Embracing a new technology

Calls for a new business model are frequent for the legacy newspaper industry. The reasons are apparent. The Newspaper Association of America reports that newspaper print ad revenue is down 44.2% from 2005. The Pew Research Center says "Internet overtakes newspapers as news outlet."  

If a new model is necessary, let’s first consider a definition of the legacy newspaper business model. What are the key activities and benefits that are unique to newspapers? Whom do newspapers serve?

Newspaper's key activities and benefits can be described as (1) gathering and relaying original facts and figures in a timely fashion (2) employing reporters who work long and non-standard hours to do so (3) employing sales representatives to build alliances with businesses that wish to get their facts and figures in front of the news audience and (4) offering readers the benefit of the most reliable, trusted, impartial, in-depth and insightful reports and analysis about life in geographic places.

So, what’s wrong with this model? Why the newspaper advertising and readership declines?

The Internet!

The Internet turned information flow 180 degrees. Before the Internet, capital, presses and lengthy processes were required to get information to the people. Facts and figures were gathered and published in print on fixed schedules -- taking world news to the neighborhood. Now, a teenager with a flip-camera can report an event and make it instantly accessible to anyone --taking neighborhood news to the world. No one has to pay the teenager.  No presses are required. The report is good enough for the moment.

The Internet also has turned advertising flow 180 degrees. Until the Internet, small numbers of big businesses dominated. With Internet, large numbers of Main Street businesses compete.

Print is a medium open to organizations, information flows one-to-many, from top to bottom; and is closed and paid.

The Internet is a medium open to individuals; information flows one to one, one to many and many to many; from bottom to top; and is open and free.  Diametrically opposite from print.

John Paton, CEO of Journal Register Co. opened the June, 2010 Editor & Publisher's Interactive Media Conference in Las Vegas, NV urging those in attendance to "put down their acoustic guitars and pick up the electrics. Now." His presentation, "Digital First, Print Last, Resetting the Newspaper Business Model", offered an example of the diametrically opposite environment the Internet has created. 

Can any part of the legacy newspaper business model work? It all can.  There will be a continuing demand for reliable and impartial news gathering and news reporting, for providing an advertising venue, and for the publishing of reports about matters important to every-day life.  The Internet will just allow us to do more of this and to do it better than we can with print alone.  

Adopting digital first, print-last, as Paton suggests, does not require news organizations to abandon its key activities or its time-honored benefits. The digital age provides the opportunity to make some stories available as they happen and others on a periodic schedule. This is a process change not a model change.

James Fallows, in the June 2010 edition of The Atlantic, describes an experiment at Google called Living Stories. This experiment is based on the understanding that while a teenager with a flip-phone relaying impressions from a protest might be the first source of news of the event, a news organization with hired reporters and editors will still be necessary to put such an event into context and to explain its history and implications for the future. 

News organizations can adapt their time-honored and proven business model to build upon these new sources of information. Sustainable news organizations will be those who adopt a bottom-up flow of information.  News happens in population centers of 20,000 to 40,000 or even smaller.  Reporters will be on the ground in these centers. Sales people will build alliances with the Main Street businesses in clusters of two to four of these centers and the organization will brand two distinct products, a periodic publication and an immediate publication.

For now, the sustainable organization’s periodic publication, probably weekly, will appear printed on paper. In the not-too-distant future, it will appear a pad-device. This publication will feature stories that provide context, analysis, prose, poetry and features by and about the people in their geographic place. It will look more like a magazine than a newspaper.  The few, but larger-scale advertisers will power these publications.

The sustainable organization’s immediate publication will be open, free, dynamic and always on. It will appear on mobile platforms populated with posts from the organization’s professional journalists along with attributed, unfiltered, and unfettered posts from community citizens, organizations and businesses. My company calls this the Digital Main Street™. This is where the news organization will publish, as it happens, the professional journalist’s first report of the school board meeting vote, the citizen’s report from an accident scene and the community theater group and corner market offerings and advice.  The plentiful, smaller-scale advertisers will power these publications.

Expanding the brand to two products, embracing contributions from all community members, encircling the instant capabilities of digital devices and extending alliances beyond the real estate, auto and major financial and retail players is not a new model. It is simply a model which embraces a new technology to do faster, better and more cheaply what the legacy business model has always produced.