Friday, February 27, 2009

How to save the newspaper ...

Something similiar to Mark Cuban's crazy idea to save the newspaper industry is being put into action, and it's topical with the San Fran Chronicle in trouble and the Rocky Mountain News having gone nips-up.
"NEW YORK (Reuters) – Cablevision Systems Corp plans to charge online readers of its Newsday newspaper, a move that would make it one of the first large U.S. papers to reverse a trend toward free Web readership.

The paper said in a statement late on Thursday that it is in the process of transforming the site into a locally focused cable service."
The debate really is about saving reporting as a profession, or at least as a vocation. Whether people get news from a dead tree-derived product which is dated within a day is secondary.

That might explain why there is some appeal to Cuban's notion that newspapers should be partnering up with Big Cable (a whole different can of worms). Presumably, in his model, a BellExpressVu subscribers in Canada, for a few cents a month, would get exclusive access to what on the Globe & Mail's website. It beats the hell out what seems to be prevailing in the newspaper industry of late, not that anyone reading this needs any reminder.

As Cuban puts it:
" ... newspapers ... should be knocking on the doors of cable and satellite providers offering their subscribers exclusive access to the online versions of their newspapers. That's right, the New York Times should be going to CableVision, Time Warner, Comcast, Charter, Directv, Verizon, ATT, Echostar et al, and offer to each that for 25 cents per month for those subscribers in the New York area, and for 5 cents per month for those outside the immediate NYC area, their subscribers will get exclusive access to the NY Times Online. Non-subscribers will get what Wall Street Journal non-subscribers get today, access to some content, but not the most timely or valuable content.

"If the Times can convince these operators that their subscribers will find value in exclusive access to the content, particularly if they can become part of their basic or near basic service, then all of a sudden, the NY Times and any other newspaper finds themselves with a recurring source of revenue that can turn into real money, while at the same time offering differentiated value for the video distributors.

"On a macro basis, I don't think its inconceivable that within a few years more than a material percentage of subscribers would support an additional $2 per month for unlimited access on all platforms, to all newspapers across the country. If it's 50pct (of the approximate 100 million U.S. cable subscribers) at $2, that's $100 million per month in new revenue for the industry. That's a billion dollars that matters. Plus advertising."
Yours truly has no special expertise in how this could all be matched up. Hear me out on account of livelihoods hanging in the balance, although frankly, many people working at newspapers will not be missed (and there's always one more than everyone thinks, Sager).

Cuban had mixed feedback, as you would expect with an idea which stands to work for the benefit of Big Cable. (Adrian Dater, the Denver Post and hockey writer who's suddenly got less competition on the Colorado Avalanche beat thanks to the Rocky Mountain News' demise, left a very positive comment, by the way. No scribe worth her/his notepad wants less competition. You want more. It means more people to lift the good stuff from.)

At least Cuban is talking about a new business model and how to get cash coming in. It beats the continual, numbing slash-and-burn which has been a huge downer for hundred of journos across Ontario over the past few months. It also beats the arterioschlerosis which has been taking place in the media in Canada, where embracing technology hasn't come with an accompanying attitude adjustment, namely that we don't have all the answers.

I never had any status to begin with, so it wasn't hard to give that up. I realized it was better to ask Pete Toms about anything in Ottawa that encompassed the economy, sports and municipal politics than open a newspaper or turn on a 6 p.m. newscast. Sorry, but Pete just knows it cold.

People still want to be informed and want to read quality stuff. The challenge is bringing in money so it's affordable to produce. It is better when someone is being compensated for their work. The most expensive thing in the world is cheap labour, or at least that's why my dad probably mused whenever he had me with him on a job site.

Having news content synched up with a cable company, provided there was still competition in the marketplace, has a lot of potential. Cuban noted the local paper's website needs to becomea kind of content aggregator, something a writer named Morgan Warstler pointed out recently (it was linked in Cuban's comments section).
"Here’s the plan:
  1. Google will license all US newswires with (the Associated Press wire service's) explicit support (they'll help cajole the other newswires), and will alter Google News to display only the headlines, not the abstracts. They will do this for a song, but they will have NO rights to publish any of the articles.
  2. Current syndication contracts will be abandoned by newspapers.
  3. Readers and bloggers will now have via Google News ALL the headlines and a 'proxied local link' to all the stories.
  4. Here’s the rub. Every single paper in America at their website will have (granted to them via Google's master license) every single article carried on the wires. (Ed.'s note: Which means the editors at your local former fishwrap aren't just cutting-and-pasting stuff from Reuters and The Canadian Press. Instead, they're helping make that local story sing.)
A localization proxy server will ensure that every link you click at Google News, or from your favorite blogger… you’ll read the article at your local paper's web site. Newspaper sites themselves will enforce this 'read local' policy by automatically re-directing non-local IPs back to the proxy."
Any talk about going hyperlocal segues right into sports coverage. A big reason this site has carved out its tiny little niche is that it is Canadian in focus without saturation hockey coverage, which is well beyond self-parody in this country. All hockey, all the time, works in the short run since it brings in the most eyeballs, which serves the needs of advertisers, but at some point it just becomes a self-fulfilling prophesy.

Meantime, there are only so many people who want to hear about the high school basketball playoffs, the local CIS football team or the an analysis of Roy Halladay's last five starts, based on Pitch FX data. It is a bit chicken-and-egg. Do people not care or is the problem that not enough people are out there trying to make it interesting and easily relatable?

