This is my response to Michael Schudson’s response to my criticism of his report with former Washington Post Executive Editor Leonard Downie Jr., The Reconstruction of American Journalism. I recommend reading the other links, if you haven’t yet, before reading this. Schudson is a journalism professor at Columbia University. While I encourage you to read Schudson’s response from the link above in one read, I have pasted it below. His comments are in italics, mine in regular type.

First, this was no clip job. Unless there’s something that escaped my  attention, every direct quote in our report came from in-person, phone, or in a few cases e-mail interviews done over the past 7 or 8 months — except for two quotes that came from interviews Len Downie conducted a few years ago.

Buttry responds: I apologize. I was too flippant and not specific enough in calling it a clip job, especially in contrast to the reference by Columbia J-School Dean Nicholas Lemann praising “the breadth of their original research.” Originality in journalism and academia is a serious matter and I did not say or mean to imply that this was plagiarism in any respect. But there is a wide area between original research and plagiarism: rehash. And that’s what most of the first section of the Downie/Schudson report was.

I didn’t mean that I didn’t think Schudson and Downie didn’t do interviews, just that they were basically compiling lots of stuff that was out there and had been reported before. I should have acknowledged that I recognized they did some interviews. Most clip jobs include some of your own honest reporting, but it’s not very original. You plow the same ground other reporters have plowed, round up all the facts and put it in one big story. It’s like what Downie’s old paper did (probably still does, but not as often because of staff and budget cuts) all the time, swooping into another town to cover a national story that started out local, that the local media had already covered thoroughly. Yeah, they do a better overview than the local paper (which usually has done several incremental stories and not an overview), and the Post reporters do some of their own interviews. The story helps people who haven’t been watching understand, but it doesn’t tell the locals anything they didn’t already know. 

Contrast that with the original reporting by Post reporters on Walter Reed Army Hospital, Blackwater or CIA secret prisons, which told us new things we didn’t know and wouldn’t have known without their ground-breaking research. As research, the informational part of the Downie/Schudson report was more like the clip job (with interviews) than the Walter Reed story. People paying attention to innovation in journalism are familiar with the stories of Talking Points Memo, San Diego News Network, the joint news venture among philanthropist Warren Hellman, public broadcasting and the University of California at Berkeley and many other examples Schudson and Downie recounted.

I should add that in my remarks characterizing the research I was more faulting Lemann’s hyperbole than Downie’s and Schudson’s research. I have written many a clip job and much of my 2008 Newspaper Next report on interactive databases for the American Press Institute was the same sort of review of well-known facts that didn’t tell people working in interactive databases much, if anything, they didn’t know. Of course, my intended audience was the executives of media companies. As Steve Outing has speculated, the primary audience for Downie and Schudson might well be foundations and philanthropists who needed a good clip job to inform them about this industry.   

My elaboration here is meant for understanding, not to justify my initial flippancy. While criticism of Lemann’s hyperbole was appropriate, I should have acknowledged that Downie and Schudson conducted valid research, even though it did not break notable ground. Again, I apologize.

You obviously follow these matters very closely and may have learned little or nothing from our reporting, but we are finding many readers who say they are learning quite a lot.

Second, our focus throughout has been on strengthening what we call “accountability journalism.” We were not discussing the circulation of news from one person to another except as it incidentally related to sustaining a capacity for accountability journalism. No social media? Yes, no social media. You are correct that I am not on Facebook. No doubt I would learn something about the new social media if I were on Facebook or on Twitter. However, this would not change what we wrote. 

Social media offer opportunities for citizen journalism and certainly we saw in Iran how important they can be under repressive governments at a moment of mass protest. But although this is certainly important, I do not see that it is already or will become a basis for sustaining accountability journalism.

Buttry responds: This statement reveals Schudson’s (and, I presume, Downie’s) ignorance about social media. Lots of accountability journalism involves gathering information from the public. Reporters are always going to have to do that through interviews (as well as data analysis and digging through records and other techniques). But social media provide valuable tools for accountability reporting as well. TPM’s reporting on the U.S. attorneys’ firing scandal during the Bush administration relied on crowdsourcing, and social media have tremendous potential for crowdsourcing. Accountability journalism like the annual Sunshine Week projects certainly could benefit from engaging the public using social media.

Social media can play a role in business models to support accountability journalism, in the actual gathering of information, in distributing the results of accountability reporting and in building audience for those results.  

To write credibly about the future of journalism, including accountability journalism, you have to address the role of social media.

I am glad you agree that we describe a pretty robust world of online startups. Len Downie and I are enthusiastic about what we have seen in the startups. We in fact believe — I thought this was clear — that they offer great hope for the future of accountability journalism. But at this point, while they are growing, they remain small and fragile. 

They are supported largely by individual philanthropists and various foundations — and philanthropists and foundations can and do change their minds about where to donate their money. We want to encourage them to keep serious journalism in mind and we see the report as an effort to do so. As you know, increasing foundation and philanthropic funding is one of our six recommendations. Encouraging universities to contribute more fully to journalism is another.

If all of our recommendations were to be adopted tomorrow, how much would the government be subsidizing the news? Would government provide 2% of all cash for the media? 5%? 10%? I don’t know but it is hard for me to imagine it would go higher than that. We picture government money as especially useful for infrastructure support for the new startups or for “old media” to develop new media capacities and collaborations over a period of years.

Any and every source of funding has the potential for corruption. Surely you are not suggesting that commercial media have been free from distorting the efforts of journalists? We think a mixed funding model offers the best hope for sustaining the quality journalism that the market is less and less able to accommodate. (If someone comes up with the perfect business model for commercial media tomorrow, we can put some of our recommendations on the shelf, and if that perfect model really will sustain accountability journalism, we would be the last to object. But we have not seen that model and we are not in a position, as those in leadership and development at commercial news organizations are, to speak with authority on which business-model suggestions are most likely to work.)

Buttry responds: I disagree strongly with this justification for the report’s scant attention to private-sector business models. Before you go to an extreme such as government-funded watchdog reporting, you need to examine the failure of the industry to innovate, possibilities for innovation and private-sector success stories. Especially given Schudson’s admission that government support at best would be a small percentage, “reconstruction” of journalism is going to depend on development of a healthy private-sector business model. So you can’t shrug off this huge hole in this report.

One of the strongest Twitter critics of the Downie/Schudson report was Howard Owens, founder and publisher of The Batavian, a profitable online-only community startup serving Batavia, N.Y. Howard is competing fiercely with the local newspaper and correctly noted the scant attention the report paid to profitable online-only startups. Howard rightly raised concerns about government subsidies hurting small independent operations. (Howard also noted factual errors in the report.)  

Our recommendations are extrapolations from what we heard and saw already happening. Foundations are showing interest and growing interest in supporting news. NPR leaders are interested to expand support of local news at their member stations. Journalism schools and other units at universities (the Yale School of Forestry, for instance) are doing reporting for the general public, not just for classroom assignments.

To say that Congress will stand aside and say “yes, we want to fund local news and, no, we will never seek to pressure news organizations through our funding” would be ridiculous. We do not presume it. We presume only that there are ways — ways already in existence — that help preserve the independence of government-supported knowledge production. Does NSF work perfectly in funding the sciences and social sciences? Of course not. Is the BBC perfectly insulated from government pressure? No. Does CPB serve as an iron-clad separation between Congress and NPR or PBS? No. But do each of these institutions work pretty well, on the whole? You and I may differ on this, but I think the answer is yes.

It is very important to acknowledge that government is not a monolith and government is not unchangeable and government can innovate, too. And there are mechanisms — we suggest some of them in the report — to help insure the independence of journalism funded by government just as there are mechanisms to help insure the independence of journalism from investors, owners, and advertisers in commercial media.

Buttry responds: Here’s the thing: Science and social sciences aren’t so essential to our democracy that they were protected in the First Amendment. Just like the protection of freedom of religion required separation of church and state, protection of freedom of the press requires separation of the watchdog from the burglar. If accountability journalism is dependent for its funding on government, how vigilant will or can the watchdog be? 

Our report does not imagine that the mainstream media will disappear. There are 1400 daily newspapers in the country and I would anticipate that many of them, probably most of them, will be with us for years to come. Some will invent business models that will sustain them well into the future. The people trying to make their old businesses work or trying to start up new for-profit news organizations (like the San Diego News Network that the report mentions or like the Arizona Guardian I just learned about last week) are working to invent business models and we’ll know if they succeed when they execute their plans and the result is profits.

Right now, however, the most widely employed model is for newspapers to buy out and lay off reporters – and that is no way to sustain the quality journalism our society needs.

Buttry responds: Again, thanks to Michael Schudson for this thoughtful response. Despite my criticism of their report, he and Downie have made an important contribution to the discussion of the future of journalism. I appreciate his willingness to continue that discussion here. I welcome him, Downie or you to continue the discussion in the comments or with an email to me that I might turn into another separate post.

Be sure to read Schudson’s response to this post.

Update: Michael Schudson has responded to this post.

Whatever else it is, The Reconstruction of American Journalism is not comprehensive.

Leonard Downie Jr., former executive editor of the Washington Post, and Michael Schudson, authors of the Columbia University report, described their work in the Post today as a “comprehensive report.” They recommend federal subsidies for news organizations and changes in federal law to allow more philanthropic support for journalism. More on those topics later.

Here’s what the report does not address in any meaningful way:

• The role of social media in the future of journalism.
• The failure of media companies to develop new business models.
• The possibility of developing new business models that rely on the free market, rather than charity or taxpayers.

The first 70 pages or so of the 98-page report are basically an overview of the state of journalism today. Though touted by Dean Nicholas Lemann of Columbia’s Graduate School of Journalism for the “the breadth of their original research,” most of that overview is a rehash of conditions and developments that will be mostly familiar to people familiar with history and recent developments in the news media. As research, this is mostly what reporters call a “clip job,” rounding up the clippings (it’s a term dating to when these were actually clipped from papers, rather than read online) of other reporters who beat you to pieces of the story, and writing your own overview.

