Future seekers need better rear-view mirrors

As a Unitarian Universalist, I have a tough time embracing the Original Sin metaphor in the discussion about where news organizations went wrong online.

Yup, there have been a lot of failures.

But what’s getting lost in the discussion is a very real record of some game-changing innovation and achievements.

Progress, it seems to me, depends on getting a clearer and more accurate picture of what did work – even inside the failures.

By way of background, Alan Mutter started the sin thing by claiming that newspapers’ Original Sin was failing to charge for content. He’s wrong. Many of us worked for newspapers that charged for online content back in the mid-1990s. It didn’t work, and it’s not worth repeating. But it is worth remembering and learning from.

Then Steve Buttry weighed in with a thoughtful piece saying newspapers’ Original Sin was failing to innovate. He’s right, although many of us did innovative online work for media organizations. More on that later.

Howard Owens entered the conversation with another thought-provoking piece, saying newspapers’ Original Sin was keeping online units tethered to the mothership. Thanks to a history lesson from Steve Yelvington, we know there were several successful and independent online spinoffs that used little or no content from the mothership. More on their fates below.

Buttry countered that “Organization is not as important as mindset. And spinning digital operations off did not change the mindset.

Jeff Jarvis offered a variation on a theme by Owens, saying the real sin was not running the online unit as a business.

While rejecting the notion of original sin, Yelvington says newspapers failed by not confronting the basic question:

“What should we be doing to build an (online) audience without the benefit of the newspaper content?”

Welcome back to the Genesis.

Elizabeth Eisenstein, a wise scholar on the topic, reminded me earlier this year that since the industrialization of newspapers, the business model has been this: collect the largest audience, and then sell that audience’s attention to advertisers.

That worked fine until the audience’s attention fled to the Web.

“Perhaps the biggest threat to the subsidy of newspapers by advertising is the ease with which people can order and purchase all kinds of goods without leaving their desks and without scanning newspaper advertisements,” Eisenstein wrote after our discussion in May.

It’s not that Craigslist stole the ads, it’s that the Internet stole the audience!

And you need an audience to have a sustainable or profitable media business.

In our Twitter conversation the other day, Owens rejected my suggestion that TheStreet.com (where I was a managing editor) is a worthy example of a successful, independent, online-only news operation. “The Street isn’t local. Doesn’t address the problems for newspapers,” he said.

But I think hyperlocal on Wall Street has much to teach hyperlocal on Main Street.

The first thing TheStreet.com had to do when it launched in 1997 was build an audience and a sustainable business — from scratch, using online-only content. Some smart people at TheStreet.com quickly discovered that our subscribers craved tools almost as much as they wanted up-to-the-second news. So we gave them tons of tools and instant news. In 2001, we launched a 20-person microblog — evocative of today’s Twitterstream or FriendFeed — which became the hottest thing on the site. We built audience and a sustainable business. TheStreet.com posted its first quarterly profit in 2004.

Were there stumbles, conflicts? Of course. And we can learn from the entire experience — if we take the time to look and listen.

The idea of setting up independent corporate entities to let the online operation explore the waters without interference from the mothership is not particularly radical. As Yelvington and Jarvis acknowledge, several media organizations did it.

Here are some details from another example:

MySanAntonio.com was an independent corporation, half owned by Hearst, the parent of the San Antonio Express-News,  and half owned by Belo, the parent of KENS-5 TV. The converged combo was envied by others.

We paid our own rent in a separate building. We had our own servers. We had our own developers, designers and IT folks. We had our own 24/7 editorial staff and we had our own advertising sales people whose sole focus was the Web site. I was content director there from 2003 to 2006.

Sure, we ran content from the newspaper and TV station. But often the most popular things on the site were online-only creations, such as community-submitted pictures of the day it snowed, or the slideshow we updated with photos, stories and video of every local casualty of the wars in Iraq and Afghanistan. We got enormous traction from online-only tools like the Crime Database, which since 1997 has let people search their neighborhood for news, or the traffic page with highway Webcams and a widget with the lowest gas prices in town.

Our very first blogger was a retired Presbyterian minister who filed via AOL Instant Messenger from Internet cafes in Zambia where he was on a mission in 2003. We ran an online-only politics blog in 2004 that was so good it went Web-to-print.

We did a bunch of innovative things at MySanAntonio.com. And we sold a lot of ads. The company turned a profit 2005.

I know from watching closely that another indie, the WashingtonPost.com, did tons of award-winning innovative things with its online-only staff, and I am under the impression the dot-com also did well, financially. It was not only in a separate building from the Post, it was across the Potomac River in a different state.

MySanAntonio.com and WashingtonPost.com shared something else. In 2005 and 2006, both sites had about a 53% market penetration, an astonishing figure for “newspaper” Web sites.

We built audience and we built a profitable, sustainable business. And we didn’t do that by simply republishing newspaper stories online.

As Steve Yelvington reminds us, the Cox Interactive Media projects set an even higher pace of innovation. The one project I saw up close, Austin360.com, started from scratch, with no help or interference from the nearby Cox-owned Austin American-Statesman, and it did something no one had done before: It created a searchable and vibrant entertainment calender and review site worthy of the Austin music scene.

Before long, it had built an audience rivaling that of the established news organization.

But as Steve Buttry wrote, “spinning digital operations off did not change the mindset” inside newspapers.

Neither the journalists nor the business-side folks inside the newspapers appreciated the Web sites’ autonomy or innovation.

Rather than reward the innovations and business successes by putting the Web folk in charge of the future, many online operations got stifling bear hugs from the mothership and were finally merged and subordinated to the newspaper.

