On this week’s On the Media, Bob Garfield interviews me about CUNY’s entrepreneurial journalism program and the idea of teaching journalism students business. See our conference (call) with J-schools around the world that are starting to teach entrepreneurial journalism. We also discussed the New Business Models for News Project.
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The rise of the interest-state
In the post below, on Google standing up to China over its spying on dissidents and censorship, I note how Zeit Online calls Google a quasi-state — in a post under the headline “The Google Republic” — and Fallows says Google “broke diplomatic relations with China” as if Google were a nation.
What this says, of course, is that the internet is the New World and Google is its biggest colonizer: the sun never sets on Google.
It also says that on the internet, new states form across interests, ignoring borders. Those interests can be business — and we’ve seen what look like business-states before — but also causes, principles, and dangers (e.g., Al Qaeda). Interest-states will gain more power and that power will come from nations.
Just as what we’re seeing in the economy is more than a mere crisis — it is the shift from the industrial economy to what follows — similarly, in political structure, we are beginning to witness the emergence of new and competitive interest-states. In What Would Google Do?, I said this:
Whatever causes they take up, Generation G will be able to organize without organizations, as Shirky wrote in Here Comes Everybody. That ability to coalesce will have a profound destabilizing impact on institutions. We can organize bypassing governments, borders, political parties, companies, academic institutions, religious groups, and ethnic groups, inevitably reducing their power and hold on our lives. In an essay in Foreign Affairs in 2008, Richard Haass argued that the world structure is moving from bi- and unipolarity (i.e., the Cold War and its aftermath) to nonpolarity (i.e., no one’s in charge). We now operate in an open marketplace of influence. Google makes it possible to broadcast our interests and find, organize, and act in concert with others. One need no longer control institutions to control agendas. Haass chronicles the dilution of governments. Bloggers Umair Haque and Fred Wilson have written about the fall of the firm, and earlier I examined the idea that networks are becoming more efficient than corporations. In my blog, I follow the crumbling of the fourth estate, the press. One could debate the stature and power of the first estate, the church. What’s left? The internet is fueling the rise of the third estate—the rise of the people. That might bode anarchy except that the internet also brings the power to organize.
Our organization is ad hoc. We can find and take action with people of like interest, need, opinion, taste, background, and worldview anywhere in the world. I hope this could lead to a new growth in individual leadership: Online, you can accomplish what you want alone and you can gather a group to collaborate. Being out of power need not be an excuse or a bar from seeking power. That may encourage more involvement in communities and nations—witness the youth armies that gathered in Facebook around Barack Obama, a powerful lesson for a generation to have learned.
: MORE: Siva Vaidhyanathan responds (as part of a conversation between us in both this post and the one below):
My book plays this in a slightly different way: The Internet has enough diverse interests and players that it demands governance. No traditional state is in the position or willing to assume that role. So Google governs the Internet.
One could read this showdown (as I do) as a classic international power conflict between a major traditional state and a new, virtual state: the Googlenet.
Google is taking a risky stand to defend the Internet generally. This is what a weaker, threatened state would do.
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What Google should do
I am astounded and delighted at the news that Google is no longer comfortable censoring search results at the call of the Chinese government and is threatening to pull out of the market. Google said it discovered cyberattacks and surveillance aimed at cracking the mail accounts of Chinese supporters of human rights. Said Google exec David Drummond on the company blog:
These attacks and the surveillance they have uncovered–combined with the attempts over the past year to further limit free speech on the web–have led us to conclude that we should review the feasibility of our business operations in China. We have decided we are no longer willing to continue censoring our results on Google.cn, and so over the next few weeks we will be discussing with the Chinese government the basis on which we could operate an unfiltered search engine within the law, if at all. We recognize that this may well mean having to shut down Google.cn, and potentially our offices in China.
I know some will say that Google wasn’t doing that well in China anyway (it controls 31% of the market); they’ll ascribe cynical motives. But I say: Name one other company that finally said “enough!” and put ethic, morals, and company standards over its lust for the Chinese market. Not Yahoo. Not Cisco. Not Nokia. Not Siemens. Not The New York Times Company. Google has.
