Technology, Not War, Is the Solution to Publishing

The global publishing giants have declared war on the new technology generation of content distributors -- but they have lost sight of what consumers value and how they want to get to the value. It's time to separate content creators from distributors. It's time for a new business model which requires technology understanding and leadership to develop -- and one that new generation search applications like Google News and Digg for the consumer, or FirstRain for the professional investor, can sign up for to get the right news to the right people at the right price for them.

Local publications like The Boston Globe are teetering on the edge of bankruptcy, others such as The Seattle Post-Intelligencer are moving exclusively online after 146 years in print and global giants like the Associated Press and Wall Street Journal are trying to fight back. But the reality is this is too little, too late and effectively going to war with your customers is a fatal strategy as Arianna Huffington posted a few days ago.

Face it -- the consumers of news have changed -- dramatically. We no longer read multiple news sources on the hope that we'll find something interesting, most of the younger of us don't take a daily physical newspaper and as services like Facebook, Digg and Twitter have shown, we expect the most interesting news to find us. It's not that we believe news should be free -- clearly there is discovery, research and production cost, but it should be allowed to roam freely across the many channels the web enables and still maintain proper attribution.

Our customers at FirstRain have shown us over the past three years that the authoritative news is no longer only found in the WSJ, FT et al. Instead it's media like the DailyKos, Gizmodo, Consumerist, and In the Pipeline that are increasing the size of the news market pie and creating a huge demand for such obscure, on-the-edge news. In addition, the value of each piece of news varies by who's reading it and what they plan to do with it. What a college student reads about Apple, Inc. on an obscure blog may be informative and help him plan on his next iPhone purchase, but to a portfolio manager at a Hedge Fund, that same information may be the bit of news he's been looking for to insert into his model and make a multimillion-dollar trading decision. In both cases the news has value but the value, the search technology to find and rank the news and the delivery model is different in each case.

The critical issue still stands though -- original investigative reporting is a public service that we, as a society, cannot do without. Journalists are our educators and our whistleblowers, our eyes and ears on the ground.

The news industry needs to find a recovery path through innovation and collaboration. As Scott Karp points out in his article in Publishing 2.0, this is a technology issue that is outside the comfort zone of traditional publishers. Here are three steps the AP and its 1,500 U.S. daily newspaper members and the Newspaper Association of America (NAA) need to consider in creating a viable business model for themselves and their customers:

• Protect the original content creators: Grant original content producers the opportunity to file as nonprofits under the same laws and protections offered to the Public broadcasting companies as supported by Senator Benjamin Cardin, of MD.

• Track the content: Work with aggregators like Google News, Yahoo, MSN, as well as NYT, WSJ, and the like on developing a new HTML standard that can be inserted into the original news articles to enable the tracking of news throughout its lifecycle.

• Develop a fee-sharing business model: Work with content distributors on an appropriate fee-sharing model to enable the distribution of originally published news through the various niche channels as diverse as Google News, Bloomberg, FirstRain, and even a locally-published community paper.

These options would give content producers multiple channels to sell through, and the ability to charge a real market price based on each distributor's reach and depth, while at the same time providing an opportunity for smaller players writing original content to distribute their content through major channels for added revenue, outside of Google Adwords.

Then the AP and NAA would create a competitive environment and a generation of startups through which news is distributed to consumers and business professionals. And better yet, this would drive the separation of content creation from distribution -- and set up a long term sustainable business model which is what the publishing industry so badly needs.

Comments

[Bayfarmer]

Very well put, Ms. Herscher. Succinct and salient. My caveat as to any "solution" to the current newspaper publishing dilemma, which you have done so a fine job of compressing into a few words on a single aspect, is that too much credit for intelligence is given newspaper publishers. After all, and in the first damned place, it is their very own stupidity, arrogance and cupidity that have gotten them into this fine kettle of fish. Also, I'm not sure that the top dogs are all THAT unhappy with their apparent conundrum. Think of it, at last they have been empowered to at last indulge a lifelong publisher's dream: to break the unions. All of them. And also to at last dispense with real news gathering and reporting/­interpreta­tion. They much prefer puffery and flim-flam features of no significance to real information dispersal. Finally, these "publishing empires" everyone assumes are collapsing are not really doing so; each has dozens and dozens of ancillary puiblications floating about in the same markets---the exact markets so direly afflicted for the "flagship" newspapers that spawned all the little ones now feeeding on their parents' corpses while everyone digresses to blame the Internet.

Doug Hayward, Alameda CA

[AmeriGus]

A micropayment system might help here, where users can voluntarily transfer tiny fees, perhaps even negligible amounts AFTER reading an article, downloading a song or viewing a video. If there was a meaningful collection system in place for these micropayments to be accumulated and disseminated, it would reward the creator directly with a processor taking a small slice. This would benefit not only authors and publishers but musicians, video creators, bloggers or even charities.

