News­pa­pers - an ex­cel­lent place to breed new habits

An in­ter­view with Ken Doc­tor

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When­ever I think about in­ter­view­ing some­one who has their fin­ger on the pulse of the global news me­dia in­dus­try, one of the first names that comes to my mind is Ken Doc­tor. His ring­side seat at the great­est story ever told about our in­dus­try makes his in­sights both com­pelling and prag­matic be­cause they are con­ceived through his thought­ful anal­y­sis of the is­sues and the facts.

Ken al­ways shoots from the hip, telling it like it is, even when we don’t al­ways want to hear it. But hear it, we must, be­cause Ken has some great ad­vice for all of us go­ing into 2017…

Thanks Ken for join­ing me again this year to talk about “what’s new and what next” for pub­lish­ing in 2017.

In the fall of 2016, you did an in-depth, five-part se­ries about pod­cast­ing (which I highly rec­om­mend for our au­di­ence) say­ing, “We can mark 2016 as the year the pod­cast busi­ness came of age.” and rais­ing the ques­tion, “How can pod­casts help rein­vig­o­rate lo­cal me­dia, at a time when print news­pa­per com­pa­nies just shrink away?”

Pod­cast­ing cer­tainly is be­com­ing more pop­u­lar with con­sumers and ad­ver­tis­ers, es­pe­cially on mo­bile. And we are start­ing to see some news­pa­pers try­ing their hand at on-de­mand au­dio (e.g. The Guardian, The Wash­ing­ton Post and The New York Times). Why aren’t more news­pa­pers and mag­a­zines di­ver­si­fy­ing in this di­rec­tion as they are al­ready do­ing with events, e-com­merce and niche web­sites?

It’s an in­ter­est­ing ques­tion. I think that the band­width and the sense of that band­width adds so much to the lo­cal press; it’s so cir­cum­spect that there is very lit­tle real in­vest­ment in in­no­va­tion. There is in­vest­ment in a few things, mainly in the pure com­mer­cial ar­eas like mar­ket­ing ser­vices and the event busi­ness. The level of ed­i­to­rial cre­ativ­ity is rel­a­tively low and the level of prod­uct in­no­va­tion, even in dig­i­tal, much less pod­cast­ing, is rel­a­tively low if you look at the dig­i­tal prod­ucts that we see from lo­cal com­pa­nies.

So in the case of pod­cast­ing, I have not talked to lo­cal news­pa­per com­pa­nies about it, but I would guess the an­swer for most of them would be: “Where’s the money in it?” It’s the same thing that I heard from re­gional news­pa­per com­pa­nies when we talked about some­thing called “mo­bile” five years ago. When I men­tioned how the mo­bile au­di­ence is re­ally grow­ing, they’d re­spond with, “Yep, but there’s no money in it.” And then when asked about video, “I still don’t see the money in video.”

In all of these ar­eas of in­no­va­tion — we can go back even fur­ther with Search and other things — they have con­stantly been late to the game. They’ve been late in new tech­nolo­gies, new tech­nol­ogy adop­tion and adap­ta­tion. As a re­sult, by the time pub­lish­ing gets into the game, the field is usu­ally sat­u­rated by other peo­ple.

So does that mean that they also need to look at Aug­mented Re­al­ity and Vir­tual Re­al­ity in terms of in­no­va­tion to shore up their busi­nesses for the fu­ture?

I think that it’s wrong to think about it from a tech­nol­ogy point of view, or a “What’s the new thing?” point of view. I think the right way for them to think about it is, “How do they sat­isfy more au­di­ences, big­ger au­di­ences, and dif­fer­ent au­di­ences?”

There’s a range of tech­niques that are dig­i­tally-based in sto­ry­telling, whether it is video and Vir­tual Re­al­ity, au­dio and pod­cast­ing / au­dio-on-de­mand. All of these and many oth­ers are there, but you can’t go to them and ask, “Okay, how do we make money with this?” We need to ask, “How can we use some­thing that gets an au­di­ence more deeply en­gaged?” And then look to mon­e­tize that au­di­ence.

