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July 21 2011

15:30

The newsonomics of U.S. media concentration

The rise and potential fall of Rupert Murdoch is a hell of a story. It is, though, closer to the Guardian’s Simon Jenkins’ description Tuesday, “not a Berlin Wall moment, just daft hysteria.” Facing only the meager competition of the slow-as-molasses debt-ceiling story, the Murdoch story managed to hit during the summer doldrums. Plus it’s great theater.

Is it just imported theater, though? We have to wonder how much the cries of “media monopoly” will cross the Atlantic. Is there much resonance here in the States for the outrage about media power in the U.K.? Will the sins (its newspaper unit now being called to account by a Parliamentary committee for deliberately blocking the hacking investigation) of News International impact its cousin, Fox Television, the one part of its U.S. holdings regulated directly by government — or can it build a firewall between the different parts of News Corp.? (See “New News Corp. Strategy: Become Even More of an American Company.”)

Certainly, the tales of News International’s ability to strike fear in the London political class are chilling. Our issues in the U.S., though, are largely different. Both come down to who owns the media, and what we need in the diversity of news voices.

The question of media concentration here is tricky, complex, and a profoundly local question. Yes, there are national issues — but the forces of cheaper, digital publishing and promise of national and global markets easily reached by the Internet have spawned much more competition on a national level.

As to what kind of local reporting we get, we see powerful forces at work, shaping who owns what and how much. Likely, we’ll see some News Corp. fallout in FCC debates now re-igniting in and around Washington, D.C. — as the fire of regulating media burns more brightly here, even as Ofcom, the British regulator, grapples with similar issues.

That said, the question of media concentration, or what I will call the newsonomics of U.S. media concentration, will be fought out on two battlegrounds in the U.S. One is at the regulatory level, as the FCC looks at cross-ownership and the cap on local broadcast news holdings by a single national company, like News Corp., and may take into account its U.K. misdeeds. (Especially if the 9/11 victim wiretapping claims are borne out.) Second, and probably more important, sheer economic change is rapidly re-shaping who owns the news media on which we depend. The fast-eroding economics of the traditional print newspaper business are changing the face both of competition and of journalistic practice faster than any government policy can affect.

So this is how our time may play out. Smart, digital-first roll-ups align with massive consolidation.

First, let’s look at the print trade, at mid-year. The numbers are awful, and getting no better. We’ve seen the 22nd consecutive quarter of no-ad-growth for U.S. dailies, the last positive sign registered back in 2006. Further staff reductions, albeit with less public announcement, continue at most major news companies. This week, Gannett — still the largest U.S. news company — reported a 7-percent ad revenue decline for the second quarter, typical among its peers. Its digital ad revenues were up 13 percent, a slowing of digital ad growth also being seen around the industry.

We see a strategy of continuing cost-cutting across the board, with a new phenomenon — roll-up (“The newsonomics of roll-up“) — trying to play out.

Hedge funds — which bought into the industry through and after 14 newspaper company bankruptcies — are having their presence felt. Most recently, Alden Global Capital, the quietest major player in the American news industry, bought out its partners and now owns 100 percent of Journal Register Company. Alden, with interests in as many as 10 U.S. newspaper chains, apparently liked the moves of CEO John Paton. Paton’s digital-first strategies have more rapidly cut legacy costs than other publishers’ moves, and moved the needle more quickly in upping digital revenues.

No terms were announced, but Paton says “all its lenders were paid in full.” That would be a qualified success, given the bath everyone involved in the newspaper industry has taken in the last half-decade.

In JRC’s case, we’d have to say the push of hedge funds for faster change has been more positive than negative. Pre-bankruptcy, it was derided for its poor journalism and soul-crushing budgeting. Under Paton, who has brought in innovators like Arturo Duran, Jim Brady, and Steve Buttry, the company is trying to reinvent new, digital-first local, preserving local journalism jobs as much as possible. A work very much in early progress.

You can bet that Alden’s move is just one of its first. Sure, as a hedge fund, it may just be getting JRC ready to sell; hedge funds don’t want to be long-term operators. Before that happens, though, expect the next shoe to drop: consolidation.

JRC owns numerous properties around Philly, and a roll-up with Greg Osberg-led (and Alden part-owned) Philadelphia Media Network, has been talked about. Meld the same kind of synergies, and faster-moving print-to-digital strategies of Paton with Osberg’s new multi-point, Project Liberty plan, and you have a combined strategy. Further combine the operations into a single company — removing more overhead, more administration, more cost — and you have a better business to hold, or sell, or still further combine with still more regional entities.

It’s not just a Philly scenario.

In southern California, the question is how the three once-bankrupt operations — Freedom Communications, MediaNews’ Los Angeles News Group and Tribune’s L.A. Times (still not quite post-bankrupt, but acting like it is) — will mate. Over price, talks broke down about merging Freedom and MediaNews (both substantially owned by Alden; see Rick Edmonds’ Poynter piece for detail). Yet, everyone in the market believes consolidation will come. Now with Platinum Equity, another private equity owner, putting its San Diego Union-Tribune back on the market just two years after buying it for a song, we could see massive consolidation of newspaper companies in southern California.

Media concentration, perhaps in the works: Southern California, between L.A. and San Diego, contains at least 21 million people — or a third of the total population of the U.K. Philly and Southern California may among the first to consolidate, but the trends are the same everywhere.

So this is how our time may play out. Smart, digital-first roll-ups align with massive consolidation. It’s time to get our heads around that. That won’t necessarily mean that Alden, or other hyper-private owners, keep the new franchises. Their goal probably is to sell. But to whom, with what sense of public interest?

Which brings us back to broadcast, to which newspaper people give much too little shrift.

Both those in the old declining newspaper trade and those in the mature and largely flat broadcast trade (as an indication, Gannett’s broadcast division revenues grew to $184.4 million from $184 million in the second quarter) are beginning to figure the future this way: there may only be enough ad revenue in mid-metro markets (and smaller) to maintain one substantial journalistic operation. Not one newspaper and one local broadcaster. But, one, presumably combined text and video, paper and air, increasingly digital operation.

