Six Pixels of Separation - The Blog
March 17, 201010:47 PM

Buying A Newspaper And Free News

Would you buy a newspaper?

When word got out that the Montreal Gazette was being put up for sale along with the entire Canwest newspaper family, I immediately asked one of my business partners over at Twist Image if our company might be interested in purchasing it.

He laughed at me.

Not because we could not afford it (the truth is, we can't afford it, but we could probably find the right people and raise the money to do it), but because there was no logical connection in his brain between what we're doing here as a digital marketing agency and how that fits with owning a local newspaper (my background as a magazine publisher didn't seem to sway him either). He was right, even though The Gazette is profitable. In fact, for a medium-sized business like us, we would love to have the kind of profitability this newspaper has.

But, the other truth is that Canwest is a whole different type of business.

The economic recession, that reduced traditional mass media advertising, along with a newspaper's many legacy systems which pre-date the Internet and mobile device era - unions, printing plants, trucks and people for distribution, leases, office space, etc. - makes things seem more dire and urgent. The new business models that come into play also confuse the newspaper (and publishing) industry even further. There is no one single thing that is going to save the newspaper industry (like the Internet or the iPad). The Internet and free news on the Web is not the reason that people are subscribing, reading or caring less for their local newspaper (in fact, the plight of the publishing industry has been a hot topic of debate long before we had Google, iPhones and Twitter). We tend to forget how hard the publishing industry lobbied for more attention and care when they began to discover the masses were reading a whole lot less when compared to watching television.

Free news on the Internet is a business model.

Just last week, Le Devoir held a conference in Montreal on the future of independent media as that daily French newspaper celebrates its centenary year. Writing out of the conference, The Gazette's Jason Magder cited Torstar chairman John Honderich as saying that giving away content online has turned out to be "a bad idea." With all due respect to all of the traditional news outlets out there in the word, that's simply not true. Free news online is a very viable business model, and there are many big media publishers making lots of money online offering free news (check out The Huffington Post, Mashable, TMZ, Media Bistro, The Daily Beast and many more).

When looking at how these free, digital-only publishing houses work compared to the traditional news media, the differences are staggering.

From how the journalists are found, managed and paid to the marketing and advertising models, to the actual management infrastructure, one would not be hard-pressed to say that they look nothing like the industry that they inherited and digitized. Maybe the newspaper industry has to look well beyond the current model of simply copying-and-pasting their print content and publishing it online to re-imagining what publishing means in a world where 20 people and a WordPress publishing platform can do the job using text, images, audio and video that it used to take 200 people to do in a fraction of the time and cost.

A Canadian Press article out of the Devoir conference noted, "Part of the rush to offer free content online was spurred by the advent of so-called citizen journalism, touted as a democratic expansion of the media industry to non-professionals. But some argue citizen journalism won't be able to fill the gap left by mainstream outlets who are reducing their operations or closing down altogether. Persephone Miel, who wrote a major Harvard study on online journalism, said most citizen journalism deals with electoral politics, popular culture, technology, and little else. Ignored are more nuanced and weighty topics such as public policy. 'The question is not the survival of the newspaper,' she told an audience at the conference. 'The problem is who is going to produce... the kinds of journalism that isn't getting produced by online publications.'"

The answer might be that news which serves the public good needs to be funded much in the same way education, healthcare, libraries, the police, etc., is handled, and that news doesn't, necessarily, have to be a media format that has both revenue and advertising dollars tied to it. It can simply be something that is supported by the public for the public good. Many pundits (do a quick search for people like Jay Rosen, Jeff Jarvis and Clay Shirky) have uniformly stated that:

Journalism will survive the institution it was created for.

All of this might sound weird, and you might be wondering what this has to do with your business, but it is all connected. How we communicate, share, and connect is tied to the media channels that keep us informed. As they begin to deal with both the digitization and fragmentation of their industry, you can't help but wonder what will happen when it hits your industry as well (if it hasn't already).