Get­ting the au­di­ence, reader, lis­tener, viewer, ad­ver­tiser or spon­sor to pay is not a quick fix. You’ve got to ac­tu­ally do some­thing more for some­body and not just adopt the tech­nol­ogy.

You’re talk­ing about the en­gage­ment with the au­di­ence at a time when so many pub­lish­ers con­tinue to kill off the com­ment­ing sec­tions on their sites and send­ing peo­ple off to Face­book, in a com­pletely un­mod­er­ated, un­en­gaged man­ner.

You said at the be­gin­ning of 2016, that the ban­ning of com­ments was a symp­tom of a prob­lem. But it’s be­com­ing a much big­ger prob­lem, isn’t it? It’s be­com­ing a plague.

It is, but it’s still a byprod­uct of the same thing. The amount of time peo­ple spend dig­i­tally with

a news­pa­per com­pany is low be­cause there has not been a real com­mit­ment from most of these com­pa­nies to dig­i­tal prod­ucts that en­gage; com­ment­ing is part of that.

It isn’t easy to cre­ate a dig­i­tal com­mu­nity, and clearly Face­book and the other so­cial plat­forms serve a spe­cific pur­pose. I can­not think of how lo­cal fits into that dis­tinctly. We do see in the events area that the phys­i­cal con­nec­tion that peo­ple can make on a lo­cal com­mu­nity ba­sis is some­thing that can yield both en­gage­ment and mon­ey­mak­ing through spon­sor­ship.

This is real com­mu­nity mak­ing, rather than just com­ment­ing, and I think that cuts to the core of the prob­lem. If you’re go­ing to be in the news busi­ness, you’ve got to be part of the com­mu­nity. Un­for­tu­nately, what the in­ter­net has ex­posed is that so many com­pa­nies didn’t re­ally feel part of a com­mu­nity. They wrote for a com­mu­nity, but they weren’t re­ally part of it.

From your per­spec­tive, do you feel that the pub­lish­ers are afraid of go­ing into these di­rec­tions be­cause they think it will cost them too much money at a time when they’re cut­ting costs left, right and cen­ter, in­clud­ing the news­rooms?

Is it some­thing that as in­dus­try play­ers we need to ed­u­cate them on and say, “This

is a low-cost ex­er­cise, but some­thing that will yield long-term re­sults in terms of that en­gage­ment.” What is it?

I think there has been a short-term think­ing for an in­cred­i­bly long term. Even back in the days when there was less fi­nan­cial stress — when I was at Knight Rid­der, which was con­sid­ered to be one of the top and high­est qual­ity journalism com­pa­nies — if any­one in the en­ter­prise came up with any idea, the ques­tion was, “How is it go­ing to make a sig­nif­i­cant profit?” That was the first ques­tion any­body would ask.

To­day, with the fi­nan­cial stric­tures, we have Gan­nett an­nounc­ing lay­offs, Post­media an­nounc­ing lay­offs, and The Wall Street Jour­nal an­nounc­ing lay­offs, all within two days of each other. To­day, the fi­nan­cial stress of all that has

“This is the new fron­tier, that you’ve got to fig­ure out a way to en­cour­age a new habit in read­ing. It’s all about habits.”

gone for so long makes it such that peo­ple aren’t even bring­ing up ideas that are go­ing to cost money, or uses terms like de­vel­op­ment and en­gage­ment. So this short-term think­ing has lasted so long, there is rel­a­tively lit­tle long-term in­vest­ment. With­out it we see things spi­ral­ing down.

We al­ways looked at journalism be­ing an in­te­gral part of the demo­cratic process. If we con­tinue to see the dis­ap­pear­ance of lo­cal me­dia, is that go­ing to af­fect the state of democ­racy? Or will there be other play­ers

that will step in, such as na­tional pa­pers? But re­ally, who can fill in the shoes of the dis­ap­pear­ing lo­cal me­dia?

For the past 12 years I have been fo­cus­ing specif­i­cally on this area and have re­ally felt the fail­ure and spi­ral­ing down of the lo­cal press through­out the Western world — in North Amer­ica and Europe heav­ily, plus Aus­tralia, New Zealand and Latin Amer­ica. That’s been my pri­mary con­cern. What we see is that we have lost a great deal, but we just can’t put our fin­ger on it; we can’t quan­tify it. There is so much re­port­ing that is not be­ing done and com­mu­ni­ties are poorer for it.