Web 2.0 tools enable pop-up password prompts without needing to leave a web page. Paypal is slowly recognizing this, lowering it's minimum payment amount in 2005 from 30 cents to a nickel. But it's got to be much more convenient and even lower amounts. I'd love to surf the web, micro-paying authors and others with a nickel here, a dime there if it was quick, easy and safe. It's nothing to the buyer but could add up meaningfully for the creator and it's voluntary nature would create a new collaborative relationship between creator and consumer.

This would also reduce the advertising we're all be subject to, speeding the web up, reducing brain pollution.

Obama collected millions within 24 hours for the Red Cross during Hurricane Ike by asking people to text-pledge a $5 donation with a few keystrokes. Harnessing the aggregate size of the masses can be a great way to spread costs out, but we need a working micropayment system first.

[lauradionjones]

What we newspaper-reading, public consumers really want is more interesting and exciting writing. Not the same old stuff from the same old writers. Give more choice with fresh new voices. Especially in Chicago.

[Solaris123]

What this blog is really discussing is total and final commodification of all news.
Not sure it's such a great idea.
The quality of stuff that comes out is often quite atrocious. Regardless, of how many "buy" stuff here, on DailyKos or some rightwing rumor mill.

[Citizen54]

"... we expect the most interesting news to find us."

Maybe I'm just old-timey, but that attitude worries me.
I've been using the Internet since the mid-80s so I'm not speaking as someone opposed to digital information delivery or whatever you want to call it. But being a passive recipient counting on information to filter down to your device seems like a good way to miss important stuff.

On the other hand, we live in a country where 40-some percent still believe Hussein was involved in the 9/11 attacks. I guess the fact that he was not just hasn't found those people yet.

[mediaman]

Newspapers, and for that matter all print media, have lost sight of the most obvious truth of all. "Successful companies fail when they stop doing the things that made them successful­." We no longer have competent journalists. Old-time reporters were not products of journalism schools. The current crop of young journalists have no education, no ethics, no purpose, and no guts. We have let corporate and political interests surpress journalism. A young Mexican reporter asked Daddy Bush an embarassing question and lost his job. Dan Rather was ousted from CBS for pissing off W and the GOP. How many of today's publishers are former editors? They all used to be!

On the other hand, there are a few successful papers at the local level. Most have gone to the tabloid format, with ink that doesn't rub off on your hand and make your eyes itch. The ones who report the news without pimping for advertisers will survive and grow. That's the way it should be and the way it will be ... or we will suffer greatly from their loss!

[mjwca]

Yes, content creators and distributors are often separate entities but not always. The not-for-profit idea is plain silly and unrealisitc in most cases. It costs money, and lots of it, to create and distribute enough quality content to fill a 24 hour news world. Aggregators who think they should get everything for little or no money are as greedy and deluded as the Publishers and Media that pay talking head anchors or star reporters/pundits big salaries while they fire all the rank and file reporters, editors, producers and fact checkers that creat the majority of the content that created the product and brand worth buying. Both of them, along with consumers, need to realized that in the long run, you get (or don't get) what you pay for.

If journalists, writers, fact checkers, cameramen, news producers, etc can't make a decent living producing quality content, it will cease to be made. All that will be left is the crap. Publishers have soiled their brands by cuts to obtain unrealistic profit margins. Aggregators set up unsustainable business models based on getting content for free or under value, thereby working to destroy the very thing that brings consumers to them. Consumers feel entitled to get whatever they want on-line for nothing, so help devalue and destroy the production of the very content they want.
They all want something for nothing but how many of them would or could work for free? We all gotta eat and pay rent.

[Citizen54]

Amen.
When there are no paid reporters, editors, fact checkers, et al generating news, there will be nothing for bloggers, pundits, aggregators, et al to comment upon.

At least this site (HP) is going in the right direction by getting some investment dollars for investigative reporting (with paid reporters and editors).

[dadadata]

To quote : ...The critical issue still stands though -- original investigative reporting is a public service that we, as a society, cannot do without. Journalists are our educators and our whistleblowers, our eyes and ears on the ground. ...

Thanks.

But that also goes for coverage of local government. And state government -- in Maryland, newspaper coverage of state gov't is crap and TV coverage is just as bad.

Of course, the Md General Assembly is a little like a merry-go-round filled not with horses but with clown-cars. So maybe they get what they deserve.

Which raises a point: I think the newspapers are getting a little bit of a raw deal here. I agree that people are tired and frustrated at the same old drivel from the same old sources.

So separate the high-overhead columnists at the NYT from the news. Maureen Dowd is so tired compared to many bloggers who are willing to offer stuff that's more insightful and funnier.

And also: if this is the true dynamic, then the next victims will be cable TV "news" with ranting ranters and crawling banners and all the rest of that.

As for local TV, it's hopeless and its news function will probably atrophy.

