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June 28 2013

15:00

This Week in Review: The backlash against Greenwald and Snowden, and RSS’s new wave

glenn-greenwald-cc

Greenwald, journalism, and advocacy: It’s been three weeks since the last review, and a particularly eventful three weeks at that. So this review will cover more than just the last week, but it’ll be weighted toward the most recent stuff. I’ll start with the U.S. National Security Agency spying revelations, covering first the reporter who broke them (Glenn Greenwald), then his source (Edward Snowden), and finally a few brief tech-oriented pieces of the news itself.

Nearly a month since the first stories on U.S. government data-gathering, Greenwald, who runs an opinionated and meticulously reported blog for the Guardian, continues to break news of further electronic surveillance, including widespread online metadata collection by the Obama administration that continues today, despite the official line that it ended in 2011. Greenwald’s been the object of scrutiny himself, with a thorough BuzzFeed profile on his past as an attorney and questions from reporters about old lawsuits, back taxes, and student loan debt.

The rhetoric directed toward Greenwald by other journalists was particularly fierce: The New York Times’ Andrew Ross Sorkin said on CNBC he’s “almost arrest” Greenwald (he later apologized), and most notably, NBC’s David Gregory asked Greenwald “to the extent that you have aided and abetted Snowden,” why he shouldn’t be charged with a crime. The Washington Post’s Erik Wemple refuted Gregory’s line of questioning point-by-point and also examined the legal case for prosecuting Greenwald (there really isn’t one).

There were several other breakdowns of Gregory’s questions as a way of defending himself as a professional journalist by excluding Greenwald as one; of these, NYU professor Jay Rosen’s was the definitive take. The Los Angeles Times’ Benjamin Mueller seconded his point, arguing that by going after Greenwald’s journalistic credentials, “from behind the veil of impartiality, Gregory and his colleagues went to bat for those in power, hiding a dangerous case for tightening the journalistic circle.”

The Freedom of the Press Foundation’s Trevor Timm argued that Gregory is endangering himself by defining journalism based on absence of opinion, and The New York Times’ David Carr called for journalists to show some solidarity on behalf of transparency. PaidContent’s Mathew Ingram used the case to argue that the “bloggers vs. journalists” tension remains important, and Greenwald himself said it indicated the incestuous relationship between Washington journalists and those in power.

A few, like Salon’s David Sirota, turned the questions on Gregory, wondering why he shouldn’t be charged with a crime, since he too has disclosed classified information. Or why he should be considered a journalist, given his track record of subservience to politicians, as New York magazine’s Frank Rich argued.

Earlier, Rosen had attempted to mediate some of the criticism of Greenwald by arguing that there are two valid ways of approaching journalism — with or without politics — that are both necessary for a strong press. Former newspaper editor John L. Robinson added a call for passion in journalism, while CUNY’s Jeff Jarvis and Rolling Stone’s Matt Taibbi both went further and argued that all journalism is advocacy.

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Snowden and leaking in public: The other major figure in the aftermath of this story has been Edward Snowden, the employee of a national security contractor who leaked the NSA information to Greenwald and revealed his identity shortly after the story broke. The U.S. government charged Snowden with espionage (about which Greenwald was understandably livid), as he waited in Hong Kong, not expecting to see home again.

The first 48 hours of this week were a bit of blur: Snowden applied for asylum in Ecuador (the country that’s been harboring WikiLeaks’ Julian Assange), then reportedly left Hong Kong for Moscow. But Snowden wasn’t on a scheduled flight from Moscow to Cuba, creating confusion about where exactly he was — and whether he was ever in Moscow in the first place. He did all this with the apparent aid of WikiLeaks, whose leaders claimed that they know where Snowden is and that they could publish the rest of his NSA documents. It was a bit of a return to the spotlight for WikiLeaks, which has nonetheless remained on the FBI’s radar for the last several years, with the bureau even paying a WikiLeaks volunteer as an informant.

We got accounts from the three journalists Snowden contacted — Greenwald, The Washington Post’s Barton Gellman, and filmmaker Laura Poitras — about their interactions with him, as well as a probe by New York Times public editor Margaret Sullivan into why he didn’t go to The Times. In a pair of posts, paidContent’s Mathew Ingram argued that the leak’s path showed that having a reputation as an alternative voice can be preferable to being in the mainstream when it comes to some newsgathering, and that news will flow to wherever it finds the least resistance. The Times’ David Carr similarly concluded that news stories aren’t as likely to follow established avenues of power as they used to.

As The Washington Post’s Erik Wemple described, news organizations debated whether to call Snowden a “leaker,” “source,” or “whistleblower,” Several people, including The Atlantic’s Garance Franke-Ruta and Forbes’ Tom Watson, tried to explain why Snowden was garnering less popular support than might be expected, while The New Yorker’s John Cassidy detailed the backlash against Snowden in official circles, which, as Michael Calderone of The Huffington Post pointed out, was made largely with the aid of anonymity granted by journalists.

Numerous people, such as Kirsten Powers of The Daily Beast, also decried that backlash, with Ben Smith of BuzzFeed making a particularly salient point: Journalists have long disregarded their sources’ personal motives and backgrounds in favor of the substance of the information they provide, and now that sources have become more public, the rest of us are going to have to get used to that, too. The New York Times’ David Carr also noted that “The age of the leaker as Web-enabled public figure has arrived.”

Finally the tech angle: The Prism program that Snowden leaked relied on data from tech giants such as Google, Apple, Facebook, and Yahoo, and those companies responded first by denying their direct involvement in the program, then by competing to show off their commitment to transparency, as Time’s Sam Gustin reported. First, Google asked the U.S. government for permission to reveal all their incoming government requests for information, followed quickly by Facebook and Microsoft. Then, starting with Facebook, those companies released the total number of government requests for data they’ve received, though Google and Twitter pushed to be able to release more specific numbers. Though there were early reports of special government access to those companies’ servers, Google reported that it uses secure FTP to transfer its data to the government.

Instagram’s bet on longer (but still short) video: Facebook’s Instagram moved into video last week, announcing 15-second videos, as TechCrunch reported in its good summary of the new feature. That number drew immediate comparisons to the six-second looping videos of Twitter’s Vine. As The New York Times noted, length is the primary difference between the two video services (though TechCrunch has a pretty comprehensive comparison), and Instagram is betting that longer videos will be better.

The reason isn’t aesthetics: As Quartz’s Christopher Mims pointed out, the ad-friendly 15-second length fits perfectly with Facebook’s ongoing move into video advertising. As soon as Instagram’s video service was released, critics started asking a question that would’ve seemed absurd just a few years ago: Is 15 seconds too long? Josh Wolford of WebProNews concluded that it is indeed too much, at least for the poorly produced amateur content that will dominate the service. At CNET, Danny Sullivan tried to make peace with the TL;DR culture behind Vine and Instagram Video.

Several tech writers dismissed it on sight: John Gruber of Daring Fireball gave it a terse kiss-off, while Mathew Ingram of GigaOM explained why he won’t use it — can’t be easily scanned, and a low signal-to-noise ratio — though he said it could be useful for advertisers and kids. PandoDaily’s Nathaniel Mott argued that Instagram’s video (like Instagram itself) is more about vanity-oriented presentation than useful communication. And both John Herrman of BuzzFeed and Farhad Manjoo of Slate lamented the idea that Instagram and Facebook seem out of ideas, with Manjoo called it symptomatic of the tech world in general. “Instead of invention, many in tech have fallen into the comfortable groove of reinvention,” Manjoo wrote.

Chris Gayomali of The Week, however, saw room for both Vine and Instagram to succeed. Meanwhile, Nick Statt of ReadWrite examined the way Instagram’s filters have changed the way photography is seen, even among professional photographers and photojournalists.

google-reader-mark-all-as-readThe post-Google Reader RSS rush: As Google Reader approaches its shutdown Monday, several other companies are taking the opportunity to jump into the suddenly reinvigorated RSS market. AOL launched its own Reader this week, and old favorite NetNewsWire relaunched a new reader as well.

Based on some API code, there was speculation that Facebook could be announcing its own RSS reader soon. That hasn’t happened, though The Wall Street Journal reported that Facebook is working on a Flipboard-like mobile aggregation device. GigaOM’s Eliza Kern explained why she wouldn’t want a Facebook RSS feed, while Fast Company’s Chris Dannen said a Facebook RSS reader could actually help solve the “filter bubble” like-minded information problem.

Sarah Perez of TechCrunch examined the alternatives to Google Reader, concluding disappointedly that there simply isn’t a replacement out there for it. Her colleague, Darrell Etherington, chided tech companies for their reactionary stance toward RSS development. Carol Kopp of Minyanville argued, however, that much of the rush toward RSS development is being driven just as much by a desire to crack the mobile-news nut, something she believed could be accomplished. RSS pioneer Dave Winer was also optimistic about its future, urging developers to think about “What would news do?” in order to reshape it for a new generation.

