I have to chuckle a bit at the recent Poynter Online email interview with Wikimedia Foundation's Jimmy Wales, in which he discusses an internal memo gleaned from Associated Press (PDF) by Nieman Journalism Lab. The AP memo, entitled "Protect, Point, Pay - An Associated Press Plan for Reclaiming News Content Online," covers a lot of ground already familiar to those following AP's efforts to put in premium packaging for news content. However, in addition to conjuring up long-standing concerns about Google and other major search engines as competitive forces, the memo also highlights AP's concern about the millions of topic-oriented pages in Wikipedia that are capturing traffic when people search for breaking news. At last the light bulb begins to go off in some minds that perhaps the issue is not so much search engines but that search engines are directing people towards the most popular destinations for specific topics. Hmm, perhaps this might have something to do with...the quality of the content that they find there?

Labels: aggregation, associated press, Google, Jimmy Wales, News, Nieman Labs, Poynter, Wikipedia

I've been suggesting to my friends at Dow Jones for more than five years that they needed to consider how to use their Factiva content more aggressively on the Web as a source for virtual aggregation of news and business information. Well, five years isn't that long in enterprise content product cycles, I suppose, so when I tweeted the announcement by Dow Jones of its new Wall Street Journal Profession Edition yesterday morning, I was pleased to see that the WSJ had finally started to package licensed content from Dow Jones Factiva's news and business information database into an editorially-managed online edition. The WSJ Pro package will be strictly a premium offering, offered at first only to Dow Jones' enterprise customers starting in November, with wider availability expected next year.

Labels: B2b media, Bloomberg, Business Information, Dow Jones, enterprise, Factiva, News, prosumer, thomson reuters, Wall Street Journal, WSJ Pro

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 has been a virtual tsunami of new product announcements coming out of Google lately, a wave of innovation that makes you wonder at times why private investors were so intent on putting money into in media companies with inflated multiples recently while content companies like Google were sinking significant funds into core product improvements. With consultants left and right making money telling companies how to be more innovative, the simple answer seems to be to invest in it. One key investment from Google is a new project revealed by TechCrunch named "Flipper" that offers a very different look to its online news search services through thumbnail images of news articles.

Labels: design, flipper, Google, News, project, publishers, techcr, thumbnails

When Gordon Crovitz left Dow Jones several months ago, I knew that his experiences in helping to build the most successful premium online news brand would be likely to result in good things somewhere. Gordon’s insights into the value of traditional journalism and his online savvy are an unusual combination in the world of today’s content industry. So it was with some interest that I have been learning about Journalism Online, a new initiative captained by Crovitz, content industry veteran Steven Brill and former cable industry CEO Leo Hindery. In a detailed press release – more of a mini-business plan, actually – the Journalism Online (JOI) team has outlined a multi-pronged strategy to enable traditional journalism to reap new revenue streams from online sources.

As many of the elements of the JOI plan are in sync with what Shore has been advocating for many years to promote the health of premium content sales (I briefed Crovitz on the concepts of The New Aggregation about five years ago), I would be contradicting myself to say that his team’s plan doesn’t hold water. In fact, much of what Journalism Online advocates is sorely needed in the news industry and will be likely to offer professional journalists a chance to benefit from more sensible online business models in tune with how content is actually distributed and consumed online. However, there are some troubling aspects in both the details and the broad brush of this plan that should be considered carefully by publishers as they weigh its merits.

The first concept in the Journalism Online plan is really a no-brainer and long, long overdue. JOI would set up an online system that would enable anyone to sign up once for access to premium news content across the Web. Payment models via this system would vary, and would include subscriptions for individual premium publications, pay-per-view access and royalty-driven payments in a cross-source subscription model. This would enable any publisher participating in Journalism Online to share in common payment and billing infrastructure that would make a wide variety of premium business models possible. While JOI does not target mobile and television markets explicitly, clearly this is a system whose basic cross-source payment model based on open Web access can be easily extended to other content delivery networks.

