Wednesday, December 24, 2008

Gatehouse v. New York Times

In just a few days the media pundits have jumped on the lawsuit between Gatehouse Media and the New York Times over's hyper-local concept. Dan Kennedy is doing the best job at keeping us all updated.

At the heart of the issue is the question of whether is simply linking to stories by Gatehouse media's local papers, like the Newton TAB, or if has based its entire business model on using content developed by another commercial news organization.

Adam Reilly has a great take on this when he asks:

Imagine that I decide to start a new, web-only newspaper devoted to the city of Boston. Then imagine I fill my new publication--let's call it the "Boston Gazette"--entirely with links to articles from the Boston Globe. Is that journalistically legit? Nope. It's just a lame, transparent attempt to repackage someone else's work as my own.
It's a fair question and what I believe the Globe is doing right now. Do they have the potential for more? Of course. The problem is that the site, as it stands, spread the information out into a number of different areas. But the main page is only part of the problem.

The Newton site includes a local wiki in which the editors are asking people to submit information, any information and then self-police it. This is a fanciful notion to make a Wikipedia type play, but that's only likely to work if they can also get a number of local overzealous editors.

During the launch meeting one person asked a simple question: what's to stop the Globe from eventually taking that information, restricting access and selling it back to us? The editors assured us this would never happen. Though, that assumes the current editors are always in charge. What happens if and when gets sold. Wouldn't another owner look at any repository of information as a potential revenue source?

The editors also noted that any information submitted by an individual remains the property of that individual. OK, that's fair. But what happens when my writeup of Taste Coffee House in Newtonville gets edited by a Globe editor, and then added to by another customer? Who owns the content then? How do you track that ownership?

Jeff Jarvis portrays the Gatehouse folks as ignorant stooges who don't seem to understand how the Internet works. However, as one of the few people writing on this issue who actually LIVES in Newton and also operates a hyper-local site, I have a little better idea of the personalities involved.

It happens that the Newton TAB folks understand new media very well. They are on Twitter, blog regularly and use Facebook all in an attempt to get closer to their readers. They went from being a weekly to having an active local news site with a regular blog long before the Globe even bothered letting readers comment on its own local blog.

This is a group that understands the implications of what it's doing. But it also knows the economic realities of the situation. If a local business is looking to spend money advertising, are they going to advertise with the TAB (and on its online site) or with If Newtonians are flocking to, a site that is made up mostly of content reported by Gatehouse, then the money is going to flow there, plain and simple.

In fact, the entire hyper-local operation feels more like an adveristing play than anything else. They created a site, hired a single (very young) editor, then simply reorganized much of its existing content so it focused heavily on one city.

One final very telling note in all this. When started rolling out its site it invited a number of local thought-leaders to the Newton War Memorial Auditorium to show it off. This group included a number of bloggers, advertisers, people who have local TV shows and a few others who are well known. The mockup they showed included articles from the TAB in addition to other bloggers, some of who were in attendence, and they even pointed out that they were going to aggregate information from every site, including the TAB.

They never invited the TAB to the meeting. The editors first heard about it when I posted about it on

Saturday, December 20, 2008

Restart: Branded Journalism

I am returning to this long-abandoned blog to play with a few concepts that have been floating around my head. Specifically, what is the future of journalism?

You don't have to go far around the web to find people lamenting the fall of newspapers, even as they take full advantage of all the publishing freedom the web offers. I'm not going to sit here and tell you that life is over because newspapers face certain death.

The way I see it, people will always want information. In fact, they'll pay when the information will benefit them in some way. However, we've created a situation in which people believe the basic information in life is free. So what we have is a demand and when there is a demand there will always be a supply.

The question isn't whether journalism will survive, but how it gets funded and who does the funding. I believe that funding will come from brands. Yes, those brands can be news brands like the New York Times or the Wall Street Journal, but they can also be from companies like Coca-Cola and Pepsi.

Over the next few weeks I'll expand on this.

But in doing research I spent some time playing with the New York Times company numbers and present the following two charts. This first compares revenue from circulation and advertising. If you notice, circulation revenue remains relatively steady while advertising revenue is on a relative decline.

The second chart compares circulation by source. The numbers seem relatively steady year over year, with the exception of single copy (newsstand) sales, which show a precipitous decline.

I have more research to do to see whether this is just the Times or industry wide, but the advertising decline seems to be almost independent of readers, and the increase in online readership seems to relate only to newsstand sales. This doesn't make sense from a business perspective, but I believe that it is not that newspapers are dying, but that they were never built on a solid advertising base to start.