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Open Journalism & the Open Web

Week 5: Business Model for Journalism

Sarah Chacko's picture
Thu, 2010-10-14 16:51

Week 5, October 18-22, 2010: Business Model for Journalism
Lecturers: Owen Youngman, Knight Professor of Digial Media Strategy, with Rich Gordon, Director of Digital Innovation, both from the Medill School of Journalism

Meeting times
Live meeting (audio & chat): Monday, October 18th, 1PM Eastern (attendance highly recommended)
Mid-week check-in (group chat): Wednesday, October 20th, 4PM Eastern
Peer assessment (group chat, possible video): Friday October 22nd, 1PM Eastern


Readings

"Clues in the Rubble: A User-First Framework for Sustaining Local News" by Bill Mitchell, Sagan Fellow, Shorenstein Center, Fall 2009 (attached)
Beyond the introduction and the context it provides, the key sections for my lecture will be the one on "paid experience" starting on page 12, "new ventures" starting on page 45, and the transitional funding grid that appears on page 53. 

Reaction question (please post your response to the reaction question here by Monday, Oct 18) 
What sorts of experiences might you be willing to pay for having online? What kinds of audiences might find value in some of the ideas presented here?

Comments

I'm the much loathed consumer

Marlon x's picture
Marlon x
Sun, 2010-10-17 03:58

I'm the much loathed consumer who absolutely won't pay for access to any information. I'm also fairly technically savvy, so I tend to find a way to access and maybe even circulate information even when it is restricted.

What I do put a lot of money towards is organizations working on social and political causes, which suggests an angle that I didn't see mentioned much in the paper: crowdfunding not out of an individual interest, but out of a sense of charity or ideology. Many high-profile NGO's (for example Amnesty International) already serve some journalistic functions by releasing reports about their activities and the issues they're concerned about, but it's generally not their primary focus.

I could see the journalistic function of political and social organizations on a much smaller level coming more to the fore, and more crowdsourced contributions coming in to non-profit and citizen's organizations to support the production of journalism in addition to the more conventional functions that such organizations provide.

Obviously journalism funded by ideological or charitable groups has many weaknesses, and can't nearly fill the void left by conventional journalism, but it may be a valuable piece of the puzzle when combined with other models.

I’m looking forward to this

Matt Carroll's picture
Matt Carroll
Mon, 2010-10-18 01:52

I’m looking forward to this talk. I’m a reporter who is heavily involved in hyperlocal news at the Boston Globe. The Globe is taking some chances in the pay for news arena next year: Boston.com will be split off from the Boston Globe, with Boston.com staying a free site and the Globe shifting to a pay model. (Prices and exact details what, and how much news, will be behind the pay wall, have not been announced yet.) But the competition is brutal: Besides the Globe, there is Gatehouse, which owns a bunch of weekly papers in Greater Boston and has a strong online presence, and Patch, the new Aol effort, plus innumerable blogs and independent news sites. Is there enough ad revenue to keep afloat so many competitors? Not a chance. So innovations for pay models, for selling apps, and for raising revenues in other ways will be key. Next year will be interesting: It looks like a bunch of news orgs will try pay to view models. It will be interesting to see which models (if any) gain traction. As FT managing editor Christia Freeland notes in the reading, niche pubs have an advantage, the ques is whether people will pay for general news pubs.

The kinds of experiences I

Steve Myers's picture
Steve Myers
Mon, 2010-10-18 05:24

The kinds of experiences I would be willing to pay for are the ones that I have already.

I paid a few bucks for the This American Life iPhone app because it frees me from having to remember to sync my iPhone with my computer to keep up with with the latest free podcast. Thinking about this more, I concluded that it:
-Helps me find the best content
-Changes how I experience content
-Pushes content in front of me
-Helps me be the consumer I want to be
-Doesn't cannibalize other delivery platforms

I think the TAL app is a good example of how we can re-imagine the content and data that we deal with as news organizations. Perhaps a better case of re-imagining is The New York Times real estate app, which turns content into a tool and presents it along with traditional news stories.

I also use Instapaper to save Web pages to read later. The service is free, and the Instapaper app on the iPhone is free. But I paid extra for an app that makes reading a bit easier and enables me to engage in rudimentary sharing with other Instapaper users. I'm influenced by what certain of my friends and professional acquaintances are reading, so that ability was worth a bit of money for me. The "certain" part is what got me to pay for this -- I won't pay to see just anyone's reading list. There are many other ways free ways to share this sort of information, of course, but in this case, this one seemed like something I'd pay for.