So far, so good, most especially on the cross-source royalty model. In essence the Web is a broadcast medium that enables people to tune into multiple streams very easily, so tuning premium content delivery into a payment model more like radio’s royalty payment system for music producers is a strong plus. When specific content becomes very popular online, the spike in views of that content can result in direct revenues to its producers. In theory this helps to resolve the ongoing dilemma of having to expose content to search engines that’s monetized with ads that just don’t seem to take advantage of oftentimes brief spurts of interest in news items to the point of paying the bills for many publishers. If the QPass cross-platform payment system of ten years ago had not flopped by trying to control content distribution via their service we’d have had this type of payment management service in place years ago.

The next leg of Journalism Online’s plan is a little more shaky. JOI has put under its wings two of the most prominent legal talents in the U.S. – former Microsoft anti-trust attorney David Boies and former U.S. Solicitor General Ted Olson – to lead some strong-arm negotiations with search engines and online aggregators to pony up licensing and royalty fees for the right to link to JOI member content. While one has to respect the considerable judicial, political and corporate gravitas of these two legal heavies, I am concerned that their efforts seem to be misplaced. There is now a substantial body of law which makes it clear that indexing a link to a headline is not a crime and falls comfortably into the concept of fair use of copyrighted content. By the logic outlined in Journalism Online's stated focus they should be suing newsstands in cities across the world for exposing the headlines of newspapers to people walking by, or charging millions of dollars for copies of the venerable Periodicals Index on library reference shelves. I believe that this tactic is in large part a sop to news publishers who have been relying thus far on the Associated Press’ failing negotiations with Google and other search engines based on similar issues.

Strong-arm legal tactics for search engine licensing are also largely unnecessary, in large part, if the JOI system works as it ought to. Access policies could be enforced on all participating publisher sites, and terms of bulk access licensing could be managed for search engines and other corporate entities from the same system that services consumers. It’s more likely that the JOI legal team is a stick for the carrot of negotiating some meaningful price points for bulk indexing access – price points that are likely to disappoint many publishers, since the search engines know that news ad revenues would die without search engine links. What’s more promising is having legal and technology infrastructure in place that could facilitate bulk relicensing of content for reuse in new content aggregation schemes such as online mashups and in enterprise software applications.

The most concerning aspect of Journalism Online, though, is the sense that their team harbors a dogged determination to preserve the status quo at traditional news media outlets in the face of more than a decade of change fostered by online access to news. The following quote from Brill seems to set the tone for much of what JOI is trying to accomplish:

“We’re also convinced,” Brill added, “that readers, who have been paying billions of dollars a year for print journalism, will continue to support journalists by paying a modest, fair price for original, independent, professional work distributed online. They realize—as we do—that quality journalism is a vital component of a functioning democracy and free market.”

While I would agree that many people are willing to pay a premium for high-quality products and services, the implication in Brill’s statement is that they are out to support the journalists creating the news in a way that will sustain the traditions of print journalism. Given that many journalists caught up in newspaper cutbacks now have to accept wages that are getting closer to those offered for low-level services jobs while many media executives continue to do rather well by themselves, I think that it’s fair to say that the merits of the print journalism model's ability to support journalists are largely at question. This sales pitch for Journalism Online is not so much about preserving journalists as it is about preserving some portion of the lavish profits once enjoyed by a news publishing industry that no longer has near-exclusive access to publishing technologies. A “modest, fair price” doesn’t sound like the type of monies that will support glitzy skyscrapers that were paid for by those technologies. Promises and realiteis seem to be out of sync in this instance by a broad stretch.

In sum the Journalism Online initiative holds out a great deal of promise for the news media to revise its thinking on how to acquire revenues more realistically in an online environment, albeit with some sentimental froth around the edges of that promise for those not quite ready to accept the true value of news in today’s online publishing environment. In a world that has empowered over 1.6 billion people as publishers, it’s no longer realistic to think that only a handful of people who carry the official title of “journalist” are defining the supply of quality information and insights in the world. The key factor that Journalism Online really doesn’t address at all is that the news industry is surrounded by valuable sources of information that leave them struggling to define a fundamental value proposition, regardless of how it may be financed. News organizations are also surrounded by technology platforms that make it possible for consumers and enterprises to aggregate, filter and analyze news far more efficiently than via their own publishing platforms. The “let’s tame Google” approach to trying to control content linking and access belies the reality that the contexts in which news is most valuable are increasingly far away from publishers’ own Web sites. There's some tacit acknowledgment of this concept in the JOI positioning, but only time will tell if they can emphasize licensing of content for reuse efficiently enough to make a real difference for news producers who must compete with and complement new sources of engaging news and information.

