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Original sin? I don't think so, but ....

Submitted by yelvington on August 30, 2009 - 10:45am

Howard Owens' declaration that the original sin of newspapers was "Keeping online units tethered to the mother ship" is the subject of much chatter this morning. Having been on more than one side of that question, and having been one of the originals, I categorically reject the notion of any "original sin."

Unless, of course, you think inaction is a sin. Those who were in the vast center of gravity in newspaper journalism simply came to work and did their print-focused jobs every day. They were not change agents. They were not inventors. They believed -- rightly -- that their role as journalists constituted a valuable public service and that they should focus on it. While those may turn out to be the good intentions that pave the road to hell, I won't call it "sin."

But back to Howard's assertion, which I find flawed (in its assumption that newspapers haven't tried) but interesting.

The question of how to organize new-media efforts in an old-media company is an old one. I think the first panel discussion on which I appeared back in the mid-1990s focused on that question.

The truth is that newspaper companies have tried more twists and variations than most people recognize. Like the paid-content question that Alan Mutter claims to be an original sin, newspapers have a track record of empirical learnings that perhaps ought to be considered before jumping off into a debate about beliefs.

At the end of the last century I was executive editor of Cox Interactive Media, which ran local websites in a dozen or so U.S. cities and had an ambition of opening operations in the top 50 markets.

Some of the sites were affiliated with Cox newspapers, and with typical newspaper myopia, most people in the newspaper industry think that's what CIM was all about.

But most of the sites actually were in Cox broadband cable markets and Cox television markets. They didn't have the addictive benefit of a daily dump of newspaper copy. They had to create their own content. This included news and sports coverage, but also Web directories, forums, ranking/rating systems, local contests, games and some large-scale efforts to host websites for community organizations.

My time at CIM disabused me of some of the arrogance that newspaper people unfortunately carry into any conversation about the Internet. Research showed that some of the CIM sites matched or exceeded the local market reach of the newspaper-based competition in markets like Providence and San Diego.

And some of the ideas have stood the test of time. At CIM, we evolved a program of going to a community event, shooting hundreds of digital photos, handing out business cards with the website's URL, and posting the results in photo galleries designed to crank pageviews and induce viral link-sharing. The content/marketing program that Morris now runs, called Spotted, was essentially based on that experience.

CIM, which was intended to become a spinoff company, was dismantled in the economic collapse that came at the end of the original dotcom bubble. In the political infighting that followed, Cox threw away much of what it had learned.

The interesting thing about Howard's post is his identification of a principle: "Instead of thinking about how to generate more cash, I needed to figure out how to create a news operation that could exist profitably based on a reasonable expectation for local online revenue." This essentially is what we were trying to do with the thinly staffed CIM studios, although I'd substitute "local media business" for the more narrow "news operation."

This principle is stated by Clayton Christensen as "patient for scale, impatient for profits." And the Harvard crew has many tales of disruptive efforts more effectively being positioned at a distance from the mothership (think about IBM's PC division, which built computers at a Water-Pik factory.)

Several years ago I found myself sucked into one of those painfully chronic debates about paid content. OK, it wasn't exactly a debate, it was a discussion about how we (the online guys) could stop a paid-content movement championed by a publisher and a couple of print circulation people.

Suddenly I had had enough. It all felt paranoid. And I was frustrated by the implicit assumption that we couldn't do anything to build audience online other than pump newspaper shovelware onto the Web. I stood up and announced: "OK, I officially change my vote.

"Put the newspaper content behind a wall," I said. "It'll fail, but that's not important.

"What's important is the question: What should we be doing to build an audience without the benefit of the newspaper content?"

This led to a reconsideration that eventually yielded the blog-centered community conversation model of BlufftonToday.com, where the original plan was to not put any of the newspaper content online.

A radical move, such as setting up your online operations as a separate division, or (in Howard's case) quitting the newspaper business to set out on your own, is an effective way to force a confrontation with that basic question: What should we be doing?

It is a confrontation that does not require a spinoff or a startup. Anyone can confront that question. So, why don't we? Is it sloth? Isn't that one of those ... sins?

