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May 03 2012

14:55

The newsonomics of Pricing 101

When the price of your digital product is zero, that’s about how much you learn about customer pricing. Now, both the pricing and the learning is on the upswing.

The pay-for-digital content revolution is now fully upon us. Five years ago, only the music business had seen much rationalization, with Apple’s iTunes having bulled ahead with its new 99-cent order. Now, movies, TV shows, newspapers, and magazines are all embracing paid digital models, charging for single copies, pay-per-views, and subscriptions. From Hulu Plus to Netflix to Next Issue Media to Ongo to Press+ to The New York Times to Google Play to Amazon to Apple to Microsoft (buying into Nook this week), the move to paid media content is profound. The imperative to charge is clear, especially as legacy news and magazines see their share of the rapidly growing digital advertising pie (with that industry growing another 20 percent this year) actually decline.

Yes, it’s in part a 99-cent new world order as I wrote about last week (“The newsonomics of 99-cent media”), but there are wider lessons — some curiously counterintuitive — to be learned in the publishing world. Let’s call it the newsonomics of Pricing 101. The lessons here, gleaned from many conversations, are not definitive ones. In fact, they’re just pointers — with rich “how to” lessons found deeper in each.

Let’s not make any mistake this week, as the Audit Bureau of Circulation’s new numbers rolled out and confounded most everyone. Those ABC numbers wowed some with their high percentage growth rates. Let’s keep in mind that those growth numbers come on the heels of some of the worst newspaper quarterly reports issued in awhile. Not only is print advertising in a deepening tailspin, but digital advertising growth is stalled. Take all the ABC numbers you want and tell the world “We have astounding reach” — but if the audience can’t be monetized both with advertising and significant new circulation revenues, the numbers will be meaningless.

When it comes to dollars and sense, pricing matters a lot.

Let’s start with this basic principle: People won’t pay you for content if you don’t ask them to. That’s an inside-the-industry joke, but one with too much reality to sustain much laughter. It took the industry a long time to start testing offers and price points, as The Wall Street Journal and Walter Hussman’s Arkansas Democrat-Gazette provided lone wolf examples.

The corollary to that principle? If you don’t start to charge consumers — Warren Buffett on newspaper pricing: “You shouldn’t be giving away a product that you’re trying to sell.” — then you can’t learn how consumers respond to pricing. Once you start pricing, you can start learning, and adjust.

We can pick out at least nine emerging data points:

  • 33-45 percent of consumers who pay for digital subscriptions click to buy before they ever run into a paywall. That’s right — a third to a half of buyers just need to be told they will have to pay for continuing access, and they’re sold. As economists note that price is a signal of value, consumers understand the linkage. Assign what seems to be a fair price, and some readers pay up, especially if they are exposed to a “warning” screen, letting them know they’ve used up of critical number of “free” views. Maybe they want to avoid the bumping inconvenience — or maybe they just acknowledge the jig’s up.
  • If print readers are charged something extra for digital access, then non-print subscribers are more likely to buy a digital-only sub. Why pay for digital access is the other guys (the print subscribers) are getting it thrown in for “free”? Typically, Press+ sees a 20-percent-plus increase in signups on sites that charge print subscribers something extra. That extra may be just a third or so of the price digital-only subscribers pay (say, $2.95 instead of $6.95), but it makes a difference. Consequently, Press+ says 80-90 percent of its sites charge print subscribers for digital access. The company now powers 323 sites and thus has more access to collective data than any other news-selling source.
  • You can reverse the river, or at least channel it. The New York Times took a year, but figured it out righter than anyone expected. It bundled its Sunday print paper (still an ad behemoth) with digital, making that package $60 or so a year cheaper than digital alone. The result, of course, is that Sunday Times home delivery is up for first time since 2006. It’s not just NYT or the L.A. Times which have embraced Sunday/digital combos. In Minneapolis, the Star Tribune began a similar push in November. Now, of its 18,000 digital-only subscribers, 28 percent have agreed to an add on the Sunday paper, for just 30 cents a week, says CEO Mike Klingensmith (“A Twin Cities turnaround?”). So we see that consumers may well be more agnostic about platform than we thought. Given them an easy one-click way of buying even musty old print, and they will. Irony: If you hadn’t charged them for digital access, you probably wouldn’t have sold them on print.
  • New products create new markets. 70 percent of The Economist‘s digital subscribers are not former print subscribers, says Paul Rossi, managing director and executive vice president for the Americas. That’s surprising in one sense, but not in another. Newspaper company digital VPs will tell you that they’re surprised to see how little overlap there is between their print audience customer bases and their digital ones. The downside here: Many print customers seem not to value digital access that much. The Star Tribune is finding a low take rate of 3 percent of its Sunday-only print subscribers willing to take its digital-access upsell. One lesson: The building of a new digital-mainly audience won’t be easy and will require new product thinking; it’s not that easy just to port over established customers.
  • The all-access bundle must contain multiple consumer hooks. Sure, readers like to get mobile access as well as desktop and print, and maybe some video. Yet some may especially prize the special events or membership perks they are offered, as the L.A. Times is banking on (and start-ups Texas Tribune, MinnPost, and Global Post have applied outside the paywall model). Some will like the extras, like The Boston Globe telling its new 18,000 digital subscribers, as well as its print ones, that they now get “free” Sunday Supper ebooks (“The newsonomics of 100 products a year”). Sports fanatics or business data lovers will find other niches to value — and ones that make the whole bundle worthwhile. Archives — and the research riches they offer — will prove irresistible to some. In 2012, a bundle may offer a half dozen reasons to buy, casting a wide net, with the hope that at least one shiny lure will reel in the customers. By 2013, expect “dynamic, customized offers,” targeting would-be buyers by their specific interests to be more widely in use.
  • While pageviews may drop 10-15 percent with a paywall, unique visitors remain fairly constant. We see the phenomenon of those who do hit a paywall one month coming back in subsequent months, rather than fleeing forever. “It may be the second, third, or fourth month before someone says, ‘I guess I am a frequent visitor here, and I’ll play,’” says Press+’s Gordon Crovitz.
  • Archives find new life. Archives have lived in a corner of news and magazine websites for a long time. They’ve been used, but not highly used or highly monetized. Now, courtesy of the tablet, and a new way to charge, The Economist is finding that 20 percent of its single copy sales are of past issues. Readers will pay for the old in new wrappers, whether back e-issues, or niched ebooks. The all-access offer can be much wider than cross-platform, or multi-device. It can extend across time, from a century of yesterdays to alerts for tomorrow.
  • News media is probably underpriced. Take the high-end Economist. CEO Andrew Rashbass — speaking to MediaGuardian’s Changing Media Summit 2012, in a recommended video — said that a survey of its subscribers showed that a majority didn’t know how much they were paying for the Economist. When pressed to guess, most over-estimated the price. At the Columbia (Missouri) Daily Tribune, an early paywall leader in the middle of America, a recent price increase to $8.99 from $7.99 has so far resulted in no material loss of subscribers. At Europe’s Piano Media, early experience in Slovakia and Slovenia is that price isn’t a big factor, says Piano’s David Brauchli. “Payment for news on the web is really more a philosophical mindset rather than economic. People who are opposed to paying will always opposed to paying and those who see the value of paying don’t mind paying no matter what the price is.” That suggests pricing power. It makes sense that publishers, new to the pricing trade, have approached it gingerly. Yet the circulation revenue upside may well be substantial.
  • Bundle or unbundle — what’s the right way? Mainly, we don’t know yet, and the answer may be different for differing audience segments. The Economist started with print being a higher price than a separate digital sub. Then it raised the digital price to match that of print — to assert digital value. It now offers all-access: one price gets you both. Next up: You can buy either print or digital for the same price, but if you want both, you’ll pay more. It’s an evolution of testing, and so far, it’s been an upward one.

Overall, this is a revolution in more than pricing. It’s a revolution in thinking and, really, publisher identity.

The Boston Globe’s Jeff Moriarty sums it up well, as his company aims (as has the Financial Times before it: “The newsonomics of the FT as an internet retailer”) to emulate a little digital-first company called Amazon:

I think overall publishers have to start thinking more like e-commerce companies. More like Amazon. You can’t just throw up a wall or an app and expect it to just sell itself. We’re still building that muscle here at the Globe, and some of our colleagues in the industry are even farther along. We have extensive real-time and daily analytics and are employing multivariate testing to try offers and designs to refine the experience that works best for each type of user.

Photo by Jessica Wilson used under a Creative Commons license.

April 26 2012

13:30

April 24 2012

19:20

Boston Globe knocks down paywall to jumpstart subscriptions

paidContent :: For the next 12 days, readers can get free access to BostonGlobe.com by entering their email address. “The impetus for the free trial is getting the word out on new features, including the Boston Globe e-paper,” said Peter Doucette, Executive Director, Circulation Sales & Marketing.