The university sports example is a convenient one, since it's a niche audience. Rogers Community in Ottawa does a good job with Gee-Gees football and the university basketball team, along with junior hockey's 67's, but it is labour intensive and they can only do so many games. They can also only show one game at a time. Webcasters such as Streaming Sports Network Canada have the advantage of being able to host numerous webcasts at once; three people and a camera at centre court or centre ice is all it takes to air a game. The equipment is getting better all the time.

Rogers has 2.3 million cable subscribers in Canada. Using Cuban's $2/month model, an extra toonie is $4.6 million a month, more than $50 million per year. That would represent a huge windfall in the fourth-largest market in the country. Imagine what could be done to make news and sports coverage more hyperlocal.

Imagine if all of that was synched up and available on a newspaper's website. The game report, the informed analysis, video of the post-game press conference, an archive of the broadcast. The colour commentator might end up writing the game story. It's multitasking. It's modern.

In the sports example, the emphasis would be on what the best journalism does, which is telling people what it was like, not just what happened. The by-the-numbers gamers with the vanilla coach and player quotes everyone has read 1,000 times before no longer serves this end. The gamer, as it's called in the newsroom, has been dying probably since about 1960, especially when there's Nate Silver to do the vivisection in real time and Kissing Suzy Kolber (or KurtenBlog) to do it in a humourous, jocular way. It beats reading about someone changing his daughter's diaper, that's for sure.

Understandably, there are questions questions about media concentration, checks and balances; that won't go away. This is about good storytelling and a younger generation, guys in their early 20s such as Bucholtz and Kinger, or people slightly older such as Duane who realize the old model is dead, having the chance to be rewarded for the ability to tell a story well, instead of being blocked by Boomer hubris.

Cuban's idea might be pie-in-the-sky. It is not perfect. But it beats accepting that we should all chase after the same nickel, which used to be a quarter.

Cablevision planning to shake up newspaper industry? (Neil Best, Newsday)


Andrew Bucholtz said...

Interesting stuff, and some very good points. I hate the hyper-local idea, though. If I want national or world news, I don't want to get it from a wire service story linked on a local paper's website. I visit local papers for local news and national/world-focused ones for a combination of their own content and selected wire-service stories. Furthermore, the proxy-redirecting sounds like it would reduce your freedom to choose where you want to read your news, and I couldn't disagree with that more.

Allowing newspapers to offer content bundles through cable companies is not a bad idea, and it could benefit both sides. However, going to a subscription model only works if everyone does it, and I don't think that will happen. The WSJ can get away with it, as they offer substantial content you can't get anywhere else (and many of their readers can expense their subscription). For other papers, the drop-off in readership will hurt online ad revenue more than what you make back from subscription fees.

For me, the solution is a traditional one with a couple of new elements. Make the content free; this increases the reader base. Take that reader base to your advertisers, perhaps in new and innovative ways (different kinds of ads, ads localized to individual stories, etc). Internet advertising has the potential to be far more effective than any other form, and it's certainly more trackable; you can tell your advertisers exactly how many people saw their ad and how many clicked on it, something you can't do with print, radio or television ads. You can also tell what sites they're coming from and what stories they're reading; that gives a lot of valuable demographic information. In my mind, advertisers will eventually realize the power of the web and will be willing to buy more ads there and pay higher prices for them, especially on sites that have high repeated traffic. It may take a while for this revolution to happen, but as young people familiar with the power of Internet marketing advance through the ranks, I see it as more and more likely. Thus, in my ideal endgame, we wind up with most papers surviving and drawing most of their revenue from web ads. They may or may not still run dead-tree editions, but if they do, those will likely be in very limited numbers and done as a loss-leader to give the online version credibility. The Internet is the present and the future, and it's where the business is going, but it's based around freedom and open access fueled by advertising; trying to bring a paid model to the web is a step backwards in my view.

sager said...


The newspaper, the physical product, is secondary, I said that right off the hop.

It also isn't a paid model like you are thinking of, or the ones which have been tried (pay $4.95 for a reprint of this story!). You're misclassifying it as part of the everything-should-be-free doctrine. Perhaps it will evolve all over time, but the logical next step, if any of us are going to make a living from this, is what Cuban is suggesting:

"While the 'internet should be free' folks will hate this for obvious reasons, it makes perfect sense. Subscriber fees from cable and satellite to content creators pay the bills. Period end of story. It makes every bit of common sense to provide cable and satellite subscribers, the people who really pay the bills, with unlimited access, on any platform to the content they are already paying for. Right ? Of course right.

Marrying local news with the cable companies would give you a much broader platform. Seventy, 80 per cent of homes are cable subscribers; while 15, 20 per cent subscribe to a paper. That means eyeballs and that brings advertisers.

That gives you a lot more revenue coming in. You don't have that, than everything else is academic.

As for Warstler's suggestion, what's the difference if you read the same wire story via the Whig-Standard or Toronto Star? It's better than having no wire story at all, which is what is going to happen.

At least some people are talking about doing something, instead of the race to the bottom.

The beauty of it, putting on my editor hat here, is that I would have more time to work on making that local story sing, rather than decided to cut-and-paste 6 grafs of a wire story to fill a tiny hole.