It's worth noting that each of these are mobile apps. The mobile user is willing to pay for content because he doesn't have the time to do comprehensive Web searching. Mobile consumers also have been taught from the beginning that they must pay for this platform, whether it's a package of texts, mobile data service or voice minutes.

For each of these examples, most people would not make the decisions I did. These products -- especially Instapaper -- are aimed at a very specific consumer. But we're at the point now where we can create niche products and still make money from them.

As far as news products I'd

Michael Morisy's picture
Michael Morisy
Mon, 2010-10-18 18:06

As far as news products I'd be willing to pay for, I find myself opening my wallet for things that would make my life simpler, more efficient, or would ease the decision making process, including for newsy tools like Instapaper, as Steve mentioned.

I also paid for experiences that I thought were really unique. In my case, that *was* the WSJ's A-Hed, but they seem to be phasing those out to more occasional so I didn't renew.

I believe that people will pay for very "personalized" news, which has been the basis of our startup, MuckRock.com, which seeks to help people personalize coverage based very specifically on their interests for a reasonable fee, but I'm finding that users really like direction. The site was somewhat modeled on Jay Rosen's idea of personalized reporters at "ExplainThis," except made somewhat feasable, and the reactions have been very interesting: People don't want to work for their news.

A large part of the delay

Terri  Langford's picture
Terri Langford
Mon, 2010-10-18 18:29

A large part of the delay into digital is the fact that newspaper companies are unique in one way that has now been exposed to be its fatal flaw.

Unlike every other company in the world, newspapers' marketing and product departments are separate. And every problem we face today stems from that fatal flaw. There is no history of marketing or pushing content to users. This lack of skill is killing them.

About a month ago, I did the unthinkable. As an experiment, I dropped my newspaper subscription to the paper I write for. Frustrated with this awkward teen-age stage between print and digital, I went with digital.

Now, I pay for a Kindle edition for my own newspaper (the Kindle edition itself could be better, but a steal at $5.99 a month). What the Kindle edition doesn't provide (and it is an edited version of the paper...my company, like a lot of papers, is not happy with the Kindle deals they have made, money-wise and as a result do not put a lot of effort into them), I read online on either my Macbook or my iPad either from a bookmark for the paper (which does not have an iPad app (again...my company's cut on an Apple app deal has not been enticing enough to develop one...although we are apparently in an iPad development mode). Here's what I've found reading the Kindle...I actually read most of the paper now instead of the scanning I've been doing. But reading on the Kindle, I actually read all the Chron stories it provides. I'm finding I'm a better consumer/user by having this in my hands every morning (instead of out on the sidewalk).

But what I'm also finding is the lack of initiative with this Kindle edition and the iPad editions. Instead of looking to both of these delivery systems as some sort of methadone for that type of unique user that craves the news and must have it at all costs, we are just pushing generic content to them. Instead of surveying the readership ala Groupon or Daily Deals and finding out a little more about them so that we could market both advertising and better content to them, we push no advertising or better content to them. This flat delivery system is why print still holds about 80 percent of advertising revenue and digital fails to make large gains. Why papers aren’t pushing digital delivery systems to get that advertising going by offering readers free phone, Kindle or iPad if they lock into a 2-or-3-year subscription, I’ll never know.

At the same time we are failing to marshal local news in a constructive way because too much emphasis in newspaper meetings are on putting up an Everblock model and then not understanding why it does not reap us more readership.

I live in a huge state. But no matter how large the state, your readers want to know both what is going on around them but also the rest of the state or the states nearby. They travel. They don’t stay on their block all weekend. These are the people who want to know more about the REGION they live in. Not the block. That’s why stuff like Everyblock, while fun for a day, fails to keep folks really jazzed month to month. It fails to engage readers.

Local is great. But only local and your readers get claustrophobic. Newspapers on the other hand have retreated (because of rising costs and falling ad revenues) from offering circulation beyond a 100 mile or less area. With digital editions they need to bring the rest of the state, region back to the reader. They need to develop departments that do nothing by merge the marketing and the content into web apps that will both deliver and keep readers.

I understand I’m an unusual reader. I pay for content. I pay for apps if they do something I want or need. But I’m not the only one out there. And newspapers need to get off their behind and work both on better regional content and giving away delivery systems that bring that content to those more desirable readers.

“News has enjoyed such

Jason Dean's picture
Jason Dean
Mon, 2010-10-18 18:30

“News has enjoyed such convenient subsidy for so long, in the form of advertising, that journalists have had a tough time finding other ways of paying for it.”