Continue to read Jeff John Roberts, paidcontent.org

Tags: Paywall

April 23 2012

20:43

Who's most likely to pay for online news?

Niemanlab :: Here’s a biggie: How do you get someone to pay for online news? A new study out of the University of Texas develops a theoretical model to begin answering that question. The goal of the study, by Iris Chyi and Angela M. Lee, is to clarify the interrelationship among news preference, use, and intent to pay. What emerges, among other things, is a profile of the kind of people most likely to pay for online news

Continue to read Adrienne LaFrance, www.niemanlab.org

Tags: Paywall Study
11:31

Is the New York Times making paywalls pay? Digital advertising is struggling, even for a major brand

Guardian :: The New York Times company's latest quarterly numbers contain a rich trove of data regarding the health of the digital news industry. Today, we'll focus on the transition from traditional advertising to paywall strategies being implemented across the world. Paywalls appear as a credible way to offset – alas too partially – the declining revenue from print operations.

The highlights and trends - Frédéric Filloux, www.guardian.co.uk

April 21 2012

12:18

Ryan Thornburg: Pay walls and social media could shift the public agenda

Mediashift | IdeaLab :: If conversations around digital journalism have been dominated by anything in the first quarter of 2012, it's probably been about subscriptions, also known as pay walls. Walls are going up at the L.A. Times and Gannett papers, and getting higher at The New York Times. And the editor of The Guardian asked his readers, "What would you give the Guardian? Money, time or data?"  The conversation all this time has been focused on whether the shift toward digital subscriptions will save the news business. But the more interesting and important question is whether and how it will change the news content and public discourse.

Continue to read Ryan Thornburg, www.pbs.org

March 30 2012

14:00

This Week in Review: Grappling with ground-up activism, and a new ‘pay-less’ form of paywall

Activism and journalism from the ground up: Now that the story of Trayvon Martin’s killing has moved fully into the U.S.’ national consciousness, a few writers have taken a look back to examine the path it took to get there. The New York Times’ Brian Stelter traced the story’s rise to prominence, highlighting the role of racial diversity in newsrooms in drawing attention to it. Poynter’s Kelly McBride gave a more detailed review of the story’s path through the media, concluding: “This is how stories are told now. They are told by people who care passionately, until we all care.” (This week, there was also bottom-up sourcing of a more dubious nature on the story, as the Columbia Journalism Review’s Ryan Chittum pointed out.)

The New York Times’ David Carr looked at the Trayvon Martin story and several other web-driven campaigns to assess the value of “hashtag activism,” acknowledging its limitations but concluding that while web activism is no match for its offline counterpart, it still makes the world a better place.

There were several other strains of conversation tying into digital activism and citizen journalism this week: the Lab re-printed a Talking Points Memo story on the unreliability of Twitter buzz as a predictor of election results, and the University of Colorado’s Steve Outing wondered whether social media movements have surpassed the impact of traditional journalism on many issues.

Meanwhile, the report of an embellished photo from a citizen journalist in Syria led some to question the reliability of that information, but GigaOM’s Mathew Ingram countered that citizen journalism isn’t displacing traditional journalism, but helping complement it when used wisely. One of Ingram’s prime examples of that blending of traditional and citizen-powered journalism was NPR tweeter extraordinaire Andy Carvin, who was the subject of a fine Current profile, in which he described Twitter as “the newsroom where I spend my time” and pinpointing news judgment as the key ingredient in his journalistic curation process.

Debating the effectiveness of news paywalls: Google formally unveiled its new paywall alternative in partnership with publishers this week: News sites include surveys that users need to answer in order to read an article. Google pays news sites a nickel per answer, advertisers pay Google for the survey, everybody goes home happy. Just a few publishers have signed up so far, though. (You might remember that the Lab’s Justin Ellis wrote on Google’s testing of this idea last fall.)

Elsewhere in paywalls: Guardian editor Alan Rusbridger said his paper has not ruled out a paywall plan, though he also clarified that there’s “nothing on the horizon.” His publication is, obviously, far from the only one grappling with the prospect of charging for content online: The New Republic’s new owner dropped the magazine’s paywall for recent articles, and The Washington Post’s ombudsman, Patrick Pexton, explained why he doesn’t see a paywall in that paper’s future.

Pexton said the Post first needs to build up its reader base and make sure the site’s technology runs better, and he cast some doubt on the helpfulness of The New York Times’ pay plan for its bottom line. The Columbia Journalism Review’s Ryan Chittum picked apart Pexton’s analysis of the Times’ numbers, and asserted that a paywall’s purpose isn’t to be enormously profitable, and non-paywall digital revenue plans aren’t, either. “The point [of a paywall] is to stop or slow the bleeding and to help make the transition to an all-digital future five or ten years down the line — one that includes more than one flimsy revenue stream based on volatile and not-very-lucrative digital ads,” he wrote.

GigaOM’s Mathew Ingram suggested a “velvet rope” approach to paid content instead of a paywall, in which users would volunteer to pay in exchange for privileges and perks. The Times’ David Carr was skeptical — on Twitter, he summarized the post as, “Don’t build a paywall, create a velvet rope made out of socmedia pixie dust and see if that pays the bills.”

The Guardian opens up: The Guardian is firmly positioning itself at the forefront of what it calls “open journalism,” as it hosted a festival last weekend called the Guardian Open Weekend, during which more than 5,000 readers visited its London offices. The paper recapped the event, and Polis’ Charlie Beckett urged The Guardian to go further and faster in incorporating readers into its production process, turning them from “readers” to “members.”

Guardian editor Alan Rusbridger held a Q&A with readers on open journalism, in which he spoke of the tension between the print and digital products in enacting change: “In order to be effective digital companies newspapers have to free themselves of some of the thinking that goes into the creation or a printed product…But most of the revenue is still in print, so the transition is bound to be a staged one, involving fine judgements about the pace of change.” Rusbridger also tweeted the paper’s 10 principles of open journalism, which were helpfully Storified by Josh Stearns, along with some other open journalism resources.

New accusations against News Corp.: A new branch grew out of News Corp.’s ever-growing tree of scandals this week, when two news orgs in Britain and Australia almost simultaneously broke stories about alleged hacking by NDS Group, a British satellite TV company of which News Corp. owns 49 percent. According to the BBC and the Australian Financial Review, NDS hired hackers to break into its competitors’ systems and get codes for satellite TV cards to illegally leak them to the public, giving them pay-TV services for free. The New York Times knitted the two allegations together well.

The Australian Federal Police is now looking into the case, and Reuters reported on the growing pressure for new investigations against News Corp. in Britain and Australia. Meanwhile, Frontline aired a documentary on the scandal, and The Guardian reported on Rupert Murdoch’s attacks on the accusations on Twitter.

Mike Daisey, journalism, and advocacy: Interest in last week’s blowup over This American Life’s retraction of Mike Daisey’s fabricated story about abuses of Chinese factory workers turned out to be more intense than expected: As the Lab’s Andrew Phelps reported, the retraction was the most downloaded episode in TAL history, surpassing the previous record set by the original story. Daisey himself gave a much more thorough, less defensive apology this week, and Gawker’s Adrian Chen said he wished Daisey would have been so contrite in the first place.

In Current, Alicia Shepard examined the story from the perspective of Marketplace, the public radio program that exposed Daisey’s falsehoods. In a long, thoughtful post, Ethan Zuckerman of Harvard’s Berkman Center compared Daisey’s story to the Kony 2012 viral video, using them to pose some good questions about the space between journalism and advocacy.

Reading roundup: A few other interesting pieces that surfaced this week:

— A couple of pieces succinctly laying out some of the growing challenges for those trying to control online content and discourse: First, a piece in The Guardian by Michael Wolff on the trouble that the rise of mobile media poses for news business models, and second, a post by JP Rangaswami positing Africa as the next site of resistance against online media control.

— In a similar vein, GigaOM’s Mathew Ingram wrote about the ways in which the giants of tech are all moving in on the same territory of user data and control, arguing that the real challenge is getting users to care about whether we end up with an open or closed web.

— NYU j-prof Jay Rosen wrote an insightful piece on how journalists claim the authority to be listened to by the public: “I’m there, you’re not, let me tell you about it.”

— Finally, at Poynter, Matt Thompson put together an interesting typology of journalists: Storyteller, newshound, systems analyst, and provocateur. He’s got some great initial tips on how to work with each type, and play to each one’s strengths within a newsroom environment.

