I'm CEO of Newspeg.com, a social news-sharing platform. I've spent 20 years at the intersection of traditional and digital journalism. I've helped to invent ways to read and interact with the news and advertising on computer screens and iPads, and before that, I wrote news stories on typewriters and six-ply paper. I co-founded WashingtonPost.com and hyperlocal pioneers Backfence.com and GrowthSpur; served as editor of Philly.com; taught media entrepreneurship at the University of Maryland; and have done product-development and strategy consulting for all sorts of media and Internet companies. You can read more about me here.
With buzzgrowing over the Kindle 2 and its potential as a newspaper- and magazine-reading device, as well as a bookreader, it's worth remembering that the idea of an electronic tablet for reading news has a long and so far unsuccessful history.
More than 15 years ago, Knight-Ridder's Roger Fidler was famously advocating the creation of a tablet-like device as a way of distributing newspapers electronically. He's still at it, in fact, even though a lot of his vision of an electronic news future was overtaken, first by the Web and then by increasingly portable devices ranging from laptops to iPhones. (When I started out in new media in 1992, I heard regularly that no one would ever be able to read a newspaper on a computer while sitting on the john. Well, the iPhone has pretty much killed that argument!)
One of the problems with Fidler's vision was the notion that the newspaper-reader device had to come from a newspaper company. Needless to say, publishers aren't exactly technological wizzes (CueCat, anyone? Anyone?), and such development is probably better left to the Apples of the world. And now Amazon, whose Kindle offers a glimpse of what a portable electronic news reader might look like.
Undaunted by Knight-Ridder and Fidler's experiences, however, Hearst is trying to develop its own electronic reader, in partnership with E Ink, the company that supplies the core screen technology to Kindle. It's better to let somebody else spend the big development bucks on hardware and then take advantage of their success, rather than to try to develop a specialized product that others publishers may (or more likely may not) also choose to adopt.
While Kindle has gotten good buzz, it's hardly a ubiquitous product; indeed, it seems to be mostly beloved by journalists and a certain class of upscale book readers, and its sales–said to be in the hundreds of thousands–are a fraction of more successful devices like the iPhone.
My guess is that the Kindle is a steppingstone, transitional product, one that points the way toward the portable electronic news reader of the future, but not a big success itself. Apple is rumored to be working on a large-format version of the iPhone that will out-Kindle the Kindle and do many more things; doubtless there are other devices still in the R&D labs–including thin, flexible, roll-up screens–that will provide even better portability and quality. Devices that do much more than just present text on a screen also are likely to be more successful (again, see the Swiss Army knife-like iPhone).
What Roger Fidler dreamed of two decades ago, and Amazon is dreaming of today, still isn't here yet. But it's probably coming, in one form or another. Just not from a publisher.
There's an interesting article in The New York Times about newspapers working with Yahoo to sell online ads. The newspaper partnership with Yahoo has always been a mixed bag, but clearly the ability to leverage Yahoo's Web know-how to teach traditional print ad reps to sell online ads is paying some significant dividends. Some success stories cited by the Times:
A veteran print sales rep from the Knoxville News, who'd never sold online, selling $200,000 in Web ads in two weeks, about one-seventh of her usual annual print sales total.
$1 million in online ad sales at the Ventura County Star in a couple of weeks before Christmas, accounting for 40 percent of the paper's online sales in 2008.
$2 million in online sales in a couple of weeks in January at the Naples Daily News, or more than half the paper's online Web sales in 2008.
Literal money quote:
"If we could do just shy of $1 million in two weeks in a horrible economy, what does it mean for us when the economy turns?" asked George H. Cogswell III, publisher of the Ventura County Star.
Good question, George. Better question: What the hell have you been doing for the past few years in selling online ads? Because it sure sounds like you weren't trying very hard.
There's been endless whining by newspaper executives that they can't figure out how to sell enough Web advertising to cover the decline in print advertising. But stories like this confirm the suspicions that some of us have (backed by too much firsthand experience with ossified newspaper advertising departments) that newspapers simply haven't tried very hard to sell Web ads.
The Yahoo partnership gives newspapers a new ad system and the ability to sell ads onto Yahoo pages. But more importantly, it appears, it's giving ad reps motivation and training to finally–finally–try seriously to sell online. When the Knoxville News has a 35-year ad sales veteran who's never sold Web ads until now, you really have to wonder what these papers have been thinking. Give these pros something to sell and teach them how to do it, and that gap between print and online revenue might really start to close.
