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November 18 2010

15:00

The Newsonomics of news anywhere

[Each week, our friend Ken Doctor — author of Newsonomics and longtime watcher of the business side of digital news — writes about the economics of the news business for the Lab.]

Facebook isn’t trying to replace Gmail or Yahoo Mail — it’s just trying to bring a little order to our world, right? This week’s Facebook Messages announcement is stunningly simple, and in line with the next phase of the web, both overall and for news.

Take MSNBC’s description of Facebook Messages:

Instead of dealing with the dilemma of reaching people via e-mail or direct message or SMS, all of these will be combined, so that you’ll be able to reach someone the way they prefer to be reached, without you having to think about it. ‘All you need is a person and a message,’ said Andrew Bosworth, director of engineering for Facebook.

That’s the next web (r)evolution in a nutshell. It’s a unified theory of messaging. And it can be easily extended into the unified theories of TV, movies, shopping — and news.

Make a few substitutions, and you’ve got “All you need is a person and a movie,” or “All you need is a person and a shopping list” or “All you need is a person and the news.” For news creators, and aggregators, it’s a big thought that will be play out more dramatically in the tablet-inflected world of 2011. Only those who grok its meaning and execute properly may make digital reader revenue a reality.

In short, it’s about simplification, about interconnection, about consolidation, and it’s a principle that is beginning to — and should — form the foundation of the much of the next-generation thinking about the news business.

Though we’ll continue to see a panorama of new digital services and products, much of the early digital vision has been built out. We may live in a find-anything-anytime-anywhere world, but it’s also a digital fumbleathon, as we bounce from mobile apps of three distinct platforms, mail and preference settings, interminable demands for passwords, multiple hard-to-combine “friend” and contact lists, Twitter decks, Facebook walls, RSS feeds, preference popups, security hiccups — not to mention TV remotes and cable guides that seem like visitors from a distant analog planet.

Facebook Messages says: We get it. We’ll make it easier for you to keep in touch with those you want to stay in touch with. We’ll see how well Facebook delivers on that promise, but it’s the right one for our age. We can see its echoes multiplying.

On Wednesday, HBO announced that its HBO Go initiative will make HBO available through digital devices for its cable channels subscribers by year’s end. That initiative is part of parent Time Warner’s TV Everywhere push, which likewise says: You paid us once. Now get what you paid for wherever you want it. It’s the unification of the premium TV business, as cable companies are starting to see unprecedented churn, given piecemeal availability of programming through the Internet, legally or illegally.

Comcast is making a similar promise, as it newly announced app promises to connect up its customers’ experience. The app’s functionality is rolling out over time, but will ultimately allow viewing of all Comcast’s Xfinity content via devices, plus provide programming services, such as remote DVR taping, and let an iPhone replace that dreaded remote — borrowing a little bit from Tivo, a little bit from Sonos.

Netflix, of course, grasped the concept earlier, as CEO Reed Hastings has noted (“Six Lessons for the News Industry from Reed Hastings“): “We knew that the DVD business was temporary when we founded the company. That’s why we named it Netflix and not DVD by mail. We wanted to become Netflix.” Netflix’s current promise: “Unlimited TV.” You guessed it: one relationship with the brand, and you get what you paid for however you want it.

Where are the news promises? Well, the first generation has been Yahoo News. Remember your first time seeing all those wondrous headline links from the BBC, the Post, the Hindu, and CNET all in one place? First-generation aggregation was cool, but we haven’t really progressed much beyond it, though we’ve seen nuances, with personality added to aggregation (HuffPo) and some regional aggregation (Seattle Times, TBD.com). We’ve seen some good smartphone apps and a few new iPad apps. Come 2011, we’ll begin to see more News Everywhere experiences.

The first big one in the U.S. should be The New York Times. The Times will launch its metered pay system early in the year. If tech issues can be solved, expect paying customers to get access — aiming toward seamless, but likely with a few wrinkles — across devices, an intending-to-be-unified reader experience. The Times’ Martin Nisenholtz explained recently: “It’s not just about the website anymore. It’s about all of the brands where you can read the Times…it’s about the website, smartphones, the slates, iPad…it’s a hugely different world than it was five years ago.” So, the Times will say give us a single price, and we’ll let you read about you want of the Times where you want, recognizing you across digital experiences and — nirvana — allowing you to keep track of what you’ve shared and read, and with whom, without you having to recall whether you sent that story to your best buddy on your iPhone.

