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July 30 2012

20:41

Rafat Ali on building a media company on top of public data

Ten years ago, Rafat Ali wanted to build a company that could chronicle the transformation of media and technology. Now he hopes to do it again, this time in the world of travel. His new project Skift sounds at first a lot like paidContent: a mix of original reporting and aggregation tailored for a savvy, niche, information-hungry audience.

But this time around, Ali is placing his bet less on a stable of journalists and more on a team of product designers, developers, and, yes, journalists. Skift wants to be a media company in the same way Politico or Bloomberg is a media company: an information provider with a news wrapper. Skift bills itself as a “travel intelligence media company,” not a standalone news site.

Ali told me the way Skift will grow its audience and its fortunes will be through information services, not just news. “What we’re trying to do with Skift is scale quickly on content,” he said. “The more fortunate part for us is everybody covers travel in bits and pieces, so for us it’s a matter of bringing it all together.”

But Skift is more than just a curator of travel news. Ali and cofounder Jason Clampet want to collect a vast data library to build tools that would be useful not just to the travel industry but anyone hoping in a car, train or bus to get away. Ali has funded the site himself up to launch and has raised $500,000 from investors like former Wall Street Journal publisher Gordon Crovitz and former MySpace president Jason Hirschhorn. As designed, Skift — the Swedish word for “shift” — would be a media company built on a stable of products, not just content. “We’re starting with what we’re grandly sort of calling the world’s largest data warehouse of publicly available travel industry data,” he said.

That means things like visit and occupancy information that tourism boards report to the government, departures and delay information from airports, and flight data supplied by airlines to agencies like the FAA. It’s the type of information typically hidden away in Excel spreadsheets on seldom visited agency websites. “We’re gonna try and collect it, clean it, normalize it, put it in a dashboard that humans can understand, and then build services on top,” he said. He said they will also create APIs for the travel data they harness on the site.

Skift has a staff of four, including Ali, and they’ll be announcing the hire of a product development person soon. Ali stresses that as Skift grows they will hire more writers — but the writers will be focused on original reporting, not the things aggregation and curation can pick up more easily. Ali said curation is still an undervalued asset that can prove useful to content creators as well as their audiences. The day-to-day news of airlines’ fuel prices or the ebb and flow of tourism can be aggregated from elsewhere. Ali wants the site to chase the big stories, the airline bankruptcies and innovations in travel tech. “We’ll not get there in the next year, but we’ll get there in due time,” he said.

Ali has been around the media game for a while, having sold paidContent to The Guardian in 2008 and left the company in 2010. He’s gained an insight into how a media business can stay viable today. Focusing on a niche audience is one method of doing that, especially if that audience is highly engaged and willing to spend. Business travelers and travel industry executives are just such an attractive bunch. “We look at business travelers, professional travelers a bit like tech fanboys, where they like to consider themselves like experts in what they’re doing,” he said.

Ali said it’s not enough to simply provide people with news — it has to be valuable or actionable information. It also helps if you can package multiple resources together. In the travel industry, businesses are divided into areas like editorial (travel guides), transactional (booking flights and hotels), and organizational (plan your trip, track your flight). But there’s a fair amount of randomness that goes along with that. You may look up art museums through Frommers, find your flight through Hipmunk, and use GateGuru to navigate airports. “With Skift, on the business traveller side, we’re trying to take the randomness out of the equation and make a more directed way of delivering information,” he said.

Also in the long-term plans for Skift: a membership or subscription service. Ali believes the possibility of better data tools for travel is a step in that direction. But another option would be to create events, something paidContent has had success with. Ali said the they plan to hold one major event, a travel analog to All Things D’s D conference, which would appeal to travel industry executives, travelers, and technologists. “We’re trying to build a crossover media brand, a new kind of media company where the underpinning will be data, and then media as the layer on top of it,” he said.

Image of Rafat Ali by Brian Solis used under a Creative Common license.

June 02 2010

09:55

#followjourn: @hackneye/freelance travel writer

#followjourn: Donald Strachan

Who? Freelance travel writer

Where? Strachan has written for newspapers, including the Sydney Morning Herald and the Sunday Telegraph (see his work at the links). He also contributes to travel sites such as Frommers.com, Perceptive Travel, and travelintelligence. He has his own website here.

Contact? @donaldstrachan

Just as we like to supply you with fresh and innovative tips every day, we’re recommending journalists to follow online too. They might be from any sector of the industry: please send suggestions (you can nominate yourself) to judith or laura at journalism.co.uk; or to @journalismnews.

