Tag Archives: business models

Local TV news: Waiting for the other shoe to drop

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Photo: CC from flickr user Lachlan Hardy

Remember recently how Alan Mutter warned that the business of local TV news — supported primarily by expensive advertising on its flagship news programs — was about to be newspapered? That is, to have its very business model rendered, eventually, moot?

Well, here are two more signs that the other shoe is dangling by the merest nanometer of fingernail for local TV news. The first sign is about as concrete as you can get and the other is informed speculation about what Apple (and to a lesser extent, Google) may be up to in the TV space, as soon as this coming Monday.

First, the news, which, here in Baltimore at least, is not good for the news. David Zurawik reports in The Sun that viewership for 11 p.m. newscasts at the ABC, CBS and NBC affiliates has plunged over the past five years in the key demographic of viewers 25 to 54 years of age:

  • WBAL (NBC) down 62%
  • WMAR (ABC) down 56%
  • WJZ (CBS) down 52%

That’s right: The winner of that horserace lost only about half of its 11 p.m. audience.

The usual suspects are cited in the article: The Internet (correct – how much of the late news is actually news for people who are interested in the news?); Our Changing Lifestyles (if this is another word for choosing how to spend a half hour and finding the local tv news wanting, then correct); The arrival of the dreaded Nielsen People Meter (whining and misdirection — if the more accurate and precise tool shows a drop in audience, what does that say about those figures you reported for years using the less precise tool of a hand-completed diary?).

But, to me, the key here is that all of this plunge happened before the onslaught of hyperlocal competition from Aol’s Patch, Yahoo, Fwix and others just now threatening to wash away the footing from under local tv and newspapers. If the past five years have been interesting, the next five are starting to look, well, Biblical.

. . .

And now, the speculation, comma, informed division.

Remember Steve Jobs “hobby,” Apple TV? It was a set-top box released in 2006 and, largely, un-updated in any compelling sense since then. You can rent movies through it, watch video podcasts, show off your photos and watch YouTube videos. Not bad, but you can do a whole lot more with a Boxee box.

There’s currently a growing groundswell of informed speculation (which, in the Apple community, is often 2/5 wish-fulfillment and 3/5 tea-reading) that as soon as this coming week’s World Wide Developer Conference, Apple will reveal a new approach to Apple TV that could very well shift the paradigm for how we “watch tv” in the same way that they changed how we listen to music when iTunes went from a hobby to a full-blown business.

And no one has done a better job of channeling that combination of dreamy-thinking and clue-sifting than Adam Lisagor, in his post titled iPad TV:

I’ve owned and used an Apple TV box for two years. When I found out it could be “opened up” to allow for additional media, it started to overtake my usage of my DVD player and my cable box. So if Apple TV has been, up to now, a hobby, I have been right there with it, a tinkering geek.

But would Steve keep a hobby around for so long without any real plans for it? … Now I’m not one to get all drooley over rumors (yes I am) but when Engadget broke news last week about the next version of the Apple TV box being 1) cheap ($99), 2) run on iPhone OS and 3) streaming-only, without internal storage, I got excited. There are pieces of this hobby that are starting to fit together, and once they do, the hobby will have matured into something important.

For one, what of the massive $1 billion data center Apple’s building in North Carolina? I’ll just echo what others have speculated: this will be where our video originates when we pluck it out of the sky and siphon it through all our devices (including the cheap, tiny new box that sits by the TV).

… It could even be that the Apple TV is the lynchpin of the whole operation, the way that iTunes started as a “hobby” that organized our music collection, and revealed itself to be a hub upon which more than one industry was redefined.

It could be argued that this could be actually good for local stations — allowing them to get their news video in front of even more people in non-traditional channels — but if they don’t think of a way to monetize that video, it’s not. Would you pay 99 cents for access to a video of aftermath of a car crash or a house fire? I’m guessing no.

The reason local television stations (and, under the same model, newspapers) could previously rake in all that advertising cash isn’t so much about the content, but about the content-aggregation. For one discrete half-hour a day, they could guarantee advertisers that a sizable percentage of the local population would tune in for the news/sports/weather bundle and, likely, see the ad in the bargain.

See above for why that’s already no longer working. If Apple and Google get serious about TV, it probably just adds to the pain for local TV stations.

This entry was posted in Uncategorized and tagged apple tv, audience, business models, computing, google, local tv news on by Tim Windsor.

Sam Phillips rewrites the music business model. And plays guitar. And sings

Sam Phillips is not just a singer-songwriter, she’s a mogul.

Well, okay. A mini-mogul. And she’d probably bristle at even that. But through her year-long “Longplay” experiment in making music in semi-public for a paying audience, she’s set herself up as a fascinating amalgam of record company exec and free-wheeling artist.

