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  • Eric Ulken 12:33 pm on February 25, 2009
    Tags: Andrew Currah, economics, Oxford University, Reuters Institute,   

    Making news pay: no easy answers at Oxford 

    Green Templeton College, Oxford University

    I attended Andrew Currah‘s interesting talk on business models for news today at Oxford’s Green Templeton College. Currah has just released a report for the Reuters Institute called “What’s Happening to Our News.” Lots of good insights on the scary economic trends in the U.K. news media. Real problems urgently in need of solutions. Well worth a read.

    Currah spoke of the “messianic” belief among news executives that digital products will become engines of productivity and profitability. Unfortunately, “the new platform doesn’t seem able to support journalism in its current form,” he said. He quoted a McKinsey report that found online revenue per user to be, at best, about 1/20th of print.

    Currah outlined some of the potential alternatives being tried or proposed: micropayments, hybrid “freemium” services, charitable models of various kinds (Washington Post would supposedly need a $2 billion endowment to support its journalism). Substantial asterisks and drawbacks to all the options mentioned. Not particularly encouraging.

    But what bothers me about Currah’s conclusions is that they’re partly based on what I think is the flawed assumption that “following the audience” is a bad thing and inherently at odds with a higher public-service purpose.

    I believe that a news organization can follow the audience and be of service to it at the same time. In fact, I think one of the reasons why many newspapers — in the U.S., at least, and I suspect here too — find themselves in their current state is because they’ve fallen out of sync with the needs of the audiences they claim to serve.

    Maybe I’m overly idealistic on this point, but I think it’s not only possible to do serious journalism that’s commercially viable, it’s a waste of time to do otherwise. Put another way: If I publish a sound, well-researched investigative piece on a topic nobody wants to read about, how is that serving an audience?

    +++

    Currah’s book is here. His presentation is here. (Note: Both files are large PDFs.)

    (My own two cents’ on the revenue picture and what newspapers can do about it is now up on OJR.)

    Photo: Green Templeton College, Oxford University, by Eric Ulken.

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    • Andrew Nystrom 10:56 pm on March 4, 2009

      Eric, just wanted to make sure you saw the latest @latimesfires tweet:

      http://twitter.com/LATimesfires/status/1282071866

      re how @ev gave highlighted your Oct. ’07 San Diego fires tweets recently while on stage at @TE2009, as an example of an early, real-time watershed moment for Twitter.

      Happy travels ~ @latimesnystrom

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    • Eric Ulken 11:43 pm on March 4, 2009

      Wow. Cool. (Wish I could take credit for the fire tweets, but that was actually a Sean Gallagher innovation, as I recall.)

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    • Ben 10:39 am on March 6, 2009

      You’re putting your finger the pressure point, E. I think the major underpinning of the other side of the argument is the idea that popular ideas are often wrong. One of the major points of pride among university types is that they inhabit an environment where free inquiry can happen with some insulation from popular opinion and the demands of the market. And the perception is, I think, that newspapers inhabited something of a similar space — a beachhead of the university in the commercial world. From the point of view of a liberal college professor, the newspaper was “our monopoly.”

      I think there’s a challenge to that argument along the lines you’re making (“Prove to me, Mr. Scholar, that these investigative stories have increased the public good in some measurable way.”), but there’s a similar demand on your side of the argument too. What makes the market so great? The market gave us CNBC — and just watch the Daly Show takedown this week to see how great Jim Cramer’s advice has been for his, admittedly large, audience.

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    • Ben 10:43 am on March 6, 2009

      Please forgive the spelling and grammar errors in my previous post. I leave these things in rush and then always have a moment of horror when I reread them.

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    • Eric Ulken 6:34 am on March 7, 2009

      Ben, you make a good point about the perils of blindly following the market.

      What I should have added to my argument is this: A certain amount of “subsidizing” of less popular content with crowd-pleasing stuff is, I think, perfectly consistent with the idea of following the reader. Because, even though the Internet is the great unbundler and people are only going to read what they want to read, there is still great value in a trusted, reputable brand — and such brands are built and cultivated in part by going for stories you know aren’t going to get a lot of traffic but are worth doing because they contribute to the brand. Maybe not today or tomorrow, but in the long run.

      It might sound cynical to use marketing terminology to justify doing important and necessary journalism, but nobody said squaring free-market principles with public service goals was pretty. 🙂

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    • Mike 1:04 am on March 30, 2009

      I’ve done quite a bit of thinking on this subject myself, both from my conversations with you over the years as well as my own experiences in the world of politics, where in many ways traditional written news, broadcast news, new media, and blogs all intersect.

      I do agree with you that news-for-pay can indeed be commercially viable in the future. However, despite much lamenting of the fact that old media sources such as newspapers are dying and the need to save it, I don’t think that broad-audience general-news-for-everybody publications such as traditional newspapers are viable. The reason for this is because of what we already know — we can all get that major news for free anyway through any variety of sources online or on television.