Reading roundup: A few of the other stories you might have missed over the past couple of weeks:

— Rolling Stone’s Michael Hastings, who had built up a reputation as a maverick through his stellar, incisive reporting on foreign affairs, was killed in a car accident last week at age 33. Several journalists — including BuzzFeed’s Ben Smith, The Guardian’s Spencer Ackerman, Slate’s David Weigel, and freelancer Corey Pein — wrote warm, inspiring remembrances of a fearless journalist and friend. Time’s James Poniewozik detected among reporters in general “maybe a little shame that more of us don’t always remember who our work is meant to serve” in their responses to Hastings’ death.

— Pew’s Project for Excellence in Journalism issued a study based on a survey of nonprofit news organizations that provided some valuable insights into the state of nonprofit journalism. The Lab’s Justin Ellis, Poynter’s Rick Edmonds, and J-Lab’s Jan Schaffer explained the findings. Media analyst Alan Mutter urged nonprofit news orgs to put more focus on financial sustainability, while Michele McLellan of the Knight Digital Media Center called on their funders to do the same thing.

— Oxford’s Reuters Institute also issued a survey-based study whose findings focused on consumers’ willingness to pay for news. The Lab’s Sarah Darville and BBC News’ Leo Kelion summarized the findings, while paidContent’s Mathew Ingram gave an anti-paywall reading. The Press Gazette also highlighted a side point in the study — the popularity of live blogs.

— Texas state politics briefly grabbed a much broader spotlight this week with state Sen. Wendy Davis’ successful 13-hour filibuster of a controversial abortion bill. Many people noticed that coverage of the filibuster (and surrounding protest) was propelled by digital photo and video, rather than cable news. VentureBeat’s Meghan Kelly, Time’s James Poniewozik, and The Verge’s Carl Franzen offered explanations.

— Finally, a couple of reads from the folks at Digital First, one sobering and another inspiring: CEO John Paton made the case for the inadequacy of past-oriented models in sustaining newspapers, and digital editor Steve Buttry collected some fantastic advice for students on shaping the future of journalism.

Photos of Glenn Greenwald by Gage Skidmore and Edward Snowden stencil by Steve Rhodes used under a Creative Commons license. Instagram video by @bakerbk.

June 18 2013

15:37

The Times of London, navigating audience with a strict paywall, retires its opinion Tumblr

times opinionWhen you bet on a strict, un-leaky paywall as The Times of London has, you’re forced to get creative about how to put your work in front of new audiences — particularly if you’re trying to influence their opinions. Unlike its fellow Times across the Atlantic, the U.K. paper has chosen not to allow a set number of articles per month or a number of free routes around the paywall.

So a year ago, The Times set up a Tumblr for its opinion content, with the aim of giving “a flavour of what our columnists and leader writers do, how they think, and what influences their writing.”

After initially posting 80 times or more a month, posting fell off, and earlier this month, the Times Opinion Tumblr was shut down, with editors announcing they would be moving all opinion content back to its original home on the newspaper’s main site.

“We wanted to see if it attracted new readers to The Times and were very clear, with ourselves and our readers, that it was an experiment to see how it could work for us. It flourished in parts, but we’ve come to the conclusion that it wasn’t quite right for us,” communities editor Ben Whitelaw wrote in a post that also appeared on the Times Digital Development blog.

The Times reactivated its Comment Central opinion blog — behind the paywall — on the same day that the Tumblr blog was shuttered. Whitelaw wrote that posts to the blog would occasionally be free-to-access.

Nick Petrie, The Times’ social media and campaigns editor, told me that the Tumblr page was part of an effort to draw in new digital subscribers to TheTimes.co.uk. Regular Times columnists like Oliver Kamm and Daniel Finkelstein posted shorter “off-the-cuff” pieces on the page, which were freely viewable to all visitors. Times Opinion had amassed 66,000 followers since its launch, Petrie said, “but it wasn’t driving traffic back to the site.”

“Tumblr seemed like a good, light, easy-to-use platform that we could use to give people a taste of our comment and opinion, which is obviously the type of journalism that the Times is renowned for,” Petrie explained. “There was a hope that pushing out a small amount of original journalism, of original comment and opinion, would further enhance the idea of giving people a taste of what’s on offer if they became a subscriber.”

Reaching an audience to influence

What to do about opinion writing behind a paywall is a question newspapers have dealt with as long as there have been paywalls. Opinions, after all, are meant to influence, and influence would seem to grow along with the audience reading them. The Wall Street Journal, a paywall early adopter, committed early on to posting many of its opinion pieces online for free even while most news content was subscriber-only. Meanwhile, The New York Times took the opposite approach in the mid 2000s with TimesSelect, which kept the news free but put the newspaper’s columnist behind a paywall.

(The Wall Street Journal also began posting pieces from its editorial page on an Opinion Journal Tumblr, but back in 2007; like the U.K.’s Times, the Journal also stopped updating the page about a year after its debut.)

Petrie said that The Times had not specifically set up analytics for the Times Opinion Tumblr, so the editors aren’t sure what kind of traffic the page generated. According to comScore data, The Times has seen a substantial increase in traffic over the past year, from 748,000 unique worldwide visitors in April 2012 to nearly 1.5 million in April 2013 — but that’s still far behind other British newspapers without strict paywalls such as The Guardian, which has over 18 million monthly uniques in the United States alone and well over 30 million worldwide.

The Times, owned by the soon-to-split News Corp., remains on shaky financial ground; last week, acting editor John Witherow announced that the paper would be cutting 20 editorial jobs as a result of the parent company’s decision to separate its newspaper and entertainment holdings, The Guardian reported. The Times has seen a major decline in online readership since erecting the paywall in 2010.

“The idea is that everything that we publish is worth being paid for,” Petrie said.

Teaser pages, which allow readers to view the first 100 words of every article, were integrated into the Times site in October 2012 and may be a driver of The Times’ increased traffic. Only 881,000 unique visitors came to the site in October 2012 according to ComScore — a modest increase from the previous spring.

After the 100-word previews became a standard part of the site, Petrie said that the opinion Tumblr “became slightly defunct in that moment…We’re pursuing a strategy that essentially, we want to bring people in to see our journalism, rather than take our journalism out of our space — that’s why we’ve relaunched the Comment Central blog, which had been incredibly popular before we started charging.” That blog will soon feature podcasts on opinion topics, and Petrie noted that the Times is developing new strategies to attract paying subscribers to the site.

“That’s something we’re working on at the moment, but we’re not ready to talk about that yet,” he said.

June 13 2013

07:02

The newsonomics of Hearst Magazines’ one million new customers

Take this quiz. The era of paying for digital access (a.k.a. digital circulation or paywalls) is about:

  1. Getting more money out of core subscribers;
  2. Getting new money out of new subscribers; or
  3. Getting money any way you can.

Okay, 3 is a gimme. But 1 and 2 are very different strategies. While most newspaper publishers are leaning heavily on their long-time core bases by promising and delivering all-access, Hearst Magazines is taking a contrarian turn in the market. It’s a strategy that is largely at odds with peers Condé Nast, Time Inc., and Meredith, as well as most newspaper publishers. It’s betting almost wholly on new customers.

“We want unique paying digital customers,” says Chris Wilkes, VP for audience development and digital editions for Hearst Magazines. “We’re not interested in people reading print and digital together. We want people who are engaging with our digital products, and we’re attracting people who want to read in the digital format.” The company has experimented with a little bundling — at “fair” (higher) and not “ride-along” prices — Wilkes says, but that’s a minor part of the business.

He can now offer up one big seven-digit number to back up that strategy: One million paid digital subscribers. That’s the number of new subscribers Hearst Magazines was able to announce in May. Hearst Magazines president David Carey met that magic number just a few months behind his target. At one million, it’s still only about 3-4 percent of Hearst’s total print circulation — but it’s a milestone. The company is aiming to make 10 percent of its total circulation digital by 2016.

It’s not that Hearst is saying it won’t do all-access ever. But its reason for zagging while other zig is clear.

“It’s easier for us to pivot out of a paid model to authenticated than it would be for others to go the other way,” Carey explained to me earlier this year. In other words, Hearst can go all-access, but would do it at higher prices, reflecting dual value.

Those million subscribers are spread unevenly among 21 digital magazines. The biggest title is Cosmopolitan, with 175,000 paying digital subscribers, or 6 percent of its total circ. O, Oprah’s mag, is second at 108,000. The Food Network’s is third.

Carey’s big digital push encompasses a lot more than digital editions. The Hearst Tower is seeing lots of shake ups, new hires, and new projects. At the top, longtime COO Steve Swartz has finally moved into the CEO’s suite as Frank Bennack’s remarkable three-decade tenure has drawn to a close. He now heads a well-diversified private media company reaching into magazines, TV, newspapers and business media.

