What a year it's been.

Labels: AP, bing, Business Information, content, enterprise, Google, google wave, media, Microsoft, Murdoch, Social Media, Twitter, Windows 7

AP has taken quite a bit of heat as of late from industry pundits because of its highly visible copyright enforcement efforts, but it has also been looking at ways in which it can leverage emerging technologies to do a better job at building a better business model. It's no secret to AP that there's more money to be made in sweet solutions rather than sour legal tactics, and also no secret that its traditional business model of licensing feeds of content to a handful of select distribution partners is a cumbersome way to develop new revenue streams in the Web era. But what is somewhat surprising is that AP has bypassed a number of technology companies courting them for their services to come up with their own solution to these issues.

Labels: AP, Attributor, hnews, jeff jarvis, microformat, News, registry

There's been a whirlwind of announcements, commentary and downright bad blood beginning to steam up around the Associated Press' moves to position news content from its own reporters and its member organizations more effectively in the online environment. The latest developments in the war for news organization survival were kicked off by the AP board's announcement that it would be moving aggressively to identify and to challenge Web site publishers that were using unlicensed AP content illegally. The "why" of this move, largely ignored by media reports, is contained in the rest of the announcement: AP is introducing a new schedule of lower fees for its member news organizations that will make it easier for them to participate in AP distribution and news use. Faced with having to respond to the revenue crunches experienced by most news organizations this year, AP has no choice but to ensure that their online revenue streams from organizations consuming AP content can be captured as effectively as possible.

From the perspective of public relations, any constructive aspects of the latest AP moves appear to have been lost in a sea of furor rising up from bloggers, Twitters and other online voices. TechCrunch viewed AP's moves as being akin to the RIAA's moves to prosecute consumers for downloading relatively meager quantitites of music on to their PCs - legal moves that have backfired in many ways both from a legal and public relations perspective for the music pubishing industry. TechCrunch also highlighted a cease-and-desist order sent by AP to a Web site using AP-posted video from YouTube in an embedded video player. Of course YouTube videos are made for embedding in other Web sites, and the site that happened to be using it was that of WTNQ-FM, already an AP affiliate member. Google CEO Eric Schmidt commented in the wake of these PR fiascos by AP that it's a good idea not to "piss off your customers"- especially those who are doing their very best to abide by fair use policies for the reuse of copyrighted content. AP could certainly take some lessons from Google's efforts to get publishers to swallow some of their own bitter pills with much kinder and gentler approaches to public and professional-level communications.

The question is, though, what is really the most effective path towards revenue growth for AP at this time - and are they handling the rollout of new strategies in a way that will help those new revenue streams to materialize? From the looks of things, AP is still struggling to find answers to that question. Certainly pursuing legal enforcement against blatant content pirates is one possible route, and it's not without its merits. Data published by Attributor indicates that nearly half of the Web sites taking content from major publishers are copying more than 90 pecent of the original text of articles. Knocking out parasite Web sites that copy unattributed content strictly for the purpose of sucking up ad revenues that would go otherwise to the original publishers would do the bottom lines of all online publishers a great favor. It's a shame that AP's initial efforts along this vein have resulted in embarassing misfires - it's an important goal that should not be sidelined by a mishandling of the policies built on top of the underlying copy detection technologies.

But the larger concern is whether AP is really "getting" how to make money in the online publishing environment. The AP board announcement included a statement indicating AP's intent to build a search portal that would feature only content from "authoritative" news sources. While this is a constructive goal of sorts, we've had such search engines for years already. The Topix search engine focuses primarily on traditional media sources, and, for that matter, Yahoo! News and other major portal news services have focused on aggregating and searching mainstream news even longer. Both are good efforts in their own ways, but they're not floating the boat for most online news publishing revenues and they're not growing in any significant way. Why would yet another search portal wind up being the solution to news publishers' concerns?