[Kiwuck]

Aside from the development of technology, what killed newsprint is lack of journalism. If it had been purely technology, people would have stopped reading newspapers when radio started giving news for free and more easily. Television would have been the last straw. Why did that not happen? Because newspapers gave real news and had a lot to offer that radio and television didn't. What's happened since then is that newspapers no longer check their sources, no longer refuse to print items that shouldn't see print (such as hounding the newly bereaved) and no longer check their facts. As their standards have slipped, so have their sales.

Televsion is no better - Jon Stewart and Colbert are as valid a news source as CNN. CNN used to be the reliable source of news - but when the Bush regime was in full swing we heard more about who was or wasn't wearing panties than we heard about what was going on in Iraq. During the 8 years we needed them the most they were basically absent.

I am by no means a young person - my older grandchildren are adults - but I comb the internet for news because I can check it and filtre out the garbage. I can sort out what's likely true and what's attention-getting rubbish. I can avoid gossip and look for news - which I can't do in newspapers, radio, or television.

The only things that killed the newsmedia are the newsmedia.

[PW1206]

It's really interesting watching the old media hang on for dear life as the new overtakes it. RIAA, MPAA... AP, it was only a matter of time.

[ctngreen]

We believe that virtualized news is good for the information age. hence www.ctngreen.com/mag
however, subscriber revenue is very tough to get. We need independant news to keep reporting and flow of facts to be as pure and unfettered as possible.

CTNGREEN applauds Arianna's Fund for news reporting, and such integrity will be of huge benefit to all.

Thank-you Arianna Huffington.

[michaelejahn]

• Protect the original content creators:?
- they need salaries ! - filing as not for profits? How is that going to fix anything ?

• Track the content?
- they already have a great technology that enables who gets what - what they do NOT get from Aggregators that they DO get from Newspapers is a reasonable payment for the services AP offers, while Aggregtors simply snag it more or less for free.

• Develop a fee-sharing business model?
- sounds great. Show me how someone collecting news and is taking pictures does that. Please tell me how the Huffington Post might cover the salary of the Bangkok bureau chief.

[speakingout]

The traditional news media is being rejected because we are sick of the negativity and slanted opinions of the same commentators on a daily basis. People want THEIR voices heard. That's why the internet is exploding. The corporates are just like the oil industry that wants us to stay in the dinosaur era of the last hundred plus years of technology. The masses will bring the change that is needed in journalism and technology. Why wait for a handful of old cronies to continue to lead us down the path of no return. Maybe a "good news" paper might entice more readers. I think we've read about the car crashes, killings, etc. one too many times, it's old hat. Give us the facts, not the hype. THAT is where they failed.

[Shawn de Montaigne]

Watching the traditional publishing establishment go down in flames will stand as one of the great joys and triumphs of my days, as it should stand for anyone even remotely sane. The hyenas are starving. This is a good thing. May the vulture pick apart their bones.

As a self-publisher, I can only sit back in glee and watch, knowing that we who have been kept silent for so long by those hyenas will have a much greater voice in the days and years ahead. Again, this is a good thing. The more the establishment fights the advances of technology, the harder they're going to die. Whee!

So let's stop with the panic-mongering over their deaths. Its lame--and dishonest. Those who howl loudest do so only because they can no longer suck the lifeblood from the commonweal, can no longer tell us what to think, or how to think it, can no longer "shape" opinion (always toward and for the corporate interests that pay them), can no longer hold those of us back who wish to have our voices heard.

There you go.

[Citizen54]

Perhaps then I'm not remotely sane, but I see no joy in hundreds of thousands of people, hard-working people, being out of work because a newspaper or magazine goes out of business. It's one thing to chide the CEOs and VPs of editorial because in many ways they've blown it. But the folks who went in every day, tried to find and cover the news, and serve their community, what's so great about them being out of work? And to accuse them all of being anti-technology or whatever is unfair and makes me wonder if you know people working in newspapers and magazines.

Job losses, no cause for happiness.

[axels]

As sad as it is, industrial media killed itself. It is NOT the Internet or technology for that matter that killed publishers it is the change of their business model from independent content circulation to advertising distribution.

A publisher used to make money by providing a given audience latest news, well researched and easy to consume. Readers paid for the news and publishers made a profit by balancing cost of news gathering and distribution with newspaper revenue. Rather simple model.
I explaind the shift in process here a few weeks ago:
http://www.customerthink.com/blog/what_publishers_killed_may_kill_blogger_too

@AxelS

[3fingerbrown]

Hasn't advertising been the lifeblood of newspapers and magazines since the days of Benjamin Franklin? Would it have been possible for publishers to charge mere pennies for a newspaper for so many years if the cost of production was not defrayed by advertising dollars? Didn't the low price per copy made possible by ad dollars enable major papers to build their circulation, which, in turn, allowed them to raise ad rates, which, in turn, enabled them to keep the price per copy low and thereby maintaining their large circulation? That's the way I heard it.