David Si­mon, a past re­porter for the Bal­ti­more Sun and cre­ator of The Wire on HBO, re­ported on this be­fore Congress at a typ­i­cal hear­ing that talked about reg­u­la­tion, po­ten­tial reg­u­la­tion and an­titrust. When ad­dress­ing the lack of lo­cal watch dogs, some­one at Congress ar­gued, “The Huff­in­g­ton Post has hired a whole bunch of peo­ple.”

To which Si­mon replied, “Well, when The Huff­in­g­ton Post goes down in Bal­ti­more, where I used to work at the Sun, and they cover city hall, and they cover the cops, I’ll feel bet­ter about it. Right now it’s the hol­i­day for cor­rup­tion in Amer­ica.” And it ab­so­lutely is, but we don’t see the cor­rup­tion be­cause no­body is re­port­ing on it.

As to who is fill­ing the gaps, there is a lit­tle bit here and there. The most in­ter­est­ing gap filler is pub­lic me­dia. In a place like Los An­ge­les we’ve seen the Los An­ge­les Times news­room drop from 1,200 to 500. Mean­while KPCC, a pub­lic ra­dio sta­tion in LA, now has 100 peo­ple (most of them jour­nal­ists of one kind or an­other) cre­at­ing lo­cal con­tent.

WNYC in New York, KQED here in San Fran­cisco and I’d say an­other six or seven sta­tions are se­ri­ously in­vest­ing in lo­cal news. Im­por­tantly, pub­lic ra­dio has the mis­sion most sim­i­lar to news­pa­pers. Al­though they’re non­profit, and news­pa­pers are for profit, they have a ser­vice com­po­nent to what they do and this has po­ten­tial.

I know a lot of peo­ple in pub­lic ra­dio and pub­lic me­dia, and there’s a lot of frus­tra­tion that they aren’t mov­ing quickly enough, and they haven’t moved quickly enough to fill the vac­uum. But they are one ma­jor place we should look to do more.

Iron­i­cally, Niko­lay, you bring up pod­cast­ing. This whole idea of au­dio, au­dio-on-de­mand and ra­dio are great ways to dis­sem­i­nate news. There are parts of the world such as in Africa, Brazil and Rus­sia, where ra­dio has long been stronger than print. Ra­dio and au­dio-on-de­mand have great po­ten­tial for de­liv­er­ing real news, and not just the news in two min­utes, but longer re­ports as you’ve seen on pub­lic ra­dio. I think that’s a huge fron­tier, and it doesn’t need to be lim­ited to pub­lic ra­dio. When we talk about how a lo­cal journalism com­pany — whether it’s news­pa­per-based or news­pa­per-cen­tric or what­ever — tells its story, au­dio can be a ma­jor part of it.

An­other thing to watch into 2017 is that there are three com­pa­nies now, kind of mini-chains, that are each try­ing to in­no­vate a new, on­line-only, city-based model. One is rep­re­sented by Den­verite, which comes out of Gor­don Crovitz and his part­ners in Den­ver, Colorado. They hope that sta­tion to be the be­gin­ning of a 15-city chain.

An­other one is Spir­ited Me­dia led by Jim Brady in Philadel­phia and Penn­syl­va­nia. The third one is Char­lotte Agenda out of Char­lotte and Raleigh, North Carolina. They are all very sim­i­lar and have the spirit of the old al­ter­na­tive press, largely run by peo­ple in their 30s. They are on­line-only and they’re smart pub­li­ca­tions. The big ques­tion there is how much scale they can at­tain, and we’ll watch that into the next year.

In your re­cent ar­ti­cle on the ten sto­ry­lines we’ll be talk­ing about in 2017, you said:

“Who­ever fig­ures out a sim­i­larly ad­dic­tive be­hav­ior to read­ing the 2016 fed­eral elec­tion news post-elec­tion gets brag­ging rights for rein­vent­ing es­sen­tially what can pro­pel the next gen­er­a­tion of sus­tain­able news com­pa­nies. Na­tional, lo­cal, it doesn’t just have to be news.”