The search for subscription and royalty payments fostered by Journalism Online also tends to gloss over the ad-driven culture of most of today’s news organizations that restricts fairly radically what topics and personalities gain their attention in their search for an increasingly limited “truth.” If JOI could help fund a broader approach to journalism that gave coverage to less ad-worthy topics, then truly it would be living up to its ideals. It’s far from clear, though, that the news organizations that Journalism Online intends to support are likely to maximize the funding of such “news for the sake of news” journalism any time soon, though. But as an alternative to AP’s trenchant response to online publishing, it at least offers some hope for the news industry as a whole as a means to overcome some of the challenges posed to it by online content distribution capabilities.

Labels: B2b media, brill, crovitz, Google, hindery, Journalism, journalism online, Licensing, media, Monetization, News, Newspaper, royalties, search engines, subscription

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

Widget distribution networks are becoming a popular vehicle for major content distributors to get their content in context in weblogs, personal Web pages, portals and other content outlets. The New York Times joins the list of self-service widget distributors today with the beta launch of its Times Widgets feature. Using a simple point-and-click online form anyone can select NYT headlines from any of their more than 10,000 topical RSS feeds and get code that you can insert into your favorite publishing software or enjoy a one-click insert into iGoogle, Blogger, Vox or Netvibes. The net result is a display of recent headlines from one or more feeds, each with its own tabbed display. The popular Gigya widget distribution service provides the widget plumbing for Times Widgets, which promises that more platforms can be added as instant-add options soon enough.

It's a great positioning for the NYT's RSS feed content, which is popular enough with RSS enthusiasts but not necessarily getting the referral links out to the pages of news enthusiasts as quickly as news organizations would like. The problem is a familiar one: even with a very simple feed like RSS, only a small percentage of people are willing to do the minor heavy lifting to put an RSS feed into a useful place. Feeds are great, but the technologies to get them into useful places easily have been lagging. Widgets make it easy to manage feeds as part of a published page, ensuring not just the exposure of content but the ability to do more things with a widget payload over time.

It will also make it easier for the NYT to get come data as to which people using widgets are worth approaching to be advertising partners as well: there's nothing to say that money-making content cannnot be in those widget payloads, after all. Moves like the Times Widgets beta are examples of how publishers can use widget distribution technologies to open doors both to referral links and to advertising partners that can add value to their brands in a far more cost-effective way than traditional business development efforts. Not a bad deal for just a little bit of development effort. Kudos, folks, the building may have to go but with efforts like this there are good reasons to hope that mainstream news content can find its most valuable contexts more efficiently than ever.

Labels: embedding, gigya, New York Times, News, widgets

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

In years past one could visit the head office of Bloomberg, L.P. and peer into the newsroom right off of the main lobby. Mike Bloomberg's office was right off of that news floor, with a glass partition that segregated him about as much as a head of an investment bank trading floor is separated from his or her operations. This was a natural for someone whose career took off in the trading rooms of Merrill Lynch driven by traders responding to real-time news events, but it also underscored the importance to Bloomberg of making authoritative market-moving news a key component of its success.

Times change, and now Bloomberg has announced the appointment of Time Inc. and Wall Street Journal veteran Norm Pearlstine as their first Chief Content Officer, a move that one presumes will enable Bloomberg to leverage its news and data assets more effectively in rapidly changing professional and consumer business news markets. Certainly this will help Bloomberg to move its revenue base more heavily away from professional markets, where its ubiquitous content displays are encountering fewer seats in an increasingly automated and specialized securities trading industry.

As I've noted for several years the financial information industry, like many enterprise content sectors, is moving away from a "bell curve" market model, in which lots of money is made off of many people equipped with subscription content delivery, to a "U"-shaped market model, in which lots of money is made off of highly automated content services and highly analytical services for a small cadre of decision-makers, with your typical "seat" revenues being realized more profitably through a media model where delivery has been commoditized as a benefit. Bloomberg has been relatively slow to respond to these changes, sticking to its highly profitable professional products but only recently beginning to up investment in its media brand audiences.