11:57

Google's new paywall alternative for web publishers: Customer Survey

AdWeek :: Google has long been accused of being a content stealer and/or a value destroyer in certain publishing circles. Mark Cuban, the outspoken head of HD Network and the Dallas Mavericks, has referred to Google derisively as a “vampire,” going as far as urging newspapers and their brethren to block Google from linking to their sites. But as it turns out, Google really wants to save the digital publishing business. In fact, the search behemoth today will roll out a new product aimed at helping struggling traditional and digital publishers to make money on their Web content. The new product, Google Customer Surveys.

Continue to read Mike Shields, www.adweek.com

Tags: Google Paywall
11:52

Paywall promos: How far should newspapers open the door?

paidContent :: As newspapers lock content behind paywalls, marketers are opening that same content right back up again through campaigns that provide readers with temporary access for free. The idea seems a good one but newspapers are still experimenting with when and how to do it.

On Thursday, for instance, the Wall Street Journal launched a Jaguar-sponsored “Digital Open House” to provide free website and mobile access to the paper’s premium content. The 24-hour campaign, which gives prominent place to Jaguar ads, follows similar sponsorships last year by Sprint, Citi and Acura.

Jeff Roberts: but how far should newspapers open the door?

Continue to read Jeff Roberts, paidcontent.org

March 29 2012

15:00

The newsonomics of 100 products a year

Try this: Call up your local newspaper or online news organization. Tell them you want to buy something and ask them what they can sell you? Of course, at first, they’d be non-plussed: Sell you something? Then, after giving it some thought, they’d say you can buy a newspaper or a subscription or a membership — or, maybe, an ad? Would you like one of those?

Those days — mark it — are coming to an end. We’re on the brink of news companies producing hundreds of products for sale each year. While digital technology hath taketh (the easy ability to make money on news distribution), digital technology also giveth back, with the ability to create hundreds and thousands of newsy products at small incremental costs. The bonus: News organizations will be able to satisfy groups of readers and advertisers (often disguised thinly as sponsors) better than ever before. Double bonus: The let-a-hundred-products-bloom revolution fits neatly with the all-out embrace of all-access circulation initiatives, which news companies in North America, Europe, and Asia now can’t seem to implement quickly enough.

Can we call this the ebook revolution? Maybe, but that’s probably too narrow. Delivery of new products to new audiences can take several forms. A text-only ebook, a shinier iBooks-enabled product with video, or an app with all the glorious functionality apps offer. It’s not the form; it’s the content, content that satisfies niches rather than serves masses with one-size-fits-all newspaper or magazine products.

Call it the newsonomics of 100 products a year, or just one way to envision a much bigger future.

The 100-product-a-year model is a much-needed growth model. We can see how it fits nicely with all-access subscriptions, and together we have two interconnected Lego blocks of a new sustainable news model. We have two essential parts of a crossover model (“The newsonomics of crossover”) that I detailed here a few weeks ago. The big, hairy challenges of accelerating print ad loss and onerous legacy costs remain, but at least we’ve got a couple of building blocks we didn’t have two years ago. By we, I mean those of us who care about news and great professional content.

Is it a big moneymaker? We don’t know yet, though we can extrapolate some numbers below.

It’s directionally right, though, for at least a couple of strategic reasons. The notion of 100 smaller products reminds us that so much of the new world is based on volume. Google has built a monstrous advertising business on hundreds of thousands of smaller advertisers, while daily newspapers reaped huge profits on relatively few bigger advertisers. Even as movie watching by streaming surpasses DVD watching, more money is still in the old medium. Streaming will monetize at a lower rate, but end up generating bigger dollars over time. The same thing is true in the digital music business. Selling lots of stuff to lots of people at smaller price points is something the Internet enables superbly.

Yes, there are definitely new winners and losers in movies and music, as there will be in news. Those who transition best and fastest will win.

Second, it’s in line with the strategic push to satisfy the hell out of core customers. As publishers have figured out that it’s the top 15 percent of site visitors who make the big difference in building the new digital business — perhaps paying for subscriptions, consuming many more pages than fly-by users sent by Google — core customer satisfaction is key. Ebooks deeper the relationship to that reader customer.

This 100-product-a-year model may fit as well with the new California Watch/Bay Citizen combo (“The newsonomics of the death and life of California news”), finalized Tuesday, as its does with The Wall Street Journal, The New York Times, the Charlotte Observer, GQ, or Conde Nast Traveler.

Let’s take one example. On Wednesday, the Boston Globe launched “Sunday Supper & More.” It’s a cookbook. It’s New England. And it could be the beginning of a new franchise: Expect summer, fall and winter editions each year to join this spring debut. The Globe’s staff built it with Apple’s iBooks Author tool, so it offers video within it.

Want to buy it? Not so fast. Today, Sunday Supper & More is only available to Boston Globe print, all-access, and digital subscribers. So subscription — think “membership” (the recent riff of the L.A. Times new paywall intro) — is gaining new benefits. Surprise, says the Globe, you not only get our paper, our spiffy new replica-plus edition, if that’s what you want, and our mobile apps — you also get our cool cookbooks, with more to come.

The Globe will sell the book to non-subscribers — probably at $4.99 — but will decide the timing of that sale after next week’s Globe confab at which execs and editors will plot an ebook plan for the company.

“Events and ebooks will be the two biggest perks” of the new Globe subscription push, says Jeff Moriarty, the Globe’s VP of digital products. Beyond Sunday Suppers and a new spin on the Fenway 100 historical Red Sox book, we can picture the Globe soon mining its archives in both sports and features to provide new value for customers and a new leg of revenue. It experimented early with three books on its Whitey Bulger stories, and learned some lessons in pricing, distribution, and the technical creation process along the way.

The Globe has plenty of company in this push. We see Canada’s National Post committing to a couple of dozen ebooks in the coming year, again from hard news to features (“To learn what works (quickly), Canada’s National Post dives into ebooks”). Guardian Shorts is an early innovator; Politico is churning out four campaign ebooks this year.

Magazine publishers, faster than newspaper publishers to embrace the tablet as the next-gen platform, are also ahead of most newspaper publishers in ebooks. Vanity Fair’s done more than a half dozen, and its parent Conde Nast is hosting an explosion of more single-purpose apps in the iTunes Store, some unrelated to Conde’s magazines. Hearst’s Cosmopolitan is embracing ebooks, and now partnering, along with ProPublica — an early tester of ebooks — with Open Road Integrated Technology. Open Road Integrated Technology?

Well, it’s a book company, an ebook company juiced on the possibilities of our age. Headed by former HarperCollins CEO Jane Friedman, the company is prototypical of a new group of middlemen. With book marketing savvy (cover design, marketing, distribution+), these companies are now feeding the emerging ebook marketplace. They are also partnering back for that old standby, print, as Open Road has done with book services company Ingram. In Canada, it was Harper Collins Canada that became the National Post’s partner in bringing news ebooks to market.

Just as the web has knocked many middlemen for a loop, it creates openings for new ones.

If you talk to publishers about ebooks, they are farther along in experimenting than they were a year ago. Yet some basic issues — producing the books, marrying them to commerce engines, placing them prominently in e-stores and more — are giving them headaches as they push forward. “How do we make the right offer to the right person at the right time?” one experienced exec asked.

The marketplace has been exploding (recall that Amazon announced last spring that its ebooks were now outselling its paper books), but those issues are setting the stage for a new group of companies, many staffed with graduates of the book industry, offering their help. Newspaper and magazine publishers are looking to the Open Roads for guidance.

Some are turning to their digital circulation partner, Press+. That company, which is powering more than 280 titles’ subscription commerce, says its system can handle the commerce and even help with identifying likely customers, based on tracked content usage, so its customers are just beginning to ply the ebook trade.

ProPublica general manager Dick Tofel opted for Open Road for the non-profit investigative publisher’s fifth and sixth books. He says the company will start producing a half dozen or more a year now and is now fielding calls from other publishers eager to get the benefit of his early ebook experience.

So far, ProPublica has put 90,000 ebooks into the market. The first couple were free downloads, but with the addition of new original introductions to work ProPublica had already published free online, Amazon and ProPublica agreed on test pricing of 99 cents and $1.99, and new revenue is rolling in. It’s small, but “pound for pound, it generates more than advertising,” notes Tofel, who is a Wall Street Journal veteran. And, of course, the incremental cost of creating ebooks is closer to zero, with most sales cost able to be a commissioned cost of sale.

As assistant publisher, Tofel oversaw the print books business that’s been a good Dow Jones sideline for a long time.

Those books — personal investing and more — are naturals for the ebook revolution now. Look for the Journal to experiment more with those titles, perhaps niching by life stage.