Comments

From what I've seen as a younger person in the industry, the 'original sin' for most organizations is lying about their motivations. In nearly every news institution, community papers or big corporate conglomerate, internal politics consistently triumph over sound responses to tech and audience changes; all the talk about economics and public good is nothing more than lip service. Many of the problems/solutions for news organizations are in these "how do we move beyond..." discussions. There's certainly a need to move beyond the idea that monetizing content is the only viable way to fund newsrooms (most of which don't really generate original content anyway), but there's also mid early 2000s issues like: *moving beyond the masthead mentality with reporter branding and site design that doesn't choke content to death *moving beyond the article as the primary element of delivery into collective reporting *moving beyond the limited tech educations of newsroom to adopt free web solutions Tethering online units to legacy media happened because the big-bucks-earning sales forces and their counterparts in the newsrooms around the country care more about their internal policies, ad rates, power lunches, acquired properties and politics than informing their fleeing audiences. Even if there were totally separate business units for online components of the biggest outlets in the top DMAs, they still wouldn't have supported the necessary changes to make their online offerings work.

Steve - the real difficulty in "solving" the death of newspaper companies lies in two facts: Most newspapers failed to recognize the need to evolve their business model until long after the internet and the audience had left them standing at the altar. And now that they're trying to cobble together an online business model, the ad market isn't reliable enough, nor correctly valued to give them the cash flow they need. Good news is, that last part may (eventually) change. While newspapers spent 15 years tinkering with letting their ad staff sell online as "added value" and treating the content medium itself as some sort of "wash behind your ears" chore that they could probably ignore, the content economy took off, surged through its first boom-bust cycle and is now beginning to feel the second boom. I have a half-baked idea that if newspapers had connected (much!) sooner and more meaningfully with their audiences online, they would be a vital part of the ad economy today. In fact, the online ad medium is severely undervalued and always has been - the very thing that led to CIM's decision to shutter most of its studios mid-bust in 2001 and 2002. (Full disclosure - I worked under Steve, managing content in CIM's Orange County and Los Angeles studios) Newspapers had the exalted privilege of owning the text-based ad market until mid-century when broadcast TV began taking larger and larger bites. They pissed and moaned about how the "big" money wound up surging to network, then cable in the 70s, but couldn't compete with moving pictures and just tried to ignore the slow, steady death march of afternoon papers, complacent in the knowledge that at least they owned the overnight news cycle. CNN et al began eating that course of their lunch in the 80s, and they remained cocksure of their dominance of the "serious" journalism market. "Well, yes, cable TV is immediate and, um, visual and all that, but WE are the source of reliable, in-depth reporting, and therefore will always remain valuable." The internet smelled like a fad at first. So they dabbled - the L.A. Times played with a Prodigy-based news product as early as '93 - and, well, remained cocksure. Meantime, the online ad economy, severely devalued by the first crash, still hasn't gained the muscle it should have as the underpinning of the most important and pervasive information medium in history. I think Howard's thesis, quoted above, is right. But until ALL content companies begin charging rates for skyscraper ads that comport with their real impact (and I'd argue they're at least as impactful as billboards, bus shelters and co-sponsored soda cups, if not 15-second spots that cost much more to produce), newspapers just won't be able to afford to do what they should have done a very long time ago - ditch the presses, move entirely online in an ad-supported medium that connects directly with the people who need journalism the most. Twitter, Facebook, YouTube and other social media are helping to drive the value of online ads up, but it's gonna be a gentle ramp. Maybe too gentle to allow newspapers to survive through (and after) the inevitable and time-consuming failure of their impending paywall bandwagon ride.

The point you made about proximity (e.g., IBM PC being far from HQ) is a great way to help ensure some of the other problems you point out. Being too close to the mother-ship can choke off innovation and make you look at everything through the mother-ship's frame. I highlighted that point in looking at the only two significant new successes out of Microsoft in the last 10-15 years (Expedia & Xbox) on my Seattle P-I blog -- http://blog.seattlepi.com/seattlestartupbuzz/archives/177827.asp.

