Posts about business models

The problem with “takes” is the business model of mass media

A very good take on why all news organizations think they “need a take on that” becomes a self-fulfilling prophecy, being followed by another take and then another take on the Awl’s take on takes. Shoot us all now.

No, shoot the business model and the presumptions of mass media economics. That is what is causing this ridiculous treadmill of making content for content’s sake to get audience for audience’s sake with any original reporting or original thinking being copied and copied again and again until it looks like a the fuzzy, unreadable, 87th Xerox copy of a bad carbon copy. That is what makes media companies think the answer to any business problem is to make more content because that’s what we content makers do.

The problem is that the old business model of mass media rewards volume not value. The problem is also that we mistake our job as content makers rather than as service providers.

Advertising is bought on eyeballs by the ton — that is, every 1,000 set of eyeballs a media site can deliver. Advertisers then deliver their messages to said eyeballs. That’s because that’s the way old, one-way, mass media had to work. That’s all that print and broadcast allowed. And we are still, two decades after the introduction of commercial web, trying to copy our old business models in a new media reality. Spoiler: It won’t work.

Why do you think, as illustrated in this handy chart provided by First Monday, that Google’s value has soared 1,000 percent in that time while news media companies’ value has swirled down the toilet bowl?

monday note chart

Easy: Google sells value. To users, it provides relevance. To advertisers, it promises performance. Meanwhile, media still sell mass. They deliver one-size-fits-all products (“come see our home page, all of you; we’ll bet one of the hundred or so headlines there will grab you!”) to users. They deliver mere impressions to advertisers. Shouldn’t we be asking [cough] what would Google do?

There’s another reason that journalists like to issue their own takes on takes: ego. Back in the day, reporters were assigned to “match” other publications’ reporting not because they were scientists replicating others’ research and adding value to it but mostly because they wanted their own bylines and their on brands over their own stories in their own pages. And that made a modicum of sense in paper economics. But it doesn’t make sense anymore. Indeed, we cannot afford to use precious journalistic resources parroting what others have already done, reporting what our readers already know. The net — as distinct from mass media — rewards specialization and quality, the thing people link to because it’s good. Quality. Value. As a dividend, the link also brings news organizations the opportunity to recognize efficiencies by not trying to do everything for everyone. Dare I repeat this, too: Do what you do best and link to the rest.

The lessons of this story are painfully obvious: Stop making content. Start delivering service and value. Stop copying others’ work. Link to it. And to advertisers: Stop buying impressions. Buy performance. And to all: Challenge old assumptions. Innovation over inertia. Value over volume.

So was this just another take on the takes on takes? So shoot me.

Absolution? Hell, no

sarducciovalThe good Reverend David Carr grants us absolution. “So whose fault is it?” he asks after chronicling the excommunication of newspapers and magazines from media companies casting off their old, print ancestors to starve and die. “No one’s,” Carr decrees.

Not so fast, preacher. It is our fault. Who else could be at fault? We journalists, publishers, and journalism schools have turned out to be irresponsible stewards of journalism. We squandered our trust and our cash flow. This was was our institution to nurture and protect and Carr says it’s all but dead.

Wait a minute, Father David. That depends on what you define as our institution. He sees it as print. Well, hell, I’ve spent years now begging my journalistic coreligionists to stop defining themselves by their medium — by their means of production and distribution — otherwise they’d all end up just where they are today: the baby swirling down the drain with the holy water.

But there was good news for media companies this weekend, wasn’t there? BuzzFeed got a $50 million investment from Andreessen Horowitz. I thought venture capitalists didn’t invest in content because it has cooties, no? But its new board member, Chris Dixon, says that’s because BuzzFeed’s not a media company. “We think of BuzzFeed as more of a technology company.”

cat baptismWell, hold on, you moneychanger in the temple, you (and mind you, sir, we’re glad to have you here; please make yourself at home). BuzzFeed is still a mass media company because it still operates by mass-media economics based on volume: the more people it can tempt into its harem with the siren call of its cats, the more people it can serve to advertisers (no matter what it calls its advertising). It is a last-gasp, clever (some might say cynical) exploitation of those old-media ways, grabbing the last dollars from the cold, dead hands of Carr’s congregation. It is the newest old-media company.

But I have faith that BuzzFeed’s founder, Jonah Peretti, can invent his way out of this — that’s why Andreessen Horowitz is not nuts to invest in him. He can use the cash flow the old ways bring him to invent something new. But he hasn’t yet. And that’s the point: There’s still time. Old media companies still have cash flow they, too, should be using to reinvent themselves.

But Brother Carr has renounced his vows right from inside the old scriptorium. Fucking Gutenberg. “Nothing is wrong in a fundamental sense,” he writes. “A free-market economy is moving to reallocate capital to its more productive uses, which happens all the time. Ask Kodak. Or Blockbuster. Or the makers of personal computers. Just because the product being manufactured is news in print does not make it sacrosanct or immune to the natural order.” Or how about asking Netflix?

No, market forces are not an excuse for fatalism and ultimately suicide. Market forces are an opportunity for — forgive me, for I do know I’m getting carried away with this religion thing — resurrection. There is still time as no one has yet challenged all our old-media assumptions about content and print and reinvented journalism as what it should be.

I’ve warned you that I’m about done with a 55,000-word tome about that reinvention. I’ll give you the tl;dr now: Journalism needs to rebuild itself as a service to individuals and communities, which requires having relationships with them as people, not a mass, helping them reach their own goals in new ways — not just with content — and sustaining this work with business models built on value over volume.

That’s not what newspapers — even the digital-first among them — are yet. That’s not what BuzzFeed or Huffington Post or Business Insider or Vox is … yet. I don’t know what that is yet (thus my tome is no prophecy) but I suggest a few paths to the promised land.

At the end of his eulogy, Carr writes: “It’s a measure of the basic problem that many people haven’t cared or noticed as their hometown newspapers have reduced staffing, days of circulation, delivery and coverage. Will they notice or care when those newspapers go away altogether? I’m not optimistic about that.” Ah, but it’s a poor shepherd who blames his sheep.

So I’ll end this as good sermons should, with a charge to the congregation: Go forth and figure it out, people. Stop whining. Stop looking for excuses and forgiveness. Stop giving up. Your flock needs informing. Go find new ways to do that. And I don’t want to see your prodigal asses back in these pews until you do. That goes for us in the seminary, too.