There’s some­thing very tempt­ing in that propo­si­tion, es­pe­cially when you say it doesn’t have to be news. Is this some­thing that you can elab­o­rate on? We talked about the cor­rup­tion and the role of me­dia in democ­racy, but there’s more to it, right?

There’s a lot more to it. That was a sto­ry­line num­ber 10 – a bit of a wild­card. Last March, I wrote about The New York Times’ de­sign of their smart­phone prod­uct where I said they had rein­vented page one, fi­nally, for the dig­i­tal era — fi­nally mean­ing 2015/16. We now have a model for the age, where the desk­top pages never re­ally re­placed print in a sat­is­fac­tory or en­gag­ing way.

What I was re­fer­ring to in that sto­ry­line is this: in this era of the most in­cred­i­ble pres­i­den­tial elec­tion in any­body’s mem­ory, there was a lit­tle fea­ture in The New York Times that showed the rel­a­tive per­cent­age points be­tween Hil­lary Clin­ton and Don­ald Trump over the sum­mer. I don’t have the ac­tual num­bers, but when I talked to peo­ple anec­do­tally they said, “Oh, my god, I check that like five times a day!”

Just yes­ter­day there was a tweet from some­one I don’t know, that said, to that same point, “This is a must-read for any­one teach­ing or learn­ing about journalism in col­leges. This is the new fron­tier, that you’ve got to fig­ure out a way to en­cour­age a new habit in read­ing.”

It’s all about habits.

In the old news­pa­per days, a habit was won­der­ful and we thought it was the “end all” of the world, which meant you read the pa­per once a day. With this new poll re­sults fea­ture the Times has cre­ated some­thing that peo­ple can check through­out the day, cre­at­ing a new habit.

There are other things that peo­ple can check such as sports, etc. The chal­lenge is fig­ur­ing out what a me­dia com­pany can pro­vide that would get peo­ple check­ing over and over again in a smart­phone prod­uct.

On Oc­to­ber 24, 2016, The New York Times an­nounced it was buy­ing a lit­tle com­pany called The Wire­cut­ter for US$30M. The Wire­cut­ter does the best re­views about home elec­tron­ics on the web. Wire­cut­ter is all about home elec­tron­ics of any kind, small and large. I tweeted that I thought it was a very smart ac­qui­si­tion, be­cause it will lead peo­ple to use their site much more fre­quently. Sweet Home is an­other one – it’s all about re­views for home-ori­ented prod­ucts.

This is the kind of ap­pli­ca­tion that will keep peo­ple com­ing back to a site, be­cause it’s pro­vid­ing an ac­tual ser­vice. My chal­lenge to pub­lish­ers in that post, which I was thrilled to see picked up by a col­lege pro­fes­sor, was, “Okay, stop whin­ing about what you lost. What is it that you can cre­ate that’s an es­sen­tial check-in for peo­ple to­day?” It could be news, but it’s more likely go­ing to be in­for­ma­tion. There’s a wide fron­tier of what lo­cal me­dia com­pa­nies can do in terms of de­tailed in­for­ma­tion about their cities, about what’s hap­pen­ing all the time, about the his­tory of their cities, etc.

There are apps like De­tour that make unique GPS au­dio walk­ing tours that could be har­nessed by news­pa­per com­pa­nies. It’s find­ing new es­sen­tial­ity and then mas­ter­ing the prod­uct de­vel­op­ment that’s go­ing to bring it to a new level of habit to the new news con­sumer.

That’s in­ter­est­ing, be­cause we’re all fa­mil­iar with the old phrase, “ad­dicted to news,”

but this puts a whole dif­fer­ent spin on it. News­pa­pers need to find ways to get peo­ple “ad­dicted to fill-in-the-blank.”

The irony of that — and this is one of my other cri­tiques of the busi­ness — is that the news­pa­per was al­ways about much more than what hap­pened yes­ter­day in the city. That was rel­e­gated to the metro sec­tion which tended to be, a lot of times, the most bor­ing part of the news­pa­per.