As news and magazine publishers look to this new revenue stream, here are six points to ponder:

It’s about product development: Yes, it’s editing, but fundamentally, it’s a mindset change for many publishers stuck in the one-size-fits-all world. Publishers either need staffers with new product chops or partners wanting to license publisher content and create the products for the marketplace.

Free the archives!: Digital archives have never been a big business for publishers, caught somewhere between Google and musty library connotations. Packaged archives — for specific audiences — can offer new life for older content.

Don’t think content; think problem solving: Publishers too often start with content. If we start with audience — college-planning students and parents, new mothers and fathers to be, bored cooks, and, big time, sports enthusiasts of all ages — we can see the motors of ebook publishing beginning to role. Think life stage, just for starters, and add the geo angle, and regional publishers can play.

Mining the database: As onesies and twosies, it’s fairly easy to pick content from publishers’ own databases. Think of bigger production cycle, going beyond the 100 a year, to a thousand, all niched products that could be semi-automated and templated over time. Better tagging of content for ebook usage then becomes a priority.

Ebook or app?: Early experimenters say let the content be your guide. The more multimedia, the better an app may work. Ebooks, though, can be sold through more distributors, while Apple continues to dominate the app business.

Pricing: What’s an ebook worth? If it solidifies a subscriber/member paying $300 or more a year, it’s worth a lot, even if it’s free. Think of the lifetime value of that subscriber.

To the right niche, some ebooks will be worth $1.99 and others — Retina perfect — will go for $19.99. Let’s take our 100 products a year. Let’s average 5,000 sales for each. Let’s price at $2.99 on average. That would be $1.5 million. Some books, though, could be blockbusters. We can play with this math and see where it goes.

For the ProPublicas, it’s a nice non-ad revenue stream. For other publishers, it’s at least a growing third leg of revenue (beyond ads and circulation) and one that may be nurtured into something significant. (Last fall, Will Sullivan offered a gaggle of reasons ebooks make sense for publishers.) As importantly, it can reinforce those two legs, pleasing subscribers/members with free (or discounted) perks and advertisers/sponsors who have new opportunities to represent themselves to niche audiences. That’s a pretty good combination, and one that publishers will soon embrace, just as they lately have all-access digital circulation.

March 28 2012

14:37

Do digital readers add to the bottom line? - The WaPo ombudsman's faulty paywall analysis

Columbia Journalism Review :: Did you know? - The NYT’s meter is saving or adding more than $70 million in revenue a year already. Washington Post ombudsman Patrick B. Pexton has a flawed analysis on the logic of a possible paywall there and on the performance of the one that already exists at The New York Times. Question to answer: How much revenue could charging digital readers really add to the bottom line?

Why Patrick B. Pexton is wrong - Continue to read Ryan Chittum, www.cjr.org

March 19 2012

12:00

News-to-go is here to stay

For anyone who can remember being floored by the mid-1980s Chrysler sedan that warned “your door is ajar” in delightful monotone, it’s still kind of thrilling that Cadillacs come with wifi these days. But for a growing number of Americans, it’s hard to imagine going anywhere without an iPhone in one pocket and an iPad within arm’s reach.

Here it is, as if there was any doubt: The age of mobile.

One in four American adults now has a smartphone, and one in five owns a tablet. And 27 percent of Americans are getting news on mobile devices — increasingly across different platforms. That’s according to the Pew Research Center’s Project for Excellence in Journalism, and its annual report on the State of the News Media in 2012, released today.

One takeaway from Pew’s January 2012 survey of more than 3,000 adults is that our increasingly mobile reality brings new opportunities and, yes, more uncertainty for journalism.

Pew finds mobile devices are driving up news consumption, immersing audiences in content and strengthening traditional long-form journalism. But the industry is still following the lead of tech giants when it comes to the ways in which news is becoming more pervasive, which begs arguably the biggest of the big questions that Pew’s buffet of data raises: Who stands to benefit economically from the mobile shift?

“If they want to be everything, news is part of that, and people are spending more time with news.”

“When you look at the revenue side, we see even more that the tech companies are strengthening their hold on the revenue side, on who’s gaining the profits from this era of news,” the project’s deputy director, Amy S. Mitchell, told me. “While there may be some positive side in terms of what consumers are doing, the big technology companies are taking an even bigger piece of the revenue pie.”

Illustrating that point: Last year, five technology giants — not including Apple and Amazon — generated 68 percent of all digital ad revenue. By 2015, Facebook is expected to account for one of every five digital display ads sold. In contrast, print ad revenues were down $2.1 billion, or 9.2 percent, last year. Losses in print outweighed $207 million in online advertising gains by a ratio of 10 to 1.

This dynamic gave Pew researchers an idea that has been floated before: Could a tech giant like Google or Facebook swoop in and “save” a household-name newspaper by buying it? Mitchell says there are signs that “speak to the possibility of that happening,” namely the idea that technology leaders might identify news production as a path to omnipresence in consumers’ lives. But why would a profitable company want to acquire an operation — even one with a legacy brand — that’s in the red?

“The technology giants — the big technology companies — have all taken steps in the last year to kind of be an ‘everything,’” Mitchell says. “To not just be the king of search but to also have social networking, to have a video component, to also have your email as well as your social networking, as well as your news feed. While news may not be the revenue generator that these companies are looking to own, it is a part of how people are spending their day. If they want to be everything, news is part of that, and people are spending more time with news.”

Some of the other interesting tidbits in the report:

• Some rural Native American and Alaska Native populations are adapting straight from print to mobile, skipping right over desktops and laptops. It’s a pattern similar to what’s happening in parts of the developing world.

• Some 133 million Americans — 54 percent of the online U.S. population — are active on Facebook, and they’re spending about seven hours per month on the site. That’s 14 times as long as the average person spent on the most popular news sites. Just nine percent of adults in the United State say they regularly follow Facebook or Twitter links to news stories — despite the social media efforts of news organizations.

• Social media platforms “grew substantially” in 2011, but people are still more likely to use search engines or go directly to a news site than follow links from social media.

• Consumers perceive Twitter as having more news that’s harder to find elsewhere than Facebook. But most of those surveyed say they believe the news they get on Facebook and Twitter is news that they would have seen elsewhere without those sites.

• Print newspapers “stood out for their continued decline, which nearly matched the previous year’s 5 percent drop.” The latest Pew numbers show that total newspaper revenue — that means subscription as well as ad revenue — has dropped 43 percent since 2000. Over the last five years, an average of 15 newspapers (about 1 percent of the industry) has disappeared each year.

• As many as 100 newspapers are expected to put up paywalls (in some form) in the coming months. They would join the roughly 150 dailies that have already shifted to “some kind of digital subscription model,” which means slightly more than one-tenth of surviving U.S. dailies have a paywall or subscription service of some kind.

• More consumers are worried about their online privacy, which creates “conflicting pressure” for news organizations that need revenue to survive while also maintaining their audience’s trust. A separate Pew study found two-thirds of Internet users were uneasy with search engines tracking their activity, but they’re also relying more heavily on the services that such companies provide.

February 28 2012

18:12

From Salinas to Burlington: Can an army of paywalls big and small bouy Gannett?

Brick wall with window

Gannett is mounting the biggest campaign yet to make readers pay for journalism online. And the newspaper company’s size means its success or failure could ripple throughout the marketplace.

By the end of the year Gannett plans to launch digital subscriptions for almost all of its newspapers, a kind of unified paywall that would operate on the web, mobile and tablets and cover 80 of the company’s news sites, with the exception of national flagship USA Today.

For newspapers it may signal a turning point, since readers are now looking around the marketplace and finding fewer free papers. That doesn’t mean a change in the amount of free news (aggregation and sharing remain rampant), but it could have an effect on people’s perception, or even willingness, to pay for news. It’s like looking around for cheap gas in your neighborhood: If all the stations list unleaded at $3.85, you’re more likely to believe $3.85 is the going rate for fuel.

Until now there has been no paywall rollout of this scale for U.S. newspapers, with most digital subscription plans emerging piecemeal at places like The New York Times, The Baltimore Sun, and The Boston Globe. The Gannett plan reaches readers across 30 states (and Guam!). In other words, the number of paywalls in the United States will jump dramatically, as well as the number of people exposed to them.

Gannett is pushing a total digital transformation, not just a paid content strategy.

Like all paywalls, the success of Gannett’s plan largely hinges on people’s willingness to pay for news online. (That, and how easy it is to pay. More on that in a bit.) The company is betting readers will pony up, projecting at least $100 million from the new subscription program by next year.