That's a challenging formula for growth given the continuing evolution of both Thomson Reuters and Dow Jones in supporting media markets more aggressively. Bloomberg 's online operations have grown audence significantly in the past year, almost doubling its online portal audience, but still trails Reuters and Dow Jones significantly for global markets. Thomson Reuters reported 18 percent quarter-on-quarter growth in its media sales in its first combined reports, an indication of how its global presence in online news markets has helped to fuel profits. So while Bloomberg's online, television and licensed content is strong, there is room for growth, especially in overseas markets.

But undoubtedly the increasingly sophisticated presence of Dow Jones has to loom large in Bloomberg's radar as much as the newly combined forces of Thomson Reuters. News Corp has managed this acquisition very wisely so far, retaining an online subscription base that both Thomson Reuters and Bloomberg lack while beefing up its Enterprise Media Group with its Generate acquisition. As these kinds of products that create professional value out of media sources begin to be adopted to Dow Jones' online media offerings Bloomberg will be challenged to devise both more powerful media offerings and a subscription community willing to pay for them. This will be at least as tricky as building a global content brand out of its existing news operations. The real challenge for Bloomberg is to respond to both new opportunities for media revenues and new challenges to high-end content analytics and real-time sales intelligence services in its core markets from newly strengthened players such as Dow Jones.

Pearlstine brings a deep and impressive legacy in the content industry to Bloomberg, but more importantly he brings an outlook on the media business which recognizes that the days of a handful of news monopolies dominating news gathering and dissemination are drawing to a close. To succeed with an electronic news brand one must not only excel at traditional journalism but as well one must excel in making news valuable in whatever context an audience finds it to be valuable. While it's not clear that Pearlstine's insider view of the media industry will lead Bloomberg to new successes in adapting to this more contextual view of the content marketplace he is likely to help open doors for Bloomberg to build out a more competitive brand for both online markets and for print markets seeking out new sources of editorial content.

Labels: B2b media, Bloomberg, financial information, media, News, Norm Pearlstine

There's the usual spate of moans and groans about print profits coming out of the Argyle Executive Forum on Leadership in Media, according to Red Herring, which featured insights from many key figures in today's news media markets. This negative outlook is underscored by News Corp's withdrawal from bidding for New York area newspaper Newsday based on it being "uneconomical" and setting the stage for a potential takeover of the paper by Cablevision. While revenues continue to climb from online content at news outlets classified revenues are still highly vulnerable from online competitors, making it hard to translate growing online audiences into profiles that resemble print.

There's not much new in all of this, to be sure, but I was interested in the following comment from the Argyle conference:

Norman Pearlstine of the Carlyle Group told attendees that newspapers enjoyed a brief period of monopoly that attracted investors and convinced many families to take their businesses public. However, he said, for most of its history, the newspaper business did not enjoy the double-digit margins that characterized the 1980s and 1990s. “At the end of the 19th century there were 29 newspapers in Chicago,” he said.

In other words at the end of the day perhaps the consolidation in the print industry of the past fifty years or so, first in response to rising fixed labor costs and television competition and then from the Web, created an illusion that highly capitalized media operations would yield superior results in an industry that has historically favored diversity in lower-margin operations. By creating larger swaths of exclusivity for fewer brands in major markets, newspapers and other print outlets were able to attract advertisers for several decades and provide reach at the same level of television markets. But in doing so they never really addressed the lack of technologies that could deliver higher margins except through higher production volume. This created an artificial illusion of technology scarcity that helped to drive both margins and the expectations of people creating print content. As long as there was a steady stream of companies to acquire to build up the illusion of scarcity, this worked rather well. But we seem to have come to the end of the run of worthwhile mass market print acquisitions. Big will probably get bigger yet if government regulations allow it, but to far less avail.

By contrast, the Red Herring article highlights how Playboy Magazine was one of the very first to invest heavily in Web technologies and to learn how to make them both profitable and attractive to advertisers and audiences, including heavy investments in online video and multiplatform delivery. The result: a highly profitable and attractive operation that offers some unique appeal to online audiences based on both content and branding. Instead of focusing on acquisitions in a sea of abundant competitors to create more artificial scarcity, Playboy worked to create something more appealing what would create quality that would be hard to replace.

