No news is no news

A few notes upon reflection about the New Business Models for News Summit at CUNY:

* A few days after the conference, David Carr in the New York Times piled on the lamentations about more layoffs and cutbacks in the news business. On the Media continued the dirge a few days after that. There’s no news here. The industry is shrinking. We already know that.

There’s news in reporting on people who are trying to do something about it and create new models and enterprises for news. Those are the folks we had at the conference.

* A star among them was our own David Cohn, co-organizer of the conference, as he presented Spot.US, his Knight-Challenge-funded startup to create an infrastructure for readers to support reporters doing stories. David’s elevator pitch was a model for all my entrepreneurial journalism students. His enthusiasm, inventiveness, and ability to see opportunities where others see gloom was a model to the executives in the room. What I loved best was watching executives and investors from very big companies stuffing David’s pocket with their business cards. Who says the news business is dying? If you know where to look, it’s being reborn.

Other new models and views of news included:
> Charlie Sennott presenting GlobalPost as a means to support 70 freelancer correspondents in 53 countries around the world submitting stories and also turning their journalism into a process with their audience;
> Upendra Shardanand of Daylife and Scott Karp of Publish2 [disclosure: I have a relationship with both companies] presenting their infrastructure for the link (vs. the content) economy of news;
> Michael Rosenblum showing how training citizens in video can become a source of both content and revenue;
> Mark Josephson of Outside.in on a structure of organizing local content;
> David Chase of NextNewsNet on a local ad network and Adam Bly of Science Blogs on a specialized ad and content network;
> Colin Crawford on the transformation of IDG from a print to a digital company;
> Adam Davidson of NPR talked about the creation of the Planet Money podcast there.

Late additions to the group included Debbie Galant, the monarch of the hyperlocal bloggers at Baristanet, who talked about running a business on the scale of the old independent bookstore, and Rachel Sterne, founder of citizen-journalism platform GroundReport.

* I was delighted that the amazing group we were lucky to bring together had moved past the old rivalries: business vs. edit, new media vs. old. I was also quite relieved to hear a universal sense of urgency about the need to find new means to sustain journalism. There isn’t a minute to waste.

As a result, we saw editorial and business people entering into frank conversations we don’t often hear, willing to reset assumptions and build new models. Included in that was a general acceptance that the cost structure of the news business is way too high and has to be cut. This slide from the Telegraph’s Edward Roussel resonated strongly in the room.

Roussel slide

Roussel also said: “If you’re a newspaper group, your technology sucks.”

Just as Roussel was blunt and frank so was his fellow presenter on the topic of the disaggregated news organization, Dave Morgan, who quoted Gary Pruitt, CEO of McClatchy, from only the day before. Pruitt said: “We believe that the majority of the decline that we are currently seeing is cyclical and therefore temporary.” After heaping caveats of praise on Pruitt as an executive, Morgan called bullshit. Exactly so. We need tough, honest talk now.

* I was interested in seeing a conflict arise at the end of the day — one of the few, actually — on the relative value of content creators vs. editors. No one in the room would say that both aren’t valued and needed. But when push comes to shove with spare resources, there is a difference of opinion on what added value really means. Some put maximum resource into creating content: reporting. Some insist on the need for editors to create order, to correct and vet, to curate, as we say these days. The disagreement is only one of degree.

* I wish I’d had more people from other industries. When Tom Evslin got up to give his very good primer on network economics, he made a point of saying that he was not a journalist. After the conference, someone from an international technology company said he thought the people in the room were “not ready to make the leap” (perhaps so, but he should have heard similar folks a year ago; the change is striking). At Davos last January, I ran a session between news executives and tech executives in which the latter excoriated the former for throwing in the towel and convinced them that there was fight left in the news industry. The news business is, ironically, insular and it needs to hear that perspective. I also should have had more voices from women, bloggers, and our international participants. We could have filled two days with good discussion but decided, two weeks before an election, that wouldn’t have worked.

