Complacency is the enemy to Bob Cauthorn. In a 1998 speech to an audience of newspaper people, he said, "Most of you are here from companies named after people who tried new things, who took risks, who weren't afraid to experiment. People named Hearst, Cox, Gannett, Newhouse, Knight, Ridder, Dow and Jones. But what have you folks lately done in their name that's new, risky, experimental?"
As founder and director of AZStarnet.com for the Tucson Arizona Daily Star, Cauthorn gained an international reputation as the cowboy innovator of online newspaper publishing. A winner of the Newspaper Association of America's New Media Pioneer Award, he now is vice president of digital media for the Hearst Newspapers' San Francisco Chronicle and its Web site, SFGate.com.
"We're all in a transitional state, at an inflection point in our industry's history," Cauthorn said. "We online need to forge deeper relationships with consumers, not the shallow relationships that print has."
He said the 40-year decline of print edition readership and the online editions' lack of profitability and low readership have the same root cause -- the newspaper industry's complacency about the kind of content they deliver.
"Does the packaging of all the content in the printed newspaper still make any sense? We have to ask ourselves now, is our packaging relevant to our audience?" Cauthorn asks. "What happens if you radically repackage that, even as the shovelware online? You soon realize that the original packaging didn't make sense."
Cauthorn said online readership is infrequent and short because that's likely the reality about newsprint editions, too. "They might not spend long reading on our site, but then we don't know how often they actually read the printed papers, too. My bet is that we're only now finding out the real durations."
Cauthorn said many newspaper sites are being held back by newsprint edition concerns.
"Some of the restraints placed on it aren't because consumers and advertisers don't desire online editions, but because the print folks worry that online will steal away their circulation or advertising," he said.
"How many newspapers have online editions that are truly free to do what the online producers think will satisfy the online audience? Radio and TV became independent within the years because they were free to experiment, which most newspaper online operations today aren't."
Cauthorn said online editions should publish all that newsprint editions did, but do much more and in different ways.
"Shovelware is essentially bad," he said. "Sure, we're going to continue to publish all the contents of print, but the online edition will make very different Front Page and story selections than print will. Online also will publish at least 10 original pieces of content per day. If you only have 20 minutes per day to read the news, you'll need both the online and the print editions because both have different values."
Combining the different approaches to publishing newsprint and online editions can generate overall readership for both, Cauthorn said.
"Print circulation continues its long-term drops, but our online circulation here has been growing at a 30 percent compounded annual rate for years," he said. "I do think we cost the newspaper circulation, but you can grow audience without replacing that printed edition usage.
"Three years ago, 69 percent of our online readers didn't -- and never had -- read the printed editions. But now only 38 percent haven't, despite our 30 percent compounding annual audience growth. By providing different approaches and cross-promoting, we've converted those folks from online people to online and print people by encouraging them to buy single copies or to subscribe," Cauthorn said. "Whenever possible, we push non-replacement use."
In addition to changing and reinventing the editorial package, Cauthorn wants to reinvent the newspaper advertising business.
"We need to restore the newspaper's footprint into small enterprises, stores and markets employing less than 50 people," he said. "The newspaper industry used to serve that advertising market, which comprises 93 percent of most communities' businesses. But we lost it over the decades and instead try to earn our ad revenues by continually milking the other 7 percent who are large advertisers. We can regain that huge lost market through savvy use of online."
Cauthorn is launching an online advertising program aimed at those small enterprises. For $150, his newspaper's site will guarantee small advertisers two million online ad impressions. "Print can no longer serve those advertisers, but online can. And that will guarantee the online operation's financial independence from print."
Cauthorn sees online publishing as the crucible for reinventing the newspaper industry.
"We should take what we've done well online and drive that back into print. Wait until you see what happens once newspaper online executives take over the print side."
Will that stop the decline of print edition readership? Perhaps not, but it could reinvent it, he said.
"Here's what I think will happen within the next 10 years: You'll see a real move to a three to four day per week printed newspaper. Not dailies anymore. It will be published less often, but be more profitable."