Blog by John Miller

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Cyber stupid

Hey, Paul Godfrey, welcome to the digital age!

In a recent intervierw, the CEO of Postmedia Network Canada Corp. gives a perfect illustration of why old-school managers of traditional newspapers are having such trouble embracing new technology.

His interview with Reuters news agency came as Postmedia announced that it suffered a net loss of $12.3 million in the three months ending in February. Well, well. Is it any wonder?

Godfrey, president and chief executive of the company that publishes the National Post and major urban papers like the Edmonton Journal, Vancouver Sun, Ottawa Citizen and Montreal Gazette, said this about the challenge facing his dwindling number of journalists:

"Reporters are going to have to become more than just a reporter," he said, predicting that a quarter of the chain's reporters will have to be retrained to fit its "digital-first" business model. But not everyone will want to learn new tricks, he added. "A lot of people who have done a certain job for so long do not want to learn anything new, and the older you get, the more reluctant you are to change."

His comments reflect a shocking ignorance of the skills fresh young graduates of journalism schools already possess. They have been trained to know all the new tricks, have four years of experience delivering the news by audio, video, print and on social media, and are willing to bust their asses for starting wages. Why spend money on retraining when you can just hire who you need?

But perhaps Godfrey and his company are so busy cutting jobs that they've missed all that. Since they took over the bankrupt pieces of the Aspers' Canwest empire a year ago, they've embarked on a massive downsizing that has cut at least 10 percent of the jobs. Many of those were recently hired reporters and editors -- precisely the kind of people the company needs to survive. And more cuts are on the way. The failed slash-and-burn business model of traditional newspapers keeps getting in the way of attempts to chart a new course.

There's nothing wrong with Postmedia's strategic plan. Digital services, including websites, smartphone and tablets apps, account for 10 percent of the company's advertising sales today. The goal is to get that up to 25 percent within four years. And Godfrey has hired some of the smartest minds in the industry to lead the way, including John Paton and Wayne Parrish.

But belittling the people who will gather the news for this digital highway as Luddites is no way to inspire the troops. What old-school newspaper managers like Godfrey fail to realize is that good stories, carefully reported and edited, are the real keys to the future of his company. Reporters should just be reporters, and you may need more of them. Rather than slowing them down to retrain so they can deliver their stories on new media, he'd be better off to hire technical helpers to do it for them until the workforce can refresh itself.

Rather than embracing new tactics to achieve a new business model, Postmedia's CEO seems content to rely on the cost-cutting tactics that have failed so many newspapers in the past. Godfrey is bringing his country-wide business operations into a Toronto headquarters and expects to leave only one or two back office staff in other cities. He has offered buyouts across the country, including at the National Post. As the Reuters story says, much of the advertising production has been moved to the Philippines and India, Postmedia's call center is in Dominican Republic and it closed a printing plant after a contract to produce the rival Globe and Mail expired.

The company's problem is that it doesn't have much time to get its house in order. Under the terms of the Canwest buyout, Postmedia has to retain Canadian control of the newspapers and to list its shares publicly by July. If it doesn't do so, and sell enough shares to Canadians, its revenue will evaporate because advertisers will no longer be able to write off their spending with the newspaper chain as a business expense.

Under the circumstances, Godfrey would be better off investing in journalism, not forcing elderly journalists to be multi-taskers.