Here’s what I said in What Would Google Do? about China:
Google has censored search results in China, arguing that it is better to bring a hampered internet there than no internet at all. I don’t agree and believe that Google has more power than it knows to pressure countries around the world to respect openness and free speech. Google, like Yahoo, has handed over information to governments—Google in India, Yahoo in China—that led to users being arrested simply for what they said. As an American and a First Amendment absolutist, I’d call that evil.
Here’s what I said in a talk at Google’s offices in Washington. (Thanks to commenters, the time code for the start of the topic is 23:38.)
Note that even Google’s cofounder, Sergey Brin, has waffled if not agonized over the company’s China policy.
I can well be accused of being a Google fanboy; I wrote the book. But I have been consistent in my criticism of Google’s actions in China. And so now I have not choice but to become even more of a fanboy. I applaud Google for finally standing up to the Chinese dictatorship and for free speech.
Will the Chinese people revolt at losing Google? We can only hope. Will other companies now have to hesitate before doing the dictators’ bidding? We can only hope. Will Google be punished by Wall Street? It probably will. But as I’ve argued, we should hope that Google’s pledge, Don’t be evil, will one day be chiseled over the doors of Wall Street.
Google has thrown the gauntlet down in favor of freedom. What Should Google Do? This is what it should do.
: MORE: Said Jonathan Zittrain of Harvard’s Berkman Center: “In a world in which we are so used to public relations massaging of messages, this stands out as a direct declaration. It’s amazing.”
: Says Reuters: “The world’s dominant search firm may be hoping other search and e-mail leaders, both global and domestic, will rally around it in calling for China to lighten a heavy-handed approach to the Internet that includes frequent censorship and allegations of government-backed hacking.”
: YET MORE: Zeit Online calls Google a quasi-state that is willing to stand up to China where the U.S. and Germany are not. But it also warns that Google’s interests are not what they seem. (In German.)
: A view of the PR strategy:
Google has taken the China corporate communications playbook, wrapped it in oily rags, doused it in gasoline and dropped a lit match on it. In China, foreign companies tend to be deferential to the authorities to the point of obsequiousness, in a way that you would almost certainly never encounter in the United States or Europe. . . . In this situation Google has undertaken a bet-the-farm confrontational communications approach in China. They will not have made this decision lightly. Dressed up in the polite language above is what is essentially an ultimatum: Allow us to present uncensored search results to our Chinese users or we’ll walk.
: Rebecca MacKinnon, who knows whereof she speaks on matters China and internet, says Google is doing the right thing.
: James Fallows, who also knows, says this:
And if a major U.S. company — indeed, Google has been ranked the #1 brand in the world — has concluded that, in effect, it must break diplomatic relations with China because its policies are too repressive and intrusive to make peace with, that is a significant judgment. . . . But its government is on a path at the moment that courts resistance around the world. To me, that is what Google’s decision signifies.
: Siva Vaidhyanathan responds to me here. There’s a chicken v. egg debate about what’s leading this: the attacks or the censorship. I agree that the censorship is a tool in this power struggle; it clearly was not the catalyst or it could have been four years ago. But I think it’s also evident —see Sergey Brin four years ago — that Google, despite its public pronouncements about a crippled internet being better than no internet, struggled internally with its China policy. Slapping China over censorship is now a way to bring make the fight about attacks about China. Pick your sin — attacks, censorship (or the death penalty or repression of dissent or dangerous and fatal products) — somebody — Google — finally had the balls to make China the issue. I’ve sat in WEF meeting where some have shushed me and others for daring to criticize China: it’s a Chinese thing; you wouldn’t understand. Well, bullshit, it’s a human thing; it’s about rights (pick yours).
: See my post above on the rise of the interest-state.
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John Paton on newspapers’ future
Two newspaper companies hired new chiefs last week. The Star Tribune hired Michael Klingensmith, my former colleague at Entertainment Weekly, and Journal Register hired John Paton, now head of Spanish-language publisher impreMedia and a newspaperman with roots in Canada. The latter didn’t get the attention it deserved.
Paton has executed a strategic vision at impreMedia, turning it into company that truly puts digital first, hiving off functions that don’t add value and cutting costs to make the company sustainable (that’s the half of the budget that gets too little attention these days), and beginning to build a new relationship — including a commercial relationship — with the emerging ecosystem of news.