So, finally, let’s turn back to the FCC. The Third Circuit Court of Appeals just returned cross-ownership regulations back to the FCC, largely on procedural (“hey, you forgot the public input part”) grounds. In addition, it will likely soon take up the national cap on local broadcast ownership. (Good sum-up of FCC-related action by Josh Smith at the National Journal.)

Which brings us back to the News Corp story. The national cap — how much of the U.S. any one national company can serve with local broadcast — is 39 percent. Fox News does that with 27 stations, and, of course, has lobbied for more reach. So, the media concentration issue may play out as the cap is further debated, and as cross-ownership — a News Corp. issue in and around New York/New Jersey — returns as well. Will Hackgate’s winds blow westward, as local broadcast news concentration comes up again?

Though it may be shocking to many newspaper people, though, local TV news is a major source of how people get the news. Some 25 to 28 million viewers watch local early-evening or late-evening TV news, according to the Project for Excellence in Journalism. That compares to about a 42-million weekday newspaper circulation, so those numbers aren’t quite apples to apples. In my research for Outsell, I noted that local survey data indicated that reliance on TV news equaled that of newspapers.

As Steve Waldman’s strong report for the FCC pointed out, local TV news is “more important than ever” — but thin on accountability reporting.

So while much of the media concentration questions centers on print, local broadcast ownership, and direction of news coverage, matters a lot.

Combine that local concentration — 39 percent or more — with the sense that the market may only support single journalistic entitities and we’re back to the theme of media concentration, perhaps on a scale hitherto unseen.

A declining local press, with signs of impending roll-up. Stronger local TV news, weaker in accountability reporting, and pushing for more roll-up. Winds of outrage wafting over the Atlantic. Regulatory breezes gaining strength.

These are powerful forces colliding, and in the balance, the news of the day won’t be quite the same.

July 18 2011

16:00

Alden Global Capital drops a shoe: Is the Journal Register acquisition prelude to more consolidation?

On Thursday, Journal Register Company announced that it had been acquired by Alden Global Capital, a secretive hedge fund that specializes in “distressed opportunities,” such as companies emerging from bankruptcy — including newspaper groups. The acquisition may foreshadow additional moves by Alden, which is interested in two strategies to add value to its investments: (a) it wants its newspaper holdings to aggressively develop digital capabilities and revenues, and (b) it wants to see consolidation (mergers) among newspaper groups.

In its capacity as a distressed-opportunity specialist, as I detailed here in January, Alden acquired stakes not only in JRC, but also in MediaNews Group, Philadelphia Media Network, Tribune, Freedom Communications, and the Canadian newspaper group Postmedia Network . Among publishers that avoided bankruptcy filings, it has stakes in A.H. Belo, Gannett, McClatchy, Media General and Journal Communications. (I detailed those investments in this post in March.) In addition to its newspaper holdings, Alden has other media investments, including in Emmis Communications and Sinclair Broadcast Group. Only the investments in public companies are detailed in SEC filings — they add up to about $210 million in media holdings. Together with the non-public investments in JRC, MediaNews, Freedom, Postmedia, and Philadelphia, Alden may have as much as $750 million of its total assets of $3 billion invested in newspaper and broadcast media properties.

At the time of that January post, Alden had just asserted itself at MediaNews Group by shaking up the executive suite and naming three new directors to the seven-member board. (Disclosure: I spent 13 years as a publisher at a MediaNews Group newspaper.) That move was important because it enabled Alden to use MediaNews as a platform from which to drive consolidation in the still-fractured U.S. newspaper industry. (The largest player, Gannett, owns only about 13 percent of the industry in terms of daily circulation.) Under SEC rules, by taking a position on the board, Alden was no longer allowed to speculate in MediaNews stock; hence, their assumption of board seats signalled an intent to use their MediaNews holdings strategically rather than speculatively. Until the JRC acquisition, Alden had not done the same at any of the other firms in which it had invested.

The first strategic move MediaNews made after the January shakeup was to make a bid for Freedom Communications, publisher of the Orange County Register and other papers and owner of broadcast properties, which put itself up for sale in March. Alden is believed to own about 40 percent of Freedom, a stake similar to its MediaNews holdings, but by not taking board seats, it had remained on the speculative side of the fence at Freedom, and therefore could not influence Freedom’s choice of an acquisition partner. But clearly, the ideal marriage from Alden’s point of view would be between Freedom and MediaNews.

Last month, the Wall Street Journal reported that talks between MediaNews and Freedom had broken down, with a Freedom valuation of about $700 million at issue. Other suitors, including Tribune (in which Alden has a stake), may be in the picture, but with its relatively debt-free post-bankruptcy structure, and its heavy presence in the California newspaper market, MediaNews was in the strongest position in the bidding for Freedom. As Denver-based Westword (which keeps a close watch on MediaNews) said about the talks breakdown, “expect MediaNews Group and Freedom to sit down again in the coming months despite the current state of negotiation interruptus.”

Meanwhile, the Alden takeover of JRC gives it a second operating platform for its consolidation goals. Its JRC investment is now strategic rather than speculative as well; it can call the shots. Clearly, it likes JRC CEO John Paton, one of the prime exponents of a “digital first” strategy. Paton has also had a relationship with Alden’s Canadian interest, Postmedia, including a spot on its board and a role in recruiting its CEO, Paul Godfrey.

Since Paton took over JRC as it emerged from bankruptcy in 2009, he has built a reputation as a visionary by replacing old proprietary systems with open source software and cloud-based services. In 2010, the company said it earned $41 million in cash flow and increased digital revenues about 70 percent.

JRC, with Alden backing, could now become an east-coast consolidator by scooping up other newspapers and newspaper groups — perhaps even acquiring the East Coast holdings of MediaNews, papers in Pennsylvania and New England which, although dear to the heart of chairman Dean Singleton, are mostly a distraction to its Denver-based, California-centric holdings.

Obviously, the Philadelphia newspapers could be part of the reshuffle/consolidation, and other owners, including Gannett, could join the fray. (Gannett already is partnered with MediaNews in California.) It’s not hard to imagine an east-west strategy, with newspaper properties flowing into a western-U.S. consolidation led by MediaNews and an eastern grouping led by JRC. Even without mergers, there are places where Alden could encourage strategic partnerships between companies it owns or has invested in — for example, between JRC and the Philadelphia newspapers.

