Left Bay’s Musings on the Media

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Archive for Saving Journalism

Clay Shirky’s Message to Old Media: Change or Die

Author and academic Clay Shirky has a re-tooled message to old media: Change or die. In his new post called “The Collapse of Complex Business Models,” Shirky asserts “When ecosystems change and inflexible institutions collapse, their members disperse, abandoning old beliefs, trying new things, making their living in different ways than they used to.”

One example he uses is the move to return to having users pay for journalistic content. Many newspapers, magazines and entertainment outlets say that content shouldn’t be free and that they will start charging for it. But the fact is, users now have choices. There are free outlets.

Another example he uses is video. It used to be complicated to record, edit and air video — say nothing of expensive. But with the advent of better technology and free methods of distribution — think YouTube — anyone with a camera phone can upload and show their favorite video. And while we still enjoy our movies, riveting television shows and other highly produced extravaganzas, it’s now often the cheapest that entertain us the best.

If truth were told, says Shirky, these media titans would seem to be saying something like this: “Web users will have to pay for what they watch and use, or else we will have to stop making content in the costly and complex way we have grown accustomed to making it. And we don’t know how to do that.”

Asks Shirky — What’s the most watched video in the last five years? “Baby Charlie biting his brother’s finger. (Twice!) That minute has been watched by more people than the viewership of American Idol, Dancing With The Stars, and the Superbowl combined. (174 million views and counting.)”

Old media has to change because the economic “ecosystem” has stopped rewarding complexity. Simple is better. And those who figure that out will be rewarded in not only the present, but future too.

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Who Will Pay For News?

President Obama recently weighed in on the crisis in journalism.

“Journalistic integrity, you know, fact-based reporting, serious investigative reporting, how to retain those ethics in all these different new media and how to make sure that it’s paid for, is really a challenge,” Mr. Obama told a reporter from the Toledo Blade. “But it’s something that I think is absolutely critical to the health of our democracy.”

About the same time I was reading this article, I came across another — this one quoting the results of a Harris Interactive Survey on who would pay for news.

The research, commissioned by paidContent:UK shows that most readers would, in their words, “run a mile” and NOT pay. Nearly 75% would switch to free sites, 8% would read only the headlines and move on, and 12% weren’t sure. That left a measly 5% who would actually pay for content.

As reporter Robert Andrews asks, “The big question for publishers: Is five percent of your readership enough to offset the decline in advertising revenue that would come with putting your content behind a pay wall?”

Actually, that 5% would choose to pay is in line with the anecdotal evidence we’ve heard at Kachingle, which is that between 5% to 10% of readers would pay for content. Journalism Online is using the higher number. NYTimes said they received 12% for their failed effort called “Times Select.” Others in the business I talk with seem to think you can get at least 5% to pay. So in and of itself, the numbers are not surprising, and reinforce what we’ve been hearing.

What’s surprising, and frankly somewhat baffling, are the results broken out by age. Harris reports that 13% of 16-24 year olds and 6% of 25-34 year olds said they would pay; as opposed to only 1% of 45-54 year olds. Harris Interactive is a big name in polling, but these results go against everything we’ve seen, and seem totally out of whack. If anyone is going to be willing to pay, it’s the baby-boomers, not the “kids.”

But the big picture remains true: “As long as free alternatives exist, consumers will turn to them for their daily information.”

At Kachingle, we get asked a lot about statistics like these. There’s some comfort in knowing that some percentage of users will pay for content. What’s disconcerting is that so few actually will.

We’re not about getting users to pay for content; we’re about getting them to build online personas. They’ll Kachingle in order to associate themselves with sites and build their personal brand. That’s why in our demos, we show side-by-sides of a Yugo and a Porsche. What does contributing say about YOU? Our question hasn’t been asked yet. But it will, soon…

Do Newspapers Matter?