The future that AP needs to embrace can be summed up in a fairly simple phrase: get news content that people really want to read to where it can make money. In broad concept that's pretty much what AP's mission has been all along, but in insisting that that mission cannot be expanded or altered significantly in light of how news is created today is holding back both AP and its member organizations from surviving and thriving in online news markets. Media organizations need to become better at aggregating sources of news more agnostically: if someone is streaming live video via Qik from their mobile phone at the site of a plane crash, then AP should be the natural source to which news organizations would turn to find such content as breaking news, not "i-reports." The idea of "authoritative" news need not always be synonymous with editorial and news-gathering methods that grew up in the era of printing presses. With today's publishing technologies editorial values can be implemented in many ways that can expedite the most compelling information getting to the right audiences at the right time.

This recognition that its own members need better agnostic aggregation of news sources is key to AP supporting the economic performance of those news organizations. Thomson Reuters CEO noted recently at a conference, "Why does The New York Times need to have 600-700 journalists? Why not 30 journalists with 30 apprentices?" In other words, if the economics of news have shifted permanently, why try to justify subsidizing jobs that need to move elsewhere in the news economy simply because you want only specific people in specific organizations producing news a specific way? With billions of people around the world equipped with real-time news publishing tools, including increasingly successful independent journalists, the world's attention span has permanently embraced this "Content Nation" as a source of information that they trust. That's a fact that will simply never go away. Trying to make it go away is about at pointless as anyone who tried to sift the tea thrown overboard in Boston Harbor back in 1775. Even if you could do it, who would want to drink it?

Instead of arguing with people who are both consumers and sources of news, AP needs to take a deep breath and think about how they can power the profits of today's news organizations using whatever content - news, metadata, links, video, anything - will help them to make money. In some instances this may mean new members and approaches to membership, in other instances it may mean playing a very different role with existing members and in how they participate in its editorial efforts. This can be a hard thing for any organization with a venerated history as rich as AP's to do, and I know that they are trying their best to move in that direction. But if they were able to leave the confines of Rockefeller Center behind to set up shop in dot-com West Side digs, one would hope that AP could help to carry both its traditions of excellence and of innovation to new levels of performance in the news industry that take it in directions that others have yet to dare to imagine. The time to dream a new dream at AP has come. I do hope that they start to envision and to realize that dream aggressively some time soon, both for its own sake and for the sake of its members.

Labels: AP, associated press, Attributor, copyright, Eric Schmidt, Google, News, techcrunch, thomson reuters, tom glocer, Web search engine, Yahoo, YouTube

Editor & Publisher notes along with many others the announcement by the Tribune Company that it has given its two-year notice to discontinue receiving content from the Associated Press. The E&P article cites the recent rate hikes from AP as a key factor in its decision, but other accounts also highlight concerns raised by other newspapers subscribing to the service regarding AP's cutting back on local coverage and its efforts to create a more competitive position for its own content through non-newspaper outlets that compete directly or indirectly with member outlets. Whatever the exact reasons in these instances, the pullout echoes sentiments surfacing in some of Shore's private research that indicates a growing dissatisfaction with AP as a source of content.

Although some of the growing rebellion against AP services no doubt is fired by cost, content and competition from the membership-driven service, there is another key factor that is driving newspapers to reconsider AP as a source of content: the marketplace. In local newspapers and media outlets there is a dwindling interest in national news as a revenue driver, as 24x7 online and broadcast sources diminish the need of local residents to turn to their hometown papers for this view of the world. There is more money to be had by many of these papers by building up deeper and more engaged local content and by building special interest sections for holidays and other event-driven interests that will attract local advertisers more effectively. Put simply, with dwindling budgets to cover world and national events many papers are making the choice to rally their limited resources around locally focused content and advertisers.

The other key factor in the challenge to AP, though, is that there is an increasing reservoir of options for media outlets that want high-quality editorial to insert into their publications. Link exchanges, content swaps and other cooperative online publishing options enable the online editions of local papers to insert content from other newspapers and media outlets into their own sites and to host their own content elsewhere at partner sites. In other words, when revenue isn't all about what happens on your own Web site but also about driving more traffic to inventory from relationships with online publishing partners there are more options for local publishers to drive up both page inventory and audience engagement. AP delivers content inventory, but not the kind of inventory that's most likely to engage the audiences that value a local newspaper brand in a way that will drive the highest revenues.