I came up through the fea­ture sec­tion which con­tained con­tent about how you take care of your fam­ily, how you deal with health is­sues, to­day’s weather and what’s on TV? Devel­oped over the decades, news­pa­pers served all these and more needs in peo­ple’s lives. Then the in­ter­net blew it all up. The weather page was once one of the most read sec­tions. To­day, we don’t need it or many of the other fea­tures we used to read be­cause they have all mi­grated to the smart­phone, out­side the bounds of the news­pa­per app. And in a lot of cases, the news­pa­per app doesn’t even ex­ist.

News­pa­pers can’t recre­ate that old world. But un­less they do more for read­ers and cit­i­zens, the busi­ness is go­ing to be tiny and it will con­tinue to re­cede. To get more money you have to do more and you have to do more smartly. It doesn’t mean just dou­bling the num­ber of sto­ries you’re go­ing to write.

Ken, you called for uber­fi­ca­tion of news as the next big thing in pub­lish­ing, ref­er­enc­ing Fresco. In the past few years we’ve seen some growth in mo­bile journalism (mojo) – a new breed of re­porters with a multi-hat role of re­searcher, cam­era per­son, di­rec­tor, ed­i­tor, pub­lisher, dis­trib­u­tor, and mar­keter of mul­ti­me­dia con­tent in real time. What do you think about these new forms of journalism, and their fu­ture in main­stream me­dia?

I wrote about Fresco, and I think it’s a re­ally smart op­er­a­tion. If you look at Fresco, the great use of it and the great in­ter­est in it is by lo­cal brands. So far it’s been the Fox re­gional sta­tions that have used it al­most uni­formly and by them­selves. Fresco is a re­ally in­ter­est­ing ex­am­ple of young en­trepreneurs, in­cred­i­bly young, 22,24, fig­ur­ing out how to take the fric­tion out of a sys­tem that had too much fric­tion in it for too long — mean­ing that there are peo­ple with smart­phones ev­ery­where that can take pic­tures and send them out to a cen­tral place.

But why it works, and why there is an ecosys­tem, is be­cause there is a sub­stan­tial lo­cal brand in the mar­ket­place – in this case the TV sta­tions that peo­ple know, which is a source of both ag­gre­ga­tion and cu­ra­tion. It’s not us­ing ev­ery­thing, but they’re cu­rat­ing with what they think is use­ful, and has the power of pre­sen­ta­tion, both on the air and on­line.

“I re­ally do think, so sadly, they [old brands] are com­mit­ting sui­cide.”

I think it’s that dy­namic bal­ance with some­thing like Fresco that makes it work. I vis­ited the guys that put that com­pany to­gether in down­town New York; and why it works is that you don’t re­ally need to be a jour­nal­ist.

I chided them in the col­umn about call­ing their peo­ple “cit­i­zen jour­nal­ists”. They’re not re­ally jour­nal­ists, they’re pic­ture tak­ers. They can au­then­ti­cate the pic­ture, but they’re not adding an in­ter­pre­ta­tion other than where they stand and take the shot.

Do you see the in­dus­try trend­ing to­wards en­tre­pre­neur­ial mo­jos, work­ing di­rectly with dis­tri­bu­tion chan­nels and plat­forms, re­duc­ing the need for tra­di­tional pub­lish­ers as we know them to­day?

No, for a num­ber of rea­sons. Journalism is a skill, and while there are peo­ple out­side news­pa­pers that know how to write, in­ter­view and re­port, they are rel­a­tively few and they’re not go­ing to do it hap­haz­ardly for a US$50 pay­ment here and there. I think that kind of thing is very use­ful, but it’s very lim­ited.

And this ques­tion of brand is still hugely im­por­tant lo­cally. I don’t see any kind of sce­nario where peo­ple just ran­domly look to Face­book or Twit­ter for news that has no brand iden­ti­fi­ca­tion about who is cer­ti­fy­ing lo­cal in­for­ma­tion. I don’t think that’s the world that peo­ple re­ally want. The prob­lem has been, of course, the lo­cal me­dia busi­ness model.