The paywall should be easily scalable, since Gannett likes to take advantage of consolidating resources within the newspaper group. The paywall mechanics and back end will be the same for all 80 papers, but details about pricing and metered access get decided on the local level. Gannett’s papers run the gamut of small to big, and no two communities are alike when accounting for factors like Internet use and penetration of mobile devices. That’s likely why the company began testing digital subscriptions at select papers in St. Cloud, Minn., Poughkeepsie, N.Y., and Lafayette, Ind., among others.

If Gannett has any data about its paywall experiments, it’s keeping it quiet. (The company has, however, been preparing employees to answer questions about the change.) Since the paywall test sites were announced in 2010, no numbers have been released on subscribers or circulation revenues. So what have they learned? Here’s what a Gannett spokesperson told me via email:

On the previous pilots, we learned a lot about consumer engagement and willingness to pay for unique local content from our experiments in Greenville, Tallahassee and St. George. This new model builds on that, responding to consumer demand to have the news and information they value available on whatever platform they choose. Obviously, we feel those early tests were successful or we wouldn’t be building a new subscription model around those learnings. However, we are not going to discuss confidential business data at this time.

Gannett is pushing a total digital transformation, not just a paid content strategy. There will be dozens of tablet and phone apps, which, aside from color schemes and branding, will likely look and work similar across the 80 properties. Again, Gannett’s size is a boon for small and mid-sized papers, as the company can bring them to market faster than the individual papers could have alone. As tablet usage continues to grow, apps or other digital access can incentivize digital subscriptions.

There is some evidence that paywalls for small and mid-sized newspapers can succeed, or at least shore up circulation and not be a drag on revenues. At the same time, in some cities a paywall has boosted circulation of the Sunday paper in particular (the “Frank Rich Discount”). Newspapers in Memphis and Minneapolis have seen bumps in the Sunday circulation, but for others that increase has has yet to fully materialize.

For each community it comes down to how a digital subscription plan is executed, said Ken Doctor, a media analyst and the Lab’s resident expert in Newsonomics. Specifically, he said, it’s a question of how to charge readers, existing versus new, or whether to offer a print discount versus an additional charge for web access.

“What Gannett is saying is, ‘We think we can bump revenues by 10 percent from essentially being flat.’”

For other publishers the decision is simple: Increase subscription prices across the board and promote the value of bundled access to mobile, tablet and desktop. Taking all of that into consideration, and Gannett’s $100 million calculation, doesn’t seem impossible. “What Gannett is saying is, ‘We think we can bump revenues by 10 percent from essentially being flat’,” Doctor said.

Hitting that target is easy when you factor in the conversion of existing print subscribers to digital subscribers. The challenge for most local and regional papers with paywalls is bringing in new readers, who are getting their news elsewhere. And most people signing up for digital subscriptions are older readers, he said. “I haven’t heard of any regional paper that produces substantial digital only customer numbers and revenue numbers,” Doctor said. These are problems that point to whether paywalls can have long term success for locally focused journalism.

Since each site has the ability to determine the pricing for its subscription plan, there will undoubtedly be tension between what individual markets will bare and what the mothership needs to improve its bottom line. For Gannett, one paper’s success with digital subscriptions can be another paper’s failure. The fate of Gannett’s plan rests in whether the Sioux Falls Argus Leaders of the world offset the likes of The Indianapolis Star or Cincinnati Enquirer.

Image by Darwin Bell used under a Creative Commons license

February 10 2012

15:00

This Week in Review: Facebook’s future and the open web, and finding balance on breaking news

Is Facebook a threat to the open web?: There was still a lot of smart commentary on Facebook’s filing for a public stock offering rolling in last late week, so I’ll start with a couple pieces I missed in last week’s review: Both The Atlantic’s Alexis Madrigal and Slate’s Farhad Manjoo were skeptical of Facebook’s ability to stay so financially successful. Madrigal said it’s going to have to get a lot more than the $4.39 in revenue per user it’s currently getting, and Manjoo wondered about what happens after the social gaming craze that’s been providing so much of Facebook’s revenue passes.

How to supplement those revenue streams? A lot of the answer’s going to come from personal data aggregation, and law professor Lori Andrews wrote in The New York Times about some of the dark sides of that practice, including stereotyping and discrimination. Facebook also needs to move more deeply into mobile, and Wired’s Tim Carmody documented its struggles in that area. On the bright side, Wired’s Steven Levy approved of Mark Zuckerberg’s letter to shareholders and his articulation of The Hacker Way.

Facebook’s filing also spurred an intriguing discussion of the relationship between it, Google, and the open web. As web pioneer John Battelle said best and The Atlantic’s James Fallows summarized aptly, several observers were concerned that Facebook’s rise and Google’s potential decline is a loss for the open web, because Google built its financial success on the success of the open web while Facebook’s success depends on increased sharing inside its own private channels. As Battelle argued, this private orientation threatens the core values that should drive the Internet: decentralization, a commons-based ethos, neutrality, interoperability, and data openness. Mathew Ingram of GigaOM countered that users don’t care so much about openness as usefulness, and that’s what could eventually do Facebook in.

Another Facebook-related discussion sprung up around Evgeny Morozov’s piece for The New York Times lamenting the death of cyberflânerie — the practice of strolling through the streets of the web alone, taking in and reflecting on its sights and sounds. Among other factors, he pinpointed Facebook’s “frictionless sharing” as the culprit, by mandating that all experiences be shared and tailored to our narrow interests. Sociologist Zeynep Tufekci pushed back against Morozov’s argument, countering that there’s still plenty of room for sharing-based serendipity because our friends’ interests don’t exactly line up with our own. And journalist Dana Goldstein argued that a lot of what yesterday’s flâneurs did is still echoed in the web today, for better or worse — cyberstalking, trying out new identities, and presenting our ideal selves to the public.

The clampdown on breaking news via Twitter: One of international journalism’s leaders in social media innovation, News Corp.’s Sky News, issued a surprisingly stern crackdown on its journalists’ Twitter practices, banning them from retweeting information from any other journalists without clearing it past the news desk and from tweeting about anything outside their beats.

There were a few people in favor of the new policy — Forbes’ Ewan Spence applauded the ‘better right than first’ approach, and Fleet Street Blues rather headscratchingly asserted that “it makes no sense for them to pay journalists to report through a medium outside its own editorial controls.” But far more people were crying out in opposition.

Reuters’ Anthony De Rosa reiterated that argument that a retweet is simply a quote, rather than an endorsement, and Breaking News’ Cory Bergman said not all the broadcast rules apply to Twitter — it’s okay to be human there. GigaOM’s Mathew Ingram and POLIS’ Charlie Beckett made the point that Sky should want its reporters to be seen as go-to information sources, period — no matter where the information comes from. As Beckett put it: “We the audience now privilege interactivity and added value over conformity. We trust you because you share, not because you have hierarchical structures.”

The BBC also updated its social media guidelines to urge reporters not to break news on Twitter before they file it to the BBC’s internal systems. BBC social media editor Chris Hamilton quickly clarified that the policy wasn’t as restrictive as it sounded: The BBC’s tech allows its journalists to file simultaneously to Twitter and to its newsroom CMS (an impressive feat in itself), and when that tech isn’t available, they want their journalists to file to the newsroom first — “a difference of a few seconds.”

J-prof Alfred Hermida said the idea that journalists shouldn’t break news on Twitter rests on the flawed assumption that journalists have a monopoly on breaking the news. And on Twitter, fellow media prof C.W. Anderson asserted that the chief problem lies in the idea that breaking news adds significant value to a story. “The debate over “breaking news on Twitter” is a perfect example of mistaking professional values for public / financial / ‘rational’ ones,” he wrote. Poynter’s Jeff Sonderman, meanwhile, praised the BBC for putting some real thought into how to fit Twitter into the breaking news workflow.

An unclear picture of the Times’ paywall: The New York Times released its fourth-quarter results late last week, and, as usual with their recent announcements, it proved something of a media business Rorschach test. The company reported a loss of $39.7 million for the year, thanks in large part to declines in advertising revenue — though most of that was due to About.com, as revenue in its news division was slightly up for the quarter.

As for the paywall, media analyst Ken Doctor reported 390,000 digital subscribers and estimated the Times’ paywall revenue at $86 million and said the paper has climbed a big mountain in getting more than 70 percent of its print subscribers to sign up for online access. Reuters’ Felix Salmon saw the paywall numbers as “unamiguously good news” and said it shows the paywall hasn’t eaten into ad revenues as much as it was expected to.

Others were a bit less optimistic. GigaOM’s Mathew Ingram said the Times’ new paywall revenue still isn’t enough to make up for its ad revenue declines, and urged the times to go beyond the paywall in hunting for digital revenue. Media analyst Greg Satell made a similar point, arguing that the paywall is a false hope and calling for the Times build up more “satellite” brands online, like the Wall Street Journal’s All Things Digital. Henry Blodget of Business Insider had a different solution: Keep cutting costs until the newsroom is down to a size that can be supported by a digital operation.