While some newspapers seem to question the refocusing of AP's content on more analysis and opinion pieces as an additional point of concern, in general the real issue for most publishers confronting their rising AP charges is that as good as AP news can be it's not what will drive their profits moving forward in most instances. While AP has spent a great deal of legal and marketing effort to shore up the value of the AP brand through copyright protection and brand positioning, it has in many ways failed to identify how a cooperative news distribution service can help its members to generate more revenues cost-effectively. With their members cutting their own collaborative content deals left and right, oftentimes with providers of unique online sources of content, the power of the Web to make these deals work without AP's infrastructure is the chief challenge to AP's future.

All of this argues for a selloff of AP in the next couple of years to an owner that can take advantage of its extensive network of reporters and stringers to package its core assets more effectively to a broader base of clients beyond dwindling newspaper properties. News Corp would be the most likely taker, in part because of Rupert Murdoch's designs already in place to provide better global marketing for Dow Jones resources (already aligned closely with AP in financial markets), though others such as Google continue to be bandied about. The missed opportunity in this, of course, is the opportunity to redefine AP as a new kind of distribution channel for high-quality content based on a new generation of news producers and to enable it to include a cross-platform network of news enthusiasts who will add value to its brand based on their enthusiasm for commenting on news content. If everyone wants to do content swaps and link exchanges, for example, why isn't AP positioned as a channel designed to make that easier?

On this note I think that one of the great missed opportunities for AP has been its failure to adopt a strategy for embracing social media more effectively. While an acquisition of a player such as Newsvine would not have stanched the bleeding based on its core asset issues it would have at least started to position AP as a service that could center communities around key news assets. If audience engagement is the key to online publishing profits, catchy headlines and great ledes are not necessarily going to help your members as much as giving people a good reason to stay on a page - something that good social media can help to do very effectively.

AP's pricing will help to define for its members what AP needs to do to cover costs for existing editorial operations, but that's little more than an opening argument when AP members are looking for concluding remarks as to how AP will help them to drive revenues more effectively. It's probably best at this time for AP to seek a parent aggressively that will help them to maintain their core editorial assets while enabling them to invest in a broader array of content assets and services that will bolster their value over time. By all indications current AP members will not be the ones to sponsor that investment, so it's most definitely time to go find buyers to make those investments while there's still a good opportunity to do so.

Labels: AP, associated press, distribution, media, Murdoch, News, tribune company

I've tried to remain low-key about the Associated Press action against the Drudge Retort, a parody of the famous Drudge Report political Web site, but given the furor out there I think that a post on the topic is worthwhile. The AP has raised "takedown requests" claiming violations of the Digital Millennium Copyright Act (DMCA) and other laws in unlicensed use of its content in seven of the Drudge Retort's blog post. Not only is the Drudge Retort being challenged on its own use of AP's content but as well for people in comments sections that quote paragraphs from AP content. The Drudge Retort's Rogers Cadenhead commented on the takedown letter on his own weblog and provided a summary of each of the takedown requests, citing the examples.

Similar to the lawsuit raised by AP against Moreover for their use of AP headlines and ledes to provide links to AP content the concern of AP seems to center on the use of headlines and ledes as copyrighted content. Unlike the AP/Moreover suit, though, this takedown letter focuses on only seven items rather than a bulk use of AP headlines and ledes. And unlike the AP/Moreover suit, some of the headlines on the Drudge Retort site were not AP headlines but headlines rewritten by the site's staff. Also notable was that the sections of text from AP stories were quite small. In all of the sections posted by the Drudge Retort itself they were either just a lede sentence or a lede plus a quote from someone at a public event.