Hearst just hired digital native Troy Young as president of Hearst Magazines Digital Media. Young’s digital business associations — xoJane, ReadWrite, Refinery29, Spinmedia, and CrowdSurge — lead to this job where he’ll be responsible for “digital content, technology, operations, revenue, product, and business development strategies.” The company has now made it possible for advertisers to buy across its digital titles through Totally Global Media. Its two-year-old App Lab is home to 40 staffers. Its embrace of native advertising is recent, warm, and wide; it has just announced five new products in the field, and raised some editorial eyebrows as its magazine staff is writing commercial copy as part of their jobs.

Hearst’s strategy here is one to watch. There are good reasons (more on that below) why daily newspapers have opted to go for door number one and get more money from long-time subscribers while making new subs a largely second priority. But they know that’s a two- to three-year strategy. As 10,000 baby boomers turn 65 every single day through 2031, the older-reader market inevitably winnows and must be refreshed with new, paying customers. For daily newspapers, getting younger (yes, younger means under 55) readers to pay is mostly phase two.

So let’s see what Hearst learning, as it leads both newspaper companies in that quest and its fellow magazine chains as well.

There’s a lot to like about the demographics of the digital audience. According to the company’s data, the readers are 10-20 percent more affluent, 10 years younger, and more educated. Wilkes acknowledges that those good demographics may be skewed by early tablet demographics themselves, but they are directionally vital.

Make no mistake: The tablet is the linchpin here. How much of the reading of these magazines happens on the tablet? An amazing 98 percent. For many, the tablet is a truly becoming a replacement for the print magazine.

Wide distribution is key to gaining numbers; subscriber growth is now moving at about 10 percent a month. Hearst uses all the platforms out there, from the Apple, Amazon, and Android stores and beyond. It is also testing magazine aggregation: It’s an owner of Next Issue (“The newsonomics of Next Issue magazine future”), which offers dozens of titles at two price points, and it partners with Zinio (which just debuted its first multi-title offer).

The tablet, of course, has become the lifeline of the magazine, a bequest of Steve Jobs, soon to be refreshed by the changes coming in iOS 7. While the horizontal web page always proved an awkward fit for vertical magazines, the tablet is oh-so magazine like.

“It was a small novelty business [on the pre-tablet web],” Wilkes says. “We knew when the iPad came out, we would finally be able to build our business.” The iPad revolution completely changed the magazine industry’s potential trajectory.

Newsstand sales continue to crash — down 8.2 percent in the second half of 2012, in part, of course, because of the millions of tablets that readers are carrying into airports and on trains. (And soon, when the FAA finally relaxes tablet reading on takeoff and landing, the necessity of having a print piece packed away will lessen further.)

Hearst, while arguably leading the magazine pack, certainly has its own challenges. Its single copy sales lost 1.9 percent in 2012, even though its 2.3 percent overall circulation increase to 30.7 million stands out among its peers.

For the first quarter, print ad pages were down 4.9 percent for U.S. consumer magazines, though only 0.1 percent in revenue due to price increases. Hearst Magazines was up 6.6 percent.

Given the across-the-spectrum drop in print advertising, both Time Inc. and Meredith have recently laid hundreds of employees. Time Inc. is, of course, in turnaround — yet again. First up for sale and now to be spun off from Time Warner, it let CEO Laura Lang go after but a year of ongoing strategic review and seems significantly behind Hearst in digital innovation. It is now playing catch-up with notable hires for Time.com, but is climbing out of its indecisive recent past; ad pages were down 12.2 percent in 2012, though up 0.6 percent for Q1 2013.

It’s intriguing that Hearst has — so far — embraced a double-edged bundling philosophy. While it won’t, largely, bundle print and digital subscriptions, advertising is mostly bundled. If you buy an ad in House Beautiful or HGTV Magazine, you are paying for the whole rate base, including that three percent of the readership that’s tablet, says Wilkes. At this point, a buy is a buy, though, Hearst, like so many others, is going to town on all the new possibilities of customizing advertising for top brands. It’s not just those latest buzzwords, content marketing. It’s interactive ad creation. Advertisers who buy print can tweak their tablet ad to use its capabilities.

Wilkes notes a real movement in the ad creation business. Last year, he says, 85 percent of the ad customization done for the e-edition ads were done by his App Labs staff, with only 15 percent of advertisers, or their agencies, doing the tweaking. This year, brands or their agencies have assumed the work in about 40 percent of the cases, with the Apps Labbers doing the rest.

Wilkes anticipates the work will continue to migrate back to the advertiser. That’s a big lesson for all the publishers jumping into the agency business: As traditional agencies step up, increasingly fearing their own obsolescence, the custom/content marketing units of publishers will get more competition. Many inevitably will fall back to doing what they’ve long done: sell space. Those — nationally or locally — who see riches in becoming agencies — may find the going a lot tougher than it may be in 2013.

The pricing of the digital magazines is a big question and still a work in progress.

Magazines, which long used token reader payments just to print hundreds of pages of lucrative advertising, have a price problem. As John Loughlin, GM of Hearst Magazines, recently put it at MPA Swipe 2.0, “a magazine subscription needs to be valued at more than two venti cappuccinos.” Magazine publishers realize, just as their newspaper brethren do, that the challenges of digital advertising will only grow, as print ad pages decline — and that readers must pay more of the freight going forward.

On average, Hearst’s digital mags cost 30 percent more than their print equivalents, Typically, they are $19.99 for a year, $1.99 for a month. Buyers can pay for a single issue or per year, depending on the title. A majority opt for the annual sub.

“It’s not pricing up — it’s pricing back,” says Wilkes, meaning magazines need to regain value lost in the heavily discounted print subscriptions that can now be found in seconds simply by Googling.

It’s true that most of that 30 percent in higher prices never reaches Hearst, as it deals with Apple and others of its more than a dozen distribution points, many of whom take cuts in the 15-30 percent range as commission. Wilkes says that’s not the reason for the 30 percent upcharge — it’s meant to convey a new value for the tablet age.

Might the price go higher? Early data says it could. A magazine’s price isn’t among the top reasons readers buy — or don’t. As Hearst interacts with consumers and reads app reviews, it sees that customer satisfaction with the product is by far the key driver in gaining and keeping subscribers. “We’re not seeing much price sensitivity,” says Wilkes.

The pricing conundrum is at least two-sided. Magazines have a greater ability to draw in new subscribers. Getting someone to one-click for $20 is one thing. Getting them to commit — after cheap trial subs — to $200 to $300 for a year’s newspaper subscription is another.

So here magazines may have an edge at gaining new customers — unless newspapers can figure out cheaper subset products that may provide more saleable price points. The Wall Street Journal’s test with Pulse, on three cheaper products, may not be producing big results, but expect to see more such tests; The New York Times’ first-quarter earnings announcement about new niche paid products is one to watch here.

Yet newspapers’ weakness is also their strength. Their all-access plans have been front and center for a reason. On average, those putting all-access plans into place have increased subscription prices 40 percent, according to Press+, the leading supplier of paywall technology to the U.S. industry. Forty percent of $250 is $100. Newspaper publishers will tell you they’d rather increase rates for readers across the board than expect “onesie or twosie” new sales to propel their businesses and make up for ad loss.

The New York Times, now getting close to 700,000 digital subscribers and offering all-access to print readers is the best example of a daily having it both ways.

The bigger money that newspaper publishers are taking in makes magazine publishers envious. It’s important to acknowledge the differing cost bases of the newspaper and magazine industries — but still, the ability to yield significant new reader revenue has largely been a newspaper advantage.

Hearst Magazines, in reaching the golden million number, is the leader in new consumer magazine reader revenue. It has added, we can extrapolate, about three to four percent of new reader revenue to the mix. That’s impressive, but not world-beating. Literally, at $20 price points, or even $30 prices, they need millions of new readers — which is David Carey’s plan — to fundamentally alter publisher economics.

One further hope may be niche paid products. Hearst Magazines’ own experience with those may be cautionary. It has produced numerous standalone apps out of its shelter, food, and health properties, but is now de-emphasizing that development. Why? Too much noise in the marketplace, so too little return for the investment. Rather, it will concentrate on improving its digital editions.

There’s one more long-term business strategy playing out here. It’s hard to see in 2013, but it will enjoy high visibility by 2020. Hearst’s cost in printing and distributing magazines are 30-40 percent of its overall cost base, on a par with newspapers. As its readers cross over (“The newsonomics of crossover”), paying as much or more for digital as they do for print, profit increases markedly. At three percent of circulation today, or 10 percent in 2016, Hearst won’t be at crossover. Expect, though, that crossover to move more quickly for Hearst than for other publishers.

As it reaches 50 percent and more, it’s a new business, and strategies, like Hearst’s, may make even more sense in the rear-view mirror.