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April 15 2010

15:26

The Newsonomics of content arbitrage

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

We’re into a new age of digital news content. Every conceivable kind of company is starting to produce it and find homes for it. Smarter advertising strategies are matching up against the new content. Mix and match exploding content creation with ahead-of-the-curve ad targeting, and you’ve got a new math.

Presto: Content arbitrage. Forget “curators”; an accurate but museum-musty term for judgment. As news sites have branched out, bringing in community bloggers and sites, “hiring” top-end bloggers, we’ve come up with the genteel “curation,” a popular term at this week’s ASNE conference, a hot (well, warming) bed of such forward-reaching ideas.

So if want to move beyond “editors,” with its old-world connotations, to get at a reaching out, an aggregation of more content, what’s the proper word? Well, aggregator is technically correct, but it’s Terminator-like. News people don’t like to think of themselves copying the the first, big aggregators like Yahoo, Google, MSN and Huffington Post. (Each of which, not incidentally, sees great next-stage opportunity in content brokerage and are competitors to news companies in this area going forward.)

So let me suggest a title that fits what is going on, though it will make “editors” uneasy: “Content brokers.” I’m not suggested that anyone change a job title to “content broker,” but rather to recognize that’s a huge role going forward. (And even backwards, for us veteran features editors who understood that buying content from diverse syndicates, wires and freelancers was an essential part of the business.)

Let’s go to the newsonomics of content brokering.

Demand Media, fairly and not, has become the poster child of the content-and-ad arbitrage. It’s both been derided as an amoral, slave-wage content farm and marveled at for its absolute smarts about the value of content, and its creation. Just last week, Demand announced a deal to power a “Travel Tips” section for USAToday.com; earlier it had done a lower-profile deal with AJC.com, in Atlanta

It’s just one example of news companies starting to get it about content brokering. The principle is simple: Obtain the highest quality content you can (or at least sufficient to what the market of readers and advertisers demand) at the lowest possible cost. Then, make sure you can make a profit over each set of obtained content. We all understand the idea: Buy low, sell high.

Demand will pay, say, $35 for an article of new treatments for spring allergies, knowing how many pageviews its distribution networks can generate and what cost-per-thousand rates it can get. Maybe it makes $100 or $300 on that article. Maybe it makes a lot more. You can do lots more arithmetic here, with thousands of stories, higher-priced ones and even “free” user-gen ones. The principle, though, is the same.

Newspapers understand that principle. For decades, they employed large newsroom staffs, paid them what they had to, sold advertising, at expectable and rising rates, and took in margins of 20-percent-plus. That’s content-and-ad arbitrage, though it moved at glacial speed and seemed more like a constitutional principle than an evolving business, subject to change.

Now, the arbitrage business is moving at warp speed. Consider just a few of many brokerage initiatives:

  • The New York Times is “buying” content from the Chicago News Cooperative to power its local Chicago edition. It will soon do the same with the emerging Bay Citizen in California. The economics are key here: The Times can’t afford to add full-time staffers at $100k a pop; it can afford something less to get its standard of journalism from other sources.
  • Seattle is hosting the battle royale to aggregate local bloggers. The now-online-only Seattle P-I, led by Michelle Nicolosi, has been signing up bloggers for years, and hosts more than 200 of them, who use the P-I’s publishing system. Across town, Bob Payne, communities director of The Seattle Times, is working with 22 hyperlocal sites in the region. That’s a J-Lab-funded project, which the Miami Herald and Charlotte Observer are also trying. All the newspaper sites get more content, as blogs and bloggers get more notice and traffic.
  • Hearst recently signed up Bleacher Report to provide fan-generated sports content for its sites.
  • Demand’s growing list of competitors to provide brokered content to news companies (and others) includes Associated Content, Helium, Seed, and Examiner, although there are signal differences among them. Outside.In and FWIX both offer pointers to local content of interest and have done deals with news websites.
  • Poynter Institute is even putting a finer point of the business of getting cheaper content, hosting a “Stretching Your News Budget with User Content” seminar in May.

Some of this content brokering brings in community-oriented “user-gen.” Some of it brings in useful content in niche areas, like sports, travel, family, religion and much more. Some does both.

Is there a danger in content arbitrage? It’s value-neutral; it’s all in how you do it. Let’s remember that journalism is essentially a manufacturing process, with as much or as little value added as we want.

On a brand- and content-integrity level, it’s all in exercising good judgment — but against a much wider array of choices. On a business level, it’s making sure you are buying low and selling high. Ironically, many news companies are starting to bring in more content — mostly from local bloggers and sites — but few are seeing ad departments monetize it well. That’s buying cheaply, but if you don’t sell it, it’s not really much of a business advance. That should be temporary, if news publishers and editors take content brokering to heart.

Photo by Petra Sell used under a Creative Commons license.

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