Friday, April 29, 2005


Dr. Joe Becomes "Syndicated"

The good folks at have decided to work with printing and graphic communications associations and publications to syndicate a monthly column based on my weekly "Fridays with Dr. Joe." It's an updated "best of" that's tailored for print publications that readers will find challenging and interesting. Contact Randy Davidson at for details and costs. The column is also great for company and industry newsletters. Formal announcement will be made sometime in May.


Neat Articles for the Week

Mary Meeker, one of the virtually disgraced cheerleaders of the Internet bubble is now back and "wowed" the crowd at the Ad:Tech show in San Francisco. I can’t believe how often this presentation was cited, and it didn’t look planned, it looked for real. The file is big.
An article about it
Her presentation

Big retailer Home Depot has some interesting ideas about implementing multichannel marketing

Hot topics, at least according to Microsoft; note the shortage of computer scientists.

Companies that "get it": The Wired 40

Bruce Chizen, CEO of Adobe, the printing industry’s equivalent of the Roman god Janus (is Adobe our friend or foe? ... the only answer is "yes") was interviewed recently, and had some very interesting things to say

George Will's column about newspaper readership

Saturday, April 23, 2005


More About Trade, and Google's Ad Revenue Now Bigger Than NY Times, Washington Post, Knight Ridder, & Dow Jones

Today's Barrons has a good article explaining the "trade deficit" and debunking the various myths around it

Thursday's articles about newspapers were balanced by Google's stellar revenue results. This line from the Wall Street Journal is a shocker: "...Its quarterly advertising revenue now outstrips the advertising revenue of most major newspaper publishers, including New York Times Co., Washington Post Co., Knight Ridder Inc. and Dow Jones & Co. ..." My favorite line from the WSJ story was uttered by Eric Schmidt, their CEO who said that "...strong earnings growth was largely due to revenue outpacing expenses..." -- what a concept! This means they already have economies of scale, and as they grow, their margins will expand (as opposed to which is still intent on not making money as they try to build a digital Wal-Mart).

WSJ: Google Net Soars on Web Ad Boom (subscription required),,SB111409494873913280,00.html?mod=home_whats_news_us
NewsFactorNetwork (free)
Google press release

Thursday, April 21, 2005


Newspapers, Kraft Foods' Marketing, and Free Software

Advertising Age had a good article today, "Analysts: Newspapers Could Lose $4 Billion to Internet," which focuses mainly on the classified ad business that they have lost. Classified has always been a huge source of high margin dollars for dailies and non-dailies.

A second article has yet more comments about the state of newspapers: "Newspaper Conference Bemoans Changing Consumption Patterns"

Here is a good, but short, article on Kraft Foods' use of multichannel marketing.

For you road warriors out there, Computer Shopper is running an article on the top 50 free software programs
Among my favorites, some of which are not mentioned in the article are:
Word processing (compatible with MS Word): AbiWord
Office suite OpenOffice is a full featured suite (compatible with MS Office), with word processing, spreadsheet, presentation, data base, drawing, free PDF maker and free Macromedia Flash making capabilities. Get it at (new version 2 to be released in this summer; stable version is 1.1.4, but take the risk of the version 2 beta download)
Browser AvantBrowser works "on top" of MS Internet Explorer. It has built in ad blockers, popup blockers, many other features; asks for free-will donation; can be set to automatically clean up cookies and temporary files.
Audio recording and editing Audacity
Instant messaging GAIM is just superb, consolidating my AIM and Yahoo Messenger addresses, and saving me from all those ads and popups.
File management PowerDesk 5 replaces Windows explorer; if you're an old DOS user and remember Lotus Magellan or XTree or Symantec's Norton Navigator which was released with Windows95, this is is for you. PowerDesk just does things Explorer can't. It has many more functions than Google Desktop Search, too. The full version is PowerDesk 6; if you have the full version of 5, I can't say that there are big reasons for upgrading. V-Com's SystemSuite has PowerDesk built in, and is a better deal than Norton Systemworks. Check out the free version of PowerDesk 5 at
PDF making If you need to make a PDF or don't have good reason to buy the full Acrobat package, OpenOffice is a good alternative. But, if you want to keep using your current office suite, add this PDF making software to your system

Wednesday, April 20, 2005


Articles, Musings, and Maybe Some Insights

A few items in the past couple of days are worth noting:

Some recent stories discuss how consumers use multiple media at one time. Yawwwwwwwwwwwwn! But at least we now have statistics. Whether you call it multichannel or cross-media, the alternative-soaked communications business demands that marketers have plans to be everywhere in every way.