Shira Ovide of the Wall Street Journal noted, in response to the Alden acquisition of JRC, that there hadn’t been much action in the newspaper acquisitions market for some time. But the market could be loosening up. During the recession and beyond, owners held on, remembering the inflated values of the 1990s and early 2000s. It’s now clear both that those days will not come back and that Alden has its fingers on key factors that could build value: digital first, and consolidation. And Alden seems to have a nice cash pipeline.

Nostalgia for “local newspaper ownership” notwithstanding, the market will push owners into sales and mergers until there are just a few major owners of newspapers across the country. Even if this happens, daily print publication may still not be sustainable in many markets for more than a few years — but that’s another topic. The gamble for Alden and others is to accumulate a stake in a consolidated newspaper industry in the hopes that its local brands can retain (or regain) value as mainly digital enterprises.

Still, neither JRC’s digital-first focus nor industry consolidation strategies are magic bullets. Alden’s money chases risk in order to earn high rewards, and there’s a lot of risk in this picture.

On the digital-first side, we’re still waiting to see if newspapers can catch up and increase their share of the online ad market. JRC may have grown its online revenue by 70 percent, but in 2010 digital revenue for the daily newspaper industry as a whole grew just 10.9 percent, and still showed less online revenue than it had in 2007 ($3.042 billion in 2010 versus $3.166 billion in 2007). And much of what newspapers count as digital revenue is sold in print-dominated packages, not as pure online advertising.

As for consolidation, as I noted in a comment to Ken Doctor’s March post, “The Newsonomics of roll-up,” we could be looking at a classic industry mop-up operation — where the consolidator knows it’s all downhill from here, but is able to buy assets so cheaply that just milking them until they run dry produces a nice return. I wrote at the time in that comment:

While newspaper values have bounced back from rock bottom, you can still buy newspaper assets for a fraction of what they were worth at the peak six years ago (20 to 25 cents on the dollar, at most, depending on the company), with cash-flow paybacks in the range of 5-6 years, plus the consolidation benefits, plus, in many cases, valuable real estate that can be flipped. And with some luck, a digital spinoff or residual asset a few years down the road. So without much risk, maybe you can double your money over five years. (And if you’re really lucky, the economy keeps improving and you can find a bigger sucker and double your investment in just in a couple of years.) I believe that’s the Alden Global strategy. They have put their people on the board at MediaNews (and nowhere else) in order to use it as a launching platform for consolidation.

Let me temper that with the benefit of the doubt. John Paton says that Alden believes in digital-first. But if that strategy doesn’t begin to deliver the returns Alden expects — at JRC, MediaNews, or any other media outfit where Alden chooses to exercise the influence that comes with its ownership stake — the mop will come out of the closet and we’ll see a consolidation that’s driven purely by financial strategists at Wall Street firms, with no particular concern for journalism, digital or otherwise.

April 28 2011

15:00

The newsonomics of story cost accounting

Editor’s Note: Each week, Ken Doctor — author of Newsonomics and longtime watcher of the business side of digital news — writes about the economics of news for the Lab.

What’s a story worth?

Last week, I looked at a single investigative story (California Watch’s “On Shaky Ground“), and we saw the tab of half a million dollars for a 20-month-long tale of sleuthing. What about that ordinary daily story, quotidian journalism as we know it — the grinding out of less eventful articles, the kinds of things that keep us informed but don’t offer epiphanies? How much does it cost, and how much does that matter to the future of the news business?

It’s not an academic question. This week, McClatchy added to the long line of down financial reports, telling us that it was down 11 percent, year over year, in ad revenues and 9 percent in overall revenues, for the first quarter. That announcement follows on from similar reports from The New York Times Co., especially its regional properties, and Gannett. The U.S. news industry is extending its unwanted record: 21 straight quarters of revenue down quarter to quarter. That’s a lost half-decade.

Add up those down revenues and the need to maintain profitability — for public or private owners — and there’s but a single answer: cut costs. Certainly, the industry has cut out major costs in the last three years, but cost-cutting is slowing, if you look at the company reports. The New York Times’ costs were flat in the first quarter, Gannett’s down 0.9 percent and McClatchy’s down 6.5 percent. That’s in large part due to rising newsprint prices, making it harder to get costs more appreciably down. With those continuing revenue declines, though, expect more cost-cutting. It’s a given.

So, let’s ask about that daily story. What’s it cost?

Of course, we’ve never looked at it that way. We’ve hired people, told them to write, at times monitoring their production, but rarely taking a look at the cost of what they’re producing. Given the pressures of the day, given the Demand Media model and given the predilection to start counting whatever can be counted (“The newsonomics of WaPo’s reader dashboard 1.0“), story cost accounting is inevitable.

In fact, it’s already started. Let’s take a brief look at what is bound to become a bigger topic in the months ahead, the newsonomics of a single story.

Clark Gilbert, Salt Lake’s dean of disruption, is getting into the nitty-gritty of retooling editorial content production, top to bottom, and that includes getting a handle on differing costs of content. Gilbert is a key part of the team that is transforming the media properties of the daily Deseret News and leading local TV and radio stations KSL, all owned by the Church of Jesus Christ of Latter-day Saints, better known as the Mormon Church. Last August, Gilbert announced one of the most major restructurings in journalism, making major staff cuts — a prelude to the re-architecting now being done. That restructuring includes the launching of Deseret Connect, an initiative to round up pro-am user-generated content from around Utah, and around the globe.

The new CEO of Deseret Media will soon be able to tell you exactly how much articles cost him. He’ll specify the differing price points of local, proprietary content, of AP content, of a blog post written halfway around the world, and lots more.

For now, he draws upon his experience as a Harvard Business School prof and strategic consultant. From that career work, he estimates the following, general cost metrics for the content offered by news companies in print and online:

  • $250-$300 per staff-written story;
  • $100 per stringer story;
  • $25 per Associated Press story;
  • 5-12 for “remote” stories, largely written by the emerging class of bloggers

“You better know your cost per story,” he says. “That’s the kind of rigor you need.”