There’s a been a lot of talk about the death of newspapers, and how this impacts the very foundations of our democracy. The thinking goes something like this: Newspapers are the watchdogs over government. If newspapers go away, so too, will responsible government. Not all of it, of course. Just the few who might otherwise be smoked out by aggressive reporting.

But do newspapers also encourage citizens to get involved with local government? That seems to be the conclusion of a study by Princeton University’s Sam Schulhofer-Wohl and Miguel Garrido. Their study, Do Newspapers Matter? Evidence from the Closure of the Cincinnati Post suggests “fewer candidates ran for municipal office in the suburbs most reliant on the Post, incumbents became more likely to win re-election, and voter turnout fell.”

The authors are careful to note that their results are “statistically imprecise,” and that they simply looked at one suburban municipality, and that more work needs to be done. Nonetheless, it does give us a data point to begin a discussion. Also, as other others are suggesting, “It would also be interesting to see of the trends continued or were simply short-lived effects until new information sources filled the void.”

What might replace the newspapers? Bloggers, perhaps. The problem I see is that while bloggers offer an alternative voice to newspapers, it’s akin to reading only the editorial page: there’s no original research. Who’s going to do the work of digging into courthouse records and filing stories, ie, who’s going to “create” the news, unless they’re paid for it? Advertising is providing some of that revenue, but not enough. There have to be other means for journalists to get paid.

One such solution might be Kachingle, one of the companies I’m working with. It provides a credible, crowd-funding alternative that allows users to support any site they want, and get social recognition for doing so. If open source sites like Wikipedia can be supported with voluntary dollars, then maybe journalists can, also.

Huffington Post Announces Launch of Investigative Fund

On Monday, the Huffington Post announced the launch of The Huffington Post Investigative Fund. According to Ariana Huffington, the nonprofit Fund will produce a wide-range of investigative journalism created by both staff reporters and freelance writers.

“We’ll start with a budget of $1.75 million — and continue to raise funds and expand the project as we move forward,” she said.

Fantastic! This is the kind of support journalists need. But I also wonder, how does $1.75 million compare to what major newspapers used to budget for investigative journalism? It seems like a pretty big number, but I honestly don’t know how to measure it. There was a time when some newspapers sponsored investigative units. They were the exception, however. Most often, investigative stories would just evolve…as beat reporters uncovered parts to a story that hadn’t been told. How does “investigative journalism” differ from writing a really interesting story, of national or local interest? Is the real story of the Huffington Post’s announcement simply that they’re supporting journalism, investigative or otherwise?

Looking for Alternatives to Paid Ads

There’s a pretty good back and forth going over a TechCrunch guest article that opined that most ad models will “fail” on the internet. The article, by Eric Clemens, a Professor of Operations and Information Management at The Wharton School of the University of Pennsylvania, takes aim at paid search in particular, because we “no longer need advertising to obtain the information” we want. Clemens says we can find what we want, when we want it, through more trusted sources than paid advertising. And most of us, he says, don’t even want to view advertising.

Clemens says that “conventional search,” such as a regular Google query, “misdirects” us to sites other than the ones for which we’re looking. “Monetization of misdirection frequently takes the form of charging companies for keywords and threatening to divert their customers to a competitor if they fail to pay adequately for keywords that the customer is likely to use in searches for the companies’ products; that is, misdirection works best when it is threatened rather than actually imposed, and when companies actually do pay the fees demanded for their keywords.”

I get it. Google is making money by providing search results for misspelled keywords and ambiguous searches. But misdirection? I don’t think so. How does Google know precisely what someone is looking for?

And I guess I wasn’t alone with these thoughts. “Search advertising is one of the most powerful forms of advertising precisely because it does not misdirect searchers, nor interrupt them but instead provides answers that they seek,” retorts Search Engine Land’s Danny Sullivan.

“If I do a search for ‘alaskan fishing trips,’ how is it that a search ad alongside the editorial listings misdirected me? What was that ‘exact’ thing I was supposed to get in the first place? Was it a government document? An Alaskan tourist office? One particular fishing company?

