Sips from the Firehose


Sep 25

Yes, Investigative Journalism CAN Pay. And Pay Well.


Posted: under Digital Migration, new media, newspaper crisis, Newspaper Deathwatch, Newspapers.
Tags: , , , , , , , , , , , , ,

Mediapart in France is profitable because it gives readers what they are willing to pay for.

Imagine that.

mediapart.fr front page

The Mediapart organization makes its living by doing hard-hitting investigative journalism that its audience is willing to support. They also make a point of including lots of video on their pages.

Quick hit here for my students, who are increasingly upset about their job prospects after graduation.

I shared an article from Neiman about the upheaval in the newspaper business in France. Apparently, the same problems that plague the French economy at large are at work, writ small & exceedingly acerbic, at the major newspapers. They are tech-phobic, rely on business models that no longer fully function, and react angrily to anyone threatening the promise of a cushy work situation with guaranteed employment and 1/4 of the year spent on vacation.

Can’t imagine why that can’t cut it in a world increasingly dominated by the internet work ethic of, “If you eat lunch … you ARE lunch.” Somehow, I don’t think this will fit in with a languid afternoon at a sidewalk cafe with a nice burgundy and a baguette slathered with brie. With accordion music wafting in the background.

But about 2/3 of the way down the article, there appeared these grafs, which I am going to excerpt here, although I do urge you to go to the Neiman site & give them some traffic-love, ’cause @petergumbel did a damn good job with this write-up:

Edwy Plenel, for one, is incensed by the conflicts of interest inherent in the French press. But then that’s not entirely surprising, since outrage is Plenel’s mojo.

He has come a long way since his revolutionary youth, which he wrote about in a 2001 memoir. He made his mark as an investigative journalist at Le Monde; one of his most celebrated scoops was uncovering the role of French intelligence in the 1985 sinking in New Zealand of the Greenpeace boat Rainbow Warrior. He made the Elysée so nervous that it illegally bugged his phone during the presidency of François Mitterrand. He spent a total of 25 years at Le Monde, including a stint as editor in chief, but he left in 2005 during one of its sporadic crises, after attacks on his management style.

He launched Mediapart as a subscription site in December 2007. Three years later it was at break-even. Today, it’s racing toward 100,000 subscribers, each paying the equivalent of about $12 per month. This year he expects the site to make about $2 million net profit on just over $10 million in revenue. It has a staff of 50, 33 of whom are journalists. It now outsells Libération, which has almost six times as many staff members. [Emphasis mine – dlf]

The secret: a laser focus on exclusive news, especially revelations of high-level political and financial skullduggery. Mediapart’s subscriptions soared in 2010, the year it broke the story about a convoluted political and financial scandal involving France’s richest woman, Liliane Bettencourt. They leaped again in 2013, after it revealed that the then-budget minister Jérôme Cahuzac, whose job included fighting tax evasion, himself had an undeclared Swiss bank account and had transferred funds to Singapore. After denying the allegations for months, Cahuzac eventually resigned, acknowledging that he had lied to parliament and to President François Hollande.

Work the numbers, folks. $10 mill in revenue-$2M profil = $8M in expenses. $8M/50 employees = $160K/yr per employee. Figure about 40% of that per-employee allocation is insurance, pension, and building/maintaining the site & gathering news costs, and you still get a salary of $64K/yr on average. For a journalist, that ain’t bad. Plus you’ve got a warchest of $2M that you can throw at a big story, should one come up, and to use to build out the site & extend its reach.

So. There’s a lot going on here. I’ve written in the past about how I disagree with the authors of The Death and Life of American Journalism, who called for exactly the kinds of government subsidies for newspapers that are allowing them to continue to try to deny reality, and live in a fantasy-bubble. At the time, I was reacting to what I’ve seen in Latin America, Georgia, Kazakhstan and other places where allowing the government to get its hands on the revenue stream is akin to letting criminals loop a choke-chain around your throat. They can lead you around by it, and if you start getting out of line, all they need to do is give it a quick, sharp yank, and you fall back in line, suitably docile.

I’ve seen that happen. First-hand. In Venezuela, when I was a very young editor.

Government subsidies are kinda like this. Nothing really sticks until you try to do something that the person holding the leash doesn’t like.

The solution that Mediapart has come up with here may not last. It may not work everywhere. But it’s something that makes a lot more sense to me than journalism that exists as a kind of state-supported performance art piece. Because I’ve seen that as well: journalists who are completely disconnected from the concerns of their audience, sporting paternalistic, condescending attitudes, producing self-indulgent “investigations” that nobody really reads, and that don’t really threaten the people who give them checks each month.