      Indeed, I fully suspect that by 2015, the Kansas City Star and St. Louis Post Dispatch, in my area of the country, will cease to exist in their current forms. And, unlike some, I do not think that is a bad thing. It’s simply what it is — a fact and a reality of the times.

      However, the answer to me is not as simple as simply going online with those same, boring publications that already provide information we can get for free somewhere else. No one is going to subscribe or advertise through such sources. Rather, I think what we’ll increasingly see is smaller, crisper, enterprises that are targeted at specific audiences — varying in size depending on the topic and scope — that are built largely upon subscriptions with a smaller slice for targeted advertising such as “sponsorships”.

      In some ways, it will be a reversal of the merging of media outlets we’ve seen recently. We’ll no longer see huge corportations owning multiple newspapers and even TV stations. We’ll see small-staffed but quite effective operations operating out of strip malls or second-story offices in big and towns alike.

      A local example of this is the Kansas Liberty — http://www.kansasliberty.com. An enterprise of some local folks I know, it is billed as “Fair and Factual”, a FoxNews of sorts in covering Kansas politics. One can get a free trial but it is a subscription service of $100 a year. And, as a subscriber myself, I can vouch for the fact it provides more in depth coverage about bills coming out of the legislature and news coming out of the Kansas political scene than any of the major news outlets in Kansas — Wichita Eagle, Kansas City Star, and the Topeka Capital Journal (which does the best job of the traditional three), and certainly a lot more than our local suburban rag, the Johnson County Sun. In additional to providing a conservative opinion alternative in its editorials to the very leftward tilt of the three major dailies, it objectively — no matter what your persuasion — provides more frequent and more in depth coverage of real issues in Kansas on the legislative and political scene than any other source — with a staff of essentially 4.

      Note, and this is obvious by visiting the site of the Kansas Liberty, it is NOT blog. It is, in some ways, a combination of old and new media — a mix of opinion and hard news, targeted in a specific area (legislature and politics) and region (Kansas), but online and with a small staff — with a combination of a few free articles and a larger in depth subscription service – a service that it can charge for because, as I noted above, there is NO OTHER OUTLET in Kansas covering the bases so in depth like it does, both in terms of the actual facts of a story as well as the analysis of the event.

      Though still young and still needing to prove itself over the long haul financially — which will depend on it simply becoming known through word of mouth and such — I truly believe that you’ll increasingly see outfits like the Kansas Liberty pop up all over the country, covering a myriad of issues. You’ve already seen it on the sports scene in the emergence of Rivals.com, which has a combination of hard sports news for each college team as well as both free and subscription message boards for “insider information”, all of which you can get for that familiar price of $100/year (or $10/month).

      This similar model can repeat itself for suburban or small town news outlets — the last years where I actually think a printed newspaper can still be successful. If you’re offering something that is hard to find in quality elsewhere — or at all — such as local, small town or suburban news, people will pay for it, in my view, if it is affordable — and $100/year is, for most folks — as that is less than a newspaper subscription and, if billed monthly, about the cost of a couple trips to Starbucks a month.

      Also, one thing about this system is that I think quality will reign — people will only pay for something that is quality and provides them something they can’t get for free. In a sense, the market will force these smaller ventures to be professional, well planned, and effective in what they do.

      However, the transition will be slow and some will doubt it. This takes time anytime you have a complete reorganization of a vast area of American business, which is the print (online or paper) news business. But I think this IS the future. The small news enterprise will be back — just in a different form that we saw decades ago. It will be more niche-oriented but also more competitive, but those that take the risks and stay with it will be rewarded in the end.

      Of course, the old media guard will remain stubborn and frustrated at these “small town” or “fringe” outfits stealing their corner of the world — journalism — away from them. But, as enterprising journalists wanting to make money come into the field, I think the tide will gradually turn and we’ll see a new, vibrant, print news business that at the end of the day will actually somewhat resemble what many of us long thought print news to be — in depth, unique, quality, and something you couldn’t get anywhere else — which is why we originally paid for it anyway.

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  • Eric Ulken 7:18 pm on August 17, 2008
    Tags: economics,   

    A visit to the pressroom 

    After four and a half years at the Los Angeles Times, I finally made the trek to the other side of downtown Friday to tour the paper’s Olympic printing facility. As part of the effort to merge the web and print staffs, the Times has been giving some of the websters a “Newspaper 101” crash course. I tagged along for the tour, but my low-res BlackBerry photos just don’t do justice to the size and scope of the place.

    Anecdote: The machines that were bought to insert preprints (like the ones flying off the presses in the photo) ended up being too error-prone, so the distributors still have to stuff them into the paper by hand. Let’s see:

    Umpteen preprints x 1.1 million Sunday papers = a lot of hands

    I’m reminded of why newspapers are still largely a manufacturing and distribution business. And why this business model is falling apart.

    (For robotics geeks: Here’s Dakotta’s video of one of the robots moving a roll of paper. They follow electromagnetic guides embedded in the floor.)

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