Last week Warren Buffett, a man who has got rich, very rich, by knowing where and when to invest, sent shareholders in his company – Berkshire Hathaway – his annual letter. It gives an overview of where he has been putting his and their dollars. Perhaps one of the biggest surprises is just how much money he has been spending on buying newspapers. Not as in the odd copy from the newsstand but rather the companies that actually print them.
But then, as he has previously pointed out, he has history in the industry – he used to be a paperboy. He once jokingly claimed that at the company’s annual meeting he would introduce a new activity – paper tossing. This followed his purchase of the Omaha World-Herald when he had boasted to its staff and employees of the folding and throwing skills he had developed while delivering 500,000 papers as a teenager.
But Buffett’s willingness to spend a lot of good money on newspapers is based on a deep belief: that people still want good regional and local newspapers. In the past 15 months he has bought 28 daily papers for a grand total of $344m (€263.7m). In his letter this year he said that “People will seek their news – what’s important to them – from whatever sources provide the best combination of immediacy, ease of access, reliability, comprehensiveness and low cost.”
This is such a different US media narrative to what was dominating the headlines just a few years ago as newspaper after newspaper closed in the US. And even now we are seeing the New York Times keen to sell off any stakes it has outside of its key brand. What seems to be happening though – at last – is that media players of every size and in every sector are realising that there is not just one route to success. There is no quick-fix media model you can buy off the shelf. You can’t just run with the pack any more.
It’s funny watching Page One, the 2011 film about life inside the New York Times. There’s a moment when it cuts to Rupert Murdoch going all gushy over the iPad and how it will ride to the rescue of the industry. Does any media owner think that now? Sure, some magazines work as a slide-of-the-finger experience but others don’t.
Recently in the UK magazines published their ABC figures (their audited circulations) and also revealed the sales for their purely digital editions. If you were the Condé Nast editor who had managed to flog 325 subscriptions in your home market would you think the future was tablet shaped? Or what about the IPC title that managed to sell 1,670 worldwide despite being a loud drum-beater for web wonders? Where’s the money in that?
Sadly this debate never got to the screenwriters of the Netflix hit House of Cards. It has a subplot about the battle between old print and new media that seems sadly enthralled with the sort of people who sit on bean bags and post their latest musings unchecked.
The fact is that the media market is going to stay a tough, complex place where owners and editors are going to have to come up with their own unique recipes for reporting news and making money (look at Condé Nast’s investment, announced yesterday, that it will be buying a stake of the e-commerce site, Farfetch).
This media company for one welcomes the new realism and the understanding among the likes of Mr Buffett that print is here to stay alongside digital. There’s even room for a media company to open a cute café and invite readers to come and flick pages, have a flat white and enjoy a good cake – cue the Monocle café. It’s all about knowing your readers – even their taste in buns.
Andrew Tuck is editor of Monocle.