As the journalism industry attempts to find a way to pay for reporting in an online world, there are numerous ideas that are floated. Advertising, pay walls and partnerships are mentioned in “Clues in the Rubble.” Each of these has benefits and downfalls.

Still, I like most people will not simply pay for yet another version of the same content this time formulated for a mobile device. I definitely will not pay for content online that is now hidden behind a pay wall. So what do media companies need to do to sell their news in this new environment?

The answer: make it different. Add more. In a story about a football game, have links to the highlight videos of the plays the author describes. Have game and season stats pop up for each player that is mentioned. In a story describing local haunted houses, have a map application that determines my location and gives me instruction how to get to these places. Integrate advertising and have a coupon pop up with $2 off my admission. Do the things that cannot be or are not being done with traditional newspapers or websites.

We have reached a point where people will not pay for the same old news the way it used to be delivered, especially when they can find it free elsewhere. It is time to recreate the news and find new ways to innovate or risk losing business to a startup that will.

I'd be willing to pay more

Sarah Laskow's picture
Sarah Laskow
Mon, 2010-10-18 18:55

I'd be willing to pay more than I'm asked to now -- i.e. nothing -- for access to the news sources I depend on most. I'd probably pay $5-10/month for access to nytimes.com, for instance. And I'd be willing to pay for long-form journalism online. I don't pay for the New Yorker online, for instance, because I can read enough New Yorker online for free that I don't mind skipping the ones that require a subscription. But if I was denied all access to that content, I'd likely buy a subscription.

What I'm not willing to pay for online is access to a single article from a news source I don't use regularly. When I'm browsing the web, I'll end up unexpected places to read an article that may or may not be good. I'm not willing to pay to access the site on the gamble it'll be worth even a couple dollars. I'll just read something else.

Experiences that I am willing to pay for -- content delivery systems, more than content. Steve Myers wrote above about the TAL app, and made a key point about its usefulness: it"helps me find the best content." That's immensely valuable, more than any individual piece of content. Instapaper, Google Reader, even Twitter -- I'd probably pay for those things, because I'm not sure how I'd navigate the Internet without them.

News organizations are often blamed for giving away their content to consumers, but they're equally guilty of giving away their content to other companies who reap financial rewards from their content. I know the WSJ threat to delist from Google went nowhere, but I was struck by this quote in the paper by an Apple executive: "It just feels right—to hold the Internet in your hands as you surf it." The iPad would feel a lot less right if you couldn't use to read the New York Times. Apple is making money on giving access to traditional media content right now; is there no way for content-creators to get paid for their contribution to Apple's profit?

Really enjoying this

Phillip Smith's picture
Phillip Smith
Wed, 2010-10-20 22:03

Really enjoying this conversation... :)

I just finished a live blog

Steve Myers's picture
Steve Myers
Wed, 2010-10-20 22:47

I just finished a live blog at the APME conference at Poynter, where the topic of the opening session was about new business models for journalism.

There were strains of what we heard in Monday's lecture, though there was still a lot of the old "How do we get people to pay for our stuff?"

I think the material from AP's Tom Curley is intriguing. He talked about creating new subscription-based products, such as a "top stories" package that would include a "story behind the story" component. He emphasized that they're trying to develop new products and approaches, not try to charge for old ones.

USA Today publisher David Hunke described how he's restructuring USA Today around different platforms. USA Today is taking a more digital approach to its content by creating content verticals rather than broad-based collections of all types of content.

http://www.poynter.org/column.asp?id=101&aid=193052

I have been reading articles,

Mariano Blejman's picture
Mariano Blejman
Mon, 2010-10-25 05:13

I have been reading articles, news, reviews and opinions about business models in the world of digital journalism for at least five years and still have not found a clear answer to the problem of content type on which people are willing to pay. According to an article in The Economist --I can't find the original source, It is payed content now-- seems to be that, until now, the only type of articles by which people are willing to pay is information that has a value of economic change: that is, it can change the daily life of people. That is journalism specialized in economics, technology, and niches where the information can change the daily life of the person accessing to it. Thus, the vast range of cultural information, social or policy is in the news environment on which people are not willing to pay to read. And here it comes Google, as the largest advertising platform on the planet. A few weeks ago I put on the forum a question about the irony of Google, how Google may stay with the global advertising business in large part by proposing a model of open source software, and what is the solution to this great irony: the solution to the monopolization of Internet advertising seems to be more political, most than an issue "fixed" spontaneously by the news market. Medias and government must understand that Google will have to share ad revenue with the media by the use of the news, before the Internet becomes a mass of aggregator sites without any journalistic rigor.