Concerned Citizens

This past week some interesting developments have been occurring in the news industry that will probably help shape the future of news. The first involves how you may end up discovering news on USA Today, the Wall Street Journal or any of the other News Corp. publications. Rupert Murdoch is trying to craft a new model for finding and reading news, starting with his own set of publications. In a deal he appears to be striking with Microsoft, the content will no longer be available through Google searches or Google News but will be displayed through Microsoft’s Bing search engine. However, the other two may also shape the future of news as we know it. Those involve the concept of microblogging news and the possibility of an iTunes like store for news content. So how will these affect news delivery in the future?

Regarding the first development Rupert Murdoch feels that Google is “stealing” his news and repurposing it through their Google News channel. In the analysis by the NY Times the possible deal with Microsoft “would be a watershed moment in the history of the Internet, and set off a fierce debate over the future of content online.” Bringing Microsoft to the table demonstrates that Murdoch still feels the need for a search engine to help drive readers to his sites to read the news. He just wants monetary compensation for examining the content.

Online news has been a challenging business model to figure out for many media companies. Many media companies started the venture providing free content online, expecting ad revenues through the channel to offset the cost. This has not materialized and has created a new dilemma for the media industry on how to monetize their content. Because this horse is pretty much out of the barn I don’t think all content will revert to a paid model. There are too many sources for news to be discovered and it would take an industry-wide effort to change the model.

I think part of the reason media companies have not been able to capitalize on ad revenue is that their model is really a simplistic click-through model with little measurable results. Ads on the Internet can provide so much more due to the backing technology but that takes infrastructure investment that most of the companies cannot pour money into. With declining revenue streams and the need to maintain the traditional print model the companies are literally starving themselves to death while this business model plays out. Changing the model at this point is so risky to them they are afraid to jump but seem content to wait it out while their subscription base continues to drop. To survive they are sacrificing content creation (reporters) to offset production and distribution expenses.

What they don’t seem to realize is that this approach could lead to their ultimate demise. A case in point with my own local is how they have priced their electronic edition at a price equitable to the print version. After discovering this I threatened to cancel the subscription entirely, not understanding why a digital version should cost the same as print. After several e-mails and deals I’m still in the game but on a very strange model. I have to subscribe to the weekend print edition to get a more reasonably priced digital edition. What’s even worse is I can’t access the weekend edition online since I’m getting it in print.

The thing that really demonstrated how the business folks at the Express-News don’t understand their fate is a response from one of the senior executives – “The fact of the matter is, we are still a newspaper and plan to be for generations to come.” Come on folks, you can’t tell me it costs you just as much to pump out a digital model of the paper as it does for the print edition. Simple economics show that can’t be the case. However, I have to pay as much as print to get an all  digital edition. The funny thing of this entire matter is I’m only subscribing as a matter of consciousness for reading their content. I can get it all for free on the My San Antonio website.

Looking at the Breaking News Online/MSNBC deal this involves how news is broken to us through the “always on” society. Breaking News Online (BNO) is an interesting story to follow. It was started by an 18 year old from The Netherlands to provide quick news headlines as they broke through a Twitter handle, @breakingnews. Now it’s become one of the fastest sources for major news across the world. The tweets are simple and concise with no links. However, through this service I find out that a major earthquake occurred in the Pacific Rim well before any of the major news outlets pump it through their channels. With over 1.4 million followers the service provides more information to more people than almost any other channel.

BNO has built a strong news reporting infrastructure over time and will now focus on providing information through a paid service available to media organizations. MSNBC will maintain the Twitter account and will receive news feeds from BNO to help provide content for the account. The question will be if MSNBC will provide links in the tweets to their own news site, driving traffic from the 1.4 million to MSNBC. It could turn into a big coup for MSNBC in terms of traffic or it could backfire. The nice thing I liked about the BNO tweets was the brevity of information uncluttered by links. From there I could find my favorite source or Google the information up to find out more. I knew what was happening as it was happening and could dig for more if I wanted to or had the time.

In terms of syndication of content Time Inc., Condé Nast and other publications are attempting a new reader model to provide their publications through an online store. The new venture will also be exploring other reader options and hopes to build a stronger online presence and stop the subscriber decline. This could compete with Zinio, an electronic reader store that currently provides my electronic subscriptions of Texas Monthly, Business Week and Texas Highways.

This is yet another approach to delivering news to readers and monetizing the distribution. Time Inc. realizes new models are necessary to maintain financial security. “It’s increasingly clear that finding the right digital business model is crucial for the future of our business,” according to Ann Moore, Time Inc. chairwoman in a quote in the article. With such a large slate of publications in this deal there is a chance this coalition could also shape media distribution along with the new slate of e-readers expected next year including the anticipated Apple tablet.

One approach to consider based on these developments is a model where teaser content is provided free through the publication’s website but a per article fee would be charged if you felt the need to find out more. Using a micropayment model much like iTunes would allow aggregation of purchases with a monthly bill for your news consumption at the end of the month. Of course, the pricing model for these articles would have to be reasonable. Several things come to mind including a declining fee model, a monthly “all you can eat” model, and many others in between.

In the end news organizations need to start seriously rethinking their business models. The current one’s such as the Express-News is managing are not the future of news organizations. In response to the E-N executive I would suggest you are a news organization that produces a paper, but not for long if you keeping putting the paper ahead of the news.