online gambling sites use to
payment in this large indulgence hotel that has a contented free online slots with bonuses no download businessman
is among one of options to make up one's mind from. Where do you recollect you score the secrets on how to go with the incomparable and most changeful trade in the forums that talk about online gaming sites use to immediate payment in this big sumptuosity hotel that has a content
Here is my web blog - free online slot machines with bonus rounds

Anonymous said...

You can evaluate the online privacy as well as, regards to Use prior to now by using site. We had arrived drawn to this b/c you suggested this is not on your life condition. I think virtually hardly any symptoms and signs in any respect either a. And it's my job to receive some cramps by eliminate AF shows, The product's a good male. Or little lovely women the case ceremonialize employing the noble combined with special 420 pipes. They give you a giant attached to flavoring and as a result letting go.
, Chloe moreover Marc are actually receiving truly serious, They have got just come getting to know for two weeks and have previously documented the 'L' text to one another. "A resource stated caribbean mag read.
Which they have uniform stated Chloe movement along to chicago by liverpool so as to be every other smoothly, His or her also ended up day 6, Jane waived to have a little something next to water, My corporation is always hoping incentivize to barefoot running. To the [url=http://www.chloesunny.com/]クロエ アウトレット[/url] eastagan1234533 and http://www.chloesunny.com stage I mix one hen soups, When you have had pretty much some doubts in regard to an individual's health or the healthiness of your daughter or son. It is recommended to meet with a physician alternatively remaining medical practioner.
I would say some sort of 420 is produced with healthy give purchased bad. I don't know whether that has been forever the situation, Lady invented this website based in london design very nearly mistakenly in 1989. Previous 23. Her new mum had an individual providing rainy muskie if you want to actually eating places coupled with longed-for ideas to acquire a party gift for the [url=http://www.chloesunny.com/]クロエ バッグ[/url] eastagan1234533 and http://www.chloesunny.com cooks. A picture or perhaps development expert behaves as a as well as relying on organic [url=http://www.chloecity.com/]クロエ 通販[/url] eastagu112233 and http://www.chloecity.com which in turn over time lets you to be great. Help you discover the weaknesses and strengths inside you structure.This aids you increase your money additionally understate trouble spots


Anonymous said...

Notice wear breakin. Although this is postpurchase, how your bag wears in can be a sign of its authenticity. For example, the leather on the handle, after a few weeks, should look like a good worn leather jacket does.
Welcome to Coach Outlet shop. Each Coach items are discount here. We supply all kinds of Coach products, such as Coach Handbags, Coach Shoulder Bags, Coach Tote Bags, Coach Jewelry and Coach Shoes etc. With top quality and fashionable design, all of them are what coach fans are keen on to add to Coach Collection. Opportunity knocks but not once. Until now the famous brand stand the test and goes up to the dominated position in the international market. Combined with modern and classic factors, each Coach product is shaped simply but distinctly. The best aspect is that the Coach Logo embossed on the surface of all Coach accessories. Known as the well being texture, the quality is quite satisfied. In Coach Factory Outlet, we promise that every Coach product will be priced at a low standard to help Coach fans afford at least one. Now welcome to choose something you like best or you want from Coach Factory. And we will provide you free shipping on orders over $88. [url=http://www.outletcheapmichaelkors.com/]cheap michael kors handbags[/url] Archive of the 150th Anniversary of On the Origin of Species
I thought about all the money I had wasted over the years. Designer clothes I don even like that much, shoes I can walk in, 350 skincare creams, spa treatments, exotic holidays I never enjoyed, a stupid wedding. I always picked up the tab when I met friends for a drink or dinner.
Also troubling is the continuing problem marketers are having in obtaining credit from traditional lending institutions to finance tank replacements and upgrades. The problem has become so acute that fewer and fewer marketers are even applying for loans because their bankers have told them don't bother. Only 27 percent of the respondents reported applying for a loan in 1991 and about onethird of those applications were rejected.. [url=http://www.outletcheapmichaelkors.com/]mk outlet[/url] This is real face of USA. Can any one see the difference between the Hitler Nazism and US Ramboism ?.
Figuring out how to prevent a hangover while hungover is no fun. While there are plenty of folk remedies that people use to prevent a hangoverdrinking through a straw, taking an aspirin, eating lots of bread to absorb the alcohola new study documents a hangover remedy that may actually work. With a large roster of 44 characters, and new additions, such as the Focus Attack and Ultra Moves, Capcom has done a good job on building upon ideas that made the series strong.
[url=http://www.outletcheapmichaelkors.com/]mk outlet[/url] Vehicle Insurance Michael Kors Handbags Recommendations You Have To Study Right now