As focused as he is on building digital ad revenues, he makes the point directly: “You have to work both sides [revenue building, cost reduction] of this.”

“It doesn’t mean I’m not willing to pay for content,” says Gilbert. “I’m paying a boatload for stories that are a commitment to my audience.” It’s a straightforward strategy: If you are going to pay a boatload for some stuff, you better pay a lot less for other stuff.

Still, those numbers are bound to chill many a journalist. You think posting reader metrics in newsrooms is still a point of contention — wait ’til story cost accounting becomes mainstream. And it will. It’s just simple manufacturing, and like it or not, that’s what the news business has long been. Manufacturing, with lots (New York Times, Wall Street Journal) of quality added or with (insert your favorite rag here) just enough to draw ads. News creation used to be a sunk cost, with headcount a small and usually polite battle between editors and publishers. That was in stable times. In these times, knowing business drivers, down to the dollar, is going to be part of the new world.

The metrics-driven thinking may have been first demonstrated by Demand Media, with its $10, $25, and $50 stories (“The newsonomics of content arbitrage“), but once opened, that Pandora’s Box won’t be closed.

Clark Gilbert is early in the game, but others are taking a parallel cost-conscious approach.

John Paton, CEO of the new, continuous-revolution Journal Register Company, breaks it down differently, but is highly cost-aware.

“We’re not looking to save money on local, professional content,” Paton told me this week. Notice the emphasis on “local” and “professional.” Like many others, Journal Register is beginning to round up hundreds of local bloggers (as Patch joins that club), who will be largely unpaid.

What Paton emphasizes, though, in his cost-of-content analysis, is the 60 percent of JRC’s content — across print and digital — that is national. He’s done a careful counting of what’s in his products, and says that while 40 percent is local (above average for dailies, he says), 60 percent is national. So Project Thunderdome, newly headed by D.C. veteran Jim Brady, has put a bullseye on that content. The notion: Lower the cost, and where possible, raise the quality of national content. That thinking is behind JRC’s recent deal with TheStreet.com, which is now providing its national business news. It’s a revenue share, with JRC gaining national revenues. In addition, says Paton, it has increased its local business content-related revenue, given both the new inventory of ad impressions made possible and the quality of TheStreet.com content. That’s a model Paton intends to extend to other non-local content.

Further, he’s taken dead aim at the cost of getting content through the mechanics of a newsroom. Saying that about half of U.S. editorial staffs are engaged in producing content for publication — not creating it — he’s focused on changing that ratio. Instead of five of ten journalists engaged in production, he’s aiming for two of ten, to be accomplished through centralization and templating of the production functions. “Then, two or three more of the ten can create content,” he says.

Both plans will, in effect, reduce the cost of content overall. And, as with Clark Gilbert’s philosophy, the intent is to invest in unique, local, proprietary content, even though it’s far more expensive.

Let’s consider one more take on story cost accounting. As CEO of Huffington Post, Betsy Morgan pioneered the unique brand of higher-end, often personality-driven aggregation that distinguished the site’s offerings. Out of that experience, and in her new role as CEO of Glenn Beck’s The Blaze site, she’s evolved her own metrics. They divide nicely into thirds.

  • One-third original, professional content, largely reported journalism.
  • One-third voice and opinion.
  • One-third aggregation, or to use the updated term, “curation,” as editors aggregate, honing off-site story selection given their understanding of their unique audiences.

Morgan tells me that “the thirds” form both an audience strategy and a cost strategy. Clearly, as the venture-backed HuffPo began its life, it watched its dollars very carefully. That meant that curation wasn’t just an audience-pleasing idea, of course, but a cost-saving one, as bloggers (at least then!) willingly forked over content in exchange for play and recognition, not money.

Going forward, the “thirds strategy” offers another twist on Clark Gilbert’s and John Paton’s (and Arianna Huffington’s) strategies. Obviously, you don’t pay for the curation part, other than for the technologies or smaller staff to handle it. You can pay for some of the voice and opinion, but there’s a hell of a lot of it you can get for free or cheap. And, once again, you concentrate your costs of content on the high end — original, professional, largely reported journalism.

The new AOL/HuffPo’s been doing that with pro hire after pro hire. Morgan herself is doing it, as recently as this week with the hiring of former Denver Post columnist David Harsanyi.

Add it all up, and it’s a new cost structure for the craft of journalism. As with all metrics, the good or bad they inspire depends on who is using them. What’s clear is that those news outfits — local, national or global — which only concentrate on paying staff, like in the old days, will find themselves out-strategized by those who take the blended approach.

Is it all about thirds? No, but it’s a good place to start.

I think of it as a pyramid. Original content — content that distinguishes news brands — is at the top, and, yes, is the most costly. At the bottom is clearly aggregation, because as Morgan points out, “[readers] can’t easily find and read what’s of interest to them.” Then, there’s the middle third or so. For regional news companies, that includes hyperlocal bloggers and subject-specific (transportation, public health, sports) experts; for national sites, it’s non-staff “contributors” of differing skills and costs. That third is quite open to innovation.

It’s a great whiteboard exercise, at least, for anyone in the news business. Pass the marker, please, and work the pyramid.

March 29 2011

20:00

What’s Project Thunderdome, you ask? Inside Jim Brady’s new job at Journal Register Company

So Jim Brady, formerly of AOL, washingtonpost.com, and TBD, is now of the Journal Register Company. That’s big news — and not only because it had been an open question where Brady would land after he left TBD in November. As John Paton, JRC’s CEO, put it in a release announcing the news: “The debate of bloggers vs. journalists or citizen journalists vs. professionals is now over. The new business models of news demand we understand and incorporate both.”

Brady “will immediately be responsible for Project Thunderdome,” the release notes, which is an initiative that is — besides being, obviously, one of the most delightfully named projects in the news innovation world — “Journal Register Company’s plan for engaging audience and creating content across all platforms and geographies.”

But what is Thunderdome, exactly? I talked to Brady and Jon Cooper, JRC’s vice president for content, to learn more.