The Drudge Report appears to have complied with the takedown order and AP's Jim Kennedy promises guidelines for bloggers using AP content, but awareness of it spread quickly through social bookmarking services and weblogs and has ignited a widespread reaction from major bloggers and mainstream commentators. TechCrunch's Michael Arrington offered one of the stronger statements, claiming that his prominent weblog would no longer reference AP content. Others were more inflamed in their rhetoric, including this gem from Matthew Ingram:

I don’t want to be accused of succumbing to Godwin’s Law, but I would argue that a dialogue with the AP has about as much chance of being “constructive” as Chamberlain’s discussions with Hitler over the fate of eastern Europe.

The New York Times' Saul Hansell tries to steer a calm course through the AP challenge in their Bits blog but in the era of sub-millisecond delays of information transition used to power most large-scale trading of financial securities his citation of the century-old "Hot News" New York statute is shaky at best. If someone is linking to a story that's already minutes, hours or days old on the Web, much less in investment banks, how "hot" can that news be? And since to get the story in full one must still go to the licensed source, the licensed source is going to benefit financially from more public awareness of their having a story available.

The clear benefit of inbound links and short, fair use-style citations can be seen in the impact that social bookmarking has had on AP licensors. Looking at the data at right from Compete.com, news Web sites that are major licensors of AP content do not appear to have been harmed by the growth of social bookmarking sites such as Digg, which provide similar small snippets of content and headlines from AP and other sources. In fact, one could argue by such a trend that much of the growth at news sites in recent years has been due to the attention that weblogs and social bookmarking sites have paid to their content. Social media is the news world's best friend at this point, providing an editorial capability that curates high-value content from professional media organizations that would otherwise be ignored.

But the real point seems to be whether AP can gain financially from this exercise. Facing a dwindling number of mainstream media companies available to purchase its content AP its struggling to come up with a way to build a broader base of revenues in an environment in which their audience has become a far greater source of content curation than their traditional client base. Whatever the validity of AP's legal citations - they seem to be to be quite weak and awaiting only a decent lawyer in opposition to them to have them swept away - they are alienating the very marketplace that is driving growth for their existing licensors at a time when that marketplace needs AP content less than ever before. It is all too unfortunately like the RIAA-led lawsuits against consumers of online music, which have done little to change the fate of music publishers who have lacked a coherent marketing strategy to deal with the power of online music consumers to drive both tastes and sales.

As valuable as AP content may be, for most news stories that people will link to and comment upon online there are readily available substitutes from other wire services. AP's position as a service bureau complicates their ability to counter the power of proprietary wire services such as Reuters and Agence France-Presse, but clearly the problem is one of having only so many popularly-tracked newsworthy events to cover that will result in real "hot news" that others lack. In the meantime weblogs and other emerging publishing outlets are creating new sources of news and newsworthy opinions that could be syndicated by AP into their distribution network far more aggressively.

From a marketing perspective the real issue for AP, like the music business, seems to be far less about protecting an existing product line and far more about what needs to be done to rethink both the product line and the marketing rationale for the core product. Instead of resorting to lawsuits and takedown letters as a primary strategy to enforce the value of AP content on the Web, tactics that could create both legal confusion and a potential dilution of the value of the AP brand in the eyes of consumers, AP needs a "win-win" strategy that looks upon the drivers of economic value in online publishing more realistically - and that begins to incorporate new sources of content worth distributing to its worldwide subscribers and more valuable services.

A more refreshing approach to the opportunities available from social media is definitely in order. Simple example: instead of thinking about charging people for using AP headlines, why not PAY people for the click-throughs that they bring to subscriber content and charge higher rates to subscribers for the service? Hmm, maybe those bloggers are pretty good folks after all.
In the meantime, perhaps that nice linear relationship between social media growth and sites using AP content may not be looking so linear for a while.