April 09 2013

12:25

March 29 2013

13:30

April 23 2012

18:23

Are you a young dude interested in news? All else equal, this study says you’re a top paywall target

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: Young males who are — wait for it — interested in the news.

That last part is key, because while younger people are more likely to pay for news online, the study finds, they’re also less likely to be interested in news in the first place.

Another paradox: People say they prefer reading print products, yet online use is growing. In other words, consumers don’t always use what they prefer, and they’re not always willing to spend money on what they use.

That’s an idea that Chyi has been exploring since the 1990s. She sometimes refers to it as “ramen noodle theory,” which we’ve written about before: People might prefer steak over ramen — but when it comes time to reach for their wallets, they opt for ramen more often. Because it’s free and abundant, the “ramen” is perceived as inferior — which reinforces consumers’ preference for “steak.” This could help explain why Chyi found “very weak correlations” between use and intent to pay in her latest study. This is from its abstract:

While media scholars tend to take “media use” as an indicator of popularity or diffusion, media use alone does not fully capture the complexity of online news consumption. For instance, given free online news offerings in most cases, consumers do not always use what they prefer, and most are not willing to pay for what they use. This study identifies three distinct factors — preference, use, and paying intent — each helps explain a specific facet of online news consumption.

Given how many variables play a role in a consumer’s decision to buy online news, the takeaway is a bit more complicated, and that’s kind of the point: Fully understanding online news consumption is about more than just looking at how often people are going online. News organizations must also get dig into what consumer’s want, what they’re willing to buy, then figure out how (and why) these factors overlap.

“The overall picture when we are looking at intention to pay for online news is that we have to consider as many as five predictors,” Chyi told me. “I think that sort of explains why most newspapers have found it’s so difficult to monetize their online content.” From the study:

Specifically, age is a key factor influencing every aspect of online news consumption. Gender, in comparison, only affects paying intent. Paying intent for online news is influenced by five factors (age, gender, news interest, preference, and online news use), with age and news interest being the strongest predictors.

The study was presented Saturday at the International Symposium on Online Journalism. Chyi’s study was based on an online survey of 767 adult respondents in August 2010. While that seems like a really long time ago in Internet years — the first iPad was only five months old — Chyi says her research is current enough to offer a useful picture of a longer-term shift she’s tracked for more than a decade. Though print is declining by just about every metric, Chyi is convinced that there is an “over-optimistic bias toward online news.” At the same time, she acknowledges it’s “very late and very difficult to change the perception that the future is online or online-only.”

It’s not that she’s anti-technology, she says: “I believe that new platforms will be really important for people to access news, but in terms of how to monetize it, I think it’s getting more and more difficult,” says Chyi, who also sees a conflation between print decline and online growth. “Very often we mix the two together and say, ‘Because print is declining, the future must be online.’ But I don’t think that’s the case.”

Whatever the case may be, the theoretical model her study produced might offer the beginnings of a structural map for those who need to find a way to convince audiences that their news products are worth paying for.

14:00

A Progress Report on a College Paper's Pioneering Metered Pay Wall

It was just over a year ago that a college newspaper in Oklahoma became a digital media pioneer.

In what was believed to be a first for a college news outlet, The Daily O'Collegian at Oklahoma State University began charging for online content. Sure, the Wall Street Journal, Times of London and other professional publications had already gone for pay walls, but college newspapers are known for being a free and readily available resource on campus and online. As one commenter put it when the news broke, "They might as well charge a million dollars."

Bloggers and media watchers shared the skepticism. Why restrict access to work by student journalists who need all the exposure they can get? Who would pay for student content? Should they even have to, given that student newspapers are more about training future journalists and serving a campus community than turning a profit?

The O'Colly's decision to charge was more of a "why not?" than a grab for riches or precedent. General manager Ray Catalino figured it was worth placing a value on the outlet's content, and said he'd be happy if 100 subscribers signed up in the first year.

With that year now up, how is it going? Was it indeed a pioneering move in the march to monetize online content, or another failed experiment in the wild west of the web world?

Of course, the answer isn't simple or even fully formed yet.

The Update

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The O'Collegian worked with a company called Press+ to launch what both call a "metered system" in March 2011. After viewing three free articles within a month, readers outside a 25-mile radius of the Stillwater campus and without an .edu email address were asked to pay $10 for a year of unlimited access. Those who said yes will be automatically renewed each year unless they cancel.

Press+ launched in 2010 and counts media entrepreneur Steven Brill among its three co-founders. The company works primarily with professional outlets to monetize online content through donation solicitation and metered systems. (Brill repudiates the term "pay wall" because readers are usually given some free content before being asked to pay. Others just call that a softer pay wall.)

A year in, Catalino's admittedly informal goal of 100 paid subscribers was met and exceeded. On the one-year anniversary, there were 156 paid subscribers, and as of last week there were 177. Not a windfall, considering the paper has a print circulation of 25,000 and a regular online audience of 2,000, but enough that Catalino recently upped the annual fee to $15 for new subscribers.

There wasn't any national news on the OSU campus that might have lured a burst of new paid subscribers. They came slow and steady, never exceeding three per day. Looking ahead, Catalino has budgeted $3,000 to $4,000 in revenue from online subscribers for the next fiscal year -- again, a mere drop in the outlet's $700,000 budget, but a drop nonetheless.

"The pay wall to me is almost a no-brainer," Catalino said. "It's very simple to implement; it's basically a technical change, and the money comes in. And as long as you're providing good content, it continues. So it has very little cost, has a nice upside and very little downside, in my opinion."

So how is it going? Well enough that the O'Colly will keep charging, and might even further up the price if readers continue to show a willingness to pay. But it's no cash cow and likely won't be anytime soon.

The Impact

Once anathema in the wide open world of the Internet, the idea of charging for online news content is becoming more comfortable for publishers squeezed by plummeting print subscriptions, declining ad sales, and few other revenue options.

Press+ began with 24 clients. Another 300 have signed up since then, and still more are devising their own pay systems and seeing some success, the most prominent example being The New York Times. Those who sign up with Press+ generally pay a set-up fee of a few thousand dollars and hand over 20 percent of revenue.

The O'Collegian was the company's first college publication, but others quickly followed suit, including Boston University's Daily Free Press, the Kansas State Collegian and Tufts University's Tufts Daily. Grant money from the Knight Foundation covered the set-up fee for those that got in early, including the O'Collegian, but Press+ now offers colleges a 10 percent discount as an enticement.

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Brill says college newspapers are not a huge business priority for Press+ and counts about 50 on the client list, but he predicts that more and more will turn to the company for help with either seeking donations (the option most current clients choose) or charging for online content.

"We wanted to seed the landscape there and have them benefit from it," Brill said of colleges. "We'll probably have twice the number today by next winter. It's worked well, and it's easy. It doesn't take any work on their part. It's found money."

Brill says the company's geo-location technology is crucial for college outlets because they can aim pay requirements solely at readers outside the campus community, preserving limitless access for students, faculty members, and local residents. If a mega-story breaks and a college newspaper wants full exposure for its content, it can exempt that coverage from the metered system.

The Implications

So the Press+ client list proves that at least some college papers are willing to ask online readers for money, and OSU's first year suggests that at least some readers are willing to comply. Neither addresses the question of whether student publications should make this move.

Dan Reimold, a journalism professor and student media adviser at the University of Tampa in Florida, wrote in January 2010 that college media "should ignore the siren song of pay walls." Why? Because as professional outlets increasingly wall off their online content, college media might become a viable alternative for readers, and because student journalists deserve maximum exposure for their work.

Reimold's opinion today is essentially unchanged. He applauds the O'Collegian for taking the lead on new ways to make money. And he obviously recognizes the significance of their decision to charge, because he broke the news of it on his blog, College Media Matters, in January 2011. But he worries about the long-term implications of a world in which online student content is increasingly restricted.

"I still feel strongly that it is not such an effective revenue technique that it should trump the main purpose of the student press, which is enabling students to get exposure for their work and hopefully join a larger conversation that will help them learn more about the process of reporting things to the world," Reimold said. "The learning vehicle aspect should trump the notion of restricting access."

Brill counters that his company has found no evidence that charging for content restricts the number of unique visitors to a site. If people don't want to pay, they might stop reading for that month, but they return the next month.

Personally, I'm not convinced that access to a student's work, and therefore valuable exposure for that student, remains unchanged in a pay wall world. How can it, when a reader might have read 10 stories but stops at five because he or she won't pay for more?

At the same time, I'm not sure the siren song should be avoided. Professional news publications must find new revenue sources to survive, and their online content does have value. If readers don't agree, that's that. But if they are willing to pay, and remarkably it looks like many are, then why not keep this trend rolling? And why not train future publishers, editors and reporters (not to mention consumers) that it's OK to put a price on such work?