A nonprofit journalism merger: After a few weeks of speculation, two of the U.S.’ more prominent nonprofit news operations, the Bay Citizen and the Center for Investigative Reporting, have announced their intent to merge. Both groups are based in California’s Bay Area, and the CIR runs the statewide news org California Watch. The executive director of the new organization would be Phil Bronstein, the CIR board chairman and former San Francisco Chronicle editor.

Opinions on the move were mixed: Oakland Local founder (and former California Watch consultant) Susan Mernit thought it would make a lot of sense, combining the Bay Citizen’s strengths in funding and distribution with California Watch’s strengths in editorial content. Likewise, the Lab’s Ken Doctor saw it as an opportunity to make local nonprofit journalism work at an unprecedented scale.

There are reasons for caution, though. As Jim Romenesko noted, the Bay Citizen has recently gone through several key departures and the unexpected death of its co-founder and main benefactor, Warren Hellman (and even forgot to renew its web domain for a bit). And California Watch pointed out some of the potential conflicts between the two newsrooms — California Watch has a partnership with the Chronicle, whom the Bay Citizen considers a competitor. And the Bay Citizen has its own partnership with The New York Times for its regional edition, something PBS MediaShift’s Ashwin Seshagiri said could now prove as much a hindrance as an advantage.

J-prof Jay Rosen said the two orgs aren’t a good fit because of their differing institutional bases — the CIR is more established and has been on a steady build, while the Bay Citizen’s short history is full of turmoil. And the San Francisco Bay Guardian’s Steven Jones argued that Bronstein’s rationale for the merger is misrepresenting Hellman’s wishes.

Reading roundup: Lots of other stuff going on this week, too. Here’s a quick rundown:

— Another week, another few new angles to the already enormous News Corp. phone hacking scandal: The FBI is investigating the company for illegal payments of as much £100,000 to foreign officials such as police officers, a political blogger told British officials that the Sunday Mirror’s top editor personally authorized hacking, and The Times of London admitted it hacked into a police officer’s email to out him as the author of an anonymous blog. How much is this whole mess costing News Corp.? $87 million for the investigation alone last quarter.

— News Corp.’s tablet news publication The Daily got the one-year treatment with an update on its so-so progress in The New York Times. News business analyst Alan Mutter also gave a pretty rough review of the status of tablet news apps as a whole.

— A couple of other news developments of interest to folks in our little niche: The tech news site GigaOM announced it was buying paidContent from the Guardian (PBS MediaShift’s Dorian Benkoil loved the move, and the Knight Foundation announced the first of its new News Challenge competitions, this one oriented around networks.

— A couple of cool studies released this week: One from HP Labs on predicting the spread of news on Twitter, and another from USC on ways in which the Internet is changing us.

— Finally, for those of us among the digitally hyper-connected, The New York Times’ David Carr wrote a poignant piece on the enduring value of in-person connections, and sociologist Zeynep Tufekci offered a thoughtful response.

Original Twitter bird by Matt Hamm used under a Creative Commons license.

January 23 2012

15:30

How a tightly paywalled, social-media-ignoring, anti-copy-paste, gossipy news site became a dominant force in Nova Scotia

Every morning, the business and political elite in the biggest province on Canada’s East Coast turns to an unlikely source of information about their own world.

Among all the online news organizations trying to find a way to profitability, consider AllNovaScotia.com, which has just celebrated 10 years online and now challenges its historic print rival for the attention of the province’s leaders.

It’s done that by not following the rules: It has a nearly impenetrable paywall, no social media presence, no multimedia, and only rare use of links. It doesn’t cover crime and barely covers sports and entertainment.

However, it delivers up-to-the minute coverage of business, city hall, and the provincial legislature via the web and apps for iOS and BlackBerry. It scoops its news rivals almost daily and has won loyal readers through dogged combing of public records and often by prying into the personal lives of the province’s movers and shakers.

The site is based in Halifax, the capital city of Nova Scotia, a province of just under a million people in Atlantic Canada. Ask 10 people on the street about AllNovaScotia and it’s likely eight will say they’ve never heard of it.

“I think it might be nine people,” says Parker Donham, a former journalist for the now-defunct Halifax Daily News, communications consultant, and blogger. “But the one who did would be an assistant deputy minister or a regional manager. Between people paying for it and a limited amount of advertising, they’ve got a business model that seems to work.”

“On the whole, I think they are the paper of record now,” adds Donham. “I don’t think there are many serious business or political people who don’t see that every morning.”

AllNovaScotia has 5,950 subscribers, whose monthly dues generate 80 per cent of its revenue. The site doesn’t come close to having the broad appeal of its 137-year-old print competitor, the Halifax Chronicle Herald, which has a Monday-to-Friday circulation of 108,389. Three people with different email addresses can share a $30 a month subscription, but they can’t pass the stories on to anyone else without some effort. The publication — produced by a staff of 14, 11 of them reporters — is locked down in Flash, making sharing usually a cumbersome ordeal of cobbling together screenshots. No sharing buttons here.

A representative for 5,200 small- and medium-sized businesses in the region says AllNovaScotia’s influence among her association’s members is narrow but strong.

“I would suspect that most have never heard of AllNovaScotia,” says Leanne Hachey, vice president of the Atlantic Canadian chapter of the Canadian Federation of Independent Business. “However, among those with some influence over politics or public policy or government relations, everybody knows about AllNovaScotia and everybody, as far as I know, pays very close attention to it.”

In many ways, AllNovaScotia is similar to Statehouse News Service, the Massachusetts online outfit that offers “gavel-to-gavel coverage” of state government for lobbyists, government officials and business people. However, AllNovaScotia’s approach is both broader and spunkier.

The guts of each edition are development permits, court documents, and land transfers — and the stories of triumph and failure inside them. One January issue was a typical mixture of hard news and betcha-didn’t-know information about the province’s movers and shakers. The 25-story edition included:

  1. a scoop that a local mall would host the region’s first Apple Store
  2. an alert that a buyer had been found for one of the province’s struggling paper mills
  3. an exposé in text and photos of the $7.6-million Florida mansion purchased by the owner of one of the region’s largest companies
  4. profiles of three new partners at one of the city’s leading law firms
  5. an obituary of a small business owner and minor-league hockey supporter

The news site appeals directly to the province’s tight-knit and family-oriented business community, according to Kevin Cox, AllNovaScotia’s former managing editor, who retired in June.

“The strange thing was they liked to read about other people within their circle. Not in a satirical way…but in a serious way,” says Cox, a former Globe and Mail reporter who still writes commentaries for the site, but who is now studying to be a United Church minister. “How do the Fountains spend their money? How do they make their money? Who did they give it to?”

As it turns out, the Fountains, one of the province’s leading philanthropist families, spent a chunk of their money on a surprise appearance by crooner Tony Bennett at their Dec. 10 Christmas party. The lead story in AllNovaScotia’s next issue detailed the lavish event, Bennett’s set list, and the who’s-who-of-Nova-Scotia guest list.

This focus on people and their wealth makes AllNovaScotia a different beast from typical business coverage that focuses on companies. People’s names are bolded in stories, frequently paired with their corporate compensation and the assessed value of their house. An almost-daily feature is Who’s Suing Whom.

“We wrote about property. We wrote about local stocks. We wrote about the old families,” says Cox, of his time managing the site beginning in 2004. “We wrote about the big business deals and the little business deals. We wrote about the breweries and the coffee shops. Some of it was micro-news that no one else was paying any attention to.”

The character of the site can be attributed to its creator, David Bentley, who co-founded a gossip publication called Frank Magazine in the 1980s. Frank is an irreverent print and online journal that chronicles everything from local celebrity divorces, petty scandals and social faux pas. Many in this conservative province read it, though fewer would admit it. Bentley had started a separate newspaper a decade earlier that would become the Halifax Daily News. That paper, a scrappy tabloid that became the first Canadian newspaper with a website in 1994, folded in 2008, two decades after Bentley sold it.

Bentley, who no longer operates Frank, says AllNovaScotia’s readers are business people, government officials, academics, and health-care administrators. They are people who need to know what’s going on but who also read the publication “just to keep an eye on who’s in the courts and owing people money.”

Cox says AllNovaScotia writes about personal lives of the province’s business elite if it affects the way that business is run.

“Just because you’re Colin MacDonald of [seafood giant] Clearwater doesn’t mean we’re not going to pry a little bit to see what’s underlying the value of that stock or the lack of value of that stock. And it’s not to say that we won’t pry into people’s personal lives,” says Cox.