The overview did cover important issues, including the decline in reporting by newspapers, the state of broadcast reporting, new sources of independent news reporting, blogs, university reporting projects and public databases.

Clearly social media will play a huge role in the future of journalism — in the gathering and reporting of news and in the platforms on which people read the news. Social media and journalism are changing too swiftly for anyone to predict the future with much confidence or precision. But if you discuss the current state of journalism without considering social media, your work is not only not comprehensive, it’s shockingly inadequate.

I searched the text of the report after reading it, just to make sure I hadn’t missed. The term ”social media” does not appear.  Nor do such popular social platforms as Facebook, Twitter, YouTube or Flickr. The closest the authors could come are three passing references (on pages 13, 20 and 50) to social networks (in each case, social networks are part of a list; the report never discusses them specifically).

I wondered about whether Downie or Schudson even use social media. Neither has a Twitter account in his name. I couldn’t find Schudson on Facebook. Downie has an account and some friends (we have nine mutual friends), but doesn’t even have a profile photograph, so I’m going to guess he doesn’t use it a lot.

The report does discuss the paid-content controversy as well as some other efforts to develop business models, such as the range of new news organizations in San Diego. The report doesn’t mention the American Press Institute’s Newspaper Next project (in which I was involved), which spurred a round of innovative projects but did not, to my knowledge, fundamentally change the way any newspaper companies operate. The report does not mention proposals for new business models that wouldn’t depend on federal intervention, such as my own Blueprint for the Complete Community Connection, the City University of New York’s New Business Models for News project or Steve Outing’s suggestion of memberships. 

The truth is that media organizations are clinging stubbornly to their long-established business models. The most dramatic efforts at innovation have come from startups. The report describes a pretty vibrant ecosystem of small community journalism startups and investigative reporting projects without ever making a convincing case that they won’t provide the public-affairs journalism that our country and our communities need.

For the most part, the economic assumptions of this report are that advertising is in the tank and not likely to come back and advertising, donations or charging for content are the only possible meaningful, so we need help from the feds. The possibility of moving beyond advertising to becoming the digital marketplace for our communities gets only a passing mention on Page 75, quickly followed by the unsupported conclusion that efforts to find new business models “will no longer produce the kinds of revenues or profits that had subsidized large reporting staffs, regardless of what new business models they evolve.”

Case closed. We better put our hands out to the federal government.

While some of the specific recommendations that Downie and Schudson make have merit, the general thrust is that of a government bailout for journalism. As a First-Amendment purist who believes that independence ensures freedom, I cringe at the suggestion that we become that dependent on government (and government’s tax break for charity).

Admittedly, as Downie and Schudson recount in some detail, government intervention in the news media has been longstanding — postal subsidies, antitrust exemptions for jointly operated newspapers, heavy regulation of commercial broadcasting, heavy subsidy for public broadcasting.

We also should be careful what we ask for in seeking government help. Whatever journalists propose, the actual legislation will be written by Congress. The Senate version of the shield bill now in Congress, intended to protect journalists from having to disclose their sources, has a definition of journalist that excludes bloggers and freelancers. It would have excluded journalistic icon I.F. Stone. It may end up being worse than no shield law. 

The first recommendation in the Columbia report would have Congress or the Internal Revenue Service authorize public-affairs reporting as a purpose for Low-profit Limited Liability Corporations (L3C). That is worth exploring, though I haven’t studied it enough to have an informed opinion. The second recommendation is for philanthropists, foundations and community foundations to increase support for organizations committed to public affairs and accountability reporting. Again, I see merit. But I wonder how such organizations would perform their watchdog role on the foundations that provide their support.

The fourth and sixth recommendations I fully endorse: increased accountability reporting by university journalism programs and increased access to data from all levels of government.

The third recommendation calls for increased funding for the Corporation for Public Broadcasting, to support more local news reporting by public radio and television. With trillion-dollar deficits, that’s kind of hard to argue for, or to envision.

Perhaps the most troubling recommendation is the fifth one, which calls for a Fund for Local News, supported by a federal tax, collected by the Federal Communications Commission, on “telecom users, television and radio broadcast licensees, or Internet service providers.” This also calls for state “Local News Fund Councils.” Downie and Schudson liken this to public support for the arts, humanities and sciences. “We recognize that political pressure has played a role at times in the history of the arts and humanities endowments and public broadcasting. But these organizations have weathered those storms, and funding for the sciences and social sciences has generally been free of political pressure.”

The view that science funding, particularly, has been free from political pressure is not universally held.

Here’s my central point on Downie’s and Schudson’s dismissal of the notion that funding for accountability journalism could be insulated from political pressure: It’s hard to believe these two men could be so naïve as to think that public funding for news media would be no more controversial than funding for the arts. The news media are under vigorous attack now, and you can be sure that a federal tax to fund accountability journalism would be highly politicized, especially with 50 state councils in which media critics could apply pressure.

Dan Gillmor and Jeff Jarvis have already blogged critically about this report, and both offer more insight on these topics than Downie and Schudson. David Carr reported on it for the New York Times. I will add more links as I find them. Rick Edmonds of Poynter was more positive, but didn’t endorse the Downie/Schudson recommendations. C.W. Anderson, who helped in the research, wrote about the report for the Nieman Journalism Lab.

Given the stature of Downie and Columbia, I expect this report to be taken seriously. I would be surprised, though, if it changes much or anything. I hope the authors catch up sometime on the world of social media and the private-sector possibilities for developing new business models.

Back in February I posted an article outlining 6 Strategies For Monetizing Digital Content. One of those strategies was to focus on the delivery and immediacy of content. Whereas most people won’t pay for content, they will pay for mini applications that deliver information to them in timely and convenient ways.

 As many content providers are sitting around planning ways to charge for content online, CNN has taken the plunge today with its new Iphone application, priced at $1.99.  The app is pretty slick and well organized allowing easy access to CNN breaking news and headlines.

Being in the advertising business, I was pleasantly surprised to find that ads are still being served within the application. Though the ads aren’t obtrusive, I’m sure they’ll receive lots of complaints from readers who expect an ad-free environment for shelling out some cash.

There’s a link to iReport so users can submit their own news reports with videos and photos.  The ”Local” section of  the app is called “My CNN” which automatically tunes into feeds from local newspaper websites. Users can also enter a topic and “follow” news topics or save articles for later reading. The video feeds section is quite impressive, allowing users to view videos live on their phone while news is breaking. No more running to the nearest television for updates.

There are a couple of functional downsides however. The app doesn’t support landscape mode and doesn’t seem to allow for zooming like you can from web sites displayed on the iPhone, but  it’s well worth the $2.

I’d expect that this is an opportunity that local newspapers will be looking into to deliver quality and timely local content to their readers in the near future. It’s less costly and easier to produce an iPhone app today than it was two years ago and it’ll cost even less 2 years from now.  The developers kit is free so it’s only a matter of time before this trend catches on.

“The Word Is Alive”

A recent post that I wrote included some hearty debate in the comments between Tim O’Brien of the New York Times and me (with several other people weighing in). That debate for a couple weeks didn’t include the person whose post launched the discussion, Chris O’Brien (no relation to Tim apparently) of the San Jose Mercury News.

Chris was gone to Yosemite (lucky fellow) for a week when the debate originally broke out. Then an illness further delayed his response. While I approved his comment this morning, I wanted to use it in a separate post, partly to give it greater prominence and partly so I can respond to some specific points.

I should note that this debate is really about a secondary point of my post a couple weeks ago. I argued that the Original Sin of the newspaper industry in the early days of the World Wide Web was not failing to charge for content, as Newsosaur blogger Alan Mutter has written, but failing to innovate in how we served businesses. I think this is a much more serious issue than the one Tim and Chris and I are debating: why readers buy the newspaper and how much they are paying for it. But nonetheless, this is an important and interesting issue, so I gladly highlight it again. (By the way, I’m planning another post soon about another huge mistake we made early in the digital age, and what we need to do to avoid repeating that mistake.)

If you want to read Chris’s response in context, it might help to read or reread his original post in MediaShift Idea Lab, then read or reread my Original Sin quote and the debate in the comments. From here on, you’re reading Chris’s response to that debate, except for the italics, which are my comments:

Sorry it’s taken me awhile to jump back into this conversation. As Steve mentioned in a comment above, I was on vacation for a week and then got derailed by a family member who was injured took ill. So I’m just now catching up on an interesting discussion that began about two weeks ago with my post on Idea Lab and then spread to a debate via Twitter between myself, Steve, and Tim O’Brien. And upon returning, I see that it’s gone well beyond that with Steve’s great follow up post here, and Tim’s rebuttal.

As I began writing this comment, I saw that Tim O’Brien has gone on vacation through early September, so perhaps he’ll see this next month when he returns. Also, I’ll apologize for not covering all the excellent comments here. But I need to break off a small piece of this to establish some focus.

Let me just say I think Tim and I (and Steve, though he’s spoken quite well for himself here) agree on several points. Tim writes in his comment: “With the advertising piece of the equation shredded by the Web, print pubs have to re-engineer their revenue models or go out of business.” Absolutely. And Tim says: “The bottom line in all of this endless analysis of how the MSM doesn’t get the business and journalistic challenges facing it is that it isn’t really about the journalism at all. It’s about finding the proper way to monetize content to financially support sophisticated, enterprise journalism. It’s about reconstructing the revenue model.” Agreed. It’s well past time to reinvent the business model. Our industry’s main strategy, for the most part, has been to cut our newsrooms and cross our fingers and hope that we’ll reach equilibrium. That strategy has been a disaster.

Beyond that, I’ll stand by my post at Idea Lab and try to elaborate on how I came to those views.

Both from his tweets and his comment above, I believe Tim’s main critique of my post was that it was subjective in nature and lacked data to back up the claims. (Tim can correct that later, but that’s my takeaway.) I didn’t necessarily hear him weighing in on the thrust of the post one way or the other, just that I didn’t have the hard data to convince him I was right. As Tim posted above referring to my post: “And this is based on…what? (The New York Times and Wall Street Journal don’t have comics, but that would just be an anecdotal observation, not one based on broad surveys or more hard-minded data gathering).”