In the TV world, we be­lieve in com­pa­nies like the new Scripps and oth­ers that have been con­sol­i­dat­ing and in­vest­ing in dig­i­tal tech­nol­ogy and dig­i­tal journalism. There may be enough money in a city for one or two sub­stan­tial news op­er­a­tions that can be­come broad­cast and dig­i­tal. But they be­lieve that the brand is very im­por­tant there.

Sim­i­larly, the news brands that can man­age that tran­si­tion (and that jury is re­ally out) they have a lot of power. One of the ways that tronc, Inc. board chair­man, Michael Ferro (who I’ve crit­i­cized in a num­ber of ways over the years) has been very smart is that he saw the po­ten­tial in Fresco, “Well, you don’t have to be a TV sta­tion to use Fresco. If we use Fresco in Chicago and Bal­ti­more and Hart­ford, we could be a source of a lot of news video on­line.”

I think he had it right, but he has so much other stuff wrong that it kind of over­whelms his plans. I think there are great ap­pli­ca­tions there, but they’re go­ing to be through a lo­cal brand.

Does this the­ory hold true even for the younger gen­er­a­tion that doesn’t nec­es­sar­ily have the emo­tional con­nec­tion with a brand? I have a 20 year-old, and we’re in a mar­ket that is dom­i­nated by two news­pa­pers that are owned by the same com­pany. He’s aware of them, but he doesn’t trust them and ranks them no higher than any of the lo­cal blog­gers or news his friends shared on Face­book.

It’s a fas­ci­nat­ing ques­tion. I go back to the al­ter­na­tive press of the 70s and 80s, which devel­oped out of quite sim­i­lar cir­cum­stances of daily news­pa­pers not serv­ing a need with the younger pop­u­la­tions. Your sit­u­a­tion there in Van­cou­ver and in Canada is truly amaz­ing with the — and I hes­i­tate to use the word — ‘power’ of Post­media and the mo­nop­oly that it has. And yet, it is wast­ing away as a com­pany.

“You’ve got to get to the point where you have a ma­jor­ity of your rev­enue be­ing from read­ers by sup­ply­ing qual­ity con­tent through re­ally good dig­i­tal prod­ucts.”

That’s why we’ve seen this tremen­dous de­vel­op­ment in the last 18 months of those smart­phone and lo­cally-based chains in Char­lotte, Pitts­burgh, Philadel­phia and Den­ver. Those busi­nesses are get­ting re­ally good trac­tion and are all aimed, not quite at your son at 20, but at peo­ple in their mid-twen­ties to late thir­ties who want a voice.

All of these com­pa­nies also have jour­nal­is­tic sen­si­bil­ity. That’s why we’re see­ing this level of in­ter­est while old brands are just fad­ing away. I re­ally do think, so sadly, they’re com­mit­ting sui­cide.

There is the de­sire for some kind of or­ga­ni­za­tion — per­haps Face­book Van­cou­ver. Maybe Face­book does it, but I don’t think so. I think there will be oth­ers who will try to or­ga­nize around a lo­cal brand, and we’re just start­ing to see that hap­pen now.

Last year we talked about 2016 be­ing the year of plat­forms. We’ve just fin­ished a year with In­stant Ar­ti­cles and there have been both out­cries and few of praises about Face­book and its tweak­ing of its al­go­rithms. What’s your take on where In­stant Ar­ti­cles are go­ing?

I think that the year of the plat­form has been fairly dis­si­pated. I talk to a lot of pub­lish­ers and met­rics com­pa­nies that work with pub­lish­ers at the top of the food chain and who have the abil­ity to see what’s go­ing on with traf­fic across ti­tles. If you look at Face­book, with all of the pub­lic­ity that has hap­pened over the last year, es­pe­cially with In­stant Ar­ti­cles and other pro­grams, the traf­fic im­pact of what they have done, with all these changes, is neg­li­gi­ble.