Another important contrast comes from a recent MediaPost article, in which Ken Doctor points out that local newspapers are still doing fairly well, in part because many local advertisers as well as audiences have yet to be able to leverage a confusing array of online options effectively. This creates a real scarcity of audiences focused on local online content that are easy for advertisers to attract with some scale. Online alternatives are catching up fairly quickly in terms of content quality, but until GPS-enabled advertising services grow more sophisticated local print will continue to offer a ray of hope for print.

The bottom line is that it's far from clear that major media outlets as we know them really need to exist as they have for the past fifty or so years much longer. If the historical state of content is a wide variety of focused outlets with relatively low revenues, low volumes and low margins, then maybe what online publishing is beginning to usher in is simply the return of publishing to its more normal state. The difference with current markets is that electronic content aggregation makes it relatively easy for a wide variety of publications to leverage common technology. For example, individual weblogs such as ours use a tiny fraction of the power found in Google's Blogger.com infrastructure. So by focusing their capital mostly on pure infrastructure, Google has created true scarcity of highly scalable publishing capabilities that can service both localized and broad audiences very effectively.

Notably even companies like Google go out and buy market share through acquisitions - online video outlet Blinkx is rumored to be on their short list of short-term possible acquistions -
but these tend to be acquisitions that bring in both unique technologies and unique audiences. Where major media companies look mostly at reducing costs through online and print publication consolidation, the Googles of the world stay focused on creating more unique product value through acquisitions. With such an insistence on sticking with old metrics for performance it's not clear that established media companies can commit their capital effectively to gain a market advantage as long as they continue to focus on creating more artificial scarcity for dated products and dated delivery technologies. In the meantime private equity abounds to fund technology platforms that will take away the best opportunities for a wide variety of producers content with higher margins on lower volume and advertisers pleased with more focused audiences.

In other words, it's very unclear where the news industry goes from this point if they don't want to invest far more heavily in new electronic product development for more focused audiences. With a sour economy making it all the more hard to raise more capital for investment, expect media titans to continue to wrestle with their place in a content market traditionally dominated by smaller, more agile and more innovative players.

Labels: media, Monetization, News, News Corp, newspapers, print

When first I arrived on Wall Street many years ago at a major financial information company I was totally captivated by the notion of real-time news and information being at our fingertips every moment of the day. While other people lived through events in a seemingly second-hand world of news we were in on the cutting edge of events at all times. Reporters leaping over one another to cover these events in our newsroom was a given, and a thrill to watch as they shaped the news for leading investors worldwide.

But times change. Today what we used to consider elite real-time news is what most people on the Web expect to get as a matter of course, while traders in financial circles measure information timeliness that can give them a trading advantage via "hot news" in sub-millisecond timeframes. The Associated Press' CEO Tom Curley painted a picture of this evolving landscape for news in a recent address at the annual Knight-Bagehot Dinner in New York. In his address Curley was quick to chide "editors [who] need to stop pining for the old world and intensify the leading to the new" and to suggest that news organizations' "focus must be on becoming the very best at filling people’s 24-hour news needs." He also outlined how AP bureau offices would be staffed with more people dedicated to creating news rather than distributing it. Certainly moves such as these will help AP to generate quality news cost-effectively. But Curley fell short in his defining the scope of a number of key parameters that would help real changes to come about.

A key unrealistic expectation that Curley advanced is the role that distribution management plays in online content: "We have the power to control how our content flows on the Web. We must use that power if we’re to continue to be financially secure and independent enough to speak truth to power." It would be more accurate to say that publishers have the power to understand how their content flows on the Web. Yes, through proper packaging a publisher can employ business or legal measures to enforce some commercial arrangements over that flow in many instances, but the notion that a wire service or any other content distribution service has the ability to control distribution on the Web definitively is not only inaccurate but a folly for growing a business.

With the exception of high-end professional applications such as securities trading the ability to monetize news lies far less in its ability to be distributed and far more in its ability to be contextualized. "Hot news" without a hot context is just not hot - especially when the hot contexts far outweigh the relatively small handful of contexts that used to exist through distribution-oriented media outlets. With social media creating millions of highly personalized contexts for news it is to a publisher's advantage to maximize distribution in the most cost-effective manner to those contexts. The brand value is not in the "AP" logo next to the headline or lede but in the value that it provides in the moment. While copyright in those contexts is certainly worth defending if you make the brand less able to flow into the contexts in which news can be monetized most effectively you reduce the opportunity for revenues substantially.