And later, Tim says: “But to extrapolate from Fine’s data to say, as Chris does, and as InfoWeek does, that it shows that newspapers didn’t understand what their readers were paying for is ridiculous. I asked for any empirical data, reader surveys, etc., that outline why readers buy certain papers so we could look at that issue in a less subjective way, not one driven by Chris or InfoWeek’s assumptions. And once we have more of that, then maybe I’ll be proven wrong.”

Tim is accusing me of being purely subjective. To which I can only say: Yup.

In trying to think differently about how to deal with the ongoing news business crisis, over the past two years I’ve taken an approach that is intentionally anecdotal and subjective. I won’t even try to deliver the data that Tim seeks because I simply don’t believe that any amount of data is going to solve this industry’s problems. As I’ve worked on various newsroom reinvention and research projects over the past two years, I’ve come around to believe that the quantitative approach — putting our trust in massive reader surveys, polling data, whatever — has failed us.

Instead, I’m convinced that we need to take a qualitative approach. We need to take a fundamentally different approach to understanding the behavior, patterns and needs of our community when it comes to news and information. So if Tim needs the comfort of some cold, hard facts then I’ll just say straight up that I don’t have them and wouldn’t even try to get them. And even if I did, we’d probably still argue over what they really meant (as we are with Fine’s data).

When conducting research, weighing the quantitative versus the qualitative approach is hardly new or revolutionary. Having just recently spent a weekend at a major sociology conference in San Francisco, I can see how that academic field is split between those who spend time gathering large data sets to get at abstract truths and those who spend time observing and interviewing select subjects. Both approaches provided interesting insight. But more and more, I’ve been finding the qualitative approach has more value for me.

Why? Without listing every single study undertaken and tallying all the money spent, I think I can safely assert that over the past two decades, the news industry has spent millions of dollars accumulating data about readers and what they supposedly want. And our industry has responded by altering its products and newsrooms to produce the things that they thought the data told them that readers really wanted. Today, metro newspapers write shorter stories, with faster ledes, and publish more pictures about fluffier stuff. Our leaders have steadily used this data to make decisions that have made newspapers worse every year. Somehow, no one has stopped to consider that no industry has ever solved its problems by making its main product worse. Instead, management points to the data from readers’ survey to insist they’re doing what people say they want. The result is that we’re worse off than ever.

As I noted in my earlier post, research from the Readership Institute does agree with Chris that newspaper readers value the newspaper for a wide variety of reasons that include the journalism but are much broader (advertising, convenience, etc.). And yes, the newspaper industry spent millions of dollars on the work of the Readership Institute, not to mention lots of local readership surveys by lots of companies.

I’ll just say this to Tim: If a data-driven approach was going to solve our problems, wouldn’t it have done so by now? Our executives have been doing what they think the data has been telling them to do, and things are worse than ever. What exactly is the piece of data you feel we’re lacking to begin to address the business crisis the news industry is facing?

I don’t believe there’s a magic data set waiting to be assembled that will lead us to the big “Ah-ha!” I don’t think we’re one reader survey away from figuring it all out. We live in an era where people turn to data as a crutch, leaning on it to give themselves a false sense of certainty. The facts don’t lie, right? Except we know that they do. A lot of such data is formed by the biases and frames through which the questions are formulated, asked, and then interpreted. The newspaper business has failed to recognize its own flawed frames. To this day, no matter what you hear from a newspaper executive, they still believe their primary purpose is to get people to read them in print. It’s why newspapers still spend so much money propping up circulation by subsidizing a large number of people through persistent telemarketing.

Here I must mention the oft-told story that was part of our Newspaper Next presentations: AT&T commissioned McKinsey in 1980 to study the potential market for cell phones. McKinsey’s projection was that by 2000 the worldwide market for cell phones would be about 900,000 cell phones. Our N2 point about this data was that you can’t use market research to study a market that doesn’t exist yet. That point isn’t exactly applicable to the argument of why people buy the newspaper; that market certainly does exist. But it certainly applies to the broader point that newspapers have made lots of mistakes based on data that led us in the wrong directions. 

My intention, in the original post, was to point out that within the newsroom, these questions have been asked, and continue to be interpreted, through an incorrect frame: The belief that the primary product customers paid for was journalism. It’s not. I do think that in the newsroom, and in the management suites, many in our industry have failed to grasp the need to reinvent the business side. And even among the most experienced new executives, I think there is truly a failure to understand the dynamics of our business and our relationship to the community. While the functions in the newsroom have evolved (not as much as critics say they should, but still….), on the business side, there’s been little attempt to do anything wildly different than what’s been done before.

Want to consider something wildly different? Check out my Blueprint for the Complete Community Connection.

My perspective on the quantitative versus the qualitative approach to product design began to shift two years ago when I became a member of a task force for a project called “Rethinking The Mercury News.” In the summer of 2007, our executive editor at the San Jose Mercury News charged us with zero-basing the newsroom and re-imagining all of our products and newsroom staffing as if we were just creating the company today. Rather than hunting down piles of research data, or commissioning yet another survey of readers, we decided to conduct the research phase using the “design thinking” process. Design thinking seeks to create empathy with the user of a product by using observation and interviewing to allow you to see the world through their eyes, not your own. The goal is to “re-frame” the issues or problems in the hope of pointing toward different opportunities or solutions. Tim thinks my reliance on this is “silly.” I found the experience to be a powerful way to begin to see the world through the eyes of the reader, and not the newsroom. I’m not alone on this. Currently, Gannett has been working with IDEO, one of the leading design thinking firms, to take this approach as well.

In our case, at the Mercury News, we recruited 120 people from across the company, split into teams of three, to go out and conduct wide-ranging interviews and observations of people in the community. In all, the teams interviewed about 120 people. We used the responses and observations to brainstorm, identify themes, and explore potential opportunities. We didn’t look for a scientific sample, or try to quantify the results. In the end, the prototypes we built and the newsroom plan were scrapped. But that’s a tale for another post. And when I have enough distance, I’m going to write extensively about the insights we gained, because I think there’s a lot of value that challenges about things like the future of print and the news consumption habits of our communities.

But the things we heard in those interviews allowed me to see the newspaper through a much different lens than the way I had viewed it as someone working in a newsroom for more than a decade. The insights from that work were largely what drove the content of my Idea Lab post. So yes, those views are subjective. But they’re not just the random musings of someone sitting around and sucking their thumb late one night.

For me, it’s the anecdotes that provide better insight than the numbers. For instance, when I think about the value people find in newspapers as a product, I think about the Fall of 2007, when the Mercury News all but killed its Features sections. We heard next to nothing from readers about that decision. What we did get hundreds of emails about was the fact that we moved the puzzles and comics. That was frustrating to someone who wishes the journalism inspired the same outpouring of outrage. But the deep passion these people had for the print version was still incredibly moving. Here’s the thing: If I called these people and asked them why they get the paper, they may or may not tell me they buy it primarily for the puzzles. But their actions are telling, if not scientific.

I, too, have experience in hearing the reader passion about comics and crossword puzzles. That’s a universal-enough experience among editors that it’s not anecdotal.

And that’s the problem with a lot of data we’ve gathered. You can’t always be sure the people themselves know why they do what they do, or what they really want. Or whether you’re even asking the right questions. During one of my Rethinking interview sessions, my team talked to a woman in her early 40s who spoke at length about how un-interested she was in technology and how she didn’t feel like technology played a role in her life. As she was speaking, she kept taking out her BlackBerry and checking her email. Now, if I’d called her on the phone, and asked her about her interests, I would have checked her off as a woman not interested in technology. But in observing her, I could see that she was. Was she lying to me or was she ignorant? No and no. But she clearly thinks about that topic differently.

To take another example, let’s look at young people and printed newspapers. If there is one piece of data that everyone seems to agree upon, it’s that young people don’t read printed newspapers, right? Its turns out that’s totally false. Over the past two years, as part of the work I’ve been doing for the Knight Foundation (The Next Newsroom Project), I’ve been spending a lot of time visiting college newsrooms, which are far more conservative in their journalism culture and behind the new media curve than professional newsrooms. That was confounding to me for a long time. So what’s going on? The response I heard from college media advisers and college newspapers editors has been fairly consistent: The staffs at college newspapers look around and see all their classmates reading the printed version of the college paper everyday. When they get up in the morning, the newspaper bins are empty. If everyone is still reading the print version, why should they worry much about the Internet and all this new media stuff?

As I’ve considered what that means, I’ve tried this experiment a few times myself: Go into the student union and leave a few copies of the newspaper like the New York Times or the Mercury News on a table. They get scooped up pretty quick.

In fact, the generation that doesn’t read print does read a lot of print. What the surveys have really been telling us is that this demographic won’t pay to have the morning paper delivered every day. But when they encounter a printed product that’s free, is compact, and fits the way they consume news and information, and yes, usually has the crossword and comics, then they’ll consume it in large numbers. Do I think print is the future? It’s a part of it, much bigger than most folks believe, I think. How does this square with all those surveys about the news habits of young adults? Those surveys are being commissioned by news executives who are really just trying to figure out how to get young people to pay for the newspaper. They thought they could do this by altering the content. But what they really needed to do was reinvent the product form (compact, free) to fit into these people’s lives (lots of downtime on a pedestrian campus), and that’s a step that’s too radical to be considered by most newsrooms.

These are insights that I’ve gained not through studying the data, but through the subjective, anecdotal approach.

Back to my main point, I want to clarify something raised by Steve and Tim: I think the reasons that people consume newspapers in print are because of the wide range of things it provides, including the journalism. But not necessarily just because of the journalism. Even if that’s what they tell someone in a phone survey. I base that not on Fine’s data, but on my own work in the field, as they say.