Alexa Capeloto is a journalism professor at John Jay College of Criminal Justice/City University of New York. She earned her master's degree at Columbia's Graduate School of Journalism, and spent 10 years as a metro reporter and editor at the Detroit Free Press and the San Diego Union-Tribune before transitioning into academia.

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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.

January 13 2012

16:30

January 11 2012

16:50

Daily Must Reads, Jan. 11, 2012

The best stories across the web on media and technology, curated by Nathan Gibbs


1. Justice Alito: "It is not going to be long before [broadcast TV] goes the way of vinyl records and eight-track tapes" (New York Times)

2. Finding success through pay walls (Monday Note)

3. UK to reintroduce computer science teaching in schools (Geek) 

4. Patch triples traffic year-over-year, claims growth across network 'consistent' (Street Fight)

5. Piano Media wants national paywalls all over Europe (Nieman Journalism Lab)

6. Q&A with Nick Kristof on journalism in a digital world (Fast Company)



Subscribe to our daily Must Reads email newsletter and get the links in your in-box every weekday!



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January 10 2012

14:00

Piano Media wants national paywalls all over Europe

Liptov, Slovakia

The expansion of Bratislava-based Piano Media into Slovenia is just the beginning of the company’s efforts to bring national paywalls to five European countries by year’s end.

Eight Slovene media outlets have agreed to unite behind a single paywall starting Jan. 16. It’s the cable TV model: Pay a flat monthly fee for unlimited access to everything inside. I caught up with Piano CEO Tomas Bella to hear how it’s going in Slovakia, where the experiment began seven months ago. He’s not yet willing to share subscriber numbers, but he did share observations — mainly, that Slovak readers are not much different from those in the United States or elsewhere.

He said there are different types of readers. The first group “will sign up no matter what you do,” he said. “They just do it in the first week or first weeks. The price can be almost any price. They will pay, and they will pay for a year.” These are people who trust traditional media institutions and are willing to pay to help them survive.

As for everyone else, the barriers to subscribing range from inertia — some people need lots of naggy “here’s what you’re missing” emails — to philosophical opposition. “People were saying, in principle, I will never pay because the Internet should be free,” Bella said. He said he had expected a strong correlation between socioeconomic status and willingness to subscribe, but the divide turned out to be philosophical.

“The number of subscribers is still going up as more and more people are telling us that they were against the concept at first but now they got used to the idea and already feel comfortable with paying,” he said. “Last week I saw one post on Facebook that literally said: ‘You know what, I have woken up one day and realized that I do not know why I was against Piano all the time, and I have paid.’”

For Bella, a former newspaper editor who has tried and failed to get paywalls off the ground, that’s more satisfying than making money. He is out to reset the way people think about the value of news. He said the subscriber numbers were “not so big” at first but that the Slovak paywall generated €40,000 in its first month.

The biggest mistake, Bella said, was trying to charge users for comments. Five of the Slovak publishers wanted a way — any way — to help manage the daily deluge of comments on news articles. But citizens of a former Communist regime don’t want their free speech impinged upon. “This was a very special central European problem,” Bella said. In Slovenia, the paywall will only cover text and video at launch; publishers will be able to add in more kinds of content down the road.

The price for the Slovene package is just under €5 a month, a couple of euros more than in Slovakia. Piano’s market research found that was the most that most Slovenes are willing to pay for news, Bella said.

“It’s still, of course, not as much as publishers would like to have, and it’s still not, I would say, a finite price. But they understood that we need to start at some level of — look at it from the point of view of the reader, not from the point of view of how much the content costs. The research was really very strong. It said that if we go any higher, then we are losing money.”

Pricing for the Slovak paywall, at €2.90 per month, was based more on intuition than research, he said.

The subscription model in Slovenia remains the same: 40 percent of the proceeds goes to the media organization that initially captured the subscriber, 30 percent is distributed to all partners based on how much time the reader spends on their respective sites, the reader’s time spent on their respective sites. So if I sign up for Piano’s paywall at the website of Delo, Slovenia’s national broadsheet, and I spend most of my time at Delo’s website, most of my money goes to Delo. (Tracking time on site has proved to be the most complicated technical challenge, Bella said. That and going after users who avoid the paywall by creating multiple free trials.)

Bella said he hopes to sign up 1 percent of the Slovene population, or about 20,000 people. He said he expects to announce two or three new deals with publishers in Slovakia later this month.

Photo of Liptov, Slovakia by Martin Sojka used under a Creative Commons license.

January 09 2012

14:00

Slovakia’s national ‘pay curtain’ expands to Slovenia

Piano Media, the company that introduced a unified paywall for all major media in Slovakia last year, is expanding to Slovenia.

Nine Slovene publishers and 11 online media sites are participating — a group that includes nearly all of the nation’s major daily newspapers, a car magazine, a sports daily, two regional publications, and even a free city newspaper. A subscription to all of the content will cost €4.89 ($6.21) per month, one euro more expensive than the package in Slovakia. Users can opt to pay weekly (€1.99) or yearly (€48.90), but that’s as complex as the pricing gets.

Publishers get to choose what content goes behind the paywall and what remains free. They can also elect to make users pay for premium features, such as commenting, access to archives, or ad-free browsing.

The Slovak paywall generated more than €40,000 in its debut month of May 2011, the company said, which was split with publishers 70/30, Apple-style. We playfully dubbed it “the new Iron Curtain” — and the metaphor seems to hold up now, as Piano expects to reach three more European markets by year’s end. The company says it is negotiating with publishers in 11 countries.

Like Slovakia, Slovenia is a relatively small, monolingual country. The company estimates 1.3 million Slovenes, or 65 percent of the population, are online; about half of those read news on the web. And while the Slovene package includes more publishers than in Slovakia (20 vs. 9), it will be interesting to see how a national paywall might work in much larger European countries with more media choices. Would the non-participating media siphon users who don’t want to pay?

When we talked last year, Piano CEO Tomas Bella told me he hoped to change the attitudes of consumers accustomed to years of free riding. The company offered the simplicity of a single login and a single monthly bill. As he told me then: “We don’t think it’s a problem of people refusing to pay — we don’t think it’s a problem of money. It’s a problem of convenience.”

Photo of Slovenia’s Julian Alps by Christian Mehlführer used under a Creative Commons license.

January 06 2012

15:30

This Week in Review: Lessons from Murdoch on Twitter, and paywalls’ role in 2011-12

Murdoch, Twitter, and identity: News Corp.’s Rupert Murdoch had a pretty horrible 2011, but he ended it with a curious decision, joining Twitter on New Year’s Eve. The account was quickly verified and introduced as real by Twitter chairman Jack Dorsey, dousing some of the skepticism about its legitimacy. His Twitter stream so far has consisted of a strange mix of News Corp. promotion and seemingly unfiltered personal opinions: He voiced his support for presidential candidate Rick Santorum (a former paid analyst for News Corp.’s Fox News) and ripped former Fox News host Glenn Beck.

But the biggest development in Murdoch’s Twitter immersion was about his wife, Wendi Deng, who appeared to join Twitter a day after he did and was also quickly verified as legitimate by Twitter. (The account even urged Murdoch to delete a tweet, which he did.) As it turned out, though, the account was not actually Deng, but a fake run by a British man. He said Twitter verified the account without contacting him.

This, understandably, raised a few questions about the reliability of identity online: If we couldn’t trust Twitter to tell us who on its service was who they said they were, the issue of online identity was about to become even more thorny. GigaOM’s Mathew Ingram chastised Twitter for its lack of transparency about the process, and The Washington Post’s Erik Wemple urged Twitter to get out of the verification business altogether: “The notion of a central authority — the Twitterburo, so to speak — sitting in judgment of authentic identities grinds against the identity of Twitter to begin with.” (Twitter has begun phasing out verification, limiting it to a case-by-case basis.)

Eric Deggans of the Tampa Bay Times argued that the whole episode proved that regardless of what Twitter chooses to do, “the Internet is always the ultimate verification system for much of what appears on it.” Kara Swisher of All Things Digital unearthed the problem in this particular case that led to the faulty verification: A punctuation mixup in communication with Deng’s assistant.

Columbia’s Emily Bell drew a valuable lesson from the Rupert-joins-Twitter episode: As they wade into the social web, news organizations, she argued, need to do some serious thinking about how much control they’re giving up to third-party groups who may not have journalism among their primary interests. Elsewhere in Twitter, NPR Twitter savant Andy Carvin and NYU prof Clay Shirky spent an hour on WBUR’s On Point discussing Twitter’s impact on the world.

Trend-spotting for 2011 and 2012: I caught the front end of year-in-review season in my last review before the holidays, after the Lab’s deluge of 2012 predictions. But 2011 reviews and 2012 previews kept rolling in over the past two weeks, giving us a pretty thoroughly drawn picture of the year that was and the year to come. We’ll start with 2011.