The New York Times understood this well enough when it lowered its subscription barrier to TimesSelect content and the Wall Street Journal appears headed towards more such exposure. Curley's suggestion of introducing tiered pricing for "hot" news versus hours-old news may have some value in this regard but if others are adept at making money without such a scheme it will be hard position to defend except at the highest end of enterprise markets. The general abandonment of 15-minute delayed pricing for stock tickers on television and the Web points towards an environment where the ability to monetize news on an exclusive basis has disappeared in large part from consumer media. It's about value relative to what else can be created in a medium, not just what you feel is valuable independent of that medium.

The fault lies not in the Web but in the reluctance of publishers to embrace monetization models beyond distribution control. "Speaking the truth to power" does indeed cost money, but it doesn't seem to ring true that this necessitates the primacy of one particular monetization model. AP has begun some experimentation with viral distribution via embedded content which is a hopeful sign for future efforts. But in an era in which the world edits its own front page and in doing so assigns value to news an organization creating news must adjust its expectations and acknowledge that speaking the truth to power also requires the active cooperation of those user-editors to make that truth relevant to power.

It's not just a matter of protecting copyright in a social media environment: it's a matter of being the master of monetizing social media through the inherent strengths of its contexts. Where value is created, monetization - and brand authority - follows. To insist that monetization and brand authority must be respected regardless of their relative value in new contexts leads inevitably to a degradation of both monetization and brand authority. Monetization isn't the real protection of quality news, it's really the creation of a defensible value proposition that protects quality news. The money - and the security to speak the truth confidently - comes from people valuing what you have to say in the most open marketplace of ideas available.

This is the inherent shift in publishing that continues to leave many in the industry not only at a fork in the road but well behind others who didn't even bother to look for the fork. It is, you might say, the difference in shifting an outlook from the East side of Manhattan to the West side versus shifting an outlook from the East coast to the West coast of the U.S. (or any other source of publishing innovation). Be a master of value in these new contexts, says the West coast, and the East coast time and again says, "Show me the money" - which sounds great and practical, except when the West coast comes up with so many new contexts that can make money that they are dumbfounded as to where to start to pick off what turns out to be sloppy seconds for monetization.

The solution to this problem lies in part in recognizing that the East coast crowd needs to be the master of monetizing contexts that the West coast creates, not the follower. Instead of sitting back on their heels and sending in a licensing team after the lawyers have roughed up a dot-com baddie established players in publishing need to think, "How can we be the next Google of content monetization? How can we be outrageously on the front lines of helping people make money from content that gets consumed the way that people want it? How can we create content packaging that is so compelling that it cannot help but to make money?" With an increasing stream of large media companies cutting deals for contextual ad networks you can see that they are starting to get a hint of what this is all about, but it's still mostly about putting up ads and not really about owning the most compelling value proposition that makes people want to advertise.

An example of this can be seen in the abandonment of print as a valuable medium. Curley suggests in his speech, "There’s still a place for appointment media -- a home-delivered newspaper on the porch each morning or an evening newscast while making dinner. But it is a smaller place. People, of course, want the news when they want it." While print's lack of exclusivity is hardly news, most publishers have been utterly uncreative in their approach to print as a highly valuable medium. Print is a medium for the most tactile and high-quality physical engagement with content: its value will be long-standing. An organization like AP has the ability to enable technologies that would allow consumers and enterprises to get highly customized print publications that would be highly affordable - and highly valuable to marketers. Instead, publishers crank out the same old proprietary content instead of putting the selection and the editing in the hands of their readers.

If this sounds as if I got up on the wrong side of the bed you may be right, but only because it is really frustrating at times to see how slowly major media companies adapt to these trends - frustration that is shared with many people working for those companies, I can assure you. There are scarce few that have had the courage to innovate with the fearlessness that's required to become a winner in the 21st century content world. AP may yet be one of those survivors under Curley's leadership as he strives to reinvent a culture that has much of which to be proud, but that equally needs to put aside that pride and acknowledge what the real goals must be for a news organization in the 20th century. AP's worldwide network of journalists and member organizations has an opportunity to reinvent the value of news around contexts rather than distribution, and many of the skills to make that so. But time is of the essence...