Labels: AP, blogs, copyright, DMCA, drudge retort, fair use, michael arrington, News, techcrunch

The Associated Press' position in the news world is in some ways stronger than ever, building on both traditional newspaper portals and the growth of online-only news venues such as Yahoo, Google and social news outlets. But it's also a challenge for AP and other wire services to define a path towards long-term growth as the variety of outlets that can generate and distribute news on the Web outside of their purview accelerates. An earlier lawsuit against Google for their use of news from AP on member sites yielded a settlement in AP's favor, so it's no surprise that AP is trying again with a new lawsuit against Moreover, Verisign's content mining service for media and enterprise clients.

In the AP statement on the suit AP notes that AP discovered the extent of Moreover's practices while negotiating with it to provide content management services to the AP's members. Oops. The main bone of content seems to be that, like Google, Moreover is fairly efficient at harvesting news from AP from member sites for its clients, claiming that headlines could be appearing in Moreover within two minutes of their hitting a news Web site. This hits a little too close to AP clients who want to be the source for breaking news headlines. Adding to AP's perceived pain is Moreover's revenues gained from ad-supported and subscription services, including what AP claims is Moreover's use of story texts and photos.

Cleverly the suit claims that Moreover's uses of headlines violate fair use laws by merely copying them instead of transforming them into a unique form and format. Given that fair use is used primarily for publications to use limited direct quotation of sources in news articles and other original works this seems like a stretch at best in relation to fair use law. By this definition any page of search results would be suspect, even though one could argue that each page of search results represents an original work of authorship through its organization of content into a unique compilation as proscribed under U.S. Copyright law. Search engine companies have been reluctant to test this concept in courts, however, as globally the interpretation could vary significantly. So this type of threat has been an effective tool for brining technology companies to the bargaining table for AP.

Although AP's suit covers no apparent new legal ground it's use as a negotiating tool targeting a content harvesting company is an important new wrinkle. Although Web mining technology is in many ways little different than search engine crawlers its use to build applications beyond mere search results means that more value-add applications based on these technologies are becoming targets for copyright enforcement. It opens up many questions for both Web miners and providers of mashups and embedded content services. Services such as Sphere, which serve up embedded link references through its own crawling services, have become very popular with publishers trying to provide value-add content links to their sites, and these could become potential targets for AP-like lawsuits as well. Notably AP is targeting relatively mature businesses but with its use of the Attributor content tracking technology any service could become a target potentially.

While AP may have some legitimate foundations to their concerns at the end of the day this is yet another company with distribution at the heart of their content business model struggling to understand how to position itself in a marketplace where distribution is in essence a free service. Like music publishing companies trying to position the value of their services for potential clients AP's aggressiveness in monitoring and pursuing potential copyright infringement provides them with a legal enforcement angle to their content licensing services that can help to justify premium prices for their services. But also like music publishers may come a point when the talent recognizes that they're pretty good at making money without distribution-oriented middle men.

But AP is far smarter than music publishers in pursuing licensing deals through their surveillance efforts with companies that are likely to be able to pay in proportion to the commercial value of their services. Notably Moreover was an early entrant into content harvesting so its relatively mature base of enterprise and media clients gives AP a reasonable target to pursue that's more likely to settle on commercial terms than to go to the mattresses to defend matters on principle alone. In this sense AP is approaching situations like the Moreover suit as a rather aggressive business development effort - one that's not likely to endear AP content to the burgeoning embedding industry but one that may have some commercial effect for now but which may erode interest in AP as a business partner over time. In the meantime the stage is still wide open for virtual aggregation services that manage copyright issues effectively for both enterprise and media services to keep suits like AP's from becoming licensing nightmares.

Labels: aggregation, AP, copyright, fair use, harvesting, legal, mining, Moreover, suit

Reuters covers the licensing of content by Google from four major wire services, including Britain's Press Association, Canadian Press, Agence France-Presse and the U.S.-based Associated Press. On one level this is a very typical licensing deal equivalent to those inked by other major portals such as Yahoo, MSN and other outlets - and in fact Google had licensed rights to these content sources earlier in some instances but had not hosted their content. But the deal takes on a far different dimension given that it's with the leading Web search engine - one whose ability to deliver advertising revenues to portals using wire services is an important driver for traffic.