The reason I cited Fine’s data was because inside the newsroom, people continue to think that journalism is THE reason people read the newspaper. And it’s not. My use of Fine’s data was an attempt to knock down that assumption from the point of view of the newsroom. No matter why people say they pay for the newspaper, the data in this case shows they never paid the full cost of the product. That print product contains many services, including journalism. So the direct funding of the cost of our journalism was less than 20 percent. Maybe it was 19 percent, maybe it was 1 percent.

Time here to reiterate my point in the earlier blog comments that the fact that consumers were never paying the full cost of the journalism they were consuming was completely relevant. Let’s say that all newspaper subscribers were buying the newspaper exclusively for the journalism, and none of them buy primarily for the crossword puzzles, horoscopes, comics or ads. The fact that they aren’t paying the full cost of the journalism is entirely relevant. If you’re paying $10 a month for all that journalism, it’s an entirely different consuming decision than paying $50 a month.  

If this seems obvious to Tim or Steve, I can say it’s not obvious to the folks running metro newspapers today. Just the other day, one of our editors during a meeting opened up a discussion by saying we have to figure out how to get people to pay for our journalism again. That view is echoed by news executives and is what is driving the push toward paywalls. Fine’s data is pretty clear that readers were only ever paying for a fraction of the cost of the product. And that’s why I think the discussion about paying to read our journalism online is a frustrating dead end. It flows from the myth that once upon a time, my parents paid for the journalism. They didn’t.

That view continues to inhibit the kind of discussion that I think needs to be happening to truly re-invent the business side of our industry and get us back on a path of the kind of growth that will support vital enterprise and investigative reporting over the long term.

I say all this knowing that I’m not going to convince Tim that I’m right. If you need data, then you need data. And I can’t help you there. But in my view, the subjective approach is the strength, not the weakness of my analysis.

Agreed. Thanks for your contribution to the discussion, Chris.

Journalists love stories. Give us a good anecdote and we know what our lead is going to be. We’re not as comfortable with data. We know a good story is hiding in there somewhere, but most of us don’t know how to find it. And too many of us — reporters and executives alike — are refusing to learn.

My first exposure to the use of data for journalism was when I was at the Kansas City Star (or possibly the Kansas City Times; I worked for both) nearly 20 years ago. The late Greg Reeves, a kind of geeky reporter I didn’t know very well but came to admire, wrote a terrific story about the driving records of Kansas City police. I don’t recall the details, but I was shocked at how many police had offenses such as reckless driving (I think drunk driving, too, but I can’t vouch for my memory over that many years). What I do recall is that I started to understand the power of data analysis.

In the mid-1990s, I attended two training programs of the National Institute of Computer-Assisted Reporting and learned a great deal from David Milliron, Shawn McIntosh and Jennifer LaFleur. I worked side-by-side on a project at the Omaha World-Herald with a reporter who was a data whiz, Carol Napolitano. I later bugged another World-Herald colleague who learned faster than I did, Paul Goodsell, for some advice as I struggled on data stories of my own.

Data work never came naturally to me (it doesn’t to many journalists), but I learned that the rewards were worth the struggle. I love a good story and using spreadsheets and other data tools helped me deliver some front-page stories that used the records of public agencies to contradict the public statements from leaders of those agencies. Every reporter loves that kind of gotcha story.

I learned that you could find great stories by asking good questions of data, just like you find some great stories by asking good questions of people (except that data didn’t lie as often). I began to argue that every reporter should learn to analyze data. I argued that the term computer-assisted reporting was as ridiculous as notebook-assisted reporting. Computers are a tool every reporter should learn to use and I lamented that our profession was turning it into a specialty reserved for a few geeks.

I saw more possibilities in using data to tell stories the first time I visited chicagocrime.org, a web site developed by Adrian Holovaty, a journalist who developed the site on his own time. He wrote programs to scrape the police reports of the Chicago Police Department every day and store them in his database. He wrote other programs to let visitors ask questions of the data and get helpful answers.

Let’s say you were considering buying a home in Chicago. You could enter an address and Holovaty’s database showed all the recent police reports in that neighborhood. Maybe you were visiting Chicago and wanted to know whether you should walk from your hotel to your business meeting: Enter both addresses and look at the police reports along your route and you can decide whether to take a cab or hoof it. If you’re an advocate for domestic-violence victims, you can search by a particular type of crime.

I began to see the possibilities for building interactive databases that let users look for answers to their own questions.

Not long after my first look at chicagocrime.org, I got a chance to hear Holovaty talk about it at the American Society of Newspaper Editors convention in Seattle in April 2006. He explained the need for journalism to have more people with programming skills to develop similar databases. In my Training Tracks blog for the American Press Institute, I wrote about the parallels Holovaty saw between a reporter pursuing a story and a journalist/programmer developing a database:

Just as a reporter gathers information for a story, Holovaty gathers information for his databases. Like a reporter distills information by deciding what’s worth writing about, Holovaty distills information by deciding which queries to offer users. As a reporter presents information by writing a story, Holovaty presents information by designing the web site.

Holovaty was innovation editor at the Washington Post then, developer of the Post’s excellent Congressional Votes and Faces of the Fallen databases. Any editor at the convention who didn’t see the importance and urgency of developing interactive databases wasn’t paying attention.

The industry has certainly improved and expanded its use of interactive databases since that convention:

• API’s Newspaper Next report later that year called for using databases to help anwer users’ everyday questions.
• That fall, Gannett made data one of the emphases of the “information centers” that replaced Gannett newsrooms.
• This spring, PolitiFact, a fact-checking political database developed by Bill Adair and Matt Waite (one of many journalists who are learning programming skills) of the St. Petersburg Times, won the Pulitzer Prize for national reporting.
• I documented the increasing use of databases, first for the N2 Blog and later in a Newspaper Next report. (I suggested calling them answerbases, because the people who use them are really looking for answers and many of them feel unfamiliar with databases.) 
• A Knight News Challenge grant provides scholarships for programmers to study journalism at the Medill School at Northwestern University.
• Some newspapers have hired programmers for newsroom positions, teaching them journalism skills and principles. I spent a week in 2007 working with and learning from such a programmer/journalist, Aaron Ritchey of thenewstribune.com in Tacoma, Wash. (I wrote about Aaron in my N2 report.) 
• Here at Gazette Communications, Zack Kucharski has developed a strong set of answerbases for the Local Knowledge section of gazetteonline.com.

That’s the glass half-full. But we have been moving too slow to embrace and explore the possibilities of databases. Data too often is an afterthought, still a specialty, handled by those people in the geek ghetto. As an industry, we haven’t really developed the possibilities for using databases as a tool to attract and support new revenue streams (I addressed this in my report for N2).

A couple years ago, Holovaty left the Post when he received a Knight News Challenge grant to develop EveryBlock. This took the chicagocrime concept of microlocal mapped information and expanded it to every type of geocoded data Holovaty’s team could find: liquor licenses, building permits, restaurant inspections, property sales, street closures, photos, news stories and more. And it’s expanded from Chicago to 15 cities: Atlanta, Boston, Charlotte, Dallas, Detroit, Houston, Los Angeles, Miami, New York, Philadelphia, San Francisco, San Jose, Seattle, Washington.

The Knight grant ended in June and Holovaty released the code to the public. Anyone can use his techniques now to develop that kind of local answerbase. This may be the best resource to provide customized answers at the local level in the history of journalism. EveryBlock would be a tremendous vehicle to tap into what Michael Gluckstadt of Fast Company calls the “$100 billion local-advertising pot of gold.”

The newspaper business watched the potential gold mine develop. And yesterday, the newspaper business watched EveryBlock join forces with MSNBC.

That’s probably a great match. Instead of dealing with the glacial pace of newspaper organizations, Holovaty has hooked up with a national news force that’s focused on the web. Perhaps local newspapers will be able to affiliate with EveryBlock, gathering the local data and selling local ads. Or perhaps local NBC affiliate web sites will play that role, representing another lost opportunity for newspapers.

Newsosaur blogger Alan Mutter wrote that MSNBC “scooped” the newspaper industry, asking, “How did newspapers lose EveryBlock?”

We lost EveryBlock because we’ve been slow at understanding the importance of data for years.

A mistaken matter-of-fact statement in an Associated Press story launched Chris O’Brien on an insightful blog post that had little to do with the original story.

In the same way, a statement in Chris’s post launched me on this post, which will start out in a different direction from his blog.

The AP story, about Microsoft, said, “If it doesn’t make the right calculation, the software maker could find itself in the same position as newspapers that gave online content away and now are struggling to replace print revenue.”

Chris, contributing to the MediaShift blog, wrote: “That second line is almost a throwaway, written with no attribution. That means that the notion has officially entered into conventional wisdom: Local newspapers screwed up by giving away for free the content everyone used to pay to consume.”

That launched him on one of the best explanations I have read about the paid-content issue. I’ll get back to that in a while, but first, as promised, I want to take this in a different direction.

The AP story was repeating a notion that has been gaining traction all year. Newsosaur blogger Alan Mutter called publishers’ decisions not to charge for online content their “Original Sin.”

Mutter is right that newspapers are still paying for an Original Sin committed in the early days of the Internet, but he (along with the AP story and lots of newspaper executives today) chose the wrong sin. (For one thing, many newspapers did try charging for online content, both initially and through the years, but that’s not my point here.)

The disastrous error that newspapers made early in our digital lives was treating online advertising as a throw-in or upsell for their print advertisers. Helping businesses connect with customers was always our business. We were facing new technology and new opportunities and we did next to nothing to explore how we might use this new technology to help businesses connect with customers.

We just offered businesses the same old solutions that we offered in print, but pop-up ads and web banners somehow didn’t work as well as display ads. Which was just as well, because we told our business customers the ads weren’t worth much by the way we treated them.

As Borrell Associates pointed out in the Newspaper Next 2.0 report, about 60 percent of online advertising comes from businesses who don’t advertise in print. And newspaper ad staffs barely bothered with potential new advertisers, instead calling on our usual suspects. In addition to conditioning those advertisers to think that online ads were just a throw-in of marginal value, many of them just took their online ads out of their print budget, so we weren’t really getting new revenue, just shifting what they already spent with us. And increasing our dependence on the same businesses, some of whom were also failing to innovate. So we grew increasingly vulnerable to an economic recession. But that was a boom time and our business boomed.