Labels: AP Tom Curley, Monetization, News, Trends

When Seattle-based Newsvine launched in Beta form last January we documented its promise enthusiastically and kept a close eye on it. Not surprisingly so did a number of hot prospects for financing a profitable exit, including MSNBC, which Newsvine has announced in its own story as its new owner. No details are available at this time about the size of the deal or how Newsvine will be integrated into MSNBC.com, but MSNBC News' estimate of USD 75 million seems about right given Newsvine's position in the social news marketplace and there are promises by MSNBC to keep Newsvine an independent entity for now.

It's a pretty good first acquisition for MSNBC.com, which is a humdrum online news portal that trails major outlets for cable news such as CNN.com and Foxnews.com by significant margins and seems to be caught in a major identity crisis. Unlike the online portals for CNN and Fox News, MSNBC.com is obliged to promote the broadcast NBC news properties more than the MSNBC cable unit, drawing away precious attention span to TV shows that have little to do with core online audience demographics. Add in an alliance with Newsweek magazine for feature content and the marketing muddle for the MSNBC.com brand gets no more clear.

Newsvine itself is not a traffic leader in overall visits amongst social news outlets and struggles to build momentum behind an intensely loyal core of news, opinion and bookmark contributors. But unlike other social news outlets Newsvine features a maturing mix of original content along with links to external news stories, a combination that will help MSNBC.com to build inventories of unique destination content and a network of popular online personalities that could be leveraged via MSNBC's cable outlet to build visibility for the community. Newsvine has had a few minor but noteworthy news scoops of its own - a member on the scene of the Virginia Tech shootings broke the initial details of the event - but the strength of the community tends to be a core of contributors who opine on and spin key topics in politics, religion, world events and popular culture. With a reasonable mix of views across the spectrum and the ability for talented writers to expand on their thoughts in their own pieces Newsvine offers a rich mix of content that's sure to complement any mainstream news outlet's offerings if managed effectively.

What Newsvine gets most out of this deal is a parent who's willing to put a little more muscle behind an organization that's been challenged to keep up with itself. With only a staff of six and an editorial policy that requires regular and timely monitoring and intervention by senior Newsvine staff to keep controversial content and comments from spinning out of control Newsvine suffers from the typical startup myopia that keeps it from looking at larger prizes at its disposal. Newsvine's features generally do a good job of promoting engaging content to the attention of its members and its social networking features were well ahead of other social news outlets but its up-only voting system tends to promote content that echoes much of the same controversy-for-controversy's-sake content that one finds in major media outlets. Ironically this may turn out to be a plus when you have a cable news outlet that focuses on much the same sort of stories.

Most major news outlets have been extremely hesitant to embrace social media too closely, a factor that has benefited portals such as Newsvine along the way: when The New York Times closed down its online comments features a few months back Newsvine picked up a good chunk of NYT commenters. With the acquisition of Newsvine established news media outlets may be beginning to recognize that this uneasy balance between social media and their own news is tipping away from their operations, creating loyalties tied to online communities creating and discussiong news that is likely in time to eclipse loyalties to news brands tied to established media channels. It's hardly a one-for-one swapout at this point in time, so the initial decision of MSNBC to keep the Newsvine brand alive as an independent unit is a wise move for now, especially given the typical sensitivities in online communities to being "sold out."

But as audiences empowered as newshounds create and discover a widening range of content their ability to build quality inventory and insights rapidly will eventually find more of today's journalists and commentators becoming professional members of online communities like Newsvine. Social news communities are accelerating in their ability to get their articles good placement in search engine results, a factor that certainly contributed to The New York Times' decision to open up its prime columnists' content to get our from behind their subscription firewall and into the mix of these communities. This transition is still fairly gradual and generational, but essential for ensuring future revenues amongst news audiences becoming used to having their peers help them select what's newsworthy - and worth their attention.

Labels: Deals Partnerships and Sales, Digg, MSNBC, New York Times, News, Newsvine, Social Media

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