Blast from the past: The problem was obvious even in 1996

When reader Bob Wyman, longtime media-technology innovator and currently a member of Google’s technical staff, discovered ReinventingClassifieds.com recently, it reminded him of an essay he wrote for CMC Magazine back in 1996: “Employment Listings Are Another Forfeited Franchise.”

Wyman’s distant words were a warning to the newspaper industry, urging publishers not to sit back and watch as online innovators created employment services that would eat away at newspapers’ revenues. His scenario of what could happen if newspaper companies stood on the sidelines too long was amazingly prescient. Here’s the article, from December 1996.

Employment Listings Are Another Forfeited Franchise

by Bob Wyman

Until literally a few months ago [in June, 1996], the newspaper industry held a virtual monopoly over the public posting of open jobs. Today, the industry finds that it is only one of many players who use the Internet as a means of posting and gathering employment-related information.

Oddly, while most of the companies that have entered the business in the last few months are either generating or seeking to generate revenues from their efforts, few newspapers have even attempted to use online postings as anything other than a “freebie” which is included in the base price of their paper-based listings.

This loss of franchise is not the result of pitched battles between the traditional holders, the newspapers, and the new upstarts. Rather, it’s all happening very peacefully as the newspapers simply watch and study events from the sidelines. The upstarts aren’t “winning” market positions that someone else held online, rather, they are simply filling in a void that the newspapers as an industry have seemingly refused to value. Of course, once the papers finally realize they must fight back, they will be fighting against entrenched competitors and things will get messy. It would have been much simpler if the papers had taken the initiative and filled the market/service holes before the new competition had had a chance to grow.

I’ve been spending a good bit of time recently looking at online job resources since I’m looking for work for myself. Being willing to relocate, my first assumption was that I would simply call up the online papers from the cities that interested me and use them as my primary resource. What I found was a mess. Most papers seem to have done nothing more with their job postings other than simply dump them online. Some have implemented fairly weak search systems, but none really provides much value. What I have ended up doing is relying on non-newspaper services.

I think the root of the problem with the newspapers is that too many of them are worrying about the problem of putting their paper online while most of their new competitors are viewing the opportunity as one of building compelling information services that will make money. The result is a glut of newspaper sponsored sites on the Net that are intent on offering news while the competition is intent on making money… This difference is seen in a variety of ways, but one of the most telling is the difference in the source of online content in the help wanted area.

Virtually every “jobs site” on the web provides a mechanism to allow you to post new ads online for a fee. Most of these ads will never be printed on paper. However, the newspaper sites only publish online ads which have run in their paper versions and I have yet to see a paper that charges for the service. What is being missed here is that the online arena offers opportunities for building new business, not simply a place to dump content from the paper version.

If you look at the corporate sites in your area, you’ll notice that many companies have a “jobs” section off their home page. In that section you’ll usually see lists of open jobs that aren’t printed in any newspaper. What you’ll frequently find in the newspaper is a cryptic (and short) ad making a general statement that the company is hiring. More and more frequently, the printed ad will contain a pointer to the URL for the company’s jobs page… This makes sense from the advertiser’s point of view but is not good for the papers. The advertisers are forced to limit the size of their printed ads because of their cost. They have no alternative other than their own sites, or sites like MonsterBoard, as a place to publish more detailed online listings.

The real cost to newspapers here isn’t the lost revenue from the online ads that aren’t published in the paper. Rather, the real cost arises from the fact that the market is becoming accustomed to seeing and looking for job listings in non-newspaper forums. The real cost is the loss of the franchise.

Just as I recently argued that papers should be seeking to carry online advertisements and directory entries that don’t appear in their papers, I also argue that the papers should look at the online help wanted business as something more than a place to dump their paper based ads. You should do a survey of every local corporate site and every local recruiting firm’s site and if there are jobs posted on any of them that aren’t in your online system, you should review the SCP (salary continuation plan…) of the folk running your online version. You should be ensuring that your paper is offering the premier site for job postings in your area and that you–not the startups in the garages outside town–are the ones making money from online job postings.

If the newspapers are to remain viable, they will have to find ways to maintain at least their existing roles and franchises. Without revenue sources, the ability of the papers to publish content, online or not, will be diminished. Please people… I really don’t want to get my news from the phone company…

Tags: history