A Canadian professor of business and financial journalism–and that's a discipline U.S. journalism schools could use a lot more of–named Christopher Waddell has a very interesting point about the raft of corporate failures we're seeing in the media business. He argues that it turns out that the very concentration of media ownership that many feared over the past couple of decades has actually proven to be an untenable business model.
Indeed, in assembling their media empires, many of these companies became so unwieldy and took on so much debt that they were particularly vulnerable to the economic turmoil that's now rocking the media business. (Just look at the financial problems facing the two most-detested media conglomerates, Gannett and Ruper Murdoch's News Corp.)
Speaking about the tottering financial fortunes of Canadian media giant CanWest, Waddell told The New York Times: "One of the ironies of all this is that people have wondered about the editorial effects of corporate concentration, when it turns out what was created was a financial weakling."
I always thought the editorial concentration argument was bogus–newsrooms are too chronically fractious, and for every newspaper whose quality was allegedly sapped by big-company-think, you could usually find another paper in the same chain whose quality had been significantly improved by conglomerate ownership. But Waddell does have a point: These larger dinosaurs just can't support their own weight anymore. How delicious.
The New York Times, doing what all smart newspapers should have been doing years ago (andsomewere), is finally jumping into the hyperlocal game. It's launching community sites in two communities in Brooklyn and three in New Jersey.
Called The Local, the sites will offer neighborhood-level coverage of crime, schools, government, restaurants and real estate, supported by local advertising. The content will largely be written by community members themselves, with supervision by Times staffers. In other words, the usual user-generated hyperlocal model. One of these days, somebody is going to make it work–based on the glimpses we saw at Backfence, there's no question that there's content, an audience and advertising for such hyperlocal sites. It's just a matter of finding the right formula.
What may be most interesting is how the Times picked the communities in New Jersey. There's a new hyperlocal startup called Patch, founded and backed by some Google alums, that recently launched three sites in New Jersey to cover community news with a mix of staff- and user-generated content. Which three New Jersey communities is Patch in? South Orange, Maplewood and Millburn–exactly the same three the Times has chosen for its New Jersey hyperlocal rollout. What a coincidence.
There's another interesting common thread between Patch and the New York Times effort. The Times sites in Brooklyn will be aided and abetted by journalism students at the City University of New York, under the direction of long-time hyperlocal champion Jeff Jarvis–who also happens to be an advisor to Patch. (Jeff has more detail here.) Small towns sure can be small worlds.
Amazingly, Amazon has backed down on implementing the text-to-speech feature of the latest Kindle (the one that Roy Blount Jr. and the Authors Guild were soupset about). Since this feature acts on a copy of the book the customer has already purchased, I really fail to see why the authors (and publishers) had any kind of legitimate beef. Sure, it might cost them the sale of a spoken-word book–but again, the customer had already purchased the book! It really isn't any different than having it read a book read aloud, or sharing it with someone else.
Still, I guess Amazon feels it has to make nice with the people who are its primary suppliers in the book business. So it will let the publishers decide which books support the text-to-speech gimmick.
As Staci Kramer writes on PaidContent:
The company seems to have realized this isn’t a fight it wants to have—at least, now. Amazon is still building its Kindle library; today’s 240,000-plus titles are a huge leap from the start but not nearly what the company needs to come close to the breadth it offers in print. The automated feature itself is as rudimentary as the experimental web browser, with off-key pronunciation and little discretion. It’s a fun gimmick but not worth a major row.
True, I suppose. But the Blount/Authors Guild argument was silly, and Amazon should have stood its ground.
The ASNE has canceled its 2009 convention in Chicago. How symbolic. With newsroom budgets slammed, getting editors to travel out of town for their annual gathering doubtless became impossible. ASNE hopes to be able to hold its 2010 convention as scheduled. But who knows how many newspapers will be left at that point to send representatives?
I've got an idea: Maybe the ASNE should try a virtual convention on the Web. That would be ironic. Of course, the bar scene wouldn't be quite as good...
Roy Blount Jr. is one of America's greatest living humorists, and in this New York Times op-ed piece, he shows why. Writing about the latest version of Amazon's Kindle book-reader, in his role as president of the Author's Guild, Blount attacks the device because it can read books out loud in a robotic voice. Brilliant, hilarious stuff. Blount even suggests this "read out loud" feature is some sort of violation of author's rights. It's killer satire, I tell you.