So when I see that Mediapart is actually making a pretty nice profit, running with a lean staff, and dedicating itself to serving the interests of its audience, it pretty much makes my day, particularly in light of the grim news out of the LA Register, NBC news, and pretty much every other traditional media outlet recently.

Look, I am not hooting and hanging on the rim here, delighting in the travails of people still stuck in jobs at tottering media empires, hanging on for dear life through ownership changes, strategy changes, and promises that melt away like morning dew.

Long-term, market forces are going to prevail. If journalists produce a product that people want, and give them a means by which to support/purchase/share it, then that audience will fight to ensure that this important part of their lives is still there. The very first case study I ever did was centered around that fact. It makes me sad to see so many journalists, who base their entire journalistic ethos on pushing people and institutions to change, to adapt to the times, to leave behind (even if painful) the habits & traditions of the past … ignoring their own best advice.

Liberation may not be a cafe. But it may also not be an outlet for journalism much longer either.

 

 

 

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Nov 30

This Week in Paid Content: Thanksgiving Week


Posted: under Uncategorized.
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In the spirit of the season, I hereby give thanks that there is such an open and vivid discussion about the core issue of monetizing online content.  If we’d had this kind of focus on actually taking the utopian dreams of “all content, everywhere, all the time” and making it work back when I was in my Web 1.0/dot-bomb startup days, we might not have cratered so spectacularly.

So this week, we’ve got a rising level of chatter about Murdoch’s media properties banning Google links in favor of getting paid by Microsoft’s Bing search engine, the BBC throws a wrench into paid content in England (and perhaps everywhere else), the idea of sprinkling porn onto newspaper websites to see what happens is floated, and what orcs and dwarves can teach newspapers.

Murdoch’s bluffing about Google to try to extract money from Microsoft’s deep pockets

This somewhat NSFW (lots of cussing) take on Murdoch is by someone familiar with the way that Murdoch papers like The Sun always seem to pick the winner of an electoral campaign.  Not because they’re so influential that the person they anoint goes on to win – but because Murdoch is canny at figuring out who the top dog in any fight is, and busies himself sucking up to them as soon as possible to maximize his profits. http://www.techcrunch.com/2009/11/28/rupert-murdoch-google-nsfw/

By convincing Bing that there’s a chance he might drop Google – for the right price – Murdoch suddenly has a new partner falling over itself to give him prominence in their search results, on his terms. Sure enough, Microsoft has just agreed to help fund the next-generation search crawling protocol, ACAP, which gives content owners like News Corp more control over how their news is indexed.

(snip) And that’s where we see Murdoch’s real genius: he has managed to use his illusion of influence to get all of these benefits without having to commit himself to anything, or expose himself in any way. There is no way in hell that News Corp content will vanish from Google and yet with every headline asking whether Google should be worried or suggesting that other companies might follow Murdoch’s lead, his image as a kingmaker is strengthened.

McClatchy starts sending out notices, but still claims paywalls are not imminent

Talk about mixed signals. The terms of services for its websites are all being changed, but that change doesn’t actually mean anything is changing. Except, of course, if it does. If they eventually decided to charge for content, they will clearly notify the readers, but in the meantime, please make coming to the site a habit and would it kill ya to click on the ads now & again? http://www.editorandpublisher.com/eandp/news/article_display.jsp?vnu_content_id=1004041770

A Perpetual Recession for Newspapers

Rick Edmonds, who writes The Biz Blog for Poynter, says that news organizations have lost $1.6 billion that was used to cover news, and that even when the economy recovers, newspapers won’t: http://www.forbes.com/2009/11/18/newspapers-advertising-rick-edmonds-poynter-business-media-edmonds.html So maybe we should all just learn from the porn industry – or maybe even start putting porn on our sites, to see if maybe that will get people to pay for our content.

The building of micropayment systems, like the one being developed by Steve Brill, is a hotly debated issue. Wouldn’t it be helpful for this kind of system to be established first with Web content that really drives users–say, pornography?

Sure, but that’s not an option for newspapers. There have been experiments with these kinds of systems in Denmark, where several companies tried it at the same time. The problem was that they couldn’t answer peoples’ security concerns. The experiments turned out to be a dud.

“Knock yourselves out,” Google yawns.