And what’s really neat about it, it’s allowed average fans to become patrons of her art. Well, mini-patrons. For a dollar a week, anyone can buy into the experiment, directly supporting her work and getting early access to the music as it is recorded and made available to paying members (if you come in late, you still get access to all the music already released).

spacer I’m reminded of this because her latest EP, Old Tin Pan, just came out and, once again, I’m getting to enjoy new music and she and her band are able to (I’m assuming here) keep the food on the table. Or buy some nice shoes. Whatever. And it’s really not about the money, but about the support: I pay because I want her to keep at it. There are lots of other performers I’d gladly support similarly, if they’d only ask.

Think of this the next time someone says people won’t pay for anything online. They will. We will. We just won’t pay for crap or commodity. I’ll pay for Sam’s music, or Evernote’s service or great iPad apps like Appigo’s ToDo or the amazingly useful Digging Into WordPress e-book.

There’s a business model for you: Make things people want to pay for.

This entry was posted in Uncategorized and tagged business models, music, music business, pay, performer, play guitar, plays, sam phillips, sings, the music business on by Tim Windsor.

Do pay walls create new opportunities?

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The New York Times, as expected, seems to have settled on a date for the paywall to go live: January, 2011.

There’s no point in hashing out, again, whether or not this is a good idea for the New York Times and the many other major metro papers considering such a move. The one good thing about paywalls going live is that the theoretical questions will finally be answered in the real world.

No, what’s interesting is whether this is a good idea for other sites serving those same markets. If, for instance, The Chicago Tribune eventually opts for a paywall of any kind, do the people in the newsroom of WLS and other local media bliss out over the potential for reaching more news consumers? What about the rapidly growing ecosystem of micro-local news and information sites serving communities and towns? If your local newspaper walls up, will you pay, or find other sources?

By stepping back from a 100% free model — no matter how carefully (and slowly – we’ve been talking about this for years) — the large news sites can’t help but create some amount of vacuum into which the smaller sites — and audience — will flow.

But that’s where this all gets very interesting. Because if we’ve learned nothing else in the past decade, it’s that gathering a large audience — “eyeballs,” as the ad guys used to say — is no longer enough. Large publishers and tiny publishers need to cover their costs and make a little profit in the bargain if they’re going to continue publishing. So flowing into the vacuum isn’t enough for the upstarts — they need real business plans.

Recently in the NY Times Magazine, there was a long look at the business models of the non-traditional publishers that have emerged in recent years. It strikes more of an elegiac tone than I think is entirely appropriate, implying that the task is Sisyphean, but it’s essential reading for anyone trying to understand the struggles the journalism business model is facing and will continue to face.

The overriding theme: The future is much, much leaner for journalism, and that business models will need to change, radically, to accommodate that fact:

…the new world could end up looking a lot like the old one, albeit with smaller newsrooms and new players. Politico replaces the Washington correspondent, TMZ is the gossip page and you can get coverage of your baseball team directly from MLB.com, which employs professional sportswriters. In cities like San Diego, New York and Washington, online start-ups are taking on metro news coverage, hoping to tap local ad markets. All of these publications have been hiring real, full-time employees — as have nontraditional providers like Yahoo, which is constructing a new political news site.

If you’re a journalist or a publisher, whether you read that passage and weep or rub your hands with anticipation and hope is a good indicator of what the next few years hold in store for you.

Photo: Creative Commons license, flickr user Shawn Econo.

This entry was posted in Uncategorized and tagged business models, create, Journalism, lean, local news, news media, pay, radically, wall, walls, windsor on by Tim Windsor.

Can an InfoValet guide us to a business model?

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Photo by Hushed Lavinia

Martin Langeveld reports on a conference focused on the notion of an “InfoValet.” It sounds like attendees at the conference spent a lot of time thinking of ways to describe what they’re onto, but I’d put it this way, from a consumer perspective:

A universal logon system whereby users “pay” for access to information with (secure) information about themselves, rather than with dollars.

Langeveld says, “While a system like this will not necessarily save newspaper publishers (because, for one thing, it will take some time to gain traction), it has the potential to help save journalism by enabling online news publishing at a different scale. While the New York Times could be an InfoValet network member, so can a blogger or micro-local news site, and each can benefit proportionately to their traffic and content value to advertisers and consumers.”

Interesting idea, though any attempt to build a new ecosystem from scratch is going to meet with a certain amount of stubborn resistance. Perhaps the recent announcements by Google and Facebook, opening their logon systems to other sites, might provide some readymade structure for the InfoValet idea.

This entry was posted in Journalism and tagged business models, news, newspapers on by Tim Windsor.

Print less to save the paper and the business

This is just about the most challenging and possibly true sentence I’ve read in weeks:

Two fat newspapers each week and a robust web platform will have more impact than five or six skinny papers and a site that’s not foremost in the newsroom’s mind.