Except...apparently Blount isn't kidding. Good lord. We're being overrun by literaryLuddites!
If you want some idea why the San Francisco Chronicle is on the brink of extinction, just take a look at its Web site, SFGate.
It's a perfectly adequate newspaper Web site–and that's the problem. Newspapers have been fumbling their Web sites for years, and that's one reason why the future for the Chronicle, and many other large papers, may be bleak. They've failed to concentrate on building great, useful Web sites rather than merely adequate ones. Satisfied with pasting newspaper headlines and stories on a screen and trying to convince print display advertisers to run online banners, the Chronicle and other papers have been left behind by smarter thinking on the Web. Their cluttered designs are hard to navigate; many still labor under the misconception that readers come to their sites looking for foreign and national headlines rather than focusing on local news; and they've failed utterly to keep up with the latest trends in online advertising and content delivery.
Sure, they've got blogs, maybe a podcast or two (how 2005), possibly some online discussions with staffers, maybe, just maybe, a submit-your-photo feature, or story comments. But where's the aggregation of local content, the hyperlocal and niche sites, the local database maps, the sophisticated ad formats, the aggressive efforts to bring readers into the conversation and solicit user-generated content to augment and enhance expensive professional coverage? You find occasional examples of sophisticated Web work here and there around the industry, but almost unanimously, newspaper Web sites, like the Chronicle's, are adequate–at best. And don't get me started on the amateurish design of most newspaper sites, or the lack of search-engine optimization smarts, social media links, iPhone apps and other leading-edge thinking that's a staple of any good Web company. Newspapers just don't do that.
It's not like the Chronicle didn't have good local examples to follow, sitting as it does at the headlands of Silicon Valley. Yelp is just around the corner from the Chronicle's headquarters at Fifth and Mission. Craigslist is just a few blocks away. Google is just down Highway 101 in Silicon Valley. And so on. All of these were founded and thrived in the shadow of the Chronicle until they themselves cast their own shadows over the paper and its Web site, grabbing away local readers, shoppers, advertisers and others.
The Bay Area is the most fecund place in the world for the development of the Web ideas that have helped cripple the newspaper industry, but the Chronicle seems to have been all but oblivious to what was going on all around it. Like other newspapers, it's been unable to break free of its print shackles and think aggressively and wisely about how to compete–really, seriously compete–online. Hell, SFGate could have established itself as the leading, um, chronicler of and gathering place for all that was going on around it in the technology industry (you know, like neighbors CNet or TechCrunch). But it missed that boat, too.
The problem was, as it is at so many other newspapers, that nobody at the Chronicle or Hearst ever really took the paper's Web site seriously or devoted real management cycles to it. It never was given the proper resources to develop, and with the exception of a visionary or two like Bob Cauthorn, who ran SFGate for a while a few years ago, it never really had bold, imaginative leadership, at any level. (A smart friend who interviewed for a top job at SFGate a few years ago all but ran screaming from the building, astonished at the lack of sophistication he found.)
Corporate machinations multiplied the problem. A couple of years ago I had a fascinating and thought-provoking dinner with a group of high-ranking Chronicle and Hearst executives. We brainstormed way outside the box about how to rethink the paper's Web site as a revolutionary guide to the best of the Bay Area, tapping into myriad non-newspaper sources to create a compendium of local news, information and opinion. It was heady stuff, and then ... nothing. I heard later that the problem was that the Chronicle execs didn't really control the Web site; the Hearst execs in New York did that, and they had their own, different priorities. We had the right people at the dinner table, but between them, they were unable to make significant changes to reinvent the Chronicle's site in a way that might have made it a breakthrough Web product. Opportunity lost.
So now the Chronicle, and SFGate, are on the brink. Maybe Hearst can make the drastic cuts necessary to save its San Francisco operation, in what now looks like the best-case alternative to closing the paper. But it's hard to believe those cuts won't also gut the already thin SFGate Web operation. And so the Web site, which should have been a big part of the solution to the Chronicle's woes, will totter on, nothing better than adequate–if the whole shebang survives at all. What a pity.
PS: Jeff Jarvis offers a telling contrast between the Chronicle and Google. And Marc Matteo has an excellent overview of what's wrong with newspaper Web sites.