The head of newspaper industry bête noir Google News says in an interview that publishers are free to do whatever they want with their content.  Google is apparently willing to work with publishers to do whatever the publishers demand with their content – list it, ignore it, work with it to implement a paywall, whatever. http://searchengineland.com/josh-cohen-of-google-news-on-paywalls-partnerships-working-with-publishers-29881 The easy confidence that is displayed here is the result of Google’s near-monopoly position in the market

Removing News Would Have Negligible Effect on Google

This study by German research company TRG shows that even if all news was taken off Google, that would still leave about 95% of Google traffic intact for them to monetize. http://paidcontent.co.uk/article/419-research-removing-news-would-have-negligible-effect-on-google/

Financially, then, Google doesn’t depend on the publishers’ content. “In comparison, if you detracted Wikipedia from the results, 13 percent of the number-one results would be gone,” said Christoph Burseg, the CEO of TRG, the research company that ran the survey.

BBC: We won’t charge for online news

Now this has got to be raising Mr. Murdoch’s blood pressure a bit. Online news paywalls only work when the competition plays along too (see the case study I did on the disastrous experiment of El Tiempo in Spain, & how they lost their market share to a formerly laughable upstart).

http://www.guardian.co.uk/media/2009/nov/24/bbc-wont-charge-online-news A more interesting discussion is brewing, about what to do about content that is not just re-purposed BBC news, but that is specifically produced for the online editions. Viz:

However, Lyons also questioned the future of content created for online that is not directly related to specific BBC programmes, asking, “where should the boundary be drawn” between this and “the online expression or extension of BBC programming”?

Wall St. Journal’s price to go Bing-only: $15 million

There’s been an increasing amout of space devoted to what Murdoch is going to do to start moving all his content behind paywalls, and away from the hated Google “parasites.” Business Insider backwards-engineers the numbers that de-listing from Google would cost the WSJ, and comes up with $10-15 mill. http://www.businessinsider.com/microsoft-should-pay-up-for-exclusive-access-to-the-journal-2009-11

If Microsoft really wanted to induce Murdoch to ditch Google, it would therefore only cost $10 – $15 million. Maybe more if Murdoch wanted a premium. Considering Steve Ballmer said he’d spend $5.5 billion to $11 billion over the next five years on Bing, this is nothing.

More on the Murdoch-Google fight – seems the Denver Post and Dallas Morning News may follow in his footsteps

Interesting that Dean Singleton has come out and said that readers in Pennsylvania and California will get hit with paywalls starting next year, and the DMN is upgrading itself to a “definitely maybe” status. http://www.bloomberg.com/apps/news?pid=20601109&sid=aRVlZEzbmNu0 A further article from the Independent about what publishers in the UK are thinking on this issue http://www.independent.co.uk/news/media/press/british-press-split-in-two-by-wappingrsquos-great-gamble-1825806.html and http://paidcontent.co.uk/article/419-has-the-times-got-it-right-with-its-online-charging-plan/

And finally, a meditation on whether Murdoch’s plan for paywalls will run afoul of anti-trust laws http://www.guardian.co.uk/media/2009/nov/05/murdoch-pay-wall-anti-trust

“Not a cat’s chance in hell” of successfully charging for online content

The CEO of the Future Publishing Group said that there is no hope for paywalls for general news because of the ubiquity of free models, particularly in the UK market. http://www.guardian.co.uk/media/2009/nov/26/charging-mainstream-news-future-chief However, Future are experimenting with specialized and niche content to see what the market will bear.

The group has taken a bullish approach to pricing its print magazine titles, with an average cover price of £5, up from £4.70 this time last year.

She cited a promotion of the new album from former Guns N’ Roses guitarist Slash, which is being exclusively attached to a special edition of Classic Rock magazine for £14.99.

Americans less willing to pay for online news

The New York Times finds that less than half the people in the U.S. are willing to pay for online news, and even at that, they will only shell out $3. http://www.nytimes.com/2009/11/16/business/media/16paywall.html?_r=2&ref=media Apparently, there’s some kind of fundamental disconnect going on at the NY Times, between top management hell-bent on charging for content, and the weary soldiers in the trenches, protesting that this will not work, has not worked, will never work, and producing article after article that seemingly is not read by their own bosses.

“Consumer willingness and intent to pay is related to the availability of a rich amount of free content,” said John Rose, a senior partner and head of the group’s global media practice. “There is more, better, richer free in the United States than anywhere else.”

If readers are willing to pay – they prefer micropayments and only pennies

The analysts at Continental Research found that 63% will not pay for news, leaving only 37% who will – and at that, only willing to pay about 10 cents per article. http://www.continentalresearch.com/media_centre/press_releases/?ID=149 More about this at http://paidcontent.co.uk/article/419-research-readers-favour-news-micropayments-but-theyll-only-pay-pennies/

James Myring, Head of Media at Continental Research says “The amounts may sound small, but it is better to get a lot of people making small one off payments, than virtually no-one paying a higher subscription. For a comparison, think of the mobile industry, profiting from lots of small payments for text messages.

