As the financial industry has writhed and wrinkled under the pressures of a wilting market for securities, financial content vendors have squirmed along with them, trying to define value propositions that will enable them to help both traditional clients and any and all possible new ones that they may be able to surface. One of the content companies positioned best to take advantage of these changes is Alacra, an up-and-coming aggregator of financial and business information that has spread beyond its roots in investment banking to appeal to a broader audience in finance and corporate circles. Alacra has a series of core premium research offerings with high functionality that major institutions can subscribe to as well as The Alacra Store that enables people to search for and purchase premium financial research and news sources on an a la carte basis. This allows Alacra to shift revenue streams rather nicely as clients become more or less oriented towards subscription services as the global economy goes through its cyclical paces.

One of the major problems in the current economic downturn, though, is that in many instances earlier sources of premium research are disappearing. As investment banks and other institutions have cut back on their research staffs, there are fewer people being paid to turn out premium research reports on institutions issuing securities and on market sectors. In some instances major institutions are passing on research coverage on major sectors such as the finance industry itself. Imagine that - banks refusing to analyze banks. Strange times, indeed, but that has become the economics of the securities industry. As more and more trading of securities has shifted to electronic trading systems, the shrinking profits from electronic trades have made it harder to justify the expense of offering clients detailed research and analysis.

This doesn't mean that quality research and opinion on financial markets has disappeared altogether, though. As in many forms of publishing much of the information that used to come from major banks and financial publishers through premium services can now be found in one form or another on the open Web. That's the good news, but the bad news is that it's not the easiest thing to filter out the good sources from the bad sources and to get it into a form that's meaningful for financially-oriented professionals. Barry Graubart, Vice President, Product Strategy & Business Development, calls this need to filter out lower-quality sources the "signal to noise ratio," a fair way to characterize the problem given the level of noisy and oftentimes inaccurate sources of financial information offered by some services on the Web.

Enter Alacra Pulse, a new "freemium" offering from Alacra that breaks new ground in organizing content freely available on the Web into a highly usable format for investors, an aggregation that focuses on content relating to several hundred large and medium companies from hundreds of sources on the Web. In some instances Alacra Pulse's sources are familiar names such as investment bank ABN Amro and Standard & Poor's Credit Research, sources that publish many market reports and alerts for free already. Other sources are much more niche-oriented and more likely to carry some of the Web's sometimes irreverent outlook on topics, but are carefully picked by Alacra for their quality and the demand for their quality by financial professionals.

For instance, Stockgeek.net might not be the first source that would come to an average person's mind as a reputable source of financial information and insight, but those in the know are aware of its opinions and rely on it and many other non-traditional sources of financial information to keep them informed. I have witnessed this myself many times in doing research for financial information companies. Many financial professionals take the time to look at key trusted online information sources that focus on their domain of expertise. These sources include many independent financial analysis firms, which use a level of free information on the Web to attract insitutions to premium services.

Alacra Pulse does a nice job of wrapping these sources up in a standardized format that makes it easy to get the best of independent thinking on investments available today. Alacra Pulse enables you to look at the latest on all topics from analysts, to drill down into research on specific companies or to browse through the research and insight offerings from specific sources. Links to articles and reports from sources are labeled with color-coded icons that identify the type of source - "sell side," "buy side," credit agencies and industry-specific experts - and are also complemented with links to premium sources in The Alacra Store for those who would like to pay a bit to dig further. Otherwise, you can click on a headline to view a story on its native Web site.

One of the key features of Alacra Pulse is the ability to leave comments on a featured story. In just the few days since its debut Alacra Pulse seems to be drawing quite a few comments already, helping to enrich the site for both its visitors and advertisers looking for a little extra "stickiness" for their ads. The presentation of the Alacra Pulse ad-based portal is similar to other Alacra products, offering a simple, clean look and generally easy-to-use features and ads that are not too intrusive. For those that need more tools, the premium version offers alerts filtering and email notifications as well.

Financial information for professional investors tends these days to fall into either the ultra-staid realm of subscription database services or the wild and wooly world of online services that speak frankly about investments. Alacra Pulse does an excellent job of aggregating the best of online services into a format that professionals - and those who pay for their financial information services - should feel comfortable using and supporting. In that sense Alacra Pulse is a good calling card for investment-oriented professionals who can learn about the Alacra brand from this new product and feel comfortable graduating from it into more premium offerings.

In the meantime hundreds of companies that have been losing valuable coverage from industry analysts at major investment banks can begin to reap the rewards of a service that begins to give their securities issues a chance of getting consistent high-quality free coverage aggregated in a convenient format for their investors. At a time when everyone in the investment community is struggling to come up with answers to getting investor confidence rolling again, Alacra Pulse is a well-timed offering with a great signal-to-noise ratio that may help the markets to get a pulse again.

Labels: alacra, alacra pulse, blogs, coverage, financial information, First Research, freemium, reports, securities

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

Yes, I've been conspicuously absent for the past few weeks. Pumping out a couple chapters of a book will do that to you, unfortunately. I am also realizing that I was working ever-harder to find news where there just wasn't all that much news. A few things have happened - more on the Yahoo mess shortly - but the industry was definitely in a bit of a real-news slump for the most part anyway as far as I could see.

What I did see was the New York Times article on blogger burnout. Blogging can give me headaches sometimes, but I am grateful that I didn't keel over with a heart attack like some. Humbly I have to take this at my own pace: I love being there for ya, but the NYT article reminds me that there's gotta be a me first and foremost for myself and my paying customers. My feeling from the beginning is that ContentBlogger should be an unbiased source of industry analysis, so I have avoided the commercial route - knowing also. of course, that this frees me to be somewhat neglectful of my blogging duties sometimes.

In the meantime I will catch up with some posts that I owe you and I thank you for your patience. I love doing ContentBlogger, but sometimes I need to balance that love with other things.

Labels: blogs, burnout, ContentBlogger

The Alacra Store sells a wide variety of high-grade research reports targeted at business information consumers across a wide variety of business sectors, but like many premium content plays it's not always easy to get people enthused about new research offerings. Some services market content proactively via telemarketing forces and push out traditional press releases to beat the drum for new premium reports, but with their awareness and enthusiasm for Web 2.0 technologies it's not surprising that Alacra opted to launch Research Recap, a weblog highlighting recent additions of reports to the Alacra Store. Research Recap is based on standard WordPress weblogging technology and features some of the nicer capabilities of that service, including a handy tag cloud that helps people see what research topics are hot, category-based navigation and RSS feeds.

The feed is particularly important for analysts and business intelligence professionals who want to get tuned into the latest research as efficiently as possible: instead of having to slog through
press release feeds with lots of unrelated topics or deal with search engine alerts filters that can find documents but not necessarily recommend the most significant content a weblog of editorial recommendations can focus potential buyers on the content that's not only pertinent but also provide insights into the content in an editorial style that is more engaging than your usual report abstract. It turns newsworthy research into news right away, rather than having to wait for a journalist to get a press release packaged into a more readable format with an editorial voice. You may not sell premium research every one who reads a summary (2/3 of Research Recap reports profiled are free) but by packaging the summary as a highly readable blog you establish a conversation with your markets that's more likely to result in research getting the context that will lead to more report sales. We've been doing the same for quite a few years, so it's a positive development to see a company like Alacra putting their beliefs and talents on the line to build both great newsworthy content and better sales channels.

Labels: alacra, blogs, First Research, reports, research recap, Web 2.0 Expo, weblogs