Playing on that theme, some of the trackers of the advertising industry are actually getting bullish, especially about new media.
I like the line at the end of the article, "complexity is their friend." This justifies the presence of agencies, a reminder of their purpose, to provide counsel and implementation for things their clients can't. Hence, outsourcing is the manager's friend. I can't say how many times, but it's a lot, where I have seen companies try to bring public relations and advertising in-house, only to realize they save money, but get nothing done. Creativity, urgency, and content suffer significantly. A good agency with an ear to the marketplace, and eye to the future, and an understanding of media saves money in the long run, and raises long term sales and profits. If you don't have the sense that's occurring, the right move is not in-house, it's to a different agency.

I strongly recommend Bob Garfield's article in Advertising Age called "Chaos Scenario." It's at and the readers' responses Garfield was interviewed on NPR

Courier Corporation has had a long string of good earnings reports, some of the best in the industry, but lowered its guidance for upcoming quarters. No explanation why was noted that I could find, so it's not clear if they were "irrationally exuberant" in their forecasts (to use a Greenspan-ism) or if there has been a decrease in demand, more competition, or competition from offshore. It was a surprise.

Economist Larry Kudlow has an update about China that describes the multitude of issues in that area of Asia. Sounds like a mess is brewing. Speaking of that, I was watching C-Span when Schumer was interrogating Treasury Secretary Snow about China's not floating its currency. Schumer was grandstanding when Snow would not say in the meeting that China should let its currency float, when he knew full well that he has been working to do so behind the scenes. Yes, often diplomacy is exercised in private-- shocking! In fact, when Snow said that we don't know what the right value of China's currency is, he was absolutely right, because the forces of the marketplace are not at work. If it is undervalued, the Chinese population is paying for it in terms of increased inflation, and they are bearing the brunt of it. And in a lot of ways it doesn't matter: when foreign countries have lots of dollars, they have to do something with them. Our dollars overseas have to be repatriated here in order to have value. But because they are so easily redeemed in the currency market, they may not be repatriated through China, and may not have to be repatriated immediately, sitting offshore for years. Since the trade data do not include investments made from overseas using dollars acquired from trade, and the data improperly value so many goods, the data are of dubious value anyway. But whatever the course, Schumer knew he had Snow in a situation where he did not want to go on record about the pressure we're putting on China in the backroom discussions, so he just pounced. Snow is a good secretary of the treasury, but the media, and media savvy senators just often eat his lunch.

Friday, April 15, 2005


Wall Street Journal's Online Business More Profitable than Their Traditional Business: Have We Reached Online Publishing's Turning Point?

An article about it is at

The second sentence is a shocker: "...its fledgling online operations earning more money for the first time than the flagship Journal and the weekly Barron's..."

You read it right, online is more profitable than traditional. I still wonder if is being allocated its deserved share of fixed costs; that's for the accountants and analysts to decide. It is certainly conceivable that would be more profitable from a production perspective. I would not be surprised if the print version economics ran something like print and postage at $1 a copy, assume 300 issues a year (WSJ & Barrons), and you get $300. The annual subscription is $356 for the two publications in mailed hard copy. That leaves $56. They charge $84 for an equivalent online subscription. I can't believe that newsstand sales are all that important any more and really cover their printing, distribution, and returns costs. Neither would bulk sales to hotels and other buyers; those are there to increase their rate base.

