Reinventing the News: To carry on, journalism must create its own media landscape.
But ask most journalists about the future, and a look of demoralized panic will wash across their faces. Yes, technology makes "modern-day reporting faster and more accurate, and the internet has been a boon to journalism and the art of keeping tabs on your local government. But it has also nearly disintegrated a once-prosperous business model that supported robust news gathering for more than a century.
Headlines about the spate of newspaper closures are almost as dispiriting as the continuous line of former journalists being forced out of the profession by layoffs, buyouts or a general malaise about their future prosperity. At times, it seems the only real response is an oversized bar tab at journalism conferences that fail to deliver on any big promises, focusing instead on the next shiny object that won't move the needle.
It's Parkinson's law of triviality in action, where we focus on relatively unimportant issues as the house continues to burn down in the background.
But what if we could reframe the future and reclaim it for journalism? I'm not talking about the current strategy of replacing print dollars with digital pennies, but think of new ways to support and sustain journalism through the 21st century and beyond.
Would that truly require bold, radical ideas that are currently being worked on in some tech genius's garage, or are the seeds for that new future already being planted today, despite the doom and gloom surrounding the industry?
Netflix and News
Why not start with how news might be able to not only take advantage of streaming services, but end up becoming the key to winning the streaming war?
Nearly 150 million people in the U.S. currently subscribe to Netflix. Another 28 million subscribe to Hulu. And while Facebook and Google long ago realized that access to news stories was an essential component of the user experience on their platforms, most streaming networks have avoided news and journalism all together (outside of documentaries).
Recently, Hulu has attempted to change that. The Disney-owned streaming platform has partnered with the New York Times to offer the newspaper's new feature The Weekly, a digital streaming home after its debut on FX. The Weekly is essentially taking content that began as long-form investigative journalism and adapting it into 18 to 24 minute episodes for a television audience.
Edward O'Keefe, currently a Shorenstein Fellow at Harvard and a former senior vice president at CNN, believes that it's only a matter of time before streaming platforms figure out that news can help them win the battle for consumer attention and loyalty.
O'Keefe argues that throughout history, every new medium--print, radio, television, cable, the internet, social media--news has become the essential component to building and retaining a loyal audience. Pointing to the Times' unique partnership with FX and Hulu, O'Keefe thinks the newspaper is busting boundaries in a number of different ways, including their willingness to give a competing platform a hard-earned news scoop, something that's been traditionally anathema to the newspaper industry.
"They're saying promiscuity is the new exclusivity," O'Keefe said. "The more platforms you can be on within a shorter duration of time, the more powerful the impact of the journalism can be."
The Times might be one of the few news organizations in the country to currently have the resources to devote to a project of this scope. But O'Keefe thinks that it's an option available to small and mid-sized newspapers across the country who are willing to disrupt the industry by partnering with their competitors.
"I'd love to see a local newspaper partner with their local TV station and do exactly what the New York Times, FX and Hulu are doing right now," O'Keefe said. "There's absolutely no reason that model can't be copied on a local level."
At least one newspaper company already has. The Alabama Media Group, which is owned by Advance Publications, grew a successful string of humor videos about Southern culture into a profitable digital business called Red Clay Media, complete with a Facebook Watch deal, merchandise and online engagement what rivals large nationals brands like the Times. It's not hard to imagine these shows ending up on a streaming platform.
"If Hulu made news content--especially in short form--available to you on their service, my argument would be if it's good, and it's easily accessible, maybe that brings you to them instead of someone else," O'Keefe said. "It would be a low cost experiment, compared to the magic bullet for the next mega hit. And it would be a boon for local news."
News as a Product
How many people subscribed to the newspaper for the comics or the crosswords? How many picked up the Saturday edition to go house hunting, or the Sunday paper to find a job?
Journalists often forget that the newspaper itself was first and foremost a product, perfectly designed to take advantage of the economy of the 20th century. So, it makes sense to think of it as a product once again, this time with 21st century consumers in mind.
Just look at the Washington Post. It wasn't that long ago the storied newspaper was struggling financially right alongside its peers. But thanks to a cash infusion provided by new owner Jeff Bezos, the Post has reinvented itself from a media organization into a profitable product company, making big bucks licensing out its content management system and ad technology to other websites and media companies.
Vox has also quietly moved into the product business with Chorus, its content management system which it began licensing out last year. Already, Vox is nabbing clients such as The Ringer, Funny of Die and the Chicago Sun-Times with a pitch as obvious as it is brilliant--use our technology and you'll never draft a story in Google Docs again. Vox has also developed an advertising platform around Chorus users called Concert.
"There's nothing stopping one of those two companies from creating the next app for hundreds of small publishers, who can just plug in their own content and publish," said Tony Haile, the former CEO of Chartbeat who is hard at work on his own new product, Scroll.
