Pittsburgh paper launches online charging scheme

"The Post-Gazette, known locally simply as the PG..."

My family owns a small convenience store in the Pittsburgh area. Over 10 years of selling that paper I've heard Pittsburgh Press, Pittsburgh Post, Post-Gazette, and "the Post," but I can't point to a single time someone called it the PG.

The thing is that newspapers back-in-their-day, didn't make the bulk of their money from selling their content but from advertising.

A small town (or even small-city) Newspaper, twenty years ago was: 1) An assortment of major stories culled from the New York Times, AP and what other newswire they subscribed to. 2) A couple custom national articles and/or editorials. 3) Some local news pulled from the police blotter 4) Classified adds plus banner ads declaring the usefulness of hypnosis for weight loss and such.

The money came from ads. Aside from the small number of major newspapers in the country, the product was completely derivative, completely ad-driven and generally strongly tied with local political interests. I can't see the death of this phenomena as a great loss. Moreover, I can't see websites with newsfeeds as what killed it. Rather, Craigslist killed it with free classified ads and it killed itself by not improving anything, not reducing prices and increasing volume, not innovating and so-forth. It's an industry which previously consisted of a lot of local monopolies and the problem with any monopoly is that it's profits are so good that it will hold to it's position till it dies rather than competing, since competition would result in a profit drop of an order of magnitude - if you have an investment opportunity that makes a solid 10% profit each year, you'd probably keep putting money into it, even if the money that you could invest dropped each year. Why innovate to make 3%?

Someone pointed-out the craigslist might make $100 million/year but has wiped-out an industry that made multi-billions. Now the billions previously spent on classifieds are available to buy entirely different kind of products but its still more logical for newspapers to gnaw on the bones of their previous business model.

I've always considered HN links to Paul Graham's essays to be PG+.