Essentially, they told me, Thunderdome is an attempt to take Journal Register’s current collective of media properties — community newspapers joined at the top by a corporate brand — into an interwoven network. While the project’s ultimately about content (both improving its quality and expanding it), it’s also about production practices: It’s trying, in particular, to create uniform standards across the organization when it comes to content management. Ultimately, Thunderdome will mean a redesign for JRC’s digital platform as well as its print platform, giving JRC’s papers — in print and especially (per JRC’s “digital first, print last” ethos) online — a standard look and feel.

Essentially, Journal Register is “building a news system,” Brady puts it, “as opposed to trying to retrofit one that came out of a different time.”

On the one hand, Thunderdome is about systematization and centralization — and the production-side efficiencies that come from them. “Right now, we operate anywhere from 6 to 8 [CMSes], depending on who you talk to,” Cooper notes — and the reason that number varies is that “we have places that don’t actually have a CMS.”

Those CMS-less properties — gird yourselves, techies — use a Windows folder structure to manage their content. Imagine erasing a coworker’s content, Cooper notes, “because you happen to name your story ‘Fire,’ and I had named my story ‘Fire,’ and I copy over yours.”

So that’s one side of it. But Thunderdome is also about the categorization of content. Much of the efficiency JRC hopes will be gained from the new system will come from the bifurcation of local content and what it calls “common” content — in other words, from distinguishing between information that requires feet-on-the-street reporting and information can be provided by wire services or other more centralized sources. It’s the classic distinction between wire content and original, taken to the next level. So take, for example, content like stocks, weather, comics — things that a journalist might not define as journalism in the strictest sense, but which readers want as part of their news experience. Journal Register, across its 18 daily papers, does over 50,000 of those pages a year, Cooper told me, creating different products for different locations. Sometimes that’s necessary, of course (the weather in Connecticut being different from the weather in Michigan); often, though, it’s simply redundant — a waste of time and resources.

Thunderdome aims to establish a 40/60 — or even 50/50 — ratio of local content to common content. “JRC is a fairly large organization,” Cooper notes, “so we have a decent amount of power that we put behind a project like this.” As Brady puts it, the system will allow the papers “to spend their actual staff time covering local news and embedding themselves in the local community — which they have to do to make themselves successful.”

A big part of Brady’s job at JRC will be to figure out the specifics of that kind of production-side streamlining, determining, for example, content partners — JRC, yesterday, announced a financial-news-content deal with The Street — and staffing the Thunderdome effort with vertical content specialists. Another part of it will be figuring out the audience engagement side of the equation — to put to use the knowledge Brady gained at TBD. “That’s key to us,” Cooper says — “key to Thunderdome, key to our brand expansion, key to our current brands.” Brady’s work won’t just be about “providing leadership to our journalists,” he notes; it’ll also be about “working with our communities — our physical, geographic communities, but also our digital communities.”

Which all sounds eminently reasonable and, well, not Thunderous. So, then: What’s with that name? JRC’s CEO, John Paton, named the project, Cooper told me. When he’d visited The Washington Post, someone had talked about the paper’s digital center as “the Thunderdome” — and the name, both epic and tongue-in-cheek at once, came into play as a working title as Journal Register laid out its (also epically named) Ben Franklin Project. The project came out of the basic realization, Cooper says, that “we can’t wait for a unified CMS; we can’t wait for a unified technology to be in place. We have to make it happen sooner.”

It’s that kind of thinking that attracted Brady to Journal Register in the first place. When you’re looking for a new job, he notes, you’re looking at both “the size of the opportunity and the size of the challenge.” For Thunderdome, the size of both is “large.” “Folks have done production hubs; folks have done content bureaus or content sharing,” Cooper says. “But what we’re really looking to do is to empower local journalism. And part of that is to remove the roadblocks to small operations.”

Image by rachelbinx used under a Creative Commons license.

March 25 2011

19:30

Journal Register’s open advisory meeting: Bell, Jarvis, and Rosen put those new media maxims to the test

We watchers of media — analysts, theorists, pundits, what you will — make assumptions about journalism that have become, along the way, tenets: Openness and transparency will engender trust…. The process of journalism matters as much as the product…. Engagement is everything…. Etc. We often treat those ideas as general truths, but more accurately they’re simply theories — notions that speak as much to the media environment we’re hoping to create as to the one we currently have.

In that respect, one of the most interesting media outfits to watch — in addition to, yes, the Googles and Twitters of the world — is a chain of community of newspapers dotted along the East Coast. The Journal Register Company, which declared bankruptcy in 2009, has been attempting over the past year to reverse its fortunes with a “digital first” approach to newsgathering that involves a healthy does of New Media Maxim: It’s using free, web-only publishing tools whenever possible. It’s established an “ideaLab,” a group of innovation-focused staffers to experiment with new tools and methods of reporting and engaging with readers. It’s been sharing profits with staff. And it’s convened a group of new media all-stars to serve as advisors as its papers plunge head-first into “digital first.”

Yesterday, those all-stars — Emily Bell, Jeff Jarvis, and Jay Rosen — gathered in the newsroom of JRC’s flagship paper, Torrington, CT’s Register Citizen (home of the famous newsroom cafe, the community media lab, and, as of this week, a used bookstore), to talk innovation strategy with Journal Register staffers. The confab was literally an inside-out version of a typical, closed-door Advisory Board session: Rather than taking place in a closed-off meeting space, the conversation happened around a desk smack in the middle of the Register Citizen’s open, airy newsroom, with the clacking of keyboards and the clicking of microfilm reels and the general hum of journalism being done serving as soundtrack to the discussion.

Most importantly, the meeting was open to the public. Community members (twenty or so of them, including librarians, an assistant schools superintendent, a UConn professor, a state senator, and a representative from the Chamber of Commerce) sat in chairs loosely situated around the advisory board’s oblong desk. (The atmosphere was casual: “We have a bit of an agenda today,” Journal Register CEO John Paton said during his introduction, “but the advisory broad usually works best when it’s just talking about issues.”) And to accommodate the members of the paper’s virtual community, the meeting was also live-streamed, both on the Register Citizen site and on UStream (370 total views). Situated directly above the meeting area was a wall-mounted screen that streamed tweeted questions and comments about the proceedings — from JRC employees and the broader community — via the #JRC hashtag.