Nielsen released its list of the most-visited sites and most-used devices of the year, with familiar names — Google, Facebook, Apple, YouTube — at the top. And Pew tallied the most-talked-about subjects on social media: Osama bin Laden on Facebook and Egypt’s Hosni Mubarak on Twitter topped the lists, and Pew noted that many of the top topics were oriented around specific people and led by the traditional media.

The Next Web’s Anna Heim and Mashable’s Meghan Peters reviewed the year in digital media trends, touching on social sharing, personal branding, paywalls, and longform sharing, among other ideas. At PBS MediaShift, Jeff Hermes and Andy Sellars authored one of the most interesting and informative year-end media reviews, looking at an eventful year in media law. As media analyst Alan Mutter pointed out, though, 2011 wasn’t so great for newspapers: Their shares dropped 27 percent on the year.

One of the flashpoints in this discussion of 2011 was the role of paywalls in the development of news last year: Mashable’s Peters called it “the year the paywall worked,” and J-Source’s Belinda Alzner said the initial signs of success for paywalls are great news for the financial future of serious journalism. Mathew Ingram of GigaOM pushed back against those assertions, arguing that paywalls are only working in specific situations, and media prof Clay Shirky reflected on the ways paywalls are leading news orgs to focus on their most dedicated users, which may not necessarily be a bad thing. “The most promising experiment in user support means forgoing mass in favor of passion; this may be the year where we see how papers figure out how to reward the people most committed to their long-term survival,” he wrote.

Which leads us to 2012, and sets of media/tech predictions from the Guardian’s Dan Gillmor, j-prof Alfred Hermida, Mediaite’s Rachel Sklar, Poynter’s Jeff Sonderman, and Sulia’s Joshua Young. Sklar and Sonderman both asserted that news is going to move the needle online (especially on Facebook, according to Sonderman), and while Hermida said social media is going to start to just become part of the background, he argued that that’s a good thing — we’re going to start to find the really interesting uses for it, as Gillmor also said. J-prof Adam Glenn also chimed in at PBS MediaShift with his review of six trends in journalism education, including journo-programming and increased involvement in community news.

SOPA’s generation gap: The debate over Internet censorship and SOPA will continue unabated into the new year, and we’re continuing to see groups standing up for and against the bill, with the Online News Association and dozens of major Internet companies voicing their opposition. One web company who notoriously came out in favor of the bill, GoDaddy, faced the wrath of the rest of the web, with some 37,000 domains being pulled in two days. The web hosting company quickly pulled its support for SOPA, though it isn’t opposing the bill, either.

New York Times media critic David Carr also made the case against the bill, noting that it’s gaining support because many members of Congress are on the other side of a cultural/generational divide from those on the web. He quoted Kickstarter co-founder Yancey Strickler: “It’s people who grew up on the Web versus people who still don’t use it. In Washington, they simply don’t see the way that the Web has completely reconfigured society across classes, education and race. The Internet isn’t real to them yet.”

Forbes’ Paul Tassi wrote about the fact that many major traditional media companies have slyly promoted some forms of piracy over the past decade, and GigaOM’s Derrick Harris highlighted an idea to have those companies put some of their own money into piracy enforcement.

Tough times for the Times: It’s been a rough couple of weeks for The New York Times: Hundreds of staffers signed an open letter to Publisher Arthur Sulzberger Jr. expressing their frustration over various compensation and benefits issues. The Huffington Post’s Michael Calderone reported that the staffers’ union had also considered storming Sulzberger’s office or walking out, and Politico’s Dylan Byers noted that the signers covered a broad swath of the Times’ newsroom, cutting across generational lines.

The Atlantic’s Adam Clark Estes gave some of the details behind the union’s concerns about the inequity of the paper’s buyouts. But media consultant Terry Heaton didn’t have much sympathy: He said the union’s pleas represented an outmoded faith in the collective, and that Times staffers need to take more of an everyone-for-themselves approach.

The Times also announced it would sell its 16 regional newspapers for $143 million to Halifax Media Group, a deal that had been rumored for a week or two, and told Jim Romenesko it would drop most of its podcasts this year. To make matters worse, the paper mistakenly sent an email to more than 8 million followers telling them their print subscriptions had been canceled.

Reading roundup: Here’s what else you might have missed over the holidays:

— A few thoughtful postscripts in the debate over PolitiFact and fact-checking operations: Slate’s Dave Weigel and Forbes’ John McQuaid dissected PolitiFact’s defense, and Poynter’s Craig Silverman offered some ideas for improving fact-checking from a recent roundtable. And Greg Marx of the Columbia Journalism Review argued that fact-checkers are over-reaching beyond the bounds of the bold language they use.

— A couple of good pieces on tech and the culture of dissent from Wired: A Sean Captain feature on the efforts to meet the social information needs of the Occupy movement, and the second part of Quinn Norton’s series going inside Anonymous.

— For Wikipedia watchers, a good look at where the site is now and how it’s trying to survive and thrive from The American Prospect.

— Finally, a deep thought about journalism for this weekend: Researcher Nick Diakopoulos’ post reconceiving journalism in terms of information science.

Crystal ball photo by Melanie Cook used under a Creative Commons license.

December 19 2011

14:28

Why not a reverse meter?

As I ponder the future of The New York Times, it occurred to me that its pay meter could be exactly reversed. I’ll also tell you why this wouldn’t work in a minute. But in any case, this is a way to illustate how how media are valuing our readers/users/customers opposite how we should, rewarding the freeriders and taxing — and perhaps turning away — the valuable users.

So try this on for size: Imagine that you pay to get access to The Times. Everyone does. You pay for one article. Or you pay $20 as a deposit so you’re not bothered every time you come. But whenever you add value to The Times, you earn a credit that delays the next bill.
* You see ads, you get credit.
* You click: more credit.
* You come back often and read many pages: credit.
* You promote The Times on Twitter, Facebook, Google+, or your blog: credit. The more folks share what you’ve shared, the more credit you get.
* You buy merchandise via Times e-commerce: credit.
* You buy tickets to a Times event: credit.
* You hand over data that makes you more valuable to The Times and its advertisers (e.g., revealing where you’re going on your next trip): credit.
* You add pithy comment to articles that other readers appreciate: credit.
* You take on tasks in crowdsourced journalistic endeavors: credit.
* You answer a reporter’s question on Twitter and the reporter uses your information: credit.
* You correct an error in a story: credit.
* You give a news tip or an idea for an article The Times publishes: credit.
Maybe you never pay for The Times again because The Times has gained more value out of its relationship with you. If, on the other hand, you hardly do any of those things, then you have to pay for using The Times.

I’ve been thinking about this, too, in light of a few other trends I’ve seen with newspapers online. First, some that are trying meters are finding that very, very few readers ever hit the wall (which papers are setting at anywhere from 1 to 20 pages). That so few hit the wall is frightening. It means that most readers don’t use these sites much. That’s nothing to brag about. Engagement is criminally low. Second, I’ve seen many sites that get a surprising proportion of their traffic from out of their markets — traffic that is valueless (or even costly, in terms of bandwidth) to sites that sell only local ads. This comes from following a goal of pageviews, pageviews, pageviews — brought in with search-engine optimization — rather than valued relationships.

After hearing a few such stories, I suggested that a site with a meter might want to reward local readers by giving them more free content and charge out-of-market readers by charging them sooner.

You see, that values the local reader over the remote reader. My idea for the reverse meter values the engaged reader over the occasional reader — and even rewards greater engagement. And therein lies, I think, the key strategic skill for news businesses online: understanding that all readers are not equal; knowing who your more valuable readers are; getting more of them; and making them more valuable.

Now I’ll tell you why my reverse meter won’t work: When I spoke with all our journalism students at CUNY about their business ideas on Friday, I asked how many had hit the Times pay wall — many — and how many had paid — few. Abundance remains the enemy of payment. There’s always someplace else to get the news. The Times can make its present meter work because (a) it’s that good [the Steve Jobs exception that proves the rule], (b) it’s still sponsoring — that is, giving a free ride — to its most valuable readers, though that is supposed to end soon, and (c) its engagement is still too low and thus many readers don’t even confront the wall (that needs to change).

So never mind the idea of the reverse meter, but retain the lesson of it: Value should be encouraged, not taxed. Readers bring value to sites if the sites are smart enough to have the mechanisms to recognize, exploit, and reward that value, which comes in many forms: responding to (highly targeted and relevant) ads; buying merchandise; contributing information, content, and ideas; promoting the site…..

The key strategic opportunity for news sites is relationships — deeper, more valuable relationships with more (but not too many) people. Engagement.

14:00

Nicholas Carr: 2012 will bring the appification of media

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

To kick things off, it’s Nicholas Carr, the veteran technology writer, whose most recent book — The Shallows: What the Internet Is Doing to Our Brains — was a finalist for the 2011 Pulitzer Prize.