So the idea that online could have crossed its breakeven point this significantly is rather incredible, and is certainly a sign of the times. It's easy to blame lower advertising revenues and hope that ad budgets will pick up, and whatever other excuses might come to mind. The B2B ad market has significantly changed, and it's not going back to the way it was. Ad dollars go where audiences go, and new media has had its corrosive effect; it's like a feather pillow case has been cut open and its stuffing dispersed in the wind, impossible to be fully retrieved and collected, never to be stuffed back the way it originally was.

One concern I have is how much ad revenue can actually be generated on the Internet, as print is based on ads delivered whether or not seen or read, and Internet ads are paid for when they are actually served to a viewer's screen or a viewer clicks on them. Advertisers are also enthralled with the idea of paying only for ads viewed, unlike print, where you have to rely on readership research (or coupons or similar) to "guess" what effectiveness might have been.

We may look back at this as a significant turning point in the publishing marketplace. The fixed cost, legacy infrastructures that support print production are under attack. Changing consumer preferences are forcing the administrative bureaucracies of managing print production and distribution to crumble. The pressure of ubiquitous direct and instantaneous access to news and information offered by new media, and a willing audience, will force a major publishing restructuring. The only question is when.

The official release of Dow Jones' earnings can be found at

Wednesday, April 13, 2005


Printing Profits Down for Q4-2004, and other interesting stuff...

Based on Commerce Deparment data for Printing and Printing Services (NAILCS 323), Q4 profits before income taxes were 2.9% of revenues, down from 3.3% for Q4 of '03. Inflation-adjusted profits were $4.4 billion for the full year, up from $3.6 billion in 2003. I'll discuss this more in an upcoming column for on 4/29, but it seems that the slide in profits seen in Q3 just continued in Q4. This is at a time when sales are flat at best, so it seems there is no end to the decline in print prices. Look for more printers to shut their doors, I guess, and the pressure to consolidate just seems to grow more forceful every day. This profits data can't be good for the capital equipment companies that sell to the industry, that's for sure. Sometimes the best business strategy is to get out of your own way.

The Friday 4/15 column has my comments about magazine circulation that are worth noting. Total magazine circulation is basically flat for 15 years, and has not kept up with population growth. See the column at this Friday; if you don't subscribe, take advantage of the free 15 day trial, and you can have access to all of my columns from when I started in January 2003 to now.
NOTE: Unlike a lot of the "free trials" you see on the Internet, WTT really means it, and doesn't ask for credit cards up front. They actually trust their site visitors. :)

Speaking of WTT, my March 30th Economic Outlook Webinar is available for download as an MP3 (audio) with PDF (slides) at At the same location there are answers to questions that I was not able to get to during the audio session.

More interesting stuff..........

Staples continues to use print to build store traffic; now they're letting people copy their tax forms for free.

Staples of course focuses on small businesses, and now Yahoo is offering free services to small businesses
Here are links to three of the stories about it:

Sales to small businesses have been critical to quick printers, and I'm still disappointed that the franchises, especially, have let Staples and Yahoo steal their thunder. As best as I can tell from U.S. Bureau of Labor Statistics data, about 69,000 net new businesses per month are being formed, on average. For all these years small printers could have been the experts at advising small business about their communications. They could have been setting up web sites, handling e-mail campaigns, managing data bases, but there was more interest in printing business cards and not even acknowledging that the Internet was there. Is this the usual story of the printing industry printing all of the marketing materials for all of the other industries, yet can't do any marketing of its own?

On more weighty matters, the IMF published its world economic forecast
Here's the Associated Press story about it

Good story in CFO magazine about surviving in dying industries

... and also a disturbing story about financial printing (go to the page and scroll down to "A License to Print Money?")
This is the kind of stuff that helped kill Sorg, Pandick, and many others financial printing businesses that are now a distant memory. Whether or not these allegations of overcharging are true or that the charges are perfectly legitimate, they help increase the desire to require only digital submissions of financial filings, without printing at all. Ah yes, the industry shoots itself in the foot..... Executives like certainty and predictability, and definitely don't like the situation described in the article. When pricing seems random or uncontrollable, it only serves to annoy.