Meanwhile, other businesses such as Amazon, Google, eBay and craigslist were exploring the possibilities we were ignoring. We could have been developing the possibilities of search, direct sales and self-service ads.

Our Original Sin was failing to  see beyond our original business model, not failing to force more of it on the new opportunity.

Which brings me back to the paid content issue. I wrote last month that I would try to stop blogging about paywallers. As soon as I wrote it, I knew it wasn’t true, so I hedged the promise immediately (I noted that it was a promise to try to stop, not to actually stop), rather than deleting it. OK, I tried for about a month.

I was goaded back into this tireless discussion by a Twitter exchange with Tim O’Brien, editor of the Sunday Business section of the New York Times (and apparently no relation to Chris, though I haven’t asked either about that). I’ve never met Tim but we’ve followed each other on Twitter a while. While I don’t always agree with his tweets, I think of him as one of the thoughtful voices of the Twitterverse.

He took umbrage when I favorably tweeted a link to an Information Week post by Michael Hickins. What I liked most about Hickins’ post was this passage: “The problem with the newspaper industry isn’t that free online content has destroyed its business model, but rather that the Internet has exposed and exacerbated its inherent weaknesses.”

Tim tweeted that the Hickins piece was asinine, the first of 15 tweets he addressed to me over Friday, Saturday and Sunday on the subject of paid content and the views of Hickins, Chris O’Brien and me on the topic. I fired back nine tweets and Chris, a business writer and journalism innovator at the San Jose Mercury News, joined the conversation with six tweets of his own. Guy Lucas, Media General manager, also weighed in with a tweet in support of Hickins.

I won’t repeat Tim’s tweets here (though you can read all our tweets by clicking the links above), but the essence of his argument, against both Hickins and Chris, was that they didn’t cite data to back up their opinions. (I wonder how frequently you could say the same thing about columns in the New York Times.) He specifically took issue with Chris’s contention that people buy newspapers for a variety of reasons — news stories, yes, but also for the coupons, comics and crossword puzzles. Tim dismissed this as anecdotal, demanding data to support this obvious point.

I was tempted to argue the value of anecdotes (the lead story in the NYTimes.com business page starts with an anecdotal lead) and to brush off the demand for data by saying that most newspapers have years worth of Belden and/or Scarborough research reports (mostly proprietary, so Chris or I couldn’t have access to them, much less cite them) showing the variety of reasons why people buy their products. But it took me just a couple minutes to find related research from the Readership Institute (delivery is one of the most important issues to newspaper readers; news content ranks more important than ad content, but advertising is important).

(I should add here that Tim’s paper, along with the Wall Street Journal, USA Today and perhaps a few others, is far different from most metro papers, and I presume that a greater percentage of Times readers do buy solely for the content than is the case for most metro or community papers. But I am sure that they buy it for different kinds of content: some for the national news coverage, some for the sports or arts, some for the business coverage, some for a particular columnist, and most, I presume, for a combination or for the whole package.)

I also need to address Tim’s dismissal of Chris’s citation of analyst Lauren Rich Fine’s figures on where newspaper revenue comes from (only about 20 percent comes from subscriptions, she said). Tim dismissed this as unrelated to the issue of why people buy newspapers. Here’s how the two are related: They are the two sides of the business model.

It is true, I believe (sorry, I won’t cite data here), that most newspaper customers do think of themselves as paying for the content of the paper, whatever reason(s) they buy the paper. So from that standpoint, it is a change for them to receive that content online without charge (and publishers who decide to charge for content invariably mention that they are tired of subscribers saying they quit taking the paper because they could get it free online). But the business model involves more than customer motive. Fine’s figures are relevant because, whatever newspaper customers think, their subscription or single-copy price barely covers the cost of production and distribution, if that. So, regardless of why customers buy the print edition or what they thought they were paying for, they never paid for the content. They would have paid several times more than they do if that were the case. What would that do to circulation? Would that model have thrived in print in the pre-Internet days?

So here’s the bottom line: Whether I am right about paid-content being a foolish idea or the paywallers are right about it being wise and necessary, it’s going to be a new business model, not the restoration of the old model. That was the central point of Chris’s blog post and I stand by my initial tweet that it was maybe the best take I’ve seen on paywalls. (And this doesn’t even address the challenge that our industry is facing in trying to force a paid-content model into a medium where free content reigns.)

And before I could get this post finished, other tweeps called my attention to two more related posts:  

• Blogger Bill Wyman (no, not the guitarist), who says he has spent most of his career in the alternate press sniping at daily newspapers, wrote a long treatise: “Five Key Reasons Newspapers Are Failing.”
• Howard Weaver, a retired McClatchy editor and executive whose writing about the business is usually insightful, responded in his Etaoin Shrdlu blog with a post headlined, “Why are newspaper doomsayers usually so sloppy?” (exactly the kind of sweeping generalization for which he criticized Wyman). 

Like Weaver, I agree with about 80 percent of what Wyman wrote. He did paint with a broad brush and damn the whole newspaper industry for some failings that were common but far from universal. His view was far more cynical than mine. But Wyman was so much closer to the truth than most of the industry leaders now that I’ll stand up and cheer the 80 percent that he got right and let the rest slide.

Wyman’s other four points deserve attention and I hope you read them. But for the purposes of this post, I will focus just on his first point: “Consumers don’t pay for news. They have never paid for news.” He went on to elaborate: “Subscribers didn’t pay for news. Advertisers did. … Some people liked the news, sure; most thought they were paying for it. And some papers spent more money on news than they had to. But the papers weren’t selling the news. They were selling ads and charging a lot of money for them because of one thing only: They held an informal monopoly on a societal convention whereby they deposited those ads—around which they wrapped some reporting, some of it serious, some of it fluff —on subscribers’ driveways.”

With this many people sounding off this vigorously on the issue of paid content, I had to weigh in. And I probably will again. But I am looking forward to a live chat for the American Society of News Editors later this month (Aug. 27, details to come soon) about some ways to innovate beyond the paywall issue. I do wish we could get past this issue and spend more time on genuine innovation.

I don’t want to belabor my opposition to paid content or to the secrecy of last week’s meeting of newspaper executives.

But the secrecy and the resulting attention to the heavy paid-content focus of the meeting kept us from learning until a week later about Alan Mutter’s interesting presentation about ViewPass, a plan for a system that would allow easy payment by consumers across multiple platforms and extensive collection of data that would allow publishers to target advertising based on that visitor’s interests.

Mutter proposes ViewPass as a way to “access valuable content on the websites and mobile platforms of all participating publishers.” While I have concerns about all paid-content approaches (I made the Freudian typo “pain-content” in a tweet last night), and about the industry’s unhealthy focus on such a misguided approach, I concede that charging for high-value content might work in some niches.

I heartily endorse Mutter’s call for better collection and smarter use of data about customers. And ViewPass might be a great vehicle for the shift to more transactions and lead-generation that is the revenue approach of my Blueprint for the Complete Community Connection.

And I hope that Mutter was as blunt with the publishers about general pay walls as he was in his blog:

If you suddenly put a pay wall on a website that used to be free, you are bound to lose a substantial amount of traffic representing a considerable amount of potential advertising inventory. Once customers are turned off, it will be awfully hard to get most of them back, especially as plenty of free websites will be glad to welcome them.

You could argue, as Steve (Brill of Journalism Online) does, that some newspapers are doing a poor job of selling their existing online inventory. But the solution is to sell the ad inventory better, not to write it off.

This is another illustration of how the secrecy of the executives’ meeting was harmful. If they had invited reporters and bloggers to cover the meeting, some of the immediate coverage might have focused on Mutter’s innovative approach, instead of all of it focusing on the paid-content discussions that leaked out first.

I have been encouraged to comment on the distance between the American Press Institute’s visionary Newspaper Next project, of which I was a proud participant, teacher and contributor, and API’s Newspaper Economic Action Plan, which focuses heavily enough on paid content that those words appear on the title page.

My time at API was one of the most rewarding times of my career and I value my friendships and business relationships there. Those relationships are strong enough that I can state my disagreement with them, as I did in a tweet when the report became public. I don’t care to go further than that.

I do, however, want to share some links from others who are writing about the issues in the news industry this week:

• Dan Conover, who visited Cedar Rapids last Saturday and plans to write about our innovation efforts and who was interviewed for the API report, calls the industry’s rush to paid content a “ritual suicide pact” in his Xark! blog.
• This post by Tim Windsor is a few months old but more timely than ever. He linked to it in a comment on Dan’s blog and I gladly remind you of it: Will paid content work? Two cautionary tales from 2004.
• John McQuaid’s blog post, On newspapers and pay walls, shows the frustration many journalists feel at the lack of true innovation in our industry.
• TechCrunch took a mocking tone in its assessment of the API report.
• Steve Outing proposed some alternatives to paid content.
• Scott Nelson was disappointed with the heavy early paid-content emphasis of the API, but later found some encouraging ideas, as he recounts in Invest in the content, not the channel.
• Paul Bradshaw reminds us that the news business has bigger issues than free content or Google in How the web changed the economics of news — in all media.
• Daniel Bachhuber, a Publish2 intern with more wisdom about media than many executives twice his age and more, offers a plan of action in his Open memo on how to right a sinking ship: Value experimentation with new business models, redesign newsroom for digital age, change audiences into communities and products into processes, hire developers and go open source.
• At my prodding, Nick Bergus invited journalists to start a collection of metaphors for the news industry: lemmings, the Titanic, Humpty Dumpty. It’s quite a list, to which I contributed substantially, wincing at the accuracy of many of the metaphors.