For years now, the line between the software business and the media business has been blurring. Software applications used to take the form of packaged goods, sold through retail outlets at set prices. Today, as a result of cloud computing and other advances, applications look more and more like media products. They’re ad-supported, subscribed to, continually updated, and the content they incorporate is often as important as the functions they provide. As traditional media companies have moved to distribute their wares in digital form — as code, in other words — they’ve come to resemble software companies. They provide not only original content, but an array of online tools and functions that allow customers to view, manipulate, and add to the content in myriad ways.

During 2011, the blending of software and media accelerated greatly, thanks to what might be termed the dis-integration of the internet. The old general-purpose web, where everyone visited the same sites and saw the same stuff, is rapidly being supplanted by specialized packages of digital content geared to particular devices—iPhone, iPad, Android, BlackBerry, Kindle, Nook, Xbox — or to particular members-only sites like Facebook and Google+. Not only has the net left its Wild West days; it’s entered the era of the gated suburban subdivision. As part of this trend, the open, html-based website is being replaced, or at least supplemented, by the proprietary app. In app stores, the already blurry line between software and media disappears altogether. Apps are as much content-delivery services as they are conventional software programs. Newspapers, magazines, books, games, music albums, TV shows: All are being reimagined as apps. Appified, if you will.

Appification promises to be the major force reshaping media in general and news media in particular during 2012. The influence will be exerted directly, through a proliferation of specialized media apps, as well as indirectly, through changes in consumer attitudes, expectations, and purchasing habits. There are all sorts of implications for newspapers, but perhaps the most important is that the app explosion makes it much easier to charge for online news and other content. That’s true not only when the content is delivered through formal apps but also when it is delivered through traditional websites, which may themselves come to be viewed by customers as a form of app. In the old world of the open web, paying for online content seemed at best weird and at worst repugnant. In the new world of the app, paying for online content suddenly seems normal. What’s an app store but a series of paywalls?

Appification opens to newspapers the powerful marketing and pricing strategy that the Berkeley economist (and now Google executive) Hal Varian dubs “versioning.” Long a cornerstone of the software business, versioning is the practice of creating many versions of the same underlying informational product, packaging them in different ways, and selling them at different prices to different sets of customers. A software maker, for example, may give away a bare-bones version of an application, sell a version with more features to mainstream consumers at a modest price, and offer a high-end version, perhaps combined with added services, to professional users at a premium price. As Varian explains, “the point of versioning is to get the consumers to sort themselves into different groups according to their willingness to pay. Consumers with high willingness to pay choose one version, while consumers with lower willingnesses [sic] to pay choose a different version. The producer chooses the versions so as to induce the consumers to ‘self select’ into appropriate categories.”

We already see versioning strategies at work in the “metered” programs operated by a growing number of papers, including the Financial Times, The New York Times, and the Minneapolis Star Tribune. Readers lacking a willingness to pay get limited access to the papers’ sites for free. Readers who value the content more highly, and hence are willing to pay for it, subscribe for a fee to gain unlimited access. And readers with the greatest willingness to pay shell out even more money to receive both the print edition and unfettered online access. Appification provides an opportunity to create many more versions of the same basic content and deliver them to different customer segments. In 2012, we’ll see versioning strategies become not only more common in the newspaper business but more intricate, sophisticated, and lucrative.

The orthodox view among online pundits has been that paywalls and subscription fees won’t work for general-interest newspapers, that people simply won’t pay for a bundle of news online. Last year, media blogger Jeff Jarvis dismissed The New York Times’s metered plan as “cockeyed economics.” Earlier this year, Nieman Lab blogger Martin Langeveld opined that “newspapers are slowly digging their graves by building paywalls.” It seems likely that 2012 will be the year when we stop hearing such gloomy proclamations. Well-designed versioning strategies, spanning various devices, formats, functions, content bundles, and access plans, will provide smart newspapers with new ways to charge for their products, in both digital and print form, without sacrificing the unique opportunities presented by online distribution. That won’t mean the end of the industry’s struggles, but it does portend a brighter future. And that’s good news.

May 30 2011

14:48

Newspaper paywalls post on Huffington Post

There were two significant developments in the media in Canada last week.

The Huffington Post crossed the 49th parallel to set up Huff Post Canada and one of the largest newspaper groups, the PostMedia Network, dipped its toes into paywalls.

In my first post for the HuffPo, I discuss the metered model being tried out by PostMedia at two of its newspapers.

In the post, I take issue with the philosophy of charging readers for the news:

However, there is a more fundamental issue at play. People have never really paid for the news. By news, I mean the political infighting in city halls or the violence in faraway foreign places — the news that is important and matters but can be challenging to make relevant to a broad audience.

Readers were paying for the sport results, the lifestyle section, diversions like the crossword and horoscopes. The cost of producing “the daily miracle” as Canadian playwright David Sherman put it was largely borne by advertising sales. The subsidy model worked when mass media was the dominant model for distributing the news. The business of newspapers was delivering large audiences to advertisers, and they were pretty good at it.

I hope the post adds to the discussion on funding models. Head over to the Huff Post to read the full post and add your thoughts.

April 29 2011

14:30

This Week in Review: WikiLeaks’ forced hand, a Patch recruiting push, and two sets of news maxims

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

Leaking gets competitive: WikiLeaks made its first major document release in five months — during which time its founder, Julian Assange, was arrested, released on bail, and put under house arrest — this week, publishing 764 files regarding the Guantánamo Bay prison along with 10 media partners. (As always, The Nation’s Greg Mitchell’s WikiLeaks über-blogging is the place to go for every detail you could possibly need to know.)

That’s more media partners than WikiLeaks has worked with previously, and it includes several first-timers, such as the Washington Post and McClatchy. As the Columbia Journalism Review’s Joel Meares noted, the list of partners doesn’t include the New York Times and the Guardian, the two English-language newspapers who worked with WikiLeaks in its first media collaboration last summer. Despite being shut out, those two organizations were still able to force WikiLeaks’ hand in publishing the leak, as the Huffington Post’s Michael Calderone explained.

The Times got their hands on the documents independently, then passed them on to the Guardian and NPR. This meant that, unlike the news orgs that got the info from WikiLeaks, they were operating without an embargo. As they prepared to publish last Sunday, WikiLeaks lifted its embargo early for its own partners (though the first to publish was actually the Telegraph, a WikiLeaks partner).

The New York Times’ Brian Stelter and Noam Cohen said the episode was evidence that WikiLeaks “has become such a large player in journalism that some of its secrets are no longer its own to control.” But, as they reported, WikiLeaks itself didn’t seem particularly perturbed about it.

Patch’s reaches for more bloggers: AOL seems to be undergoing a different overhaul every week since it bought the Huffington Post earlier this year, and this week the changes are at its hyperlocal initiative Patch, which is hoping to add 8,000 community bloggers to its sites over the next week or two in what its editor-in-chief called a “full-on course correction.”

While talking to paidContent, AOL’s folks played down the degree of change it’s implementing, explaining that these new bloggers (who will be recruited from, among other sources, the sites’ frequent commenters) aren’t disrupting the basic Patch model of one full-time editor per site. In fact, they’ll be unpaid, something that’s been a bit of a headache for AOL and HuffPo lately.

Business Insider’s Nicholas Carlson liked the plan, saying volunteer bloggers can become “extremely effective word-of-mouth marketers” and “excellent pageview machines” with, of course, “manageable” salaries. Others from MediaBistro and Wired were a little more skeptical of the no-pay factor. Lehigh j-prof Jeremy Littau took issue with a more systemic aspect of the new blogs, which will exist both on the writer’s own site and on Patch. Splitting up the conversation with that arrangement won’t be helpful for the individual blogs or for the local blogosphere as a whole, he said: “I see something developing that leads to less population in the local blogosphere and a walled-off system that operates on Patch. At worst, it will lead to parallel and fracture[d] conversations online, which is death when we’re talking about hyperlocal.”

Two new media manifestos: Two New York j-profs — and two of the more prominent future-of-news pundits online these days — both published manifestos of sorts this week, and both are worth a read. Jay Rosen summed up what he’s learned about journalism in 25 years of teaching and thinking about it at NYU, and CUNY’s Jeff Jarvis gave a few dozen bullet points outlining his philosophy of news economics.

Rosen’s post touched on several of the themes that have colored his blog and Twitter feed over the past few years, including the value of increasing participation, the failure of “objectivity,” and the need for usefulness and context in news. But while the ideas weren’t exactly new, the conversation they generated was stimulating. The comments chase down some interesting tangents, and GigaOM’s Mathew Ingram expanded on Rosen’s point about participation, arguing that even if the number of users who want to participate is relatively low, opening up the process can still be immensely important in improving journalism. Rosen also inspired TBD’s Steve Buttry to write his own “what I know about the news business” post.