“In plain language, online advertising isn’t failing — the economy overall is failing.”

But that’s precisely the problem. Sites cannot survive on advertising alone. Which both Clemens and Sullivan recognize:

“The net will find monetization models and these will be different from the advertising models used by mass media,” says Clemens. Agrees Sullivan: “Charging for content gets trotted out as a solution. Well duh. People have been charging for content online for ages, and successfully so. Personal sidenote, don’t go banking on micro-payments to be the magic solution. But many sites, in my view, backed away from charging for content because the online ad revenues cranked up. Now newspapers that opened pages up to anyone to increase ad views are having to reconsider that much access. The balance will be found.”

Exactly. That’s why I think a monetizing model like “Kachingle” will eventually be among those working alongside advertising. Kachingle hasn’t launched yet, but when it does, it promises to offer readers a sustainable, easy-to-use way for supporting content sites. Stay tuned for more information.

Tools For Saving Journalism

"Tipjars" were one option used by Mother Jones Magazine for to encourage contributions from readers.

I attended a conference over the weekend at the UC Berkeley Graduate School of Journalism titled “Tools for Saving Journalism.” There were about 125 of us in all, and I gotta say, it felt a little like attending a wake. It seemed to a person, everyone was worried, and even fearful, what lay next for journalists.

For instance, Alex Cohen, the host of NPR’s daily news program “Day to Day,” and who moderated a session called “Active Innovators,” began by saying she’ll know soon what it’s like to be unemployed: This coming Friday will be the last for Day to Day, a victim of budget cuts at NPR. Later in the day, we heard how the union representing journalists and others at Hearst Corporation’s San Francisco Chronicle voted to allow the company to cut more than 150 jobs, in a desperation attempt to save the paper. Ouch!

Yet like at any funeral, there was plenty of hope for the future. David Cohn, of Spot.us explained how the public can now “commission” journalists to do investigations on important and perhaps overlooked stories. Monika Bauerlein from Mother Jones Magazine talked about their use of a “tip jar” so readers can show their appreciation for an article they read. Andy Bowers from Slate and a former NPR reporter, talked about the podcasts that slate has created with NPR.

Also speaking was Cynthia Typaldos, the CEO of the start-up “Kachingle,” which is an online monetizing solution for content sites. I’m now consulting for Kachingle and will write more about them in a future post.

Some of my favorite quotes:

Why journalists should get over their fears about becoming business people: “When you’ve knocked on the door of a parent whose kid has been shot and killed, making cold calls should be easy.”

“Journalism is the first line in history.”

The three biggest stories missed by journalists in the last 40 years: The truth behind the Vietnam War, the false government “evidence” of Weapons of Mass Destruction in Iraq; the economic meltdown.

“It’s a lot cheaper to pay for a good newspaper than a bad war.”

Thinking about newspapers and journalists

I find myself thinking a lot about newspapers these days, and journalists in particular. I got my start as a journalist, albeit as a radio journalist. In college, I worked at UC Berkeley’s radio station KALX, then got hired by Tony Russamanno assisting with the morning news at KMEL. Eventually, after business school at Stanford, I made my way to one of the largest newspaper publishers in the country, Knight-Ridder, where I worked on the business side of the company and did everything except write articles. But I continued to consider myself a journalist, even after I moved on to run the operations of graphic design magazine called Communication Arts.

So it’s with a lot of sadness when I read about the demise of the Rocky Mountain News. As a kid in Kansas City, my dad would sometimes take me to a downtown newsstand and there I’d thumb through the out-of-town newspapers. My favorites were the tabloid-style papers like the Rocky Mountain News. I never could figure out why other papers didn’t follow their format — it was so easy to hold, for a kid or an adult. Headlines seemed to fit so much neater, too.

There’s also talk about the Hearst company’s San Francisco Chronicle losing money and being up for sale. Advertising revenue is down. Circulation has plummeted. Are there any newspapers making money these days?