OK, who had the San Francisco Chronicle in the daily newspaper dead pool?
Hearst Co.'s announcement that it is considering closing the Chronicle, barring a sale (less than unlikely) or significant concessions from its unions (less than likely) really is no surprise. The Chronicle famously has been losing at least $1 million a week for years, and Hearst is conceding that the losses have increased recently as the newspaper economy has crashed. The biggest question may be how Hearst has managed to hang on for so long. As former Hearst CEO Victor Ganzi ominously warned more than two years ago: "We either had to fix it, sell it, or shut it down."
That sounds like the three options the company is looking at now. As a result, Hearst has now brought the Chronicle officially to the brink of extinction, which would make San Francisco the first major American city without a major daily newspaper (in respect of the sick, we'll hold off any jokes about San Francisco never really having had a major daily newspaper!).
There do seem to be a couple of possible outs for Hearst, short of a shutdown, which Ken Doctor recaps in his excellent analysis. Basically, they boil down to a) cutting deals with the unions to reduce costs sufficiently to allow Hearst to successfully transition to its revolutionary and cost-saving print-outsourcing plan, due to kick off this summer; or b) selling the paper to William Dean Singleton's MediaNews Group, which owns most of the rest of the papers in the Bay Area. But the latter plan seems unlikely because MediaNews is cash-strapped and federal antitrust regulators may not look kindly on the deal. Besides, Hearst is essentially MediaNews' banker; it's hard to see the company funding somebody else's attempts to revive the Chronicle.
Maybe Hearst can stanch the bleeding, with help from the unions. Maybe it can find a way to get MediaNews to take the Chronicle off its hands. Maybe there's some rich (if foolish) buyer in the Bay Area who's always thought it would be fun to run a newspaper. Maybe Hearst can pull off some sort of triple backflip and close the Chronicle but revive it as an online-only paper, as it's allegedly considering in Seattle.
But most likely, the Chronicle will be shut down before the year is out, and San Francisco will be missing its major newspaper. It's time for smart people to begin thinking about the phoenix that arises from the Chronicle's ashes, more than likely a smart, online-only, community-oriented, economically operated new kind of journalism product.
ChiTown Daily News founder Geoff Dougherty thinks it's possible to operate a respectable news site in a major city for $2 million a year. That may be a tad on the low side (especially given the Bay Area's cost of living), but he's not the only one running numbers that look something like that. That's a bargain-basement operation, compared to what the Chronicle costs to put out, but it's an interesting model. It's time for somebody, some city, to find out if that model really works. Let's begin inventing the future of local news, information and advertising. I'll be writing more about my vision for these post-newspaper products over the next few days. But in San Francisco, that future is about to begin.
Philadelphia Media Holdings, publisher of the Philadelphia Inquirer and Daily News, filed for Chapter 11 bankruptcy protection tonight, after failing to reach a new financing agreement with its lenders. The company was several months behind on its debt payments.
PMH is a formerclient, and I have many friends there, so it's difficult for me to say much about this. But I'm not really surprised. Despite rosy statements about the state of the business by PMH CEO Brian Tierney–including some in internal meetings this past week, I hear–the situation there has been untenable for some time. As was the case at the Minneapolis Star Tribune, the combination of enormous acquisition debt, the declining state of the newspaper business and the struggling economy was a lethal recipe for local owners. Tierney's a smart guy, but he and his partners may have been, shall we say, a bit too optimistic and idealistic about what they were getting into when they purchased the papers two years ago.
While Tierney insists that the papers' operations won't be affected by the bankruptcy filings, that's hard to believe. Indeed, it may not even be Tierney's call–as the bankruptcy court and the bankers step in, Tierney's control of PMH may be substantially weakened. At best. Even before the bankruptcy filing, there was ongoing speculation in Philadelphia about further significant staff cuts and perhaps even the shuttering of the Daily News (it sure seems odd to run two newspapers in the same city these days, doesn't it?). With the creditors and court in control, the choices in Philadelphia are likely to be much less benevolent than they've been under Tierney. That would be unfortunate for the many good people at the Inquirer, Daily News and Philly.com.
We'll see what the next chapter in this Philadelphia Story is after Chapter 11. But with PMH joining Tribune Co., the Star Tribune and, most recently, Journal Register in bankruptcy court, the newspaper industry's victims list continues to lengthen. And sadly, we're very likely to see more stories like this in the months to come.