* Eric Stein of Google gave us some stats that show where the potential is. He said there are 23 million small businesses in America, six million of them with one or more employees. That is the new population of advertisers who never could afford newspapers. Though as I learned when I visited Gannett’s lab a few days after the conference, those businesses don’t necessarily operate with the same needs and assumptions as present newspaper advertisers and it would be a mistake to try to impose those practices. Stein also said that newspapers reach only 20 percent of advertisers in a market. In that other 80 percent lies much of the hope for the future of local news.

* I didn’t write down who said it but I wrote down this thought: We may want to reframe journalism not as an information business but as community-building.

* At the end of it all, we asked the participants to charge CUNY with next steps as we work to build the Center for Journalistic Innovation and raise money under a matching grant from the Tow Foundation. Among those tasks:
> Develop a baseline business model to provide a community with journalism. (See the post above; I agree that that is job 1.)
> Share best practices and lessons, including mistakes, from various countries. (That will be the main job of the New Business Models for News project in the center; we have the remainder of the MacArthur Foundation grant that funded this meeting to start that work and we just received a grant from the McCormick Foundation to continue it but we need to raise more.)
> Develop new models in detail to share with the industry. (This, too, will be the work of the New Business Models for News project.)
> Develop quantitative research on community needs. (I just spoke with the Knight Commission and found that they are working on that.)
> Collaborate with our business school to better equip journalists with business knowledge. (That’s my hidden agenda for teaching entrepreneurial journalism at CUNY. We’re looking at doing more.)
> Discuss curation in a journalistic context. (I just spoke with a museum curator about creating a symposium to do that.)
> Work on an infrastructure for news organizations to share and monetize original content. (Work on that began that very evening with another group meeting).

* We had an incredible group of people at CUNY, which is a testament to their sense of urgency to work on the business of journalism. I want to thank them all and also thank the MacArthur Foundation for making this meeting possible and the McCormick Foundation for enabling us to continue this work.

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  • http://wyman.us Bob Wyman

    You wrote: “a conflict … at the end of the day — one of the few, actually — on the relative value of content creators vs. editors” …

    I’m one of those who argue for the higher value of editors. My reasoning is simple: Online news is a competitive business. Given competition, readers will choose between news sources based on perspective, voice, and quality. It is editors that craft and maintain voice and quality. Thus, they (as curators), will form the core of a news source’s competitive advantage.

    Good writers are necessary but not sufficient. Their work cannot be distinguished in a sea of searchable articles without the handiwork of a good curator. On the other hand, as we’ve seen from numerous examples of “curated” link lists, aggregated news services, (HuffingtonPost…), etc. a good curator can build a competitive advantage even without on-staff writers. Thus, curators seem to be both necessary and sufficient to build competitive advantage.

    bob wyman

  • http://www.digidave.org Digidave

    Shucks Jeff, I’m blushing.

    Site will be launching in full soon….. very soon (rubs hands together while plotting).

    mwwwuahahahahah (evil laugh).

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  • http://ultralocalvoice.wordpress.com william perrin

    Interesting debate Jeff – we have been having a similar discussion in the UK. The real trick is to mobilise the power of volunteers to write on local content by empower them with the simple skills required to maintain their own sites.

    See the good quality discussion here http://ultralocalvoice.wordpress.com/2008/10/05/talking-hyperlocal-ultralocal-workshop-at-mashup/#comment-66

    cheers

    w

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  • http://www.sunvalleyonline.com Dave Chase

    Jeff – Thanks again for putting together a great summit and group of attendees as well as to the foundation sponsors who are enabling the gathering. I have two main take-aways from the summit and my observation of established media organizations that relate to each other.