What's your take?

The above posting is my twice-monthly column for the Montreal Gazette and Vancouver Sun newspapers called, New Business - Six Pixels of Separation. I cross-post it here with all the links and tags for your reading pleasure, but you can check out the original versions online here:

- Montreal Gazette - Why I won't buy the Montreal Gazette.
- Vancouver Sun - Newspapers are struggling, but journalism will survive.

By Mitch Joel


Comments Comments Feed
  • Posted by Kyle McGuffin
    Mitch Joel

    Thanks for the post Mitch. I believe that the ad revenue from online and the reduced costs in e-news the business should flourish. I never thought I would give up my morning paper but I have. I enjoy sharing my thoughts and comments with different groups. This process creates a deeper commitment and engagement.

    Reply
  • Posted by Subbu Iyer
    Mitch Joel

    I would still buy a newspaper; not if it published stale news that had already been repeated a zillion times on television and internet in a meaningless manner....just sensationalizing it for TRP ratings or eye ball ratings. Unfortunately, over a period of time, the differentiation between a tabloid and a newspaper reduced causing the speed of decline of the newspaper. As Malcolm Gladwell has predicted (and I had actually stated that much earlier to his prediction), newspapers will survive much beyond anyone's imagination when they start addressing features and insightful stories rather than merely reporting or sensationalizing news. In India, the Times of India has already started a weekly release called "The Crest Edition" and this is proving popular, though the editorial content is yet to to scale quite a few notches. The intellectual life of a newspaper article is much longer than the bits and bytes on television and internet (despite the fact that they can be stored better). Reading provides a intellectual stimulation (peace and calm and the space to construct multiple perspectives) to the human mind that cannot be substituted by the visual attack of the electronic medium. Having argued this far, I would want to disagree that newspapers need to be funded in the same way as public utilities and education. Remember that news as well as broadcasting the world over started as a state funded institution and has progressively moved into the hands of the private enterprise. And it will remain so. Businesses will have to make newspapers relevant and creative in attracting new demographics; for example render the differentiation in multiple formats in a personalized way and charge based on what is consumed perhaps? Let me be clear here...if one is just going to browse through a section, it is reading news. But if one is going to analyze it and retain it and re-use it, this is a feature. Newspapers need to bring that quality of feature reporting into their content to become relevant and sustain and even increase their demography.

    Reply
  • Posted by Mike Berryman
    Mitch Joel

    It depends on what the desired end game is. If short term profit is a must, the move would get a thumbs down. If the move is part of a larger more integrated strategy I think the case could be made in favor of the move. The way I see it everything comes down to opportunity cost. If the money, time and energy invested in this strategy offers you a broader more engaged audience and you have what it takes to offer them the kind of product/service/information that will not only keep them engaged but equip them to share with others, you have the potential to change/define the game in a positive way.

    Reply
  • Posted by Tom Rau
    Mitch Joel

    Good post Mitch.
    This is a problem that has been talked about for quite some time now.
    There has been an interesting interview with Rupert Muroch on Sky News not too far back http://www.youtube.com/watch?v=M7GkJqRv3BI (although, keep in mind Sky belongs to Murdoch).
    In my believe, printed media will not disappear and I don't think anybody will argue on that.
    Some newspapers simply don't stand out in any way so I don't know why I should bother reading them. Online or offline.
    Friends of mine all have their favorite newspaper and they read the printed version regularly, just like myself.

    With online media and blogs I always have in mind that what I'm reading is a personal opinion of the author. I need to know something about the author and his ethical behavior before I can blindly trust him/her. But once I trust someone I tend to share interesting things with friends and contacts, something impossible with print media.
    A printed newspaper has an overall reputation built over years. All published articles are forced to comply with ethical rules to maintain it.So I tend to find printed news more trustworthy. I don't necessarily need to know the author to trust him.

    Paying for online news content makes sense to me, if I want to have it available everywhere. On my iphone for example.
    But if I only want to take a quick look at whats going on I don't feel like paying.