At the end of 2008, Hearst and Belo dissolved the MySA partnership, and the Express-News pulled MySanAntonio.com in-house. I can’t link to many of the online-only projects we created because they slipped between the cracks in the move to a new hosting and content management system.

As Yelvington described, Cox Interactive Media was dismantled, and “In the political infighting that followed, Cox threw away much of what it had learned.” Austin360, which once thrived because of its distance from the American-Statesman, now has the newspaper’s name prominently in its masthead.

The Washington Post cannibalized its Web site more publicly, as detailed in this City Paper article and interview with Jim Brady.

All of this is hardly ancient history. And it’s an incomplete list. Do you know of more examples? I know they’re out there.

Those who don’t pause to learn from the successes we had as we failed forward, face a longer journey.

13 thoughts on “Future seekers need better rear-view mirrors

  1. So, NOWCastSA will be an independent, online only, news website? Complete with innovative engagment for anyone interested?
    Since we are nonprofit, we do not need to consider the business thing, but only the engagement thing.
    Is this it in a nutshell?

    Sincerely,
    Laura

  2. So the payoff for a successful newspaper web offshoot is that the print newsroom (the same people who can’t figure out the web) will absorb them? The recent WP web/print merger probably explains why WashingtonPost.com suddenly started asking me to register/login to see most of its content earlier this year.

  3. Charlotte, thoughtful piece with some good insight, and I don’t mean to belittle anybody’s efforts, but none of the examples of so-called separation get even close to what I’m talking about, and at best are one-off examples, not the kind of industrywide shift that should have taken place. I’m talking about what should have happened was widespread complete, total and utter separation of online from print with absolutely NO cross pollination. Not a single article from the print side going online. No consultation at all between sales staffs. Utterly and totally completely different business operations. The same degree of separation that now exists between The Batavian and our chief competitor the Batavia Daily News (though in this case, neither company was ever related in anyway). I’m talking about the highest, thickets wall of separation you can imagine. The Potomac isn’t wide enough when both products are still branded the Washington Post.

    • Your last comment I think exactly makes my point, which is, let’s learn from what they did and do the right things better!

  4. “Hi:

    Two things

    1) I’d like your permission to (re)print your article on Frontline
    for our website

    2) I was hoping we could use your ‘scribing’ talent for our website.

    The Best Shows Youre Not Watching (dot) com [all one word]

    ‘The Clone Wars’ is one of our featured shows. We’re hoping to round up a few people who can occasionally contribute perspective (via an article/blog) on the shows – maybe a recent episode, future direction, plot shortcomings etc.

    What’s in it for you?
    Primarily a larger audience back channeled to your blog. We don’t pay but the site has a lot of promise and we’re pretty excited about getting it off the ground. Let me know what you think.

    Thanks

  5. Hey Charlotte-Anne,

    Great to meet you and I (as a History major) agree that there is a lot to learn from the past.

    Unlike most in this discussion, I bring (I know -oh yuck) a marketing perspective. And the perspective of one who has owned and operated the exclusive rights to a multi-media sports event with an avid and underserved fanbase (US Latinos).

    From reading Steve Buttry, Jeff Jarvis, Howard Owens, Steve Yelvington, as well as others you haven’t mentioned, I think we all agree that consumer-oriented innovation is needed. Some agree that people will pay for a more consumer-oriented product. I think all agree that marketers will pay more to support a more consumer-oriented product.

    I understand why Howard and others think the Divide and Conquer route is the only alternative to get around the conflict with the “old” media mindset.

    I have tried to partner with “old” media to create a fully integrated media experience on TV, in print, online, in radio, and activating locally – all the way to retail (we had merchandise to sell too). Can’t tell you how that worked – because couldn’t get these guys to think this way! So I get the hurdle.

    I agree that a lot has been learned by operating “untethered” from the mother ship. When I experimented with very limited syndication of a dynamically updated widget during games (reported line score and highlights) our website traffic tripled. In other words, curiosity is there, and I had a chance to convert them to buy a live video subscription and merchandise.

    But I also know how many sponsors were interested in my fully integrated concept that I couldn’t deliver to them. Many $ left on the table. The point is that marketers have been trying to execute integrated marketing campaigns forever. The biggest hurdle is that media is not integrated. (By the way, I think the MySanAntonio.com jv with the local tv station and newspaper is brilliant. I’ll bet if the print and television entities integrated seamlessly with the website it would still be alive today. The timing for that idea could not be better. As the big networks are not “over the air” anymore their relationship with affiliates is totally “in the air” right now – the local stations should be very motivated to explore how to “own” their local markets by collaborating with other local media – and I would include radio too.)

    The point is learn what you can be being a renegade. But eventually you have to work together to succeed. So the question is what will it take to bring all the stakeholders to the table and collaborate. I think delivering a better product for the audience is it. And if focused on delivering a product they would actually pay for, the motivation goes up.

    Is it possible they will pay? Remember CB Radios: Created a market for mobile communications, demonstrated how bad it could be, cellphones came along and solved that problem for a huge premium – even with less reliable reception!

    That’s all for now. But I think this is a really productive conversation. Wonder how it could be improved . . . hmmm.

    Katherine Warman Kern

  6. Pingback: Home page tweaked at mySA.com | John Tedesco

    • John, nice piece on the changes at MySA, and thank goodness for the Internet Archive’s Way Back Machine to remind us of what *not* to repeat!

  7. Thanks, we could write a thesis on the successes and setbacks of mySA. But I think the site is improving. Heck, maybe someday I’ll be able to put links in my stories like a blog. What a novel concept!

  8. Pingback: Home page tweaked at mySA.com

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