Further industry recognition about the importance of databases is found in the API’s February 2008, Newspaper Next 2.0 study. This study suggests that collecting local knowledge could, in just a few years, form the basis of an unparalleled local repository in high demand. Every community has local experts who have accumulated more knowledge than reporters, editors and librarians, about history, railroads, businesses, schools, geography, weather and other topics. Moreover, every day, local newspapers publish information that belongs in a knowledge repository. If all this knowledge were captured, structured and made searchable in database format, one would have a foundation for broad, digital-information services.

Shifting from a newspaper company to a digital-media company (with a broad, data-collection and dissemination, mandate) would, of course, impact the fundamental nature of the business. In order to portray this as an opportunity, Newspaper Next 2.0 draws a powerful, historical analogy from legal publishing.

Less than 15 years ago the traditional [legal publishing] model had publishers cranking out print texts, looseleaf services and reference works. Lawyers paid substantial sums of money to keep libraries current. Research showed that most of these publications were never opened. For the publishers it was a truly wonderful business model – ongoing subscription business to wealthy professionals, often with most of the money paid in advance. Profit margins were spectacular.

Today the model has been inverted. Facing the near-elimination of barriers to entry for new online competitors, these same publishers now manage huge databases, with a range of subscription arrangements that mostly operate on a “just in time” as opposed to the old “just in case” basis. They have eliminated all of the costs of printing and distribution. Their revenues have declined, but with drastically lower costs, once they’d figured out how to run an online business, investment and working capital are down, and margins are up. Law books do still get printed, but the owners of these companies saw what was happening, and made the changes needed to survive. There is no reason newspaper companies cannot reinvent themselves as media companies, and operate multiple business streams to capture a wide swath of advertising.*

*Newspaper Next 2.0: Making the Leap Beyond “Newspaper Companies,” American Press Institute, February 2008, 107.

——

Next: Embracing the Opportunity

As a kid I can recall fighting  with my brother over the comics section on Sunday morning. My dad always went for the sports section and my grandma pulled out coupons and specials. Often times the rest of the newspaper just layed around until it was thrown out later in the day.

What if you could choose the sections of the newspaper you want delivered every day? 

Better yet, what if you could print them out yourself?

That’s exactly what MediaNews Group intends to do with its new service dubbed “Individuated News”.  Subscribers can customize their news and print it out at home with specialized  printers.  The company will be launching the service on a test basis this summer in the L.A. market with the Los Angeles Daily News.

Because subscribers are choosing the articles they’re interested in, targeted advertising can be delivered.  It’s like Behavioral Targeting in the “real” world. 

Though the business model is still a bit murky and the company has not decided how to charge for the printers etc. it’s an idea that’s sure to catch on as the cost of technology decreases every year. 

I would suggest that they give away the printers or build the cost into the subscription fee. Being able to deliver printed materials to a consumer has far more value that the cost of the printer. I can see consumers sigining up to receive special offers and coupons from local businesses, or subscribing to content from local businesses. Newspapers can set themselves up as the clearing house for local publishers.

It’s still not clear to me why this has to be a “specialized” printer. Why not make the service available on all printers. Perhaps we can create a device that’s picks up the information and delivers it to the printer wirelessly. Subscribers could simply leave their computer on in the evening and pick up their news in the morning.

I’m excited to see where this goes in the coming months and I’m hoping to be one the first to sell an individuated advertising campaign as MediaNews Group happens to be the company that I work for.

“The Word Is Alive”

From the perspective of driving business results in a suburban media company, what is so compelling about widgets? Firstly, widgets allow publishers to push content, services and interaction to web sites and desktops used by individuals who do not visit their web sites directly. By downloading or embedding widgets in a host environment, users have chosen to engage with the content or brand on their own terms.

Secondly, widgets promise to combine the power of advertising with interactive content and transactions. Quality widgets, with integrated advertising, are perceived differently than pure advertising, because they deliver utility. For example, a Random House widget lets users search through the contents of a book and read preview pages. With utility at the forefront, users don’t mind the Random House branding and commercial messages. They see the widget as a useful tool.

Thirdly, especially when offered within a social-network environment, widgets are extremely viral. Not only are they easy to install, they are also easy to recommend to friends. When one recalls that social networks attract almost 600 million unique users worldwide, the viral potential becomes clear. (Of course, the maximum opportunity is realized only when a widget is compatible with desktops, blogs and personalized start pages as well as SNSs.)

Several widget-management platforms, such as Clearspring, Sniperoo, Spring Widgets, and Nokia’s mobile-enabled Widsets have launched to support the publication and management of widgets across desktop, web and mobile platforms. Clearspring, focusing on widget developers and widget syndication, offers a developer API that wraps widgets in a container supporting usage tracking, handles installation and offers a viral “Grab this” button. Clearspring lets developers decide how and where to offer the widget to users. Clearspring has announced a few deals with media companies, including one with NBC.

In addition to the supportive work of widget development and management companies, the W3C, a web standards organization, recently published a draft of the first widget specification. The goal of this effort is to standardize how widgets are scripted, digitally signed, secured, packaged and deployed in a way that is device independent and interoperable with existing user agents. The spec is raw, and mostly based on desktop widgets, but it is already showing the direction where many experts think widgets should evolve. Indeed, there is growing recognition that documenting and standardizing widget specifications is a big step towards interoperability.

Google is also working toward interoperability among widget hosts (with numerous partners) by launching their OpenSocial API. Google’s focus is on the social networking space. Google understands that there is much more value to be gained from a shared ecosystem and from the “long tail” of distributed communities, than from a “walled garden,” even if it’s big. The key opportunity for users, developers and businesses is to integrate with existing SNSs and their communities of users.

So here we have it: A “widget paradigm” for distributing applications, branding, and content (including targeted advertising) across multiple, third-party platforms. This paradigm has significant ability to expand the current model of driving traffic to a single web destination. In fact, in some cases, publishers will likely enjoy more success through syndicated widgets than through their own sites.

Found this on www.kenradio.com:

E-mail leads all other channels by a wide margin in terms of performance for their companies. 80.4% of more than 3,000 executives surveyed chose e-mail as a strong advertising performer, compared to 56.8% who chose search, the second leading performer. e-mail is a proven means to develop one-on-one communications and provide valuable and relevant content. Latest research shows the effectiveness of these programs which drive online and offline behavior, from applying for credit cards to opening new accounts and selecting investment products.

In addition:

* 42.1% chose online display advertising as a strong performer
* 32.8% selected offline media, such as television and print
* 32.1% chose direct mail
* 22.9% selected social media
* 9.2% chose mobile marketing

“The Word Is Alive”

By Jack Whitaker
By now you either attended the annual MPA meeting in Columbia or have heard about it. Either way, I can
report that the meeting was a great success. Registration was good and we virtually filled the Stoney Creek Inn.
Individual sessions were great and the coordination with the MU Journalism School Centennial worked out well. Our political forums were well attended and lively. All were very informative.
A highlight of the Convention for me was the Newspaper Next presentation that we sponsored. I was fortunate to attend the all-day workshop on this program in California last year. We have implemented numerous ideas from that workshop in Hannibal.
But I want to talk to you about a different topic this month. The Missouri Press Association is a multi-faceted organization that does many things for this industry and for each of us. Not only does it lobby in Jefferson City for open records and to protect our profession, it also provides many other services for us.
One of the most important services, one that assists us in achieving financial goals, is advertising placement. Several programs form the foundation of MPA’s various networks. And Networks pay big dividends.
To cite a few, I offer the following facts and figures that you may or may not be aware of:
• The statewide classified ad network paid out $29,600 in June to all participating newspapers. In addition to that, nearly $14,000 was paid in sales commissions over the last six months.

• The statewide 2X2 display ad network paid $28,675 to participating member newspapers in December, 2007, along with an additional $3,500 in sales commissions.

• The statewide online ad network, the new kid on the block, paid $1,092 in July to participating newspapers.

• The ConnectMo ad program has been paying between $12,000 and $15,000 per month to participating newspapers.

Add these up and you find a significant amount of money just waiting to be earned by participating in these programs. These ad networks produce amazing results, but not only for the newspapers that run the ads. Members that sell the ads are also paid the most through high commissions on their sales.
Most important, however, is the fact that these networks are producing tangible results for our advertisers. This form of advertising is extremely cost-efficient, so it is extremely attractive to ad buyers. Since their ads produce results and generate leads and sales, they are relatively easy to justify.
Once an advertiser gets results from his ad(s), he usually continues to run the ads.
Believe it or not, ad buyers of these programs are in every local community. They include employee recruitment firms, retailers with online sales, tourism agencies, Convention and Visitor’s Bureaus and their festivals and fairs. Real estate brokers, developers, attorneys, manufacturers, collectors and auction houses are just a few of the potential advertisers.
So, what is my point? If you are not participating now, give each of these programs serious consideration. If you are participating in one or two of the programs, consider expanding to additional ones this year. It costs nothing to join and you simply can not lose money. There is only an upside to all of this.

Once upon a time there was a tiny hamlet in the Swiss Alps. This hamlet was in serious trouble. The well that supplied water to the village went dry. The people began to panic.

There was, however, another well flowing with water across a deep gorge on an adjacent mountainside. An imaginative young thinker came up with a solution. He built a bridge across the gorge.

The villagers were elated.

A bucket brigade was formed immediately, and the water supply was replenished. Needless to say, the bridge became very important to this group. It was their source of life.

They honored the bridge. A committee was formed to take care of the bridge. Only certain people were allowed upon it, and then only on certain days, and then only wearing certain clothes. No one could see or cross the bridge without permission.

Unfortunately, there were disputes within the committee. The disagreement centered around whether a canopy should be built over the bridge. So the bridge was closed until a decision could be made. Many villagers died of thirst while the leaders debated.

A similar tale is unfolding in the newspaper industry. Just as the village in the Alps found another source of water, newspapers have found another source of revenue on the internet. Like the Swiss villagers, they need to work a bit to bring that revenue over. Unfortunately, some newspaper companies have begun to mismanage access to this new source of revenue.

The landscape is different, the product is different and the business model is different, yet too many newspapers are trying to fit interactive models into a print framework. If they’re not careful, newspapers run the risk of putting themselves out of business by not recognizing the differences between print and on-line in their efforts to increase on-line revenue.

