WASHINGTON – A top executive at A. H. Belo Corp., parent company of The Providence Journal, told Congress last week that Amazon.com Inc.’s much-publicized new Kindle DX e-reader “is not a model” that will return the troubled U.S. newspaper industry to health.
James M. Moroney III, who is an executive vice president of A. H. Belo as well as publisher and CEO of The Dallas Morning News, made the comments in a U.S. Senate hearing on the future of journalism.
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Although he described the Kindle as “a marvelous device,” Moroney said that during extended negotiations over whether his paper would become available on the Kindle, Amazon insisted on keeping 70 percent of subscription revenue generated by the paper, leaving only 30 percent for the company, PaidContent.org reported.
In addition, Amazon said it wanted the right to republish Dallas Morning News articles on any portable device.
“Now is that a business model that is going to work for newspapers?” Moroney said. “I get 30 percent and they get the right to license my content to any portable device – not just ones made by Amazon? That, to me, is not a model.”
The Providence Journal and The Dallas Morning News, both owned by Dallas-based A. H. Belo Corp., are not available on Amazon’s current version of the Kindle, which has a smaller screen than the one introduced last week, which will become available next summer at a cost of nearly $500.
Moroney noted that with Kindles having less than 1 percent penetration in the U.S., “They’re not a platform that’s going to save newspapers in the near term.”
Moroney was the second-highest-paid executive at A. H. Belo Corp. in 2008, making $764,025 in total compensation, according to regulatory filings.
Amazon introduced its larger-screen Kindle last week to much fanfare. New York Times publisher Arthur Sulzberger, who spoke at the machine’s launch event, is among the media executives who have agreed to work with Amazon in the hopes that the Kindle will help boost the news business’ bottom line.
Moroney’s comments echoed a similar statement last week by media mogul Rupert Murdoch, chairman of News Corp., who said his company has no intention of making its newspapers – including The Wall Street Journal – available on the Kindle, The Guardian reported. He also said he expects News Corp. to begin charging for more of its newspapers’ online content this year.
A. H. Belo last week posted a first-quarter net loss of $103.07 million as advertising revenue plunged 28.2 percent compared with the same period a year earlier.
Additional information on A. H. Belo Corp., the Dallas-based parent of The Providence Journal, The Dallas Morning News and other newspapers, is available at AHBelo.com. Additional information on Amazon.com’s new Kindle DX device is available at Amazon.com.
Does anybody really care what someone who has the nerve to take $764,025 in compensation why his organization loses $103 million in Q1 has to say?