Like Rosen’s post, Jarvis’ wouldn’t break a whole lot of ground for those already familiar with his ideas, but it summed them up in a helpfully pithy format. He focused heavily on providing real value (“The only thing that matters to the market is value”), the importance of engagement, and finding efficiencies in infrastructure and collaboration. His post contains plenty of pessimism about the current newspaper business model, and Mathew Ingram and FishbowlNY’s Chris O’Shea defended him against the idea that he’s just a doomsayer.

Times paywall bits: The New York Times spent a reported $25 million to develop its paid-content system, and it will be spending another $13 million on the plan this year, mostly for promotion. Women’s Wear Daily detailed those promotional efforts, which include posters around New York as well as TV spots. PaidContent’s Robert Andrews compared the Times’ pay plan to that of the other Times (the one in London, owned by Rupert Murdoch), noting that the New York Times’ plan should allow them to draw more revenue while maintaining their significant online influence, something the Times of London hasn’t done at all (though it’s largely by choice).

Meanwhile, Terry Heaton found another (perhaps more convoluted) way around the Times’ system, tweeting links to Times stories that he can’t access. And elsewhere at the Times, the Lab’s Megan Garber explored the Times’ R&D Lab’s efforts to map the way Times stories are shared online.

And elsewhere in paywalls, the CEO of the McClatchy newspaper chain has reversed his anti-paywall stance and said this week the company is planning paywalls for some of its larger papers, and Business Insider introduced us to another online paid-content company, Tiny Pass.

Apps, news, and pay: In his outgoing post on Poynter’s Mobile Media blog, Damon Kiesow had a familiar critique for news organizations’ forays into mobile media — they’re too much like their print counterparts to be truly called innovative. But he did add a reason for optimism, pointing to the New York Times’ News.me and the Washington Post’s Trove: “Neither is a finished product or a perfect one. But both were created by newspaper companies that put resources into research and development.”

Media analyst Ken Doctor said local news needs to start moving toward mobile media to reach full effectiveness, laying out the model of an aggregated local news app pulling various types of media. For maximum engagement, that app had better include audio, according to some NPR statistics reported by the Lab’s Andrew Phelps.

There may a bigger place for paid apps than we’ve thought: Instapaper’s Marco Arment twice pulled the free version of the app for about a month and found that sales actually increased. He made the case against free apps, saying they bring low conversion rates, little revenue, and unnecessary image problems. Meanwhile, makers of one free app, Zite, said they’re releasing a new version to deal with complaints they’ve been getting from publishers about copyright issues.

Reading roundup: No big stories this week, but tons of little things to keep up on. Here’s a bit of the basics:

— On social media: Facebook launched a “Send” plugin among a few dozen websites (including a couple of news sites) that allows private content-sharing. The Next Web’s Lauren Fisher argued that journalists should spend more time using Facebook, and Canadian j-prof Alfred Hermida wrote about a study he helped conduct about social media and news consumption.

— The Guardian shut down a local-news project it launched last year, saying the local blogs were “not sustainable.” PaidContent’s Robert Andrews said that while the blogs were useful, there are few examples of sustainable local-news efforts, and Rachel McAthy of Journalism.co.uk rounded up some opinions to try to find the value in the Guardian’s experiment.

— The news filtering program Storify launched in public beta this week, prompting a New York Times profile and pieces by GigaOM’s Mathew Ingram and the Knight Digital Media Center’s Amy Gahran on the journalistic value of curation.

— Thanks to its most recent content-farm-oriented algorithm tweak, Google’s traffic to all Demand Media sites is down 40%, which caused Demand stock to slide this week. Google, meanwhile, added some more automatic personalization features to Google News.

— The Lab’s Andrew Phelps wrote a great piece expounding on the journalistic utility of the humble (well, kind of humble) smartphone.

— And for your deep-thinking weekend-reading piece, Harvard researcher Ethan Zuckerman’s thoughtful take on overcoming polarization by understanding each other’s values, rather than just facts.

April 01 2011

15:29

Lessons on newspaper paywalls from Mexico

In the session on paywalls at the ISOJ, Jorge Meléndez, vice president for new media, Grupo Reforma (Mexico), explained how the newspapers have had paywalls since 2002.

The newspaper sites were free for the first two years. But they realised there was a very small online advertising market so the group just did it. Part of this involved an active strategy to convert newspaper subscribers online.

The impact of the paywall was a 35% drop in traffic. But Meléndez said they stopped minor circulation declines.

Access to all of the the news sites is free for newspaper subscribers. The prince for an online subscription is 80% of a newspaper subscription, as a way of encouraging readers to take the newspaper.

Meléndez explained there is some free content, such as the main page and emailed links.

The group provides apps for free, at least for now, said Meléndez. It has an “aggressive” app strategy, with dozens of apps for different topics.

Meléndez said broadsheet circulation is holding steady and tabloids have grown by 5% over last 8 years. Advertising and classifieds have also grown.

The group has 300,000 newspaper subscribers for all papers. 50,000 are only online subscribers. In terms of traffic, the sites have six million unique visitors, with an average of eight pages per user.

Meléndez said they learnt that people do not read instructions. Online, people just expect to click. So use action verbs and clear instructions, with as few words as possible, he urged.

The reasons behind the success of paywalls is local content, argued Meléndez. And the sites have more local content than in the newspaper. “Local is very important for us,” he said.

But when it came to today, he said the situation with paywalls was more difficult than in 2002. People are used to free, there is more competition and newspaper metrics are “so bad.”

March 30 2011

20:00

Canadians are also hostile to paywalls, survey finds

Twelve percent of Canadians are willing to pay for ringtones, but only 4 percent are willing to pay for news.

A survey of almost 1,700 adults by the nonprofit Canadian Media Research Consortium (summary, pdf) finds its hard to get people to pay for any kind of digital content, but that news ranked behind movies, ebooks, music, games, and yes, ringtones in willingness to pay. If their favorite news sites started charging, 92 percent said they would simply find a free alternative — with no significant differences among age groups or education levels.

Southward-focused Canadians got a head start on the paywall experience this month when they were the first to come under The New York Times’ paid-content umbrella. Interestingly, the CMRC study found that — if there were absolutely no free news sources available, something unlikely in the land of the CBC — the type of news Canadians would be most willing to pony up for is breaking news — which the Times has said will often be made available without restrictions to Times readers, even those past their monthly article quota. (What does “breaking news” mean? The survey doesn’t say. I suspect the respondents would have provided about 1,700 definitions.) “Hard,” international, and investigative news were also more likely to be judged payment-worthy, with entertainment news a tougher sell.

Men were more likely than women to pay, and French speakers more likely than English speakers, the survey found. As for how they’d prefer to pay (if they had to), 34 percent of the willing adults would prefer a flat-rate subscription model, with the Times’ metered approach (free until you hit 20 articles a month) in second place. Very few respondents said they would pay per article or per day.

Of course, this is a survey about how people feel, not what they do. The New York Times has not released digital subscription data since putting up the wall. The other Times, The Times of London, on Tuesday released data indicating at least some people are paying, citing 29,000 new digital subscriptions in the last five months — even as higher-priced paper subscriptions continue falling.

“If only consumers were as comfortable paying for content as owners would like them to be, the future would be a lot rosier,” the report concludes. “Paywalls might work for selective publications, such as The Wall Street Journal and the Times of London but given current public attitudes, most publishers had better start looking elsewhere for revenue solutions.”

16:30

Canadians don’t want to pay for the news online

In the week the New York Times introduced digital subscriptions, a Canadian study shows that consumers just don’t want to pay for the news.

An online survey of 1,682 adults, conducted by the Canadian Media Research Consortium (CMRC )and Vision Critical, showed that Canadians are overwhelmingly opposed to fees for content.

It found that 92% of Canadians who get news online say they would find another free site if their favourite news site started charging for content.

The findings suggest that news as an online commodity has little monetary value in the eyes of the consumer. What is less clear is whether people would pay for the service and convenience of having the news packaged in emerging delivery mechanisms, such as an iPhone/iPad app.

Among the other key findings:

  • 81% say they definitely will not pay to continue reading their favourite online news site.
  • Up to 30% indicate they would definitely or probably pay, if there were no other choice.
  • Charges are most acceptable for breaking news (28%) or hard news (22%). 19% indicate they would pay for international news and 16% would purchase feature and analytical news.

Perhaps not surprising, most news consumers (82%) were happy to accept advertising alongside content, if it meant the news was free

Canadians, though, are more willing to pay for music, games, movies, e- books and even ringtones online than they are to pay for news.  But it is only a minority: 26% cent already pay for music; 19% pay for games; 9% for movies; 8% for e-books and 12% for ringtones.

I am part of the research team behind the study, which is the first in a series of reports that looks into the changing news consumption habits of Canadians.

The full report is available as a PDF download.

 

 

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