    1. The vast majority of the innovation taking place and being discussed at the summit was around managing the cost side of the equation and/or models to fund journalism as opposed to funding a business. The level of urgency and innovation doesn’t match it on the revenue side of the equation. We can’t cost cut our way to a compelling business so the revenue side has to step up their game. My next point posits why they haven’t yet.
    2. The business side of most of the established news businesses are led by non-innovative Order Takers. In working with sales orgs, broadly speaking I find there are “order takers” and “order makers”. For those not in sales, this isn’t about bossing people around. Rather “order takers” pretty much wait for customers to come to them and/or consider ongoing revenue to be a birthright. They simply need to continue to schmooze and service the account and they’ll be fine. In contrast, “order makers” passionately find new business opportunities whether it is under-served segments, new revenue streams, or different sales approaches to ensure revenue growth. As long as established media organizations are led by an order-taker mentality, their decline will be assured.

    While we don’t pretend to have all the answers, NextNewsNet is trying all kinds of different approaches with sites in our network (e.g., SunValleyOnline and NewWest.Net) despite having achieved a modicum of profitability which makes us unique amongst pure play online local news/info sites. This past week we tried a new approach that gives me reason for huge optimism. Conservatively speaking, we should close ad deals with local businesses that are equal to 20% of our total revenue of the prior year using a new approach.

    Let me give one example from this past week. We had done research on our site in order to quantify the value of our audience to specific market segments and developed some new ad tools in preparation for the push this week. We called on a real estate broker/office in a market where sales volumes are down 70+% from 2 years ago. Previously, we’d made pitches that hadn’t led to any business. Before we started, the broker said that they were in the process of cutting back on their ad spending and didn’t plan on doing anything with us but were happy to hear about our research. We had a great meeting where they were impressed with the tools and accountability we had built in to our pitch. By late the next day, they told us that they were going to cut their magazine, newspaper and TV ads where they’d seen no evidence of results so they could find money to sign a 1-year agreement with us. That may give pause to those in the newspaper/magazine/TV arena but I’m confident they wouldn’t have lost that revenue had they communicated the value they were delivering. In this economy, one needs be able to do that as that revenue isn’t their birthright.

    Separately, we are doing some things to increase our qualified lead flow that borrows from approaches Dell has had success with and it’s going very well. As your comments from Tom Evslin made clear, there’s much to be gained by looking for ideas outside of one’s own industry. One of my favorite business stories is how Southwest Airlines gained a huge competitive advantage by cutting down on gate turnaround time (and thus planes can be in the air more and thus they sell more seats per plane). Where did they get their breakthrough? Not United or Delta. NASCAR pit crews. They had a similar challenge of quickly and safely turning around a transportation vehicle of a different sort and Southwest was able to apply those principles to their business.

  • http://johnwilpers.wordpress.com John Wilpers

    Hi, Jeff,

    When Charlie Sennott spoke at your conference about Global Post, he left out one of our key differentiators: We will be publishing the work of 350 of the world’s best bloggers from the 53 countries Globa Post will be covering.

    One of the problems media are having is connecting to people. What better way to do that than by publishing the riveting work of real humans living, and in some cases surviving, in some of the most fascinating situations in the world? The street-level, real-life stories of people living in countries from Algeria to Zimbabwe are compelling.

    And that’s my job as their Director of Global Blog Development (fancy title, huh?!). Along with 14 interns, we have been scanning the Web for the very best bloggers writing in or about our 53 countries. And we have found some incredible stuff.

    I have posted samples on my blog where you can see their pictures and read excerpts of their best writing: johnwilpers.wordpress.com.

    The combination of correspondents and bloggers will be a very compelling package and add to the success of our business model.

    – John Wilpers (jwilpers@globalpost.com); blog: johnwilpers.wordpress.com

  • Dhyana Sansoucie

    Hi Jeff,
    I expect the answers for a city-sized publication are going to be MUCH different than those for small and mid-sized newspapers. For smaller papers, I would think content creators would win out over content editors. The smaller papers need to uncover the news … not find it already created elsewhere and edit and package it carefully. Are local papers going to quit print entirely? Five years from now? That’s what I wonder.

    Community building is as much our job as info providing. I think as an industry we’re a bit late to the game, though.

    Dhyana

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