I’ve called that approach All-Access, and I think it’s the news industry version of TV Everywhere. So far, the best example of all-access pricing is the Financial Times, upon whose experience the Times’ model is built. Its “newspaper + online” top-of-the-line subscription allows full digital access plus the paper for one price.

The Everywhere notions seem friendly — and they have to be consumer friendly to be successful — but they’re actually quite darwinian. How many entertainment and news brands will we pay for? Only a handful, probably, especially at premium rates. So in the news business, that battle means only a few brands win the reader revenue sweepstakes, unless a Hulu-for-news proposition (AP’s digital rights clearinghouse expanded; a second life for Rupert Murdoch’s Alesia?) succeeds big-time.

To win, news companies will have work on the principle of the Field Theory. No, not the unified field theory, though unification of message and of service is fundamental. It’s the Sally Field Theory, which you remember the 1984 Oscars speech: “I’ve wanted more than anything to have your respect…I can’t deny the fact that you like me, right now, you like me!” Well who wants renewed respect than newsies? Who keeps talking about the trusted brand relationship that newspapers have long had with readers?

If news companies want to “own” the news customer (and be able to mine his data deeply), then they, large or small, newly minted or history-encrusted, have to bring their games to a new level. For the Times (or the Journal), the current breadth of content may be sufficient, if the execution manages to bring a little delight of ubiquity to paying subscribers.

For local news companies, the bar is probably a different one. Yes, they’ll have to put their tech development in high gear (many are woefully behind on tablet apps, just as the devices explode under this year’s Christmas trees), but they’ll also have to up their local value proposition. That means not just repurposing their own staff’s local news output, but really reaching out to community blog aggregation, broadcast partnership, working Yelp-like guide magic (probably through partnership) and/or creating a new level of digitally enhanced local shopping experiences. It’s unclear how much limited local news across devices is worth to news consumers.

News Anywhere, or unified news, or All-Access, whatever we want to call it, demands the singular focus, product development and messaging that Netflix, HBO, Comcast, and Facebook are bringing to it. Those are all skills that have been problematic in the news industry. Yet, here we are, in a new age, in a mobile news age about to unfold, giving the journalism, and journalists, another chance to get it right.

November 04 2010

14:00

The Newsonomics of Kindle Singles

[Each week, our friend Ken Doctor — author of Newsonomics and longtime watcher of the business side of digital news — writes about the economics of the news business for the Lab.]

Maybe the newspaper is like the old LP — you know, as in “Long Play.” It may be a 33 1/3, though it seems like it came out of the age of 78s sometimes, a relic of the post-Victorian Victrola age. It is what it is, a wonderful compendium of one day in the life (of a nation, a city, a village), a one-size-fits-all product, the same singular product delivered to mass volumes of readers.

In the short history of Internet disintermediation and disruption of the traditional news business, we’ve heard endless debate of the “the content and the container,” as people have tried to peel back the difference between the physical form of the newspaper — its container — and what it had in it. It’s a been a tough mindset change, and the many disruptors of the world — the Googles, the Newsers, and the Huffington Posts, for instance — have expertly picked apart the confusions and the potentials new technologies have made possible. The news business has been atomized, not by Large Hadron Colliders, but by simple digital technology that has blown up the container and treats each article as a digestible unit. Aggregate those digestible units with some scheme that makes sense to readers (Google: news search; Newser: smart selection and précis; HuffPo: aggregation, personality and passion), and you’ve got a new business, and one with a very low cost basis.

None of this is a revelation. What is new, and why I re-think that context is the advent of Kindle Singles. The Lab covered Amazon’s announcement of less-than-a-book, more-than-as-story Kindle Singles out of the chute a couple of weeks ago. Josh Benton described how the new form could well serve as a new package, a new container, for longer, high-quality investigative pieces, those now being well produced in quantity by ProPublica, the Center for Investigative Reporting (and its California Watch), and the Center for Public Integrity. That’s a great potential usage, I think.

In fact, Kindle Singles may open the door even further to wider news business application, for news companies — old and new, publicly funded and profit-seeking, text-based and video-oriented. It takes the old 78s and 33 1/3s, and opens a world of 45s, mixes, and infinite remixes. It says: You know what a book is, right? Think again. It can also say: You know what a newspaper is, right? Think again. While the Kindle Singles notion itself seems to have its limits — it’s text and fixed in time, not updatable on the fly — it springs loose the wider idea of publishing all kinds of new news and newsy content in new containers. Amazon is trying to define this strange new middle, with the Kindle Singles nomenclature, while some have used the term “chapbook” to describe it. We’ve got to wonder what Apple is thinking in response — what’s an app in Kindle Singles world? What’s a Kindle Single in an apps world? It’s not a book, an article, a newspaper, or a magazine, but something new. We now get to define that something new, both in name, but most importantly in content possibility.