Here are some thoughts on the differences between print and on-line models that newspapers should keep in mind in their search for new revenue over the next 5 years:

I. On-line Sales Strategies Are Not The Same As Print Strategies:

Many newspapers are treating on-line as just another product. Training programs are in place to teach print reps how to sell on-line ads. Internet Sales Managers are put in place to coordinate sales efforts and ride-along on appointments. While it’s true that these practices have been helpful and necessary, on-line only sales efforts also need to be put into play. Here’s a few reasons that Newspapers should consider on-line only sales strategies:

1. Print reps are ill-equipped:

Besides the lack of technical skills required, interactive products require much more support after the sale. Without laptops or even access to computers in some offices, its challenging to make presentations and support on-line products after the sale.

2. Core Compensation Plans Discourage On-line Sales:

When faced with allocating a clients campaign budget, print execs take care of the core first in an effort to hit their monthly budget or goal. On-line compensation plans are often based upon a flat percentage with no contribution to core revenue targets. Certainly special bonuses and spiffs can be put into place, but these “Pep Talks” wear off and sales execs go back to their bread and butter core sales activities.

3. Territories Are Gone:

While print sales execs are often comfortable selling and taking ownership of a territory, on-line campaigns are network wide by nature. Execs need to be able to sell into a network of sites. Some newspapers have actually begun trying to territorialize their on-line sales teams, encouraging execs to sell on-line in their territory only. The result is less revenue and poor performance for clients. On-line only sales execs can focus on selling products across territories, reaching businesses who have never advertised with the newspaper before.

“The” Objection:

The major objection to on-line only sales teams seems to be the fact that these new execs will be taking revenue away from print reps who are already struggling. I would suggest that these new execs would actually bring more revenue in for print reps by pulling in advertisers who have never advertised in print. This is “reverse-publishing” at its best.

Perhaps shared revenue programs can be put into place to encourage print and on-line reps to work together. On-line campaigns can be turned over to on-line only execs who are more skilled and better equipped to support on-line products. On-line only execs can do the same with print and bundling opportunities that they run across in the field.

II. Online Ad Production Is Not The Same As Print Ad Production:

Too many newspapers are treating on-line ad production like print production. They need to remember that there are no hard deadlines with on-line. Ad production systems need to be streamlined by leveraging the technology and standards the WWW offers. Any on-line ad producer who has built print ads will tell you that on-line display ads with set IAB sizes are much easier to produce than print ads. There are even some companies like ImpactEngine and AdReady who have built a self-serve business behind standard ad sizes and themes.

Creative services teams need to build similar systems in-house to streamline ad production. On-line specs are a much larger part of the sales process than print specs. On-line specs need to be shown on a website spec, not on a white background as they are in print. It’s like taking a newspaper into an advertiser and showing them their spec ad in the newspaper in the exact spot that it will run. Something newspaper companies have never been able to do, can be done easily on-line.

III. On-line Fulfillment Is Not The Same As Print Fulfillment:

Web traffic changes hourly, unlike print circulation which is more static in nature. Too many newspapers are over-managing their ad-delivery systems. With an often lengthy and layered submission and approval process, newspapers have made it difficult to fulfill on-line advertising orders. There are also too many automated restrictions in the process. At some newspapers, campaigns are actually being rejected by ad serving systems because their impression goals exceed “projected” impression availability by 100 impressions or less. Newspapers need to remember that “available” impressions is a “dynamic” quantity. On-line campaigns need to be started and billed, impressions can be made up later if necessary. Who knows what local news event will occur tomorrow that results in increased traffic and impression inventory.

IV. Performance Metrics For On-line Are Not The Same As Print Metrics:

Newspapers are right at home with CPM models for measuring performance. They’re actually starting to treat CPM’s like CPI’s, a metric they’ve been using for years. Elaborate metrics reports are being developed and refined to help compare different newspaper groups and increase average CPM’s.

It’s time for newspapers to realize that there’s not enough revenue in on-line display ads. Banner revenue is limited by traffic and we can’t just add more pages like we can in print. The formula is simple (Total Banner Inventory Available/1000) X (Target CPM). Perform this calculation for any newspaper site and you’ll see that banner revenue is not going to sustain the industry. While behavioral targeting and niche site development are going to help CPM’s, the CPM metric is the last thing newspapers need to focus on right now. The focus needs to be on (in this order):

1. Interactive Revenue (non display):

Newspapers need money now. Local search (directories), Search Engine Marketing, On-line Video, Web Site Development and hosting, Email Marketing are all recurring revenue opportunities, independent of banners that newspapers can take advantage of now.

2. # Of New Advertisers:

Newspapers need to use their brand to build networks of new customers in local markets. Self-service products need to be developed and sales forces need to penetrate ALL businesses in the local market. Ted Leonsis, former vice chairman of AOL, states it well in his recent blog post where he lays out his “Ten Point Plan For Newspapers“.

Ted writes:

“Create mini local third party networks. Embrace and extend your reach locally by building a great digital sales force and then network and ingest local unique visitors, page views and engagement from third parties. Do locally what Advertising.com has done nationally, superset the region by creating a network of affiliates and build up massive scale of local sites. Promote them in your print-based property..”

3. Traffic Building Content:

Desperate times call for desperate measures, so content comes last. While they still have some quality journalist left, newspapers need to look for innovative ways to deliver quality content on-line. Again, they can leverage technology and partner with companies wanting to reach local markets.

The veil between sales and editorial needs to come down completely and newspapers need to build content initiatives with sales objectives. There are too many instances where sales is not aware of a new on-line section that suddenly appears on the web site. Editors need to let they’re guard down a bit and invite sales people into meetings about on-line special sections. Widgets can be built to syndicate content across other local sites, encouraging viral traffic growth.

Crossing The Gorge:

It should be clear by now that the solution for newspapers and the tiny hamlet in the Alps is to cross the gorge. They need to get out of the newspaper business and into the internet business. Sure there’s competition, but they still have a foothold on local markets. Newspapers also have a brand that’s been around for hundreds of years versus even the largest and most successful internet companies that have only been in existence for 10 to 15 years.

The answer is not in applying old methodologies, they need to create a new framework and business model to redefine the industry.

“The Word Is Alive”

We held our second News Paper Next Brainstorming Session this morning.

Though we had 6 out of 8 teams represented (teams formed in Brainstorming Session 1), we were down to a total of 18 attendees. It was encouraging to see that we still had the support of key department heads and executives from circulation and sales. We had at least 5 new attendees, with a strong showing from the creative department. Still no sign of editorial, but it’s clear that next steps in the N2 process will rely on their involvement.

After a brief overview of the N2 Game Plan and framework for flushing out ideas, we spent a few minutes on 6 of the ideas from last month’s session. Team members in attendance were given time to elaborate and suggest next steps for each idea. Of the 8 original teams, only Team 5 led by our ad services manager came prepared with prototype web/print mock-ups , completed N2 Resume Idea Template & preliminary revenue projections.

As new committees/teams were formed to further explore ideas, it became clear that many attendees were reluctant to take on additional responsibilities. “How much time is this going to take?” was the question from sales staff present. While our goal is new revenue, the time investment from commissioned sales staff needs to be justified. With current commission structures focusing on core print revenue within a sales territory, it will be difficult and dangerous to pull talented sales execs away from their bread and butter to work on new “ideas”.

It might make more sense to rely on sales staff less for “hands on” participation and more for feedback as ideas develop. Better yet, in the true spirit of entrepreneurship that N2 fosters, we should consider a “bonus” compensation structure for those employees who spearhead profitable N2 initiatives.

At the end of our discussions we were left with 4 new teams charged with drilling down further into the following ideas/initiatives (for a more detailed description of these ideas see Newspaper Next Idea Brainstorming Session I):

New Team 1: Improving communications and customer service systems.

New Team 2: Coupon advertising program and Auto Display Ad Program.

New Team 3: Hosting industry events tied to publications.

New Team 4: Local kid-targeted special section.

Next steps were also suggested for the following :

1. Creation of a local Hispanic print product: We will be inviting one of our sister publications to provide a presentation on how they successfully launched a “new” Spanish print piece using N2 methods.

2. Alternative News: a prototype of an Alternative News section will be created for presentation at the next meeting.

The following new idea was also presented and accepted with enthusiasm by most present:

PS Weekly (Prep Sports Weekly):

This would be a new weekly print publication highlighting prep sports topics and information. The piece could be distributed free to all high schools and prep sporting events in the local area. With our current on-line dominance in the Preps category, we could also use the product to build out our on-line section. Advertising programs could be developed with the cooperation of schools who would benefit from a percentage of ad revenues.

We’ll be meeting again in the coming weeks to choose an idea to launch within the next 45 days.

“The Word Is Alive”

We held our first Newspaper Next brainstorming workshop this morning.

Kudos to our Marketing Director extraordinaire who spearheaded the effort. We were all surprised when over 50 employees showed up to this voluntary event, including department heads from circulation and production. We were even more surprised to notice that nobody showed up from our editorial department. We sat through a brief overview of the N2 initiative including a handout on “Using the N2 Method” and then the real fun began.

As you’ll see from the summary below, many people used the exercise as an opportunity to suggest improvements in the current operations of the company. This, in my opinion, was one of the biggest takeaways from the workshop. It’s apparent that our own employees are concerned with the integrity of the company and the product, an issue we should be addressing first.

We were divided into 8 teams of 6 people and were given the task of completing a blank Newspaper Next Idea Resume. Each team had approximately 15 minutes to come up with an “idea” for the newspaper. We’ll be meeting with our teams throughout the month to flush out our ideas using the N2 tools before the next meeting. At the very least it was a great team building exercise and you could sense some of the excitement in the room as the ideas were explained. The workshop is voluntary so we’ll see who shows up next month.

The following is a summary of the ideas presented:

Team 1 Idea: Improve Delivery and Distribution:

This idea focused on improving existing circulation and distribution systems. Having relocated our press production department to another city, we’ve been dealing with circulation challenges on a regular basis. Team 1 took the opportunity to bring these challenges to light and suggested we focus our efforts on improving circulation above all else.

