The Cash Is In The Topics

All conversations I keep having about the economics of a news web sites revolve around two key ideas: how to increase both the duration and the depth of a visit. In this respect, much work remains. For August 2009, here are the numbers of page views, as measured by Nielsen Net Ratings on the French market. :

  • Online gaming:         between 400 and 600 page views per person and per month
  • Facebook:………………………411
  • Google:………………………….260
  • Meetic (dating site) :………..208
  • Leboncoin (free classified):..182

That was for the top 17 French sites ; further down in the rankings, medias sites go like this:

  • TF1 (n°1 television network):…39
  • Le Monde (national daily):………24
  • Ouest-France (regional daily):…22
  • 20 minutes (national free):…….20
  • Le Figaro (national daily):………20
  • Les Echos (business daily):…….14
  • Rue 89 (pure player):……………10
  • LePost (pure player):………………8
  • Liberation (national daily):……….8
    (Those numbers apply widely elsewhere as behaviors don’t vary much from one market to the other)

Well. You see where I’m going: if you set aside tricks such as massive video or slide-show contents used to artificially increase page view numbers, heavily used news sites such as Le Monde’s or Le Figaro’s get less than 5% of the monthly page views of a gaming site. Agreed, you shouldn’t compare gambling and consuming information; but in analog life, there isn’t the wide difference we observe in the digital universe, on line, between the amount of time people spend playing the lottery or betting on horses, and reading a newspaper or a magazine. In other words, the internet hugely accentuates the viewer’s “engagement” in favor of social entertainment, at the expense of consuming solid, but static contents such as news. Depressing indeed. But here is the good news: there is room for improvement.

If we take 4 pages per visit as a credible average for a news site, adding 2 more pages  per visit will sharply increase the actual advertising revenue per visit. Not by 50%, of course, since the more you add pages, the less valuable they become (CPM drop fast once you leave the hottest part of a site), but still worth the effort. More

Medias : time to fix the training problem

Let’s start with sobering facts :

  • the top 10 in-demand jobs in 2010 didn’t exist in 2004
  • today’s learner will have had 10-14 jobs… by the age of 38
  • new CEOs landing in a “great” company will devote most of their time, months or years, to placing the right person in the right slot.

How does the media industry react to such facts? Well, each time I’m pitching this question to a group of editors ad publishers, in Europe, India or in the US, the discussion reaches the same conclusion: insufficient training is our biggest collective failure. (There is the notable exception of Nordic countries. I’m fairly familiar with them: over there, the very notion of education and continuous training is deeply rooted in the national and corporate culture — but they are not immune to inefficiencies either).

Everywhere else, we witness two major impacts on organizations.

First, on human resources management. In most cases, there isn’t anyone tasked with taking care of careers. No one wonders: What is this individual good at? How can this person improve and, therefore, derive more psychological, not to say spiritual satisfaction from his/her professional life? How does he sees himself five years from now? And so on.
At the same time,  real compensation policy is almost nonexistent, except for a salary scale, the misbegotten result of painstaking negotiations between management and union representatives. Carved in stone, these Tables of The Law shield everyone from responsibility. Which leads to talk like this :  “— I can’t give you a raise, pal, you’d be out of the scale. But, by next year, I can promote you to Deputy Assistant Managing Editor in charge of such and such… — But I’m not interested in managing anyone, I just want to do the reporting job I’ve been doing for seven years now, but for a better wage, that’s all. — I know, but it’s the only way…”
No wonder layers of accidental managers have built up over the years — and, of course, without any training to handle such responsibilities. More

Web + Print: A Powerful Combo

In today’s context of massive revenue depletion, everyone (almost) agrees on one thing: digital media revenue sources will have to be diversified. There is no magic bullet, no dominant model that will guarantee, by itself, a sustainable revenue stream. Time to think the hybrid way.  Free will coexist with paid-for, different users (occasional vs. intensive) will be discreetly assigned different revenue models, platforms will diversify as technical standards for publishing or transactions emerge, opening new fields for monetization. Old churches and ideologies will crumble.

The biggest stimulus for such creativity is the collapse of the internet advertising model. On average, CPM (cost per thousand viewers) have dropped by 30% – 40% during the last twelve months and very few expect a recovery.  As far as booking rates are concerned, they are dropping as well. It is frequent to see only a mere 30% of pages inventories actually sold to advertisers. Unlike prices, this latter percentage is likely to bounce back at the first sign of economic relief.