Scroll, which is currently in the test phase now, hopes to convince readers to spend $5 a month to read their favorite news sources ad-free. In exchange, Scroll will send news organizations 70 percent of their subscription revenue. The new product currently beta testing and has already amassed an impressive of list partners, including the Atlantic, BuzzFeed and MSNBC.
Haile is a realist when it comes to publishers suddenly shifting gears in an attempt to become the next great tech company. After all, engineers aren't cheap and most media organizations are struggling with just keeping the lights on and the printing presses going.
The good thing about our industry is that the Seattle Times doesn't have to fail for the Miami Herald to succeed, and news organizations don't have to build a product from scratch in order to take advantage of it. After all, one of the benefits of operating in local markets is a product readers might be willing to pay for or support in Washington D.C. might also be as relevant in Oakland, Calif. It just depends on the right content, which thankfully is the sweet spot of most media companies.
The Future of Advertising
While the industry as a whole continues down the path of more direct revenue from readers, media companies will still depend on advertising as an important revenue stream. Print advertising decades-long decline is expected to continue, but worldwide digital ad spending is expected to rise nearly 18 percent to more than $330 billion in 2019, and continue to increase well into the next decade, according to market research company eMarketer.
Within that market are any number of opportunities for enterprising media companies to take advantage of, whether it's the growth in ad spending on mobile video thanks to emerging technologies or the explosion in ownership of internet connected devices. And the growth of podcast advertising continues unabated, with the Interactive Advertising Bureau projecting the market will top $1 billion in 2021.
The Ringer, a relatively new media organization founded by former ESPN personality Bill Simmons, made more than $15 million in 2018 on podcast ad sales alone. According to the Wall Street Journal, the company charges advertisers upwards of $50 for every 1,000 people who hear an ad, well above the pitifully low CPM rates most media companies are able to charge for display ads.
There's just one problem to developing a strategy around digital ad revenue. Nearly two-thirds of the U.S. digital ad market is consumed by Google, Facebook and Amazon, who leave crumbs behind for the rest of us. Haile thinks it's an unfortunate truth that small and mid-sized publishers will continue to be squeezed out of the lucrative digital ad market.
"Advertising will overwhelmingly occur through the large platforms with very little left aside from small players who lack either the targeting or reach to compete," he said. "Every single trend in advertising has generally made ads bigger, more interactive or more intrusive."
Optimism About Selling Digital Subscriptions
The biggest idea is also arguably the most boring--simply charging readers to access news content online.
At this point, nearly all major newspaper companies and many digital news companies sell digital subscriptions or offer memberships, and have some form of paywall walling off their content.
Some, such as The Athletic, do it well, with a slick, ad-free interface that loads fast and puts their creators and content at the forefront. The Guardian, which has no paywall, has 190,000 readers who pay for a premium version of its mobile app and tablet layout that have no ads and better offline reading functions.
Others are slow-loading, glitchy monstrosities that force you to constantly reenter your login information and provide little value beyond accessing stories and annoy the very readers news organizations are attempting to engage with.
Regardless, digital subscriptions have been one of the few bright spots for some when it comes to local news organizations attempting to create sustainable revenue streams online. One of the best examples at the local level is the Boston Globe, which has more than 110,000 digital subscribers paying on average $300 a year. In fact, the Globe just became the first local newspaper where digital subscribers outnumber print subscribers.
But selling a digital subscription to news stories isn't the only opportunity newsrooms have in this area. The Lenfest Foundation (which owns the Philadelphia Inquirer, where I work) founded a team called the Lenfest Local Lab focused on mining the value of location by experimenting with mobile apps that mix the expertise of local news organization with specific products that might appear to local residents.
In addition to selling a premium version of its mobile app, the Guardian solicits donations from readers on every story to donate a small amount to support the news organization's journalism. The result? More than 340,000 one-off contributions during its last fiscal year, according to the company.
Which is why there is some level of optimism about the next generation of news consumers, who will grow up with an internet where it's expected they'll have to pay for content online. They'll subscribe to Netflix. They'll pay to be a premium member on Spotify. So the idea that news has to be free online won't be an entrenched thought in the mind of future readers.
"We just need to work out what the nexus of value is," Haile said. "If we can find a way to be relevant to this new generation in a way that we can't be out competed by Facebook, we may have something."
Caption: By partnering with streaming services, newspapers have a better chance with getting in front of more audiences.
Caption: The Athletic is an example of an ad-free interface that loads fast and puts content at the forefront.
Caption: Tony Haile
Caption: Podcast advertising is projected to top $1 billion in 2021.
Please Note: Illustration(s) are not available due to copyright restrictions.
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|Publication:||Editor & Publisher|
|Date:||Aug 1, 2019|
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