Martin Langeveld, who blogs at News After Newspapers, makes the case that local newspapers are on the road to ruin if they continue to publish every day in print. His recommendation: Print two big papers weekly, on Thursday and Saturday. Profits do shrink under his new model, but at the end of five years, he says they’re much more robust than they would have been following the existing 7-day model to its slow death.

I do hope he posts his spreadsheets, though, so we can all poke and prod at the assumptions.

People like Langeveld are reinventing an industry, idea by idea.

Read the entire proposal here.

This entry was posted in Journalism and tagged #newsbiz, business models, newspapers on by Tim Windsor.

Let’s put the government in charge of journalism!

Writing in The Mediashift Idea Lab on pbs.org, David Sasaki wins the award for the longest argument yet in favor of government funding of the failing journalism business.

I try not to get into outright arguments here, but this seems to me to be a really, really bad idea. You can’t micro-manage every single industry with bailouts and new taxes to support them. If US automakers, for instance, can’t build cars that people want, then they should contract, combine or even, in the most extreme outcome, disappear. We won’t have any shortage of vehicles, as better-run companies slip in to fill the void. That’s cold, true, but that’s also the marketplace in action.

Same goes for journalism. If newspapers have created the perfect storm of outdated content and revenue models at the very moment when user consumption patterns are changing radically, then that’s a bright neon sign that it’s time to change. Not that it’s time to find a deep-pocketed government benefactor to allow things to operate as they always have.

But don’t tell that to David Sasaki. He’s thinking about the National Journalism Foundation, funded by the federal government. Which, as we all know, is really you and me:

The National Journalism Foundation would essentially serve as a re-invented Corporation for Public Broadcasting. Annual funding should increase from $200 million to $3 billion. (One percent of the total cost of the Iraq War; four percent of the federal bank bailout.) Similar to the NSF, the National Journalism Foundation would regularly award grants to individuals, organizations, and institutions that propose projects which serve to better inform the American public about their communities, government, nation, and the rest of the world. PBS and NPR would, of course, continue to receive funding, but other organizations and projects like EveryBlock and FiveThirtyEight.com, which provide important information to the public but don’t attract advertising revenue, would also be considered for funding.

As described, it sounds sort of enticing. Let’s fund the the cool startups. Let’s tax those “telecommunications giants” (who will, no doubt, totally absorb these new taxes out of the kindness of their bleeding hearts) and give the money away to a super-sized Corporation for Public Broadcasting. Yes, let’s. And Popsicles for everyone.

Or, publishers could look down the long-barrel of changing realities and change in ways that will allow them to continue in the business of informing people while still making a profit. But they surely won‘t do that if the Gravy Train is about to pull into town, just like GM won’t change if it’s guaranteed a future through taxpayer bailouts.

And what’s really the worst thing about this? Live for 5-10 years under such a system, and the bulk of the press will be dependent on the government for funding, essentially defanging an already gap-toothed watchdog.

Sorry, I’m not buying it. Journalism is currently screwed, but that’s a good thing. It’s finally forcing some real change. Let’s not screw that up by taking away the only incentive they have to change: fear.

This entry was posted in Journalism and tagged business models, government-funding, Journalism, taxes on by Tim Windsor.

New Business Models for News: Rebuilding the Newsroom

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Photo by John Smock, CUNY

At the CUNY summit last week, I was assigned to the group that looked at rethinking our newsrooms to meet the current financial imperatives. Or, as someone wryly named us, “the cost-cutting group.”

But, as Chris O’Brien, one of the thought-leaders in that group, notes in his excellent distillation of the day’s themes and discussions, it was less about the wild slashing that’s going on now in newsrooms large and small, and more about rebuilding a newsroom suited to the needs and challenges of 2008 and beyond.

We took the approach of essentially creating a new news organization from the ground up. But the other way to look at this question is to ask: How would you make a current newsroom more efficient? After leaving the discussion, a number of things occurred to me that should be explored:

1. Use templates for the print paper. Spend less money on designing the paper every day and use that money elsewhere. Newspapers have been trying to design their way out of their problems for years, and it hasn’t worked. I don’t think this something print readers think about. They want substance and content, not more pictures.

2. Cull circulation. Most newspapers are underwriting a chunk of their circulation to fight churn. What if you stopped spending so much money trying to sign up new subscribers? That costs a lot of money. This would require a change in ad rates. But I think it might save costs in the long run.

3. Reduce editors. I love editors, but it seems a lot of content, especially shorter stories, could be posted directly the Web. Many newspapers now let reporters post to blogs without editing. Why not the main site?

4. Newsroom salaries. I’m not sure yet how I feel about this, but it would seem that how we pay people needs to be rethought. Some online news sites pay employees by traffic they generate. That’s ruthless, but still, I wonder if that might work for some online jobs at newspapers?

There’s much more, here at Chris’s Next Newsroom project.

This entry was posted in Uncategorized and tagged #newsnext, business models, CUNY, newsroom, sustainability on by Tim Windsor.