    Reply
  • Posted by john P Garrett
    Mitch Joel

    Great post but one problem:online media doesn't have a proven profitable model. The Huffington Post isn't profitable according to the latest reports. Plus online ROI for advertisers is unproven and on real shaky ground. As you probably know, just because advertisers want to spend online doesn't mean it will work. Most profitable online news sources are small one to four people blogs. I see print coming back strong with great online opportunities ahead.

    Reply
  • Posted by Jane Langille
    Mitch Joel

    Newspapers are not the main print filter for news any longer. That role has shifted to the reader, who can use a variety of tools online to create their own menu for the type of information they wish to consume, for free. I canceled my only subscription to a newspaper last November. Here's why:
    http://www.janelangille.com/blog/2009/11/breaking-the-news-print-habit/

    Long term, I wonder who will be paying to create quality journalism, i.e. brand new stories, not content merely aggregated or re-purposed from other web sources. Models like ProPublica in the US that rely on non-profit funding could ensure that journalists are paid to create new, original content.

    Reply
  • Posted by Nelson Wee
    Mitch Joel

    Dear Mitch,

    Thanks - Great Post! I find myself swerving more these days to the online social media like Twitter, articles forwarded through colleagues, recommendations through Facebook Walls. But I still gravitate to the good old newspaper - only during the weekends -> for summaries, light reading on lifestyle, local articles. Newspapers are great. But online media are more spontaneous and I value more the interactivity from various individuals in the comments posted.

    cheers,
    Nelson

    Reply
  • Posted by Carl Brabander
    Mitch Joel

    I would buy a newspaper, partly because I believe it would be a fun and rewarding business challenge, but mostly because I believe in the traditional notions of "community" and "society".

    Agreed that personalised news feeds based on individual interests are convenient, but I believe they only ADD value "as part of a balanced (news) diet". The reality is, as we embrace news aggregators, we are turning away from local papers & radio stations. To continue the diet analogy, we're eating more Froot Loops, but less granola, yogurt, and orange juice. Our news diet is changing, and we are becoming increasingly splintered, isolated, and disfunctional as members of the (traditional) communities in which we live. I find I am having more and more (actual real-life) conversations with people who are very well-informed on a wide range of ecclectic business and special-interest topics, but know nothing about current events that actually affect us as members of a community.

    If nobody is reading local news from a reliable source, can democracy survive?

    I like the idea of a newspaper as part of a healthy balanced news diet, because the "aggregating" part is done by known and respected members of my own community. I may not share all their interests or views, but respect their judgement and am grateful for the service they provide.

    I would love to see newspapers make a comeback, or at least stop the bleeding, if only because I believe in the traditional notions of community and accountability.

    Reply
  • Posted by Mike Ketelaars
    Mitch Joel

    Your Twitter asks:

    The newspapers say "free news" on the Internet is a bad business model. What do you think?

    My answer:
    Reality says that consumers are demanding free news so in order to fill that demand you must find a way to supply it if you want to stay in that industry. I think over the next few years we'll be seeing lots of innovative ways to write the news, share those stories and for the consumer - keep up and manage it all. And all these solutions are going to be free for consumers.

    Newspaper industries should see an efficiency opportunity here - like you mention; you can now do with 20 people what you use to need 200 people and for a fraction of that price, with a world wide potential reach. Is there a business modle there? Yea I think so.

    Like you say in your book - you've gotten where you are today by publishing free articles - now off those free articles, how many profitable business ventures have arisen? Your book sale, you becoming an industry leader in social media, your company is probably seeing incredible success and you're probably doing quite well speaking at all the eMarketing events you go to.

    any individual blogger who has news or stories or topics to teach about should see the same opportunity for themselves. The newspaper industry should see that this is what consumers demand and find an innovative solution where they fit in the mix - I think its there - everyone wants a reliable source (that's assuming the newspaper industry is reliable..) and the newspapers can be that.