Greenspeak: No One Knows What He Means, and That's The Whole Idea

Today's WSJ has this line: "...the Federal Reserve expects to raise interest rates higher than it previously believed necessary and possibly at a faster pace...",,SB111332811394904803,00.html?mod=home%5Fwhats%5Fnews%5Fus

Today's NY Times has this line: " still stuck with language in its post-meeting statement that future rate increases could be at a pace 'that is likely to be measured.'''

Ummmm.... yeah.... Just another reminder that the Fed tries to stay out of the marketplace as best it can, and it's up to us as executives and investors to interpret the tea leaves on our own. One reporter looks at it one way, and other,... well, you know. Good job, Mr. G. As Harry Truman said "I want a one-armed economist so that the guy could never make a statement and then say 'on the other hand..." Unless of course, that economist is in charge of the Fed.

I still think we're headed for a quarter point every time they meet.

For a great view of the economy, the Dallas Fed updates its PDF slide show every Tuesday afternoon. Slide 32 shows the real Federal funds rate, and shows there's plenty of room for the Fed to keep raising rates. When the business press reports things, it often lacks perspective, so looking at the data in its fullness illuminates the data to be something quite the opposite of what was reported.

Sunday, April 10, 2005


China: Closer to Being the World's Largest Economy than Most People Realize

Inc. magazine has a superb article about China in its March 2005 issue. It cuts through a lot of the myth and adds some excellent insights. It even estimates how much of the China economy might not be counted in the "official" figures.

By my calculations, it will not take long for China to become the largest economy. Using the official figures, and assuming that U.S. annual economic growth is 3%, China would have to grow at about 6.3% per year for its population to achieve one-quarter of the U.S. per capita GDP. At that level, since the Chinese population is 4x that of the U.S., it would exceed the total size of the U.S. GDP in twenty years. China's most recent growth rates are between 8% and 10%; it may happen sooner.

Today, China called for collaboration with India in information technology. (WSJ; subscription required),,SB111314988859802835,00.html?mod=home_whats_news_us


Who Needs Faster Broadband? The Economic Foundation of B2B Publishing is Already Showing Cracks

The results of a study in the UK by the Association of Online Publishers have been made public. The fact that this is done by an association for online publishers must be kept in mind, from a skeptical researcher's perspective. This is a UK study, but equally, if not profoundly applicable to the US. What i found most interesting was the study included agencies and their perspectives about B2B web. Even if the results are biased in the favor of websites, we know what the trend is.

Are B2B magazines dead? No. But they've just applied to be in an assisted living facility. They have years ahead of them, but they have to adapt to their new surroundings, which are obviously littered with numerous digital formats, some of which have dubious revenue streams, if any. The foundations of the publishing business are being undermined every day. New publishing businesses that start from scratch and don't have to undo fixed cost legacies are probably in a better position than the old guard as a new publishing business with a new economic structure, emerges.

The story:

The presentation:

Thursday, April 07, 2005


What Would Happen to the Printing Business If Broadband Was 16x Faster?

You don't have to answer... we know... This article in USA Today gives some ideas about the opportunities for many sectors and applications. Even if the new broadband was 3x or 5x faster, it would create significant disruption.

"Tomorrow's Net speeds could be up to 1,600% faster", By David Lieberman, USA TODAY

Some other data that might be of interest
Worldwide broadband data

Two Business Week articles shed some light on what broadband means
Broadband Ads' Speedy Progress
America: Still the High-Speed Laggard

Saturday, April 02, 2005


Ignore the Employment Pessimists

Yesterday's employment report was quite good, as the rate dropped down to 5.2%. "Experts" focused on 110,000 new payroll jobs, supposedly lower than needed or expected (but even that's a good number considering how CEOs are with tight budgets). Did anyone see the 357,000 new jobs reported by the household survey in much of the business press? My 12-month moving average of net new businesses was up to 68,830 (that's 825,960 news businesses in the last 12 months). Few, even among business reporters really recognize, or report, the confluence of technological, social, and legal factors that are turning us into a "1099 nation." Self-employment is not an abberation or something to be looked down on, it gives our economy resilience and better ability to react to, and create, change.

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