What it may be for news organizations is a variety of news-on-demand. Today, we could be reading tailored and segmented sections on the election, from red and blue perspectives, from historical perspectives, from numerical perspectives. Today, we in the Bay Area could get not just a single triumphant San Francisco Giants celebratory section, but our choice of several, one providing San Francisco Giants history, one providing New York Giants history, one looking at the players themselves; the list goes on and on. More mundane, and more evergreen commercial topics? Job-hunting, job-finding, job-prep guides, tailored to skills, ages, and wants? Neighborhood profile sections for those seeking new housing (pick one or several neighborhoods, some with data, some with resident views, others tapping into neighborhood blogs). It’s endless special sections, on demand, some ad-supported, some not; a marketer’s dream. Some are priced high; some are priced low; some are free and become great lead generators for other digital reader products.

A few recent initiatives in the news business news lend themselves to Singles thinking. Take Politico’s newly announced topical e-newsletters. Take Rupert Murdoch’s notion of a paid-content portal, Alesia, which had within the idea of mixing and matching content differently, until its plug was recently pulled. Take AP’s new rights consortium, a venture that could build on this approach. Again, endless permutations are possible.

Who is going to come up with the ideas for the content? Well, editors themselves should have their shot, though one-size-fits-all thinking has circumscribed the imagination of too many. Still, there are hundreds of editors (and reporters and designers and copy editors) still in traditional ranks and now employed outside of it capable of creating new audience-pleasing packages. Some will work; some won’t. Experiment, and fail quickly. The biggest potential, though? Letting readers take open-sourced news content and create packages themselves, giving them a small revenue share, on sales. (Both the Guardian and the New York Times, among others, have opened themselves up for such potential usage.) Tapping audiences to serve audiences, to mix and match content, makes a lot of sense.

Why might this work when various little experiments have failed to produce much revenue for news companies, thinking of Scribd and HP’s MagCloud? Well, it’s the installed bases and paid-content channels established by the Amazons (and the Apples). They’ve got the customers and the credit cards, and they’ve tapped the willingness to pay. They need stuff to sell.

For newspaper companies, it’s another chance to rewrite the economics of the business. The newsonomics of Kindle Singles may mean that publishers can worry less about cost of content production, for a minute, and more about its supply. Maybe the problem hasn’t been the cost of professional content, but its old-school one-size-fits-all distribution package. That sports story or neighborhood profile could bring in lots more money per unit, if Singles notion takes off.

One big caution here: Singles thinking leads us into a more Darwinian world than ever. In my Newsonomics book, I chose as Law #1: “In the age of Darwinian content, we’re becoming our own and each other’s editors.” Great, useful content will sell; mediocre content will die faster. Repackaging content pushes the new content meritocracy to greater heights. As we approach 2011, news publishers are hoping to hit home runs with new paid content models. Maybe the future is as much small ball, hitting a lot of one-base hits, of striking out as often — and of Singles.

September 09 2010

14:00

The Newsonomics of public radio’s Argonauts

[Each week, our friend Ken Doctor — author of Newsonomics and longtime watcher of the business side of digital news — writes about the economics of the news business for the Lab.]

Overnight, it seems, journalism has been transformed from a daily grind to an heroic quest. Rupert Murdoch has dubbed his adventure to get readers to pay for tablet (and other) content Alesia (after a Roman/Gauls battle) and now public radio formally launches Project Argo. Ah, journalists pursuing the golden fleece. Forget Woodstein — the pursuit of journalism itself is now an against-all-odds mythic trip against budget monsters and business model slayers.

If last year was the year of massive cutting, this is the year of new news creation popping up from unusual quarters. AOL’s Patch is probably the biggest hiring agent, with more than 400 new full-time jobs covering local communities. Sites like TBD.com and Bay Citizen are crafting new products and strategies and hiring dozens of journalists. Now Argo pushes forward, in a quest to stick a new flag of public media in terra incognita, and is hiring journalists in the process.