As Bell tweeted after the confab concluded: “Never quite been to a meeting like that before.”

I highly recommend watching the archived video of the discussion (above or here): Rarely do journalism’s wide array of interested parties — journalists themselves, business-side executives, academics, analysts, and, of course, community members — come together in such direct dialogue. The conversation that resulted is both telling and, I think, fascinating. But if “Read Later” you must, here are some broad — but, be warned, not even close to summative! — takeaways from the proceedings.

The tension between journalism-as-process and journalism-as-product

During the board’s discussion of engagement and transparency, Emily Olson, the Register Citizen’s managing editor, described a recent experiment in which the editorial staff asked the paper’s readers what they would like the paper to fact-check. The responses, she noted, weren’t gratitude at being asked to participate in the process, but rather sarcasm and indignation: “Why do we have to do your jobs for you? What are you getting paid for?”

While the table generally agreed that a more targeted question — “What do you want us to fact-check about X?” — might have been more effective in terms of eliciting earnest responses, Olson’s experience also hints at one of the broad problems facing news outlets that have so many new engagement mechanisms available to them: How do you serve a wide array of audience interest, not only in terms of content, but also in terms of presentation? How do you accommodate different “levels” of audience, not only when it comes to background information about stories, but also when it comes to the desire for participation? To what extent do people want to participate in the process of journalism, and to what extent do they prefer information that is simply presented to them?

“People,” of course, is anything but monolithic — and that’s the point. Some folks are thrilled, cognitive surplus-style, to have new opportunities to participate in the creative process of journalism. Others, though, want a more sit-back experience of news consumption. They don’t want here’s-how-we-got-the-story or here’s-how-you-can-help; they simply want The News, the product. If you’re a media outlet, how do you enable participation from the former group…without annoying the latter?

The power of data

In a post-meeting discussion, the table agreed on the power of data — not only as a valuable journalistic offering, but also as a means of increasing JRC papers’ pageviews, and thus the company’s bottom line. Rosen noted the telling experience of the Texas Tribune, where a whopping two thirds of total site views come to its data pages.

Data presentations, Rosen noted, can be successful because they bridge the gap between what’s available and what’s accessible in terms of information. Sure, data sets are already out there, so in focusing on them, you might not be adding new information, strictly speaking, into the communal cache of knowledge; but “packaging, framing, explanation, user-friendliness: that’s the value added.”

The Register Citizen recently posted the county schools budget on its site, its publisher, Matt DeRienzo, noted — which was, the board agreed, a good first step in the data direction. The paper could try similar experiments, they suggested with any number of similar data sets, from the already-accessible to the need-to-be-FOIAed. Ultimately, “become the Big Data place,” Jarvis advised.

The benefit of hedged experimentation:

One of JRC’s chief infrastructural advantages — one shared, in various ways, by other media companies — is that it holds several different properties under its auspices. In other words, it has an entire chain of newspapers that it can experiment with, testing everything from those news-innovation-y tenets to more notional what-ifs. If Journal Register, as a whole, wants to figure out the best way to run comments, the Register Citizen could implement Facebook Comments, say, while the New Haven Register could experiment with a HuffPo-style community moderation approach, while the Troy Record could see what happens if comments are turned on for one type of story and disabled for another. For the company overall, risk can be essentially mitigated through experimental diversification — and, on the other hand, the lessons learned from the experiments can be applied company-wide. And, in that way, amplified.

The commenting conundrum

The board’s discussion — as happens a lot — spent a lot of time focused on the ideal way to run comments systems. How do you reward helpful participation while punishing — or, at least, discouraging — trolls and other conversation-killers? “Every community is going to have bozos,” Jarvis noted. “The Internet’s just a community; so it’s going to have bozos.”

A more productive approach than one focused on troll-fighting, the board suggested, might be to focus instead on rewarding good behavior — the Gawker/HuffPo approach that empowers community members to elevate the good comments and demote the bad. Utlimately, though, no one’s “figured out” how to do comments; and that’s partially because each community is different when it comes to the kinds of conversations it wants to conduct and convene online.

What the board — and, from the sounds of things, community members — did agree on, though, was that it’s a good idea to expand the notion of comments beyond the-things-that-follow-a-story. Reframing commentary from the reactive to the more productive — instead of “What did you think of this story?” something like, “How should we write this story?” — could be a useful exercise not only in terms of conversation, but also of engagement and transparency. And, of course, it could keep improving the overall quality of the journalism. “I’m going to be honest — it used to be a joke,” Melanie Macmillan, a reader who’d come to the meeting, noted of the Register Citizen. But now, with the strides it’s making toward openness and involvement, “it’s something I’m proud of.”

February 16 2011

19:00

Dataviz, democratized: Google opens Public Data Explorer

Two years ago, Google acquired Gapminder, the Swedish graphics-display company whose Trendalyzer software specializes in representing data over time. (You may recall the company from this awesome and much-circulated TED talk from 2006.) Since the acquisition, Google has built out the Trendalyzer software to create its Public Data Explorer, a tool that makes large datasets easy to visualize — and, for consumers, to play with. The Explorer has created interactive and dynamic data visualizations of information about traditionally hard-to-grasp concepts like unemployment figures, income statistics, world development indicators, and more. It’s a future-of-context dream.

“It’s about not just looking at data, but really understanding and exploring it visually,” Benjamin Yolken, Google Public Data’s product manager, told me. The project’s overall mission, it’s worth noting, is a kind of macro-meets-meta version of journalism’s: “to make the world’s public data sets accessible and useful.”

The big catch, though, as far as journalism goes, has been that users haven’t been able to do much with the tool besides look at it. If you’ve gathered public data sets that would lend themselves to visualization on the Explorer, you’ve had to contact Google and ask them to visualize it for you. (“While we won’t be able to individually reply to everyone who fills out this form,” a contact form noted, “we may be in touch to learn more about your data.”)

Today, though, that’s changing: Google is opening up its Explorer tool. Yolken and Omar Benjelloun, Google Public Data’s tech lead, have written a new data format, the Dataset Publishing Language (DSPL), designed particularly to support dynamic dataviz. “DSPL is an XML-based format designed from the ground up to support rich, interactive visualizations like those in the Public Data Explorer,” Benjelloun notes in a blog post announcing the opening. (It’s the same language that the Public Data team had been using internally to produce its datasets and visualizations.) Today, that language — and an interface facilitating data upload — are available for anyone to use, putting the “public” in “public data.”