Team 2 Idea: Create a Local Hispanic Print Product:

Recognizing that we have one of the largest Hispanic populations in the LA area, Team 2 suggested we develop a more local product catering to the Hispanic market in the San Gabriel Valley. The product would be home delivered and would earn income by selling advertising to businesses targeting the Hispanic market.

Team 3 Idea: Improve Communications and Customer Service:

Once again the focus was on “fixing” things that are currently broken. This team brought to light the many basic customer service and communications issues the company has on a daily basis. Although the examples given were borderline sarcastic, some good points were made about how important customer service is before anything else.

Team 4 Idea: Create an On-line Everything Local Guide:

This team discussed the creation of a free on-line guide with hyper-local information for consumers and local residents. This is kind of a community resource center with contact information and resources aside from news stories which are are running currently on the main news site. Again, the project would create revenue from local advertisers.

Team 5 Idea: Create A Topper Coupon Spadea on Sunday:

The idea was to publish a spadea to top the paper each sunday. The spadea itself would feature full color coupon space sold to local advertisers. Examples were given of success of such spadeas and coupons in other markets.

Team 6 Idea: Publish More Alternative News:

This team suggested that news in general had become somewhat “controlled” in the aggregate, and that there was a genuine demand by the public for “alternative” news perspectives on key issues. The newspaper should focus on becoming a conduit to other information sources, without being so concerned with sources and etiquette. As a result the paper would make more money as a better product.

Team 7 Idea: Organize And Host Local Events Tied To Publications:

An example of a “Travel Expo” was given. The newspaper could organize and host a local expo much like the job fairs that have been put on by newspapers in past. The paper could target a specific industry and sell booths along with advertising in an accompanying print publication promoting the event.

Team 8 idea: Create A Product To Target Younger Audiences:

The notion here was that we need to hook them on the paper at a young age. This team discussed the creation of a section or sections in the paper that provided activities, resources and information for kids age 4-12 and their families. The paper could create educational content along with schools and team up with local chambers, community centers, Boy Scouts, YMCA etc. to offer information in print an on-line to this demographic. Advertising sales again would provide the revenue to support the effort.

“The Word Is Alive”

Having spent just under 500 days in the industry, I’m not really qualified to comment on where newspapers are going or what they should do in the coming years but I have seen enough to form some entertaining ideas on new business models that might work. 

Along with the ideas outlined here, newspapers have a number of challenges to overcome which I feel are limiting their growth  and future success. The most limiting of these being the ability to activate new ideas often and quickly. In my estimation, newspapers have a 18-24 month window to move on these ideas to maximize their revenue opportunities.

Here’s three business ideas for newspapers in 2008 that may help them capitalize on their position in the local marketplace and acquire new customers over the next 18 to 24 months:

1. Web Development & Hosting For Businesses.

As part of the API’s Newspaper Next initiative, seven local news organizations were selected to launch N2 pilot projects over a 4 month period. Local market research was conducted to determine what “jobs” businesses needed done. One of the prominent discoveries among non-advertising small businesses was that they needed  help developing an effective web presence. Local newspapers are in a great position to develop and promote web sites for small businesses.

Whether it’s a shopping site profile page or a full blown 15 page site, local newspapers can capture the market for local web development and on-line promotion. Local newspapers have creative services departments in place churning out print ads 24 hours a day in many cases. With the proliferation of easy to use web development tools and templates, web ads are much easier to develop than print ads. Most layout and design software including Adobe’s Creative Suite come with “save for web” features built in.

“That’s a completely different business model”, a colleague of mine argued. “How can we maintain the servers and all the programming”. Newspapers may not realize it, but they are already in the hosting and design business. Each section of the newspaper site is its own “mini” web site. Servers are already co-located and there are no real technology barriers to hosting and maintaining web sites today. Newspapers also have the layout, design staff and systems in place which local businesses need.

“But most businesses already have web sites.” it might be argued. While this may be true, I’d challenge any newspaper to take a random sample of 10 local business websites to see what you’re up against. In my estimation 6 out of 10 sites are outdated, poorly designed and generally ineffective as an advertising vehicle. The average local newspaper  has been designing advertisements for businesses for over a 100 years. They know how to write effective copy and turn customer ideas into action generating advertisements. The WWW can be thought of as nothing more than a giant newspaper or yellowpage directory.

Business models and pricing still need to be worked out, but the real value here is in relationship building. There are over 200, 000 businesses in the average metropolitan marketplace, there might be 2000 to 3000 who have been “touched” by the average print sales executive.  Providing these new services expands the prospect base and opens up new opportunities to market products to non-customers who might not ever advertise in the local news paper. Special print/on-line bundles can be created to market a web presence along with additional on-line or print exposure.

Becoming the web presence provider for local businesses is like owning their telephone, fax machine or front door.  Newspapers are effectively locking in a relationship with that business. Whether it’s facilitating domain name registrations, providing self-service web creation tools or complete web services, newspapers are helping businesses attach themselves to their local newspaper, a brand they’ve trusted for years.

2. Renting Mobile CSC Codes to Businesses

Whereas the technology and price barriers to web site development have come down, these barriers are still very much in place for mobile advertising. The cost and price of mobile devices are dropping but the processes by which advertisers can start using mobile advertising are still too complicated and expensive for business owners. There are many applications and ideas for mobile advertising within an industry or vertical market. The basic ability to communicate with customers via text messaging is something businesses will find invaluable for local promotions. 

 The most common mobile programs and easiest to employ are based on CSC (Common Short Code) text messaging. A CSC is a 5 or 6 digit number or letter combination, similar to a phone number which mobile phone users can text messages to interact with businesses.  The CSC itself costs from $500 to $1000 per month, and requires a somewhat lengthy and detailed application process. Newspapers can setup a master CSC for their business community and rent the keyword phrases to local businesses. For example, mobile users might text the phrase “Free Pizza” to  LANEWS (526397) and receive information on a free pizza deal in town. Newspapers can earn monthly fees for renting the phrase and CPA (Cost Per Action) fees for each response received. Because this type of marketing is in its early stages, newspapers can become the front runners in providing local mobile advertising services to businesses. Again, the strong brand and reputation that local newspapers enjoy will help them in acquiring new revenues from advertisers who are currently non-customers.

3. Email Marketing For Businesses

If they don’t have one already, every business should have an email list of all their local customers. Newspaper’s can create programs to help businesses collect email addresses and send emails with promotional information. Newspapers should already be actively collecting email addresses from visitors to the news site and creating opt-in lists of users who are open to receiving information on deals from local advertisers.

With the increase in behavioral targeting capabilites and the proliferation of personalization features on local news websites, newspapers can create databases of consumer information. Local businesses can then be matched up with consumers by interest.  Email marketing can also be bundled with local direct mail campaigns providing for “Total Audience” direct marketing programs.

The Work Factor: 

Henry Ford once said “Opportunity is missed by most people because it is dressed in overalls and looks like work.”

Recognizing that the strength of newspapers lies in their strong LOCAL brand, ad production systems, and local sales forces, these ideas are in no way “easy” to implement.  In fact, I think newspapers and especially their sales forces will have to work harder and more consistently than they ever have to succeed in todays marketplace, but the results will be worth the effort.

 ”The Word Is Alive”

I just finished reading Scott Berkun’s “The Myths of Innovation,” a book that belongs on any local newspaper leader’s bookshelf along with Jim Collins’ Good to Great, Clayton Christensen’s The Innovator’s Dilemma, and few others.

Berkun dissects the messy processes behind innovation, using well-known examples from both old and recent history. This isn’t just an exercise in mythbusting: Berkun discovers lessons for those who attempt to innovate.

After demystifying the innovation behind Galileo, eBay and Craigslist, Berkun goes on to reinforce principles we all know but often violate, for example:

1. All innovations build on work done previously by someone else .
2. Most innovators aren’t motivated by innovating, but by solving a problem.
3. Ideas are cheap but innovators start with lots of them
4. Those ideas need to get filtered through reality, then executed well, to get to innovation
5. There’s more luck involved than we like to admit, and lots of failures (which is why it’s foolish to focus on only one idea)

I like Berkun’s take on innovation as problem solving:

“Problem finding — problem solving’s shy, freckled, but confident cousin — is the craft of defining challenges so they’re easier to solve.  Many bright would-be innovators … fail to spend enough time exploring and understanding problems before trying to solve them.”

If you’ve spent any time working through the Newspaper Next principles or Christensen’s “jobs to be done” concept, you’ve probably found it hard at times to escape your own world view. This short book (176 pages, 30 of which are notes) is a handy way to freshen your thinking.

I finished my first Newspaper Next “Idea Resume” today.

Newspaper Next is an initiative of the American Press Institute designed to provide a blueprint for transforming the newspaper through new business models. The “Idea Resume” is one of the Newspaper Next tools developed to help newspapers summarize new business ideas. It’s basically a one page template of questions about the idea and anlysis of critical assumptions. Click here to download the N2 Idea Resume template.

My first idea proposes to generate monthly fees from clients that have never advertised with the Newspaper. It turns out that there are over 80,000 businesses in our marketplace yet we have maybe 500 who advertise with us. We’ll be partnering with a technology company to build a site that allows businesses to promote themselves on-line and in the paper locally.

I wasn’t really in on the Newspaper Next hoopla meeting but the white paper makes a lot of sense. Any intiative that promotes “failing often and failing fast” is ok by me. I really liked the Idea Resume form which helps to identify strengths and weaknesses in new business ideas. It also does a good job bringing out certain key revenue assumptions. The whole process took about 20 minutes so I should be able to crank out quite a few of these first drafts and then go with the best one.

It’s my objective to get as many irons in the fire as soon as possible. This “Newspapers Next” initiative is basically giving us the green light to innovate. Something that I think the industry should have done 10 years ago. I intend to document my progress throughout each of these projects so stand by for more.

“The Word Is Alive”