Argo is intended to bring a high level of attention to hot button topics, covered from a regional perspective. “We want to be the best means of authoritative coverage,” NPR Digital Media G.M. Kinsey Wilson told me recently. [We want] to be the top-of-mind choice for issues like immigration [now covered out of L.A. by KPCC with the Argo site Multi-American].”

Coverage is handled by the increasingly familiar reporter/blogger/curator, finding the most relevant coverage for readers. Largely providing a single new full-time position for each new site, “hosts” come from some impressive reporting backgrounds, like WBUR’s Carey Goldberg, former Boston bureau chief of The New York Times, and Rachel Zimmerman, former health and medicine reporter for The Wall Street Journal. Much of the content — and there’s an impressive amount at launch — is text, not audio.

At first, Argo seems hard to put in context. It’s public radio becoming public media becoming locally topical, but in ways that can inform more than local audiences — which we used to think of as public radio listeners, but who are now public media listeners and readers. Got that?

I’ve talked to a number of people in the emerging public media landscape — a fairly merry lot of Argonauts and other dragon slayers who see lots of upside — so let’s take a look at the emerging newsonomics of projects like Argo.

By the raw numbers, Argo is a $3 million investment. That’s not much by traditional journalism standards, but in this day and age, it wins headlines, like the minor economic development miracle of a new big-box store being covered on the Metro front. The money comes both from a foundation — the omnipresent Knight Foundation at $1 million — and from the Corporation for Public Broadcasting at $2 million.

That Knight funding reminds us of the good that’s still being done by the once dependable profits of newspaper companies, as Knight Ridder funding built one of the 25 foundations in the country, one that has been instrumental in seeding sprouts of the new new journalism.

That CPB funding reminds us that our tax dollars have been supporting news for more than four decades now, even as the debate rages abstractly on whether it’s a good idea to have “government” in the news business. NPR’s news effort — supported by members, philanthropists like Joan Kroc and yes, our tax dollars — makes a pretty good case that some government funding is a good idea, especially if we compare NPR radio news to what is elsewhere generally available in the growing desert of commercial radio news coverage.

Argo itself is 12 sites, produced by 14 public radio stations (two sites are jointly produced), each specializing in major topics like education, health, immigration, and ocean health, and exploring that topic regionally. Journalists are hired by individual public radio stations, each of which applied for the funding. The initial funding is intended to sustain the sites through the end of next year — and to provide “prototype products,” according to Wilson.

So that funding is one of the first things that tells us about the business of this effort. Like Silicon Valley startups, the effort is about building a product that seems to meet a clear audience need, building that audience — and then finding a sustainable business model. That’s what has built companies for decades in the valley, and it’s in contrast to how much of the journalism business has long gotten funded.

Looking under the covers, though, here are three more things to watch about the emerging economic model underneath Argo:

  • It’s local and vertical. In the conundrum that the web has been for newsies, publishers often felt compelled to choose “local” or “vertical,” the fancy term for topical. Of course, readers’ concerns encompass both, and an education site that focuses on local education (such as Minnesota Public Radio’s Argo site On Campus) creates double value and may multiply audience. Even though, it’s “local,” just as WBUR’s CommonHealth, it will find national audiences as well.
  • It’s built for networking. Public radio used to a fairly one-way street, with national NPR and then Public Radio International and American Public Radio essentially licensing or syndicating shows to local stations, of which there are more than 250. Now built on increasingly flexible technologies like NPR’s emerging API and PRX’s exchange, local stations can increasingly both syndicate their own work, Argo-funded and other, to each other — and pick up other stations’ work more easily. In a sense, we see an alternative wire in creation, especially as the Public Media Platform goes forward.
  • It builds on public radio stations’ local news push. A number of stations represented in Argo have also begun building out their local/regional/statewide news presences. KQED, in the Bay Area, which is launching MindShift through Argo, just hired eight new news staffers as it launched KQEDNews.org (Good piece by MediaShift’s Katie Donnelly on the initiative and its context.) So in KQED’s case, as in WBUR’s, KPCC in L.A.’s, and Oregon Public Broadcasting’s, the topical initiative receives more play due to the expanded news reach — and the expanded news reach gets more public notice because of the new topical coverage.

Each of those factors are multipliers, multipliers of public radio’s emerging digital news business. They multiply audience. They multiple the ability to get members and membership income. They multiply sponsorship opportunities, the “advertising” of public radio. That’s on the business level. On the journalism level, public radio’s news values — the closest to newspaper’s traditional ones — get to flex their muscles, another early test of just how far public media wants to go in filling the yawning local news vacuum.

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