It’s an experimental feature that, like the Public Data Explorer itself — not to mention some of Google’s most fun features (Google Scribe, Google Body, Google Books’ Ngrams viewer, etc.) — lives under the Google Labs umbrella. And, importantly, it’s a feature, Yolken notes, that “allows users who may or may not have technical expertise to explore, visually, a number of public data sets.”

The newly open tool could be particularly useful for news organizations that would like to get into the dataviz game, but that don’t have the resources — of time, of talent, of money — to invest in proprietary systems. (The papers of the Journal Register Company, a news organization that has made a point of experimenting with free, web-based journalistic tools, comes to mind here — though any news outfit, big or small, could benefit.) The Public Data team had two main goals in opening up the Explorer tool to users, Yolken notes: Increasing the datasets available to be visualized and, then, distributing them. “First, we want to have lots of data sets available that are credible and useful and interesting,” he says. Second, the hope is that the tool’s embedding capabilities will allow for easy sharing of those data sets.

Though the Explorer platform is now open to anyone — and though Yolken and Benjelloun mention teachers and students as groups who might do some interesting experiments with it — they hope that journalists, in particular, will make use of the tool. Even more particularly: “data-driven journalists.”

To that end, the tool isn’t as intuitively understandable as, say, the awesomely easy Ngrams book viewer tool — “we realized that, in order to show the data properly, to make the data understandable, you really needed to describe the metadata,” Benjelloun notes — but nor does it require special expertise to use. “This format doesn’t require engineering skills,” Yolken says; then again, “it’s not as easy as a spreadsheet.” It’s somewhere in the middle — akin to learning, say, basic HTML. (Here’s more on how to use it.)

But if journos can get beyond the initial learning curve (one that, for data-driven journos, in particular, won’t be especially steep), they, and their readers, could benefit doubly. The Explorer tool allows users not just to create dynamic data visualizations, but also to avail themselves of a new way to understand those data in the first place. In other words: The tool could prove useful from both the presentation and the production ends of the journalistic spectrum. There’s something about watching data move over time, Yolken notes, that changes your perspective as a consumer of those data. “It makes you start asking questions that you wouldn’t have asked before.”

September 22 2010

19:00

Journal Register Company joins with Outside.in for a hyperlocal news/ad portal in Philadelphia

At the Suburban Newspapers of America conference in Philadelphia this morning, Journal Register Company CEO John Paton made an announcement: The newspaper chain will soon be launching an online, hyperlocal news portal in Philly. A new step forward in the company’s “digital first” business model, the yet-to-be-named site’s content will come from a mix of journalists professional and amateur, curated by JRC editors. And it will leverage the partnerships the JRC already has in place with Yahoo (audience targeting) and Growthspur (contributor training).

Or, as Paton puts it: “crowd and cloud.”

The site will be a direct competitor to Philly’s existing establishment news sources: the Inquirer and the Daily News. It’s no accident that Paton announced the project the day before the financially plagued papers are to be put to auction. “They’ve had that town to themselves for a long time,” he told me. “And I think there’s room in this new ecosystem for a whole bunch of people to play. I’m sure they’ll think we’re no threat at all — and I hope they keep on thinking that.”

The idea of the new site is to bolster both content and audience — on the cheap. (JRC, you’ll recall, declared bankruptcy last February; since Paton took the helm of the company shortly after that — with an advisory board that includes new media thinkers the likes of Jay Rosen and Jeff Jarvis — it’s been engaged in the Herculean task of restoring a network of small, Rust Belt papers to profitability. Remarkably, it’s getting close.) The new effort will tap into Philly’s existing content infrastructure — the hyperlocal blogs that have already sprung up to cover the area — and then give that content, via the hyperlocal news provider Outside.in, a singular publishing platform. (The site will also mark a continuation of JRC’s partnership with Growthspur, which trains would-be journos in both blogging and the dark arts of content monetization.) The details are still being worked out, but the idea is a mutualization of resources and revenues that will benefit all involved, from the local bloggers to the Journal Register Company to its partners — to, of course, the site’s consumers. Think TBD, Philly edition.

Think also: TBD, “inexpensive tools” edition. Though JRC will dedicate some of its resources to the new site — in particular, staffers will provide additional content, curation, and general editorial oversight — “we’re hoping that this will be largely crowd-supported,” Paton notes. JRC, after all, doesn’t have papers in metro Philly. “We’ve surrounded Philly with our properties, and so we’re able to provide some context” — but, then, generally not “right-downtown context.” For that, the site will rely on the bloggers who know the terrain; and in turn, Paton says, “we can bring depth to this, and we can bring curation to this.”

And that’s true of audience, as well. The site will apply JRC’s “digital first” approach…to users. Last week, JRC expanded its partnership with Yahoo — the latter company provides behavioral and geographical ad targeting to the newspaper chain — to include the Philadelphia market. That was “the sales piece,” Paton notes; the new site will be “the content piece.” The hoped-for end result? “We’re collectively creating audience, collectively creating content, at a very low price point.”

It’s a “hoped-for” result, though, because the site is still in its development stages. (Hence, again, the lack of name — “I figured TBD was taken,” Paton laughs.) But the CEO values transparency, even if it means unleashing a gestational product onto the market. “It’s a work in progress,” he says of the site. But he and the JRC staff figured, he says, “Let’s just announce it — we’ll get some help in finalizing it just from the announcement. And our solution will come out of that.”

July 14 2010

14:00

“Smart editorial, smart readers, and smart ad solutions”: Slate makes a case for long-form on the web

Via blogs, or, more likely, Twitter, you might have come across the breezy term “tl;dr.” Which is short — appropriately — for “too long; didn’t read.”

Yes. You know the conventional wisdom: long-form journalism doesn’t do well on the web. Our attention spans are too short and sentences are too long and and we’re too easily distrac — oooh, Macy’s is having a sale! — and, anyway, complex narratives are inefficient for a culture that wants its information short, sweet, and yesterday. Long, carefully wrought articles are tasty, sure; online, though, the news we consume is best served up quick-n-easy. The web isn’t Chez Panisse so much as a series of Sizzlers.