Over­all, the amount of traf­fic that most news pub­lish­ers get, na­tional and lo­cal, from Face­book has not changed much from a year ago. What’s up is In­stant Ar­ti­cles at about 10%, while news­feed traf­fic is down about 10% be­cause of the al­go­rithm changes there. The so­cial shar­ing that peo­ple do them­selves is about the same. The Face­book Boost pro­gram where pub­lish­ers es­sen­tially buy views/links, that’s about even.

This has not been a huge year of change in Face­book, and Face­book is by far the big­gest phe­nom­e­non out there. I think pub­lish­ers that have the busi­ness in­tel­li­gence and data an­a­lyt­ics to ac­tu­ally fig­ure it out, rec­og­nize that so­cial is very im­por­tant for con­tin­u­ing to feed the top of that fun­nel with new, younger cus­tomers. They be­lieve that’s very im­por­tant. But they also know that only a small per­cent­age of those peo­ple are go­ing to be­come re­ally en­gaged read­ers and pay­ing sub­scribers.

I think it’s get­ting clearer and clearer that in terms of how so­cial plat­forms should be used, it is re­ally a re­source al­lo­ca­tions de­ci­sion. It is im­per­a­tive for news brands to keep their iden­tity and for peo­ple to un­der­stand that what they are of­fer­ing comes from that news brand. It doesn’t come from Face­book, just like it didn’t come from Ya­hoo, even though they were do­ing a dis­tri­bu­tion deal ten years ago. Pub­lish­ers need to re­ally em­pha­size the qual­ity and the trust­wor­thi­ness of their brand.

It’s also a re­source al­lo­ca­tion de­ci­sion when you com­pare in­vest­ing in other tech­nolo­gies and com­mu­ni­ca­tion strate­gies such as pod­cast­ing, VR, video or news­let­ters (which can have an in­cred­i­ble open rate that leads to a lot of en­gage­ment). The com­par­a­tive in­vest­ment there then be­comes a fairly sim­ple ques­tion, “How much more ef­fort and money do I want to put into work­ing with Face­book, or Snapchat, or Twit­ter? Be­cause I have a sense of what that ROI is in terms of my reader re­turn, com­pared to putting more into news­let­ters, or pod­casts, or video.” I think in­creas­ingly that’s how pub­lish­ers need to look at it.

They need to do it from a very rea­soned, dat­a­cen­tric point of view, and not by mov­ing from one alarm to an­other, think­ing: “Oh, my god, we’re late on video;” or, “Oh my god, VR… what are we go­ing to do?” or, “Oh no, Face­book’s eat­ing the earth; do we even need our own site any­more?” It’s a mat­ter of step­ping back, un­der­stand­ing who you are, and run­ning your own busi­ness.

Google AMP was get­ting some good re­views when the first set of re­sults started com­ing in. But there ap­pears to be no suc­cess­ful mon­e­ti­za­tion strat­egy for mo­bile as of yet. Are you see­ing any­thing out there that you feel is on the right track in terms of ad­dress­ing the mo­bile ad­ver­tis­ing chal­lenges?

Yeah, I think there are. Mo­bile ad­ver­tis­ing is the fastest grow­ing type of ad­ver­tis­ing in the coun­try. There are mod­els that work, but lo­cal news­pa­per com­pa­nies, again, have been late to the game. The most suc­cess­ful mod­els I have seen are ones that are com­ing from na­tional com­pa­nies that have moved strongly into branded con­tent, na­tive ad­ver­tis­ing, and use the smart­phone as one plat­form for that con­tent. They’re sell­ing au­di­ence and they’ve got the an­a­lyt­ics that show the au­di­ence they’re get­ting, in­clud­ing the seg­ments on the smart­phone and rate they’re pay­ing for it.

Pub­lish­ers need to have the in­sight into their au­di­ence and they’ve got to sell au­di­ence, not the de­vice. They need to know where their au­di­ence is us­ing the smart­phone and when. The dis­play and use of branded con­tent ob­vi­ously takes an agency-like ap­proach, but when done prop­erly these kinds of ads are get­ting re­ally good rates in the $20-$40 range.

If most of those do­ing this are na­tional com­pa­nies, why aren’t re­gional com­pa­nies in­vest­ing here?