That approach hasn’t rankled MacDonald, chairman of the international shellfish company that does about $300 million in business annually. Clearwater received extensive coverage by AllNovaScotia in 2011, when it was the target of a hostile takeover.

One AllNovaScotia story in August, headlined “Colin Goes Fishing,” asked whether “the most committed Clearwater founder was losing his passion” after MacDonald went salmon fishing in Newfoundland during the takeover challenge.

MacDonald stated in an email that AllNovaScotia “provides me and I suspect other business leaders with a real-time heads up on what is happening in the business community” — an advantage over other news media in the province, which he said are slower and “lacking the business focus and insight.”

In reaction, the Chronicle-Herald played catch-up in 2011, launching a rival morning business newsletter and hiring additional business reporters.

But a major component of AllNovaScotia’s success is style, not just substance.

“We speculate about an awful lot of stuff — this could happen; that might happen,” says Cox. “We write about it with a certain amount of self-righteousness that a lot of business publications won’t take to.”

How much of this style can be attributed to Bentley’s roots with the gossip magazine Frank?

“I think a substantial amount,” adds Cox. “We’re criticized harshly in the [local] journalism school for using anonymous sources, because we do. But we have people who talk to us who won’t talk to anyone else. If they’re going to give me the legitimate news and I can verify it somewhere else, I think that’s my job to get it out there.”

For Bentley — who co-owns AllNovaScotia with his daughter, the publisher — “getting it out there” simply wouldn’t happen without the site’s uncompromising paywall.

“We’ve got to do that, otherwise they won’t buy the bloody thing,” he says flatly. “Our competition is people who want to read it for nothing. That’s the great big overarching thing that attempts to suck our blood every day. It sounds a bit paranoid. But that’s the problem.”

The result, says the consultant and blogger Donham, is a web site that would appear not to get the Internet at all, by today’s online news norms.

But that’s fine with Bentley. He knows what his content is worth to his audience — in contrast to many media excutives who “think what they’ve got is more valuable than it is.” He acknowledges the value of social media in the Arab Spring uprisings, but insists, “You can’t be in the content business and not get paid for it.”

Even so, he cautions against viewing AllNovaScotia as a model. “This thing has been going on for 10 or 11 years. It’s one little place,” he says. “What sort of success is that? It’s not as though it has taken off like wildfire and spread across the continent, has it?”

Note for transparency: Cox is a sessional instructor and colleague of mine at the University of King’s College School of Journalism.

January 14 2012

18:28

Neuromarketing - brain scanners to probe our emotional response to products

Guardian :: A spokesman for NeuroFocus, which was bought last year by global advertising giant Nielsen for $5bn, said the company has worked with Google, Microsoft, Intel, Facebook, PayPal, Hewlett-Packard and Citigroup, but refused to provide details of adverts or products involved. "It's not just one company and one advertiser; it is all sorts of companies and brands around the world," Pradeep said. "They come to us and say, 'Please run our campaign through the neural lab.'"

Continue to read Rupert Neate, www.guardian.co.uk

January 09 2012

11:07

Payment kiosk Piano to start in Slovakia with eight big Slovenian publishers

paidContent :: Eight big Slovenian publishers are about to start charging for parts of their online content all at the same time, using a single payment kiosk that was pioneered in Slovakia and could soon be expanding elsewhere. The Piano system will let customers pay €4.90 per month (or €1.99 per week, or €48.90 per year) to access to the gamut of competing sites, which are eight newspapers, two magazines and one pure-play news site.

Continue to read Robert Andrews, paidcontent.org

December 21 2011

18:00

Steve Buttry: From a dropped paywall to a social media Pulitzer, expect a year of transformation

Editor’s Note: We’re wrapping up 2011 by asking some of the smartest people in journalism what the new year will bring.

Next up is longtime digital journalist Steve Buttry, the director of community engagement and social media at the Journal Register Co. & Digital First Media.

We will see more newspaper-company transactions in 2012. After a few years where no one wanted to sell at the price the market had dropped to, we’ve had Journal Register Co., the Oklahoman, the San Diego Union-Tribune, and the Omaha World-Herald (am I forgetting one?) sell in the second half of 2011. I believe those sales have helped set the market value, and some people who were refusing to sell will swallow their losses and get out of the newspaper business.

In the transactions mentioned above, people with sufficient wealth appear to have bought the companies outright, taking on little or no debt. (Take the World-Herald, which was bought by the ultimate rich person, Warren Buffett, at the helm of the ultimate public company, Berkshire Hathaway.) I believe we’ll see more transactions involving publicly held companies in 2012. We may also see more creative transactions that fall short of a sale, such as the Journal Register Co./Digital First Media deal to manage MediaNews Group.

I think Google+ will add a new feature (probably more than one, but one will get all the attention) that will make more of a splash than the initial launch of G+ did.

At least one Pulitzer Prize winner (most likely Breaking News Reporting) will have used Twitter and/or Facebook significantly in its coverage and its entry, and the social media use will be cited by the judges (or their refusal to cite it will be glaring).

The winner of the 2012 presidential election will work harder on reaching voters through social media than through the professional media.

Gene Weingarten will write a disapproving column about the changing news business that is funny but dead wrong. (After last year, I had to throw in one sure thing.)

Those are third-person predictions about what other people/companies will do. This last new prediction should carry the disclaimer of obvious self-interest, since I am leading community engagement and social media efforts for the company — but I am confident that Digital First Media will continue to lead the way in transforming the digital news business.

Beyond that, I will re-offer last year’s predictions, since they largely didn’t happen in 2011 (I suppose I can claim #newnewtwitter as being partial fulfillment, though it doesn’t include the features I mentioned):

  • Twitter will make some notable upgrades, including targeting and editing of tweets, historical searching, and some innovative commercial uses.
  • A leader will emerge in location-based news, social media, and commerce.
  • We will see some major realignment of journalism and news-industry organizations. Most likely: the merger of ASNE and APME, mergers of some state press associations, mergers of at least two national press organizations, and mergers of some reporter-beat associations. One or more journalism organizations will close.
  • At least one high-profile news organization will drop its paywall.
15:00

Dan Kennedy: 2012 will bring “the great retrenchment” among newspaper publishers

Editor’s Note: We’re wrapping up 2011 by asking some of the smartest people in journalism what the new year will bring.

Next up is Boston-based media commenter Dan Kennedy, an assistant professor of journalism at Northeastern University, a regular panelist on WGBH-TV’s “Beat the Press,” and the author of the Media Nation blog.

Following years of retreat in the face of shrinking readership, mounting financial losses, and a rising chorus of digital visionaries telling them they’re doing it all wrong, 2012 will be a year of retrenchment for newspaper publishers.

Still standing some three years after the near-implosion of the newspaper industry in 2008 and 2009, executives will point to their continued existence as proof that their situation was never as bad as it seemed, and that a few tweaks here and there will restore them to pink-cheeked, if downsized, health.

Their rallying cry will be Dean Starkman’s essay in the November/December 2011 issue of the Columbia Journalism Review, “Confidence Game.” In the course of nearly 8,000 words, Starkman dismisses those he calls the “news gurus” (principally Clay Shirky and Jeff Jarvis), arguing they are more interested in promoting their own the-sky-is-falling agenda than in the fate of public-interest journalism. Starkman calls for the preservation of traditional journalistic institutions, which brought a memorable retort from Shirky:

Saying newspapers will provide a stable home for reporters, just as soon as we figure out how to make newspapers stable, is like saying that if we had some ham, we could have a ham sandwich, if we had some bread.

Starkman’s essay is actually a nuanced, deeply intelligent meditation on the future of journalism, but it’s the caricature — newspapers good, news gurus bad — that traditionalists will embrace. That is especially true with respect to the notion that online readers have been getting a free ride, and that it’s time to insist that they start paying.

At the Boston Globe, for instance, several staff members have taken to tweeting “This is why we pay for journalism” whenever their paper has published something particularly noteworthy — a reference to the Globe’s newly instituted paywall. Never mind that we have always paid for journalism — until recently, primarily through advertising. Never mind that NPR, some commercial broadcast outlets and a rising tide of non-profit news organizations are producing excellent journalism every day that is paid for by someone other than the end user. The unspoken message is, We hard-working journalists have been giving away our work for 15 years, and we’re finally putting a stop to it.

In fact, there are reasons to hope the traditional newspaper industry might have a bit more life left in it than we thought a few years ago. The Globe and The New York Times, both owned by The New York Times Company, are pioneering the use of flexible paywalls that keep much of their content open to social networks and blogs while imposing a fee on regular readers. The Times, at least, has had some success; the Globe has not yet released any numbers. Publishers everywhere are hoping to emulate them.