Whether or not that kind of thinking is valid from the psychological perspective, a more relevant question, for our purposes, is whether it’s valid from the financial one. What kind of value proposition does long-form journalism represent in the digital world? Can it be monetized? Or, as behavioral economists might put it: Does long-form, you know, work?

One piece of good news — good news, that is, if you’re a fan of the genre — comes courtesy of Slate.

The right readers

You may recall the online magazine’s Fresca initiative — so named for editor David Plotz’s passionate and non-ironic obsession with the grapefruity beverage — which launched last year to give Slate writers and editors the opportunity to focus on long-form work. Essentially, the fellowship program requires that every editorial staff member at Slate (Plotz recently added copy editors to the Fresca pool) take four to six weeks off from their normal jobs — and use that time to produce one in-depth piece (or, often, a series of in-depth pieces) on a subject that compels them. So far, the project has netted such praiseworthy specimens of long-form as, among others, Tim Noah’s analysis of why the U.S. hasn’t endured another successfully executed terror attack since 9/11 and Julia Turner’s look at the fascinating complexities of signage and June Thomas’ examination of American dentistry and Dahlia Lithwick’s crowd-sourced foray into chick-lit authorship and John Dickerson’s reclamation of risk-taking after the financial crash gave that quintessential American practice a bad name.

The other thing the initiative has netted? Pageviews. They’ve been in the millions, a Slate rep told me: over 4 million for Noah’s piece, over 3.5 million for Thomas’, nearly 3 million for Turner’s. That’s especially significant considering the length of the pieces, which often run in the tens of thousands of words. Combine that with New York Times Magazine editor Gerry Marzorati’s claim, last year, that “contrary to conventional wisdom, it’s our longest pieces that attract the most online traffic” — and, come to think of it, with tablet computing’s promise of portable, pleasurable reading experiences — and “tl;dr”: you are on watch.

Pageviews, though, are only part of the picture. “The raw traffic numbers matter to me — I like them, they’re good, and they’re certainly good for advertisers,” Plotz says. But the Fresca pieces are about more than, say, Huffingtonian eyeball-harnessing and traffic-baiting (PHOTOS! SLIDESHOWS! CLICKCLICKPLEASECLICK!); they’re also about brand-building. Plotz got the idea for the fellowships, he told me, through his earlier experience as a general-assignment reporter at Slate, under Michael Kinsley and, later, Jacob Weisberg. As part of that position, he got to do longer pieces of the Fresca variety; and not only did those stories “make me enthusiastic about coming to work,” he says, but they also “clearly contributed to building the brand of Slate as a place you go for excellent journalism.”

And when Plotz took over the magazine’s editorship — in 2008, at pretty much the height of Media’s Existential Crisis — he realized that “in order to really thrive, in order to have the kind of committed, excellent, well-educated, media-engaged audience that we’ve always had — and to build that audience — we had to do something more than just 1,500 word pieces, and more than just explainers.

In other words, for Slate, long-form’s value proposition is also reputational, rather than strictly financial. The Fresca pieces are community and commodity ratifiers — subtle indications, to advertisers and audiences alike, that the magazine cares as much about informing users as attracting them. “Our job is not necessarily to build Slate into a magazine that has 100 million readers,” Plotz points out. “It’s to make sure we have 2 million or 5 million or 8 million of the right readers — readers who are the smartest, most engaged, most influential, most media-literate people around. That’s more attractive to advertisers, it makes the community of readers around the site more energetic and more lively, and it’s a way to distinguish ourselves from some of the more aggregation-heavy sites, or some of the single-person blog sites, or some of the commodity news sites.”

That wide-angle view of the reader/marketer relationship is one that permeates the outlet, from its editorial content to its business-side messaging. Take, for example, the magazine’s pitch to advertisers (entitled “Slate: The Online Magazine for the Smartest Generation”), which uses the term “smart” eight times on a single, short page, by my count — four of them in the declaration that “Slate is unrivaled at combining smart editorial, smart readers, and smart ad solutions to produce the smartest possible media buy.” It’s an approach similar to the Gawker Media strategy of leveraging “recurring reader affection,” rather than relying on the blunter instrument of simple traffic metrics — and one that emphasizes the holistic quality of the audience, as a commercial entity, over its simple quantity. It’s not the size of the boat, and all that.

Engaging readers and writers

The reputation-based approach is of a piece with Slate’s broader strategy of engagement: user affection is advertiser affection. And both of those are bolstered by staff affection — a smart, engaged audience being in large part the result of work produced by a smart, engaged staff. “As a reporting and writing process, this is what had attracted me to journalism almost twenty years ago,” John Dickerson says of his Fresca-enabled series. And “it was wonderful,” he says, to translate that process to the web — to harness the multimedia power of the web to produce “that long, narrative, long-fiction storytelling that’s always been so interesting to me in the course of my career.”

As fellow Fresc-er Tim Noah puts it: “I can’t speak highly enough about the project. I think it’s probably the most exciting thing that’s been going on at Slate for the last couple years.”

Leveraging the personal passions of journalists — as opposed to their skills and talents alone — is an idea that’s getting more and more traction in a media world where standing out from the crowd is a business-side mandate as well as an editorial one. There’s Google’s famous 20-percent time — which has led to personal-interest-fueled innovations like, for example, Google News — and, in journalism proper, the Journal Register Company’s implementation of an innovation team that will devote 25 percent of its workweek to stepping back from the much-maligned vagaries of the Daily Grind. One of the challenges journalism is facing, Noah points out, is in matching ambition to ability in reporting. And though “money is a big obstacle,” in general, he points out, “none of the Fresca pieces have really been terribly extravagant in terms of their cost.” They’ve been extravagant instead with the one resource that, in journalism, is even more precious than money: time. The Fresca stories are a declaration, Dickerson says, that “this is the kind of commitment we have to storytelling: being in-depth in a world of tiny little bites of information.”

Photo by Dave Winer used under a Creative Commons license..

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