They’re still stuck do­ing old-fash­ioned (it feels funny to call it that), but old-fash­ioned dig­i­tal dis­play ads. Dig­i­tal dis­play is ba­si­cally sell­ing space for an ad – the part of the in­ter­net busi­ness that is now de­clin­ing the most rapidly. In terms of ad­ver­tis­ing on a smart­phone, it re­quires a dif­fer­ent kind of spon­sor­ship-sell or na­tive ad­ver­tis­ing-sell in or­der to en­gage with an au­di­ence that is partly us­ing the smart­phone. Those pieces have not been put to­gether by many lo­cal me­dia com­pa­nies.

The other thing about smart­phones that I think is re­ally im­por­tant is the whole move­ment to- wards reader rev­enue. There is never go­ing to be a time that any of us can see when news­pa­pers are go­ing to re­gain the kind of dom­i­nance they had in ad­ver­tis­ing. It’s why I’ve writ­ten so much about how im­per­a­tive it is to de­pend more and more on read­ers who are a more sta­ble source for the ma­jor­ity of rev­enue. The com­pa­nies that are clos­est to tran­si­tion­ing – The New York Times, Fi­nan­cial Times, The Wall Street Jour­nal and The Wash­ing­ton Post — are mov­ing this way. On re­gional lev­els, a few pa­pers like The Bos­ton Globe and the Star Tri­bune are mov­ing this way. The na­tional pa­pers are close to 60% reader rev­enue; re­gional ones are get­ting close to 40-45%.

You’ve got to get to the point where you have a ma­jor­ity of your rev­enue be­ing from read­ers by sup­ply­ing qual­ity con­tent through re­ally good dig­i­tal prod­ucts. Take the ex­am­ple of The New York Times’ habit-form­ing Clin­ton-Trump poll. If you can make your­self es­sen­tial enough where you have a check-in func­tion on the phone – some na­tional news me­dia do it, but very few lo­cal ones do – then the main mon­e­ti­za­tion of that smart­phone in this mo­bile rev­o­lu­tion is reader rev­enue. Ad­ver­tis­ing rev­enue, sec­on­dar­ily, will come through na­tive ad­ver­tis­ing and spon­sor­ship.

Last year your ad­vice for pub­lish­ers for 2016 was all about them in­vest­ing in busi­ness in­tel­li­gence/an­a­lyt­ics. You out­lined the case for it just in the past cou­ple min­utes talk­ing about how that leads to es­tab­lish­ing a sus­tain­able mon­e­ti­za­tion strat­egy for mo­bile. If you were to add one other piece of ad­vice for pub­lish­ers in 2017, what would it be?

I would tell them to please lis­ten to 2016. It’s so fun­da­men­tal to ev­ery­thing that’s go­ing on, and I re­ally be­lieve that if you don’t have your busi­ness in­tel­li­gence op­er­a­tion strongly in place at the cen­ter of your lo­cal me­dia op­er­a­tion by 2020, it’s a recipe for dis­as­ter. It is lit­er­ally mov­ing that fast.

This year I would add smart­phone prod­uct de­vel­op­ment to the whole push on busi­ness

in­tel­li­gence and an­a­lyt­ics. Mo­bile ac­counts for 55-60% of all us­age now, likely grow­ing to 75% by 2018, which is why the en­tire news thrust, pre­sen­ta­tion, cre­ation and think­ing should be smart­phone-first – not dig­i­tal first, but smart­phone first. The desk­top is fad­ing fast, es­pe­cially for younger pop­u­la­tions, but also for all.

I’ve writ­ten that the desk­top is the new print, and you can see that in terms of its us­age and the great drop-off in ad­ver­tis­ing al­ready. So it’s re­ally smart­phone-first prod­uct and busi­ness de­vel­op­ment per­vad­ing the think­ing of news or­ga­ni­za­tions.

I’d prob­a­bly put it in the or­der of smart­phone, print, desk­top, and tablet at this point. If I were go­ing to de­velop a prod­uct, it would clearly be smart­phone-based be­cause of the us­age. Then you’ve got to look at what it is that each other me­dia do uniquely well. Print does things very well, for some peo­ple right now, and ob­vi­ously most of the money’s still tied up in print.


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