I have a huge amount of respect for what Howard Owens is doing in Batavia. He's putting his money where his mouth is and getting the job done. I know he's making a more precise point about how newspapers relied too much on traditional newspaper content and ad sales even when they set up separate divisions for web sites. I have the contrary thought that what he's really saying is that the mistake newspapers made was in not going out of business sooner. That is, closing down the press and going online-only. I know he doesn't mean it quite like that. In Syracuse, the new media efforts started out as a bulletin board plus a phone-based service called NewsLine, then a web experiment at Syracuse University, then the web site came in-house. It was called Syracuse OnLine at one point, giving you a sense of the times, then became Syracuse.com. There was a try-anything attitude that competed with the likes of The Chicago Tribune and The Washington Post. Eventually it was separated and became part of the new Advance Internet. For early adaptors in the newsroom, it was a melancholy moment, but it made sense to see if it could be a business of its own. How much did it really cost? How much could it bring in? There were downsides too, though. It increased the gap between the newspaper's newsroom and online culture. Early adaptors in the newsroom had to fight to try things. The online staff across town had their peeves, too. In Syracuse, the sibling rivalry mostly worked itself out, but you can say that it delayed the newsroom's engagement with online culture. The separate division still relied too much on newspaper content, but that was not by design. It was because of something that doesn't get enough credit: A decent newspaper staff simply dominates local reporting. Oddly, it was the rise of blogs, I think, that let newspaper staffs get back online in an interactive and try-new-things way. Original sin? Newspapers have probably never really grasped the unbundling that has happened, in the product, process and readership. Too many newspapers have tried to create newspapers for web readers and web sites for newspaper readers. Owens' idea might point at that. Still, I'm contrary enough to wonder: How do we know that newspapers made a mistake? Compared to what? CompuServ? Netscape? AltaVista? Pets.com? The humble newspaper has outlasted many shiny ideas. (I'd like to make that point without defending those newspaper editors' resistance, denial, cluelessness and hostility we're so familiar with.) But in the back of my mind I imagine the publisher of The Kansas City Star, just to pick one that was an innovator in the early years, announcing that "I'm going to close down the newspaper and run a free-classified service from my house. There won't be a newspaper in Kansas City, but I'll get by OK, and the people will love those free classifieds." Many newsrooms needed and still need a kick in the pants. But what if, throughout all this, newspapers did the best anybody could do under the circumstances?

Steve, you're spot-on in this post. The main resistance to total rethink usually comes from salaried hacks who, not unreasonably, don't want a clean slate that necessitates entrepreneurial spirits setting up new models in order to fund journalism as part of broader concerns. But in the end it's still going to come down to subscribers (=cover price!) or advertising revenue (eek!) being won for whatever form the new business model takes.

Online is by its nature a vertical medium — focused on a narrow topic, deep in content, rich in its presentation capabilities. Newspapers are by nature a horizontal medium covering everything from prep sports to international politics with a dash of weather, comics, puzzles and advice for the lovelorn in between. The fact is no "original sin" for the industry exists. Since the early 1990s the industry has been feeling its way, some might say flailing away. Mistakes have been made, sure. But as newspaper organizations experiment they learn — Bakotopia.com, Indy MomsLikeMe.com and the Tribune's HealthKey.com looks like a strong idea — to name three examples. The thing that distinguishes all of these sties is that they are intensely local, narrow in appeal, deep as the dickens and in essence compete with their parent papers for site viewers and ad dollars. These fledgling efforts offer some keys to a successful internet future for newspapers by taking your strengths to your marketplace: Create free-standing Web sites in the topical areas you are strongest in; cut a small group of true believers loose to run the site and let them be in charge of the site as if it were their own business even if at times that means doing damage to the mother newspaper ship. The game isn't over yet. In fact, there are plenty more sins to be committed.

Brian, thank you for your kind words, but I'm not at all saying newspapers should have killed off print. Part of my thinking is in response to the "should have made people pay" mentality as expressed by Mr. Mutter and others. I'm saying, "Yes, make people pay, but make them pay for what they've always paid for (if you can count it as paying for it) -- print." In my model, print stays print and does all that it has traditionally done well, and maybe it survives and maybe it doesn't; but online set free of all print ties can find its own way and develop its own content and advertising models, free of any constraints or obligations to the traditional newspaper and its managers. We wouldn't be having the paid content debates we have to day if the clean-break model had been followed. I can only guess, but my guess is, both print circulation and print advertising would be strong, and we would have a lot more local news innovation if there had been a complete and clean break between operations.

Howard, I confess that it's only what I hear and not what you're actually saying. After the back and forth starting from when integrating online and print was a noble and difficult task, to separating them for business purposes, to integrating again as "everybody" supposedly does online, I think we've reached the point where everything's a niche. Perhaps it's best to specialize in a niche and really nail it. That might be newsprint for some, iPhone apps for someone else. Just as you might be successful with online-only, some contrary sort might decide to try print-only. (They'd better understand just how narrow the niche is.) But that might shake out better than still trying to be all things to all people.