London Times Editor says online paywalls are “fight of our lives”

There’s the by-now predictable bashing of Google and the other supposed “parasites,” but the one actual realization is buried at the end of the article. http://www.pressgazette.co.uk/story.asp?sectioncode=1&storycode=44649&c=1

Harding said the Times wanted to improve its relationship with its loyal customers through home delivery and through its recently launched Times+ membership programme.

He said: “Historically, newspapers have treated their best customers worst and their worst customers best.

“We give the paper away to people who could not care less and we pay little or no attention to people who love it and read it every day.”

What newspapers can learn from orcs and dwarves

This is actually something that I’ve felt for the last year or so – if we’re going to try to get young people to try & buy, then we’re going to have to emulate the things that they are already comfortable doing so with. http://paidcontent.co.uk/article/419-the-wow-paywall-what-newspapers-can-learn-from-orcs-and-dwarves/#comment_63034 Basically, the World of Warcraft guys are minting about a billion a year from online content – and there are a bunch of key points to their service that newspapers should study, if they actually want to make money, as opposed to just slamming down paywalls and pretending that the rest of the world will care (or even notice).

News as gaming: Could newspapers similarly harness the human need for interaction and stimulation and sell not just boring text news but access to a shared experience? Sure, there’s MySun, MyTelegraph and “tell us what you think in the comments below”, but that’s a marketing ploy to drive page impressions and encourage more content consumption. The lesson from gaming is that people won’t pay for content they can’t help shape themselves—or project their own personal narrative onto.

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Nov 19

Wallflowers at the New Media Dance: Newspapers Can’t Decide On Paid Content


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Due to some intense consulting projects, multimedia presentations at national conferences, and BizDev meetings with like-minded New Media entrepreneurs, there has been quite a gap in my updates on the whole “Will they or won’t they” kerfuffle over paid content. This should get us up to about last Friday; tomorrow, I will post this week’s follies – and there have been a lot of them.

The overriding theme these days seems to be borrowed from the debate over the war in Afghanistan: dithering. Waffling. Hemming and hawing.

The newspaper industry is shifting from foot to foot, licking its lips, and generally acting like a 14-year-old boy at his first school dance, afraid to take the Big Leap.

This is the screen that pops up on Newsday.com, bugging you to subscribe.

This is the screen that pops up on Newsday.com, bugging you to subscribe.

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Sep 25

This Week in Paid Content Sept. 19-25


Posted: under Uncategorized.
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This week: I attend the Digital Family Summit (pictures of which have already appeared on this blog) La Patria expands reader benefits packages, Clay Shirky hopes for a “thousand flowers” to bloom, Seth Godin indulges in some “brandjacking” and the Economist’s story on the global effects of the mobile revolution is absolutely not to be missed.

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Aug 28

This week in the paid content debate: Aug. 24-28


Posted: under Digital Migration, new media, Newspaper Deathwatch, Newspapers.
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This week’s debate is not as acrimonious as in the past (although there are exceptions to that, of course), and in the wake of the biz models released by the Aspen conference, some people are taking building new revenue streams seriously.  At least, they say they are.  It turns out that a lot of what has been reported in this paid content debate is a little like Microsoft software releases: trial balloon “vaporware.”

Page design at Rue89.com looks a little like what splatters on the side of the carny Tilt-a-Whirl after you load it up with a buncha 10-years olds who've spent the day eating cotton candy and mystery meat hotdogs.

Page design at Rue89.com looks a little like what splatters on the side of the carny Tilt-a-Whirl after you load it up with a buncha 10-years olds who've spent the day eating cotton candy and mystery meat hotdogs. I think the boxes up & down the sides are supposed to be clickable ads, but they were inert when I tried them... (click for larger)

The illustration here is of a new French news site that is apparently taking off at Rue89; I can’t decide whether the chaotic design is totally off-putting, or intriguing because it basically violates every rule of page design.  Also, I can’t hear the word “Rue” in a title without flashing to “Murders in the Rue Morgue.” Or some B-movie villain twirling a moustache and chortling, “You’ll rue the day, Rex Manly!”

As a bonus, this week I’ve broadened the focus a bit to include some big-picture thinking from some of the unusual suspects; Doc Searls has a post wherein it is posited that what we think of right now as the internet is just a finger pointing in the direction of what this thing is actually going to grow into.  Which should fuel a couple of late-night dorm-room debates, if nothing else…

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