Klingensmith, on the other hand, is a big-media executive. I was disappointed that the Star Tribune did not take the opportunity of bankruptcy — or of this hire — to redefine itself. That’s painfully evident in Minnesota Public Radio’s interview with Klingensmith, in which he talks about print and portals. (Sherman: Stop messing with the wayback machine; it’s not 1999 anymore.)
Paton’s work is largely unsung because the product is in Spanish. That, I think, is why his announcement didn’t get as much attention. So I decided to interview Paton via email about his plans for Journal Register. (Disclosure: In our discussions about the future of news, Paton has become a friend and an advisor for the CUNY J-school and my entrepreneurial class.)
JARVIS: What did you do at Impremedia to make it a sustainable news company in the Hispanic market?
PATON: The first thing we did was to decide that in our company, a print company, when it came to products we would be digital and brands first and print last. It was our radical way of focusing everyone on the future. By recognizing our competitors and our future were digital everything we built and did had to follow that decision.
More than two-thirds of any newspaper company’s expenses are in support of the core business of content, marketing and sales. Our digital competitors don’t have that two-thirds cost structure, so we attacked. it. We outsourced all printing, distribution and pre-press ad make up and page make up. We plowed a big part of the savings into expanding our digital resources – web, online video, mobile platform and widgets. We standardized I.T. We then outsourced the back end of all our digital support. Then we started cross-training journalists into one-person multi-media journalists – an ongoing process.
The second decsion was we would let the outside world in. We would share our content for free and we would play with anyone who wanted to play with us – mainstream media or bloggers. That led to our relationships with ESPN, AOL, MySpace, etc. And our launching of the Community E-Journalism Labs in Los Angeles and New York where we said we want to work with entrepreneurial journalists and help them make a living. We have opened up discussions with companies like SeeClickFix and Outside.In to augment our resources and let us re-allocate ours.
The third decision was that we would put in place a very strict protocol that follows the new news ecology of news creation and consumption. Every story of merit is first sent out as a mobile alert, then it goes to the web. After that our publications, editors and journalists use social media to push audience to the web. This process is repeated and enhanced all day with the addition of video and audio. The last step is the printed product. We are currently working to change that product to be a very different product which has to reflect how much of that story has developed and been consumed.
The result was in less than two years we went from 9 products on two platforms (print and crappy publications sites full of shovelware) to nearly 100 products on 7 platforms – with about 45% less costs.
* * * JARVIS: What are your plans for Journal Register? What will a paper there look like in 1-5 years? Will it look like a paper?
PATON: JRC needs to enter the modern news age in a much more focused and vibrant way. That means the re-allocation of resources to a digital first and print last focus.
In my opinion, JRC is too much like most of the newspaper industry – closed to their communities and input from the outside world. They need to understand the papers and their online counterparts are just a part of the news ecological system.
One of the first steps will be to establish community E-Journalism labs in our communities where we have dailies. There is no way to be hyperlocal without harnessing the power of entrepreneurial journalists and the labs help do that by making content and more importantly sales arrangements with those entrepreneurial journalists.
Second step will be to initiate and, in some cases, expand relationships with companies like Daylife, Outside.In, SeeClickFix, GrowthSpur – any company that lets JRC expand its resources in content, audience and sales while allowing it to re-allocate and focus on its core business. I am very excited about ideas like explainthis.org and others that look at community crowd-sourcing for assignments.
The third step is to tackle the two-thirds infrastructure cost bucket.
Down the road print will change. I suspect the physical size will change and the print content will be much less “he said yesterday” journalism. The focus will become very local with national and international news procured from the very best sources. With so much of the breaking news on the digital platforms, print will become longer-form journalism complimented with vibrant opinion pieces to spark and facilitate debate of issues of importance to the communities. The online forums will expand and continue that debate.
Print will also become a much more malleable term expanded to mean the tablet versions of the actual print product.
* * * JARVIS: I’ve argued that the future of news is entrepreneurial. Here you are, trying to update an institution. GIven the cost structure and culture of traditional news companies — and their failure, all in all, to reimagine and remake themselves for the digital age — what makes you think that it’s better to spend your time reforming an old company than starting a new one?
PATON: That is a very valid question.
Essentially, I believe that despite the traditional cost structure, the legacy companies do have a running head start with deep relationships with readers and advertisers and their communities. They have solid, if challenged, revenue streams and they are profitable. There are no technological or web content developments closed to them and they can harness that profit to change.
At impreMedia we proved legacy media can be changed.