    So the words on the webpage are just the "push" - it's what connects them to the consumer. The profit comes from an innovative solution whether that be selling other products or services to consumers or providing advertising space for the businesses.

    There's definitely a business there and right now I think there are too many people in the industry - eventually a profitable modle will be implemented, competition will weed all the "bad ideas" out and you'll have a new market. But - it will definitely be an online market providing free news - look at how Google has turned a free search engine into the best business modle on this planet.

    Reply
  • Posted by Tony Mariani
    Mitch Joel

    Maybe the newspaper companies were cocky and thought their empires would never crumble. Its evident newspaper business model pre internet is dead . Regardless, I am still old school and there is something about a coffee, the Saturday morning Winnipeg Free Press and ink stained hands!

    Reply
  • Posted by James Shaw
    Mitch Joel

    I'm 33 and I rarely read a newspaper. I can't really think of any Gen Xers that do. I've never bought a newspaper in my life, but my wife and I sometimes enjoy the novelty of looking at a big city paper left outside our hotel room door.

    Relevant news bubbles to the top through digital channels... it finds me. Important world events blast through to me on Twitter. Eg. Not only can I learn about the chaos in Haiti, but DO something instantly - donate money by text messaging! Newspapers are all PUSH, no share. No interaction. No DO. I don't see how newspapers can survive. They just aren't relevant.

    I don't watch news on TV either. I'm sick of the sensorship and focus on negativity.

    Free news online is awesome. Does it hurt newspapers? Probably. Maybe newspaper execs should read that famous little book about change: "Who Moved My Cheese?"

    I love the printed word when it comes to real books though. A great novel, work of fiction or non-fiction is not the same in digital/gadget format.

    Reply
  • Posted by Diane Morneau
    Mitch Joel

    Reading the news online with this advertising flashing, jumping around, forcing you click it away like an annoying mosquito, is not going to make it. How long you can read news off your screen or off a mobile device without eye stain... It may be less appealing for those above 40 who started to experience the inevitable need to wear glasses for reading (like me).

    While it is true that the newer generations read more online, still both types of media (electronic and printed) support their academic training when many habits form.

    While in transit (train or bus, not driving), would you read a long story off the printed media or from your hand held? I think these are best for skimming the news, which many are content with. It might also be great for those who need the latest news from this fast-pace world, to be the first to hear, to drill on the relevant news which they will probably prefer to do once they are in the office or at home equiped with a full size screen.

    I think electronic and printed media complement each other but not enough thinking has been put into segregating their specialties to use them wisely yet. Long and in-depth articles are still more convenient and comfortable to read on paper. Screen technology that delivers a similar contrast as paper has been there for a while, waiting for the market to be ready to become affordable.


    Reply
  • Posted by Arie Opps
    Mitch Joel

    While I agree that the news industry has to do a better job of adapting to the internet, I disagree that distributing news for free via the internet (or other media) is a viable business model. The day news businesses like the New York Times start valuing their brand's equity and charging for their product is the first step they take away from the abyss, and bankruptcy, that they're currently headed towards.

    Reply
    • Really? I think they sell advertising and not content, so if they are going to sell content (especially online), it's going to have to look (and be) very different from the current model of just CTRL-C from the print to web.

      Reply
  • Posted by Martin Carter
    Mitch Joel

    I would buy a newspaper, partly because I believe it would be a fun and rewarding business challenge, but mostly because I believe in the traditional notions of "community" and "society"

    Reply
  • Posted by Tom Clinton
    Tom Clinton

    Re: The answer might be that news which serves the public good needs to be funded much in the same way education, healthcare, libraries, the police, etc., is handled, and that news doesn't, necessarily, have to be a media format that has both revenue and advertising dollars tied to it."

    Are you seriously suggesting that public service journalism should be overseen by the entity that oversees education, healthcare, libraries and police -- the government?!? That's the same naivete that drove the people of Nazi Germany and the old Soviet Union.

    Reply
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