The forces that have been undermining newspapers since the rise of the commercial web in the mid-1990s will come back to the fore.

Since advertising comprises an ever-shrinking share of revenues, publishers have to persuade readers to pay in the form of higher prices for print and something — anything — for online access. The alternative is to continue sliding toward oblivion. And despite some promising experiments here and there, it’s still not at all clear what would replace newspapers, especially at the local level. For every community that has a high-quality non-profit news site like Voice of San Diego (currently experiencing its own problems) and the New Haven Independent, or a for-profit like The Batavian or Baristanet, there are hundreds without anything but their shrinking, debt-ridden, chain-owned local newspaper.

The great newspaper retrenchment may prove to be more than a dead-cat bounce. As the economy slowly improves, the newspaper business may well enjoy a semi-revival. But before long, the forces that have been undermining newspapers since the rise of the commercial web in the mid-1990s will come back to the fore. Some progressive newspaper executives, like John Paton of Digital First Media, are trying to figure out how to combine the best of the new and the old before it’s too late. For the most part, though, you can be reasonably sure that newspaper companies will continue to cut costs, maximize profits (or minimize losses), and do their best ostrich imitations until they find themselves under siege once again.

After all, they’re standing up for traditional values — and what could be more traditional than failing to plan for the future?

Wall image via Mark Heard used under a Creative Commons license.

September 16 2011

15:30

This Week in Review: A unique paywall plan in Boston, and ethics at TechCrunch and the Times

Every Friday, Mark Coddington sums up the week’s top stories about the future of news.

Paid and free, side by side: The Boston Globe became the latest news organization to institute an online paywall this week, but it did so in an unprecedented way that should be interesting to watch: The newspaper created a separate paid site, BostonGlobe.com, to run alongside its existing free site, Boston.com. PaidContent has the pertinent details: A single price ($3.99 a week), and Boston.com gets most of the breaking news and sports, while BostonGlobe.com gets most of the newspaper content.

As the Globe told Poynter’s Jeff Sonderman, the two sites were designed with two different types of readers in mind: One who has a deep appreciation for in-depth journalism and likes to read stories start-to-finish, and another who reads news casually and briefly and may be more concerned about entertainment or basic information than journalism per se.

The first thing that caught many people’s attention was new site’s design — simple, clean, and understated. Tech blogger John Gruber gave it a thumbs-up, and news design guru Mario Garcia called it ”probably the most significant new website design in a long time.” The Lab’s Joshua Benton identified the biggest reasons it looks so clean: Far fewer links and ads.

Benton (in the most comprehensive post on the new site) also emphasized a less noticeable but equally important aspect of BostonGlobe.com’s design: It adjusts to fit just about any browser size, which reduces the need for mobile apps, making life easier for programmers and, as j-prof Dan Kennedy noted at the Lab, a way around the cut of app fees required by Apple and others. If the Globe’s people “have figured out a way not to share their hard-earned revenues with gatekeepers such as Apple and Amazon, then they will have truly performed a service for the news business — and for journalism,” Kennedy said.

Of course, the Globe could launch the most brilliantly conceived news site on the web, but it won’t be a success unless enough people pay for it. Poynter’s Sonderman (like Kennedy) was skeptical of their ability to do that, though as the Atlantic’s Rebecca Rosen pointed out, the Globe’s plan may be aimed as much at retaining print subscribers as making money off the web. The Washington Post’s Erik Wemple wondered if readers will find enough at BostonGlobe.com that’s not at Boston.com to make the site worth their money.

The TechCrunch conflict and changing ethical standardsLast week’s flap between AOL and TechCrunch over the tech site’s ethical conflicts came to an official resolution on Monday, when TechCrunch founder Michael Arrington parted ways with AOL, the site’s owner. But its full effects are going to be rippling for quite a while: Gawker’s Ryan Tate called the fiasco a black eye for everyone involved, but especially AOL, which had approved Arrington’s investments in some of the companies he covers just a few months ago. Fellow media mogul Barry Diller also ripped AOL’s handling of the situation.

At the Guardian, Dan Gillmor said that while he doesn’t trust TechCrunch much personally, it’s the audience’s job to sort out their trust with the help of transparency, rather than traditional journalism’s strictures. Others placed more of the blame on TechCrunch: Former Newsweek tech editor Dan Lyons said TechCrunch’s people should have expected this type of scenario when they sold to a big corporation, and media analyst Frederic Filloux said TechCrunch is a perfect example of the blogosphere’s vulnerability to unchecked conflicts of interest.

There was more fuel for those kinds of ethical concerns this week, as the winning company at TechCrunch’s annual Disrupt competition was one that Arrington invests in. But Arrington had an ethical accusation of his own to make at the conference, pointing out that the New York Times invests in a tech venture capital fund which has put $3.5 million into GigaOM, a TechCrunch competitor. Poynter’s Steve Myers detailed the Times’ run-ins between the companies it invests in and the ones it covers (and its spotty disclosure about those connections), concluding that even if the conflict is less direct than in blogging, it’s still worth examining more closely.

As it plunged further into its battle with TechCrunch late last week, AOL was also reported to be talking with Yahoo, which recently fired its CEO, about a merger between the two Internet giants. All Things Digital’s Kara Swisher said there’s no way the deal would actually happen; Wired’s Tim Carmody called it a “spectacularly crazy idea” and GigaOM’s Mathew Ingram agreed, while Business Insider reminded us that they said a year ago that AOL and Yahoo should merge.

Meanwhile, the New York Times’ David Carr homed in on the core problem that both companies are facing: The fact that people want information online from niche sites, not giant general-news portals. “As news surges on the Web, giant ocean liners like AOL and Yahoo are being outmaneuvered by the speedboats zipping around them, relatively small sites that have passionate audiences and sharply focused information,” he wrote.

Facebook opens to subscribers: It hasn’t gotten nearly as much attention as some of its other moves, but Facebook took another step in Twitter’s direction this week by introducing the Subscribe Button, which allows users to see other people’s (and groups’) status updates without friending or becoming a fan of them.

As GeekWire’s Monica Guzman and many others noted, Facebook’s “subscribe” looks a heck of a lot like Twitter’s “follow.” When asked about similar Google+ features at the TechCrunch Disrupt conference, a Facebook exec said it wasn’t a response to Google+.

Guzman said Facebook is putting down deeper roots by going beyond the limits of reciprocal friendship, and GigaOM’s Mathew Ingram pinpointed the reason why this could end up being a massive change for Facebook: It’s beginning to move Facebook from a symmetrical network to an asymmetrical one, which could fundamentally transform its dynamics. Still, Ingram said Twitter is much better oriented toward being an information network than Facebook is, even with a “Subscribe” button.

The change could have particularly interesting implications for journalists, as Poynter’s Jeff Sonderman explained in his brief outline of the feature. As he noted, it may eliminate the need for separate Facebook profiles and pages for journalists, and while Lost Remote’s Cory Bergman said that should be a welcome change for journalists who were trying to manage both, he noted that shows and organizations may want to stick with pages.

News Corp.’s scandal widens: An update on the ongoing scandal enveloping News Corp.: A group of U.S. banks and investment funds that own shares in News Corp. expanded a lawsuit to include allegations of stealing, hacking, and anti-competitive behavior by two of the company’s U.S. subsidiaries — an advertiser and a satellite TV hardware manufacturer. As the Washington Post’s Erik Wemple noted, these are old cases, but they’re getting fresh attention, and that’s how scandals gain momentum.

James Murdoch, the son of News Corp.’s Rupert Murdoch, was also recalled to testify again before members of Britain’s Parliament later this fall, facing new questions about the breadth of News Corp.’s phone hacking scandal. The Wall Street Journal examined the scandal’s impact on the elder Murdoch’s succession plan for the conglomerate, especially as it involves James. The company’s executives also announced this week that they’ve found tens of thousands of documents that could shed more light on the phone hacking cases.

Reading roundup: Here’s what else went on this week:

— The biggest news story this week, of course, is actually 10 years old: Here’s a look at how newspapers marked the anniversary of 9/11, how news orgs used digital technology to tell the story, and a reflection on how 9/11 changed the media landscape.

— Twitter introduced a new web analytics tool to measure Twitter’s impact on websites. Here’s an analysis from Mathew Ingram of GigaOM.

— At an academic conference last weekend, Illinois j-prof Robert McChesney repeated his call for public funding for journalism. Here are a couple of good summaries of his talk from fellow j-profs Axel Bruns and Alfred Hermida.

— Finally, here’s a relatively short but insightful two-part interview between two digital media luminaries, Henry Jenkins and Dan Gillmor, about media literacy, citizen journalism and Gillmor’s latest book. Should make for a quick, thought-provoking weekend read.

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