Finally, while now only one part of the news ecological system, legacy media is an important part. Continuing the core mission of local journalism going forward on multiplatforms, profitably, I beleive. is an important mission for this country.
* * * JARVIS: OK, now focus on one ecosystem — say, New Haven’s. Besides JRC’s paper and site, the Register, the town has The New Haven Independent doing good and pioneering journalistic work online. There are independent bloggers. There are students covering the university. There’s an alternative paper. There are new sources of information, such as data from government. There’s Spanish-language media, a market you’re familiar with. There’s broadcast. So once you focus the Register and its resources on its greatest value, what is that value? What should your news organization add to the ecosystem? Is it more than reporting? Curation? Community organizing? Education? What else? And what does this mean for skills a Register journalist should have?
PATON: The New Haven Register has a long and deep commitment to journalism in New Haven. It can trace its history through predecessor companies and founders to the Connecticut Gazette co-founded in 1755 by Benjamin Franklin. Some of the first newspapers in the country were founded in and around New Haven. They have always changed to survive and can continue to do so. But now only as one part of of the news ecosystem.
The Register can bring something most new competitors cannot to the party – resources. It has more advertiser relationships, more revenue, more staff and more profit than any of its competitors. It can harness those resources to make the kind of business relationships with entrepreneurial journalists and companies that are doing fantastic work in that community. By doing so it expands that work and will let the Register focus its resources on other initiatives.
This approach lets the paper, as a news organization, engage again in investigative journalism and in-depth reporting of issues of importance to the community. It lets the company’s journalists spend time data mining important government information and developments that may not necessarily be highlighted.
Re-allocating the Register’s resources to create compelling original content is one benefit but the ability to curate content and add resources to put that info in context is also very exciting. Those efforts will stimulate debate in the community and the paper will become a much bigger forum for that because of those efforts.
Importantly, this approach will let the paper re-connect or perhaps connect for the first time with constituencies that either don’t engage with the paper or perhaps feel disenfranchised by the paper’s current coverage and platforms.
* * * JARVIS: Now please answer the same question from the business perspective: What will the the Register’s commercial relationship be with the ecosystem and economy of New Haven? There are all those entities above plus craigslist and local merchants’ own sites. You’ve already talked about making sales arrangements with entrepreneurial journalists (I say: bravo). Will the Register still compete with those other enterprises? Can it be a platform for their success — and how? At impreMedia, you’ve told me, you hived off distribution, enabling former employees to set up new companies that now serve not only impreMedia’s properties but also Impremedia’s (former) competitors. Do you see something similar happening with local papers? What will the heart of the Register’s own business be? What’s not core?
PATON: No legacy media news company can move forward and become hyperlocal, as it must, unless it harnesses the power of entrepreneurial journalism. And the only way to harness the power of entrepreneurial journalists is to make them your partner and help them make a living. The E-Community Journalism labs will strike content and sales relationships with community members. We will faciliate cross-publishing with some, ditto sales. Sales training will be important. The motto will be that if they win we win too. The Register, as can any community daily, afford to lead the way in these developments. No business deal works if it is too one-sided.
I believe it is important we use the power of our traffic to strike ad relationships with local merchants. By creating vibrant search directories we help drive traffic to the merchants’ sites and stores. Hitching those directories to the power of Google is a win-win for everyone. There are so many ways we can help ensure a vibrant future for the communities we serve.
It is still too early for me to know what outsourcing initiatives will be undertaken but I can say that in my past experience this has resulted in employees being set up in independent, vibrant and profitable businesses and working with our competitors to lower costs and drive profits.
The newspaper industry has been scelortic in its ability to change. It now must find the willingness to do so and become much more flexible than it has ever been.
* * * Jeff, I should add to my comments I just sent you that I am still stupified at the amount of fear in the newspaper industry. I believe that fear has got to the point that it cripples critical thinking and action. More of the same with less is just prolonging a sure death. Thinking about change and implementing it ensures survival as news organizations….
One more, one more thing: Newspapers need to become fearless again about making their mistakes in public. We used to be good at that. We lost that along the way. The web and is ever self-correcting actions make for a fearless place of ideas.The industry has to find the strength to execute, fail and execute again, again and again. And we have to stop talking and start doing. We should remember our Ben Franklin: “Well done is better than well said.”