But the classical advertising model’s weakness is more structural. The “old” banners / display stuff doesn’t fly as expected. People simply don’t click enough on those items and even sophisticated targeting yields minor relief. The only “healthy” segment is search ads, but it is dominated by the Google Way — a massively deflationary one. Successful medias will be the ones who manage to shake off the old cobwebs and proceed to rethink their relationship with the advertising sphere. It will be fairly easy for social or non-hard news sites, but true information content vehicles are likely to struggle with ethical issues…

As far as platforms are concerned, last week, we looked at smartphones: they’re on their way to become the main vector for news, whether it is for text or video. Numbers looks good: last year, according to IDC, on the 1.19 billion mobile phones sold worldwide 155 million (13%) where smartphones. In 2013, says IDC, 1.4 billion handsets will be sold, among them 280 million (20%) smartphones. And if anyone harbored any doubt regarding the ecosystem’s health, just consider the 65,000 applications available for the iPhone and the state of the competition. As explained in this Fortune magazine story, the sector is red-hot: since the iPhone introduction in june 2007, Blackberry quarterly sales have more than tripled. Even Google joined the fray with Android phones — and following a trajectory than will put the search engine to a collision course with Apple (see Jean-Louis’s column War in the Valley; Apple vs. Google).

Coming back to the title of today’s column, let’s talk about paper, the pulp, dead tree version. I can see many reasons why some sort of paper version can help. More

Paid news on Mobile. Why it could fly.

This week, I downloaded the iPhone application of the British newspaper the Independent. It’s a new breed of app, taking advantage of the new features embedded in the third iteration of the iPhone OS. For a daily newsmedia, Push Notification is the most interesting new feature, combined, in this case, with an offline reader. On the iPhone’s main screen, a red badge tells you the number of stories updated and unread since the last time you used the app (see below).

Home page of The Independent iPhone App

Then, inside the app,12 categories work the same way. On a wifi network, in the background, it takes a minute or so (three four times longer on a 3G network) to download a batch of 150 stories updated every day.  Then, the articles can then be read, quickly or leisurely, regardless of your connection. Pretty cool.

There are many reasons to be confident in the development of news on smartphones. Especially with the Apple innovation engine showing the potential to create a brand new sector — as it did in the music business with iTunes. As we speak, 43% of mobile internet traffic is generated by the iPhone device. Competitors have seen the threat and opportunity. RIM’s Blackberry wishes to enter the mobile app market — with an eye on the lucrative specialized news segment — and we can count on the combined impact of Google’s Android (their smartphone OS) and Chrome OS (their netbook platform) due next year. And Microsoft won’t stand still either. (Yes, they were early with Windows Mobile and let their lead evaporate, but they’re taking the situation seriously, they know what’s at stake if they don’t “make it” in the smartphone market.) And Nokia, the cell phone king, hard-pressed to stay ahead in the new smartphone world, but, just like Microsoft, rich, awake and determined. More

Media: What’s left for the brand ?

A well-established brand is supposed to be a key asset. Everybody keeps dreaming of building a long-lasting brand with lots of positive attributes. How true is it for media ? In the rapidly changing environment, in the massive shift towards electronic media (and the vaporization of value that goes along with it), how relevant is the notion of media brand?

Quite important, actually. Brand management must be handled with great care, especially when business models are threatened. The brand becomes a critical line of defense, and a strategic component to build upon. There are conditions, though, to the survival of media brands — and to the emergence of new ones. More

The News Cycle Heartbeat

How do mainstream media and blogs interact? How do they feed each other ? Everyone in the newsmedia would love to get a better view of the mating dance. A few weeks ago, scientists at the Cornell University unveiled a thorough analysis of the relationship between the two universes. Borrowing from genomics techniques, they dug into a huge corpus of politically-related sentences and tracked their bounces between mainstream media (MSM) and the blogosphere.

Their dataset:

  • About 90 million documents (blog posts and news sites articles) collected between August 1 and October 31, 2008, i.e. at the height of the last US Presidential race.
  • 1.65 million blogs scanned.
  • 20,000 media sites reviewed, marked as mainstream because they are part of GoogleNews.
  • From this dataset, researchers extracted 112 million quotes leading to 47 million phrases, out of which 22 million were deemed “distinct”. These phrases were important enough to be considered as news.
  • The phrases where political statements or sound bytes pertaining to the political race  and uttered by the two candidates, their running mates or their staff.
  • Processing these 390GB of data took about nine hours of computer time (using a complex set of algorithms, involving “markers”, as in genetics).

The findings, in a nutshell:

  1. Mainstream media lead the news cycle. They are the first to report a quote, the story behind it, the context, etc.
  2. The 20,000 MSM sites generate 30% of the documents in the entire dataset and 44% of  the documents that contained frequent phrases.
  3. It takes about 2.5 hours for a phrase to reverberates through the blogosphere.
  4. The phrases that propagate in the opposite way (from blogs to MSM) amounts to a mere 3.5%.
  5. A news piece decays faster on the MSM than on the blogosphere.

The comparative curve looks like this :

For those who want the complete analysis, the full report is available here.

As expected, this research triggered controversy. More

The end of the breaking news — as we know it

In the internet storm sweeping the media, breaking news is, without a doubt, the main casualty. This branch of the information stream is the most likely one to endure a kind of “commodity syndrome”. The breaking news circa 2010 will be ubiquitous, instantaneous and simultaneous. Its value, its market price actually, will tend to zero as a result.