While Google ranking algorithms will take into account the appearance of wire content in other sites the links from Google searches and portal pages will lead to Google itself - helping its own ratings and, presumably, for its own ad revenues eventually. The AP story claims that this will have a major impact on AP member sites using their content but at least one commenter on Poynter Online claims that "For the vast majority of newspaper.coms I know, wire story traffic is not a big factor, and revenues from AP pages barely, if at all,... For the vast majority of newspaper.coms I know, wire story traffic is not a big factor, and revenues from AP pages barely, if at all, cover the cost AP charges us for its CustomWire service." That may be true, but it's bound to hit those sites' overall traffic counts and referrals to other pages in their sites from wire content.

While newspaper sites will certainly feel some pinch from this move, the far larger losers in this deal will be the major portals such as Yahoo that rely on wire content for a significant portion of their news traffic and search engine referrals. With Google now playing by the same rules their relative lack of original news is bound to be yet another chink in their armor in the battle for ratings and advertising supremacy. At the same time wire services are looking at the diminishing fortunes of traditional news outlets such as newspapers and broadcast services and recognizing that they need to move more aggressively to build their brands online. In this sense Reuters has pointed the way for these wire services with its increasingly selective use of online syndication partners.

The biggest winner in this mix are the original news producers who are looking for stronger marketing of their content. From this perspective member-driven wire services such as AP are going to find themselves in a more advantageous situation as they continue to make it easier for their members to market unique content filed with AP into major outlets without having to hassle licensing deals. At the same time, though, these traditional news producers must become more adept at marketing their unique content directly via search engines, portals and social media services if they are going to continue to build the audience metrics that advertisers expect. Google's move places even more pressure on local news producers to come up with more viable strategies to engage their audiences in the contexts that they value most - and more opportunities for wire services to act as channels for those strategies.

Labels: AP, CP, Deals Partnerships and Sales, Google, News

AP reports on the new Microsoft Surface PC which provides a touch-friendly tabletop interface to a Vista PC - kind of like playing PacMan in a bar back in the 1980's, I suppose - but the real item that I wanted to highlight is that the link above goes directly to the AP site where an ad-supported version of the story can be found. That's right, AP.org provides a content portal platform for its syndication partners who want their AP content served up from AP's own host facilities. This is something that's not readily evident from the front page or site map of the portal, nor is it really exposed in search engines, but it's clear from the layout of this page that AP is now able to deliver a general news site comparable in general terms to Reuters and other wire services. AP's position as an association wire service prevents it from advancing this capability, no doubt, but it opens up some intriguing options for AP should it decide to deliver news more directly as a part of its business model. With destination portals losing market share and AP's content being embedded successfully in a wealth of mainstream and social media destination content sites, though, it's doubtful that AP really needs such a site to advance its current business goals. Ironically AP's positioning as a pure-play syndication service may have been the ideal positioning for it to weather the changing environment for monetizing online news.

CLARIFICATION: Jim Kennedy, AP Vice President for Strategic Planning, posted this comment:

I'm a great fan of Shore, but this post needs clarification. The "destination" portal you think you landed on is actually nothing of the sort.

Since 1996, AP has hosted general news pages for many of its subscribing members. The pages are generally branded for each member and carry each member's look and feel.

In this case, you found your way to an unbranded page, which we use for in-house and demo purposes.

No change in strategy here. We're not interested in creating a destination. We are doing just fine as a B2B supplier.

Thanks for the information, Jim, I understood this to be a service for AP members but I don't think that this came through clearly enough in the original post. I think that what happened is that one of your partners was using the hosted service with a frame and not a "skin", so it was easy to pop the article out of the frame and to see the hosted site in its demo form. I see this not as a budding strategy from AP but an interesting example of what AP could have done but did not do as a result of its positioning as a membership-driven syndication service.

Labels: AP, News, Trends