Two forces are at work, here: the professionalization of the blogosphere and the impact of Twitter. Dealing with this is critical for the survival of traditional media. Let’s have a closer look. More

The news flow: Dealing with the fire hose

In the Seventies, Peter Herford, CBS bureau chief in Saigon, used to send his stories the physical way: rolls of 16 mm film, usually shot with an Eclair (a French camera) and sound tapes (recorded on a Swiss Nagra recorder, a jewel of those analog times) were shipped to HongKong, courtesy the US Air Force, and then transfered to a regular US-bound flight, with a stop in Hawaii or Okinawa. “The CBS Evening News was hosted by Walter Cronkite who wanted half of its newscast filled with Vietnam stories”, Herford told me. Hence the daily routine. But once the stories were sent, Herford and his staff had time for reflexion, for working their sources and for thinking about the next stories. No satellite link, no cell phones. “Today, I would be stuck doing live reports all the time.” Hereford is in no way nostalgic about this totally analog era. As he was in Paris for a conference, a couple weeks ago, he was constantly taking pictures with a professional Canon camera. Today, he teaches journalism at the Shantou University in China and still exudes unabated enthusiasm for journalism.

Walter Cronkite in Vietnam (Feb. 1968) -- National Archives

Walter Cronkite in Vietnam (Feb. 1968) -- National Archives

Revisited with today’s journalistic tools, coverage of the Vietnam war would be different, in many ways. Live would be de rigueur.  Think about it. We would have had:
- a TV correspondent doing a standup (or rather a duck-down) right in the midst of the Khe-Sanh siege
- the Tet offensive twittered or live-blogged
- a retired general bashing the “delicate” tactics of carpet-bombing on his blog
- a heavily linked-to chemist-blogger, for his expert depiction of the horrendous effects of Agent Orange, a defoliant spread for ten years over the jungle (400,000 deaths, 500,000 birth defects). We can be sure it would have triggered a national outrage in the US, forcing the Kennedy/Johnson administration to stop
- the My Lay Massacre inevitably leaked, thanks to a disgusted soldier posting a video on YouTube soon after the the fateful day of March 16, 1968. Instead, we had to wait 18 months for a reporter for the Saint-Louis Post Dispatch to break the story; his name was Seymour Hersh, he was to become an iconic investigative reporter, bound to reveal the 2004 Abu Ghraib abuses in Iraq;
- for good measure, North Vietnamese bloggers would give the world a different perspective on the war as, on the other side, US soldiers-bloggers would have lifted the veil on the low morale, drug abuses among the troops, and their acceptance of inevitable defeat;
- in the end, the April 30th, 1975 evacuation of Saigon would have been reported live using citizens and evacuees cell phones and twitters. More

Can Data Revitalize Journalism ?

Get a demo of a Bloomberg terminal. You’ll be is blown away by the depth of available data. Thousands of statistics, historical tables, sources… Everything is available through the proprietary terminal. Bloomberg started by offering a real-time news flow dedicated to the needs of the financial community, traders, analysts, etc. Over the years, the system expanded in two directions. First, remarkable journalistic work grew Bloomberg from a unidimensional newswire into a multi-product company providing breaking news, features stories, in-depth reporting, TV feed, radio, podcasts, even a magazine. The service is encapsulated in a terminal rented for a fixed price (€1800 a month), no discount, no complex pricing structure, just one product, that’s it. (This choice of integrating content into a piece of hardware reminds me of a famous Cupertino-based fruit company). Bundled with the product, you get raw data, lots of it. That’s the other Bloomberg’s gem. The ability to tap into big databases is an essential journalistic tool. It undoubtedly helped Bloomberg to reach its status in the financial information sector. More

The real cost of genuine journalism

Updated with a video on PolitiFact Guide to Fact-checking

The idea for this column came to me last March; I was flying back from Stockholm. Schibsted, the Norwegian media group I work for, had asked me to be part of the jury for its yearly Schibsted Journalism Award. I was both honored and curious to be part of such a delicate process. The group’s publications, in Scandinavia and abroad, submitted entries in several categories: best storytelling, best innovative entry, best scoop. Altogether, 27 entries were compiled in a hefty kit sent by Fedex to each member of the jury; the kit included a couple of binders — facsimile of original pages, translation in English, CDs, memory stick, etc. Serious work. Then, we gathered in Stockholm to select the nominees and the winners.

Of course I’m bound to secrecy, I’m not going to be specific about the discussions.  But I feel an urge to write about the event because I was surprised by the level of journalistic ambition
demonstrated by many of the entries. Among them were several investigative pieces: a bribery scandal in Russia, a huge Bank fraud in Norway, or revelations of a hidden part of Norwegian war history, just to name a few. We were faced with difficult choices — happily.  On my way back to Paris, I thought this was the perfect illustration of how, true, genuine journalism differentiates itself from blogs — even good ones, simply because news organization will invest time and money in the genuine article, so to speak.

To make my point, I’ll just focus on the cost, yes, in euros or dollars, of such journalism. It could sound like a trivial way to assess editorial performance but I believe money remains a much-needed fuel for good journalism. More