Aug
14
The Slow Death of Newspaper England
Filed Under Blog, Industry Analysis, internet, mobile content, news media, online advertising, Publishing, social media, Uncategorized | Leave a Comment
Every week now another piece falls into place. The decline of the newspaper business as anything that anyone would want to progressively invest in is now turning into a rout. Like B2B magazine publishing, the question now is not what does the future hold, but how do we clear up the junk afterwards. These gloomy thoughts are prompted not just by Trinity Mirror’s catastrophic results this week, in which the half year to end July saw pre-tax profits decline from £84.8m last year to £28.9m this year, on revenue down from £382.2m to £371m. Or by the reaction of the markets: shares jumped 18% on rumours that the company was organizing a further share buyback, thus sacrificing its balance sheet on the altar of market valuation. And I am not further comforted by the fact that the Sunday Mirror gained from the disappearance of the News of the World, a situation which is purely temporary now that the Sun on Sunday has entered the market. Or by the announcement that the group internal investigation clears Piers Morgan and his colleagues from charges of phone hacking; this story has two years to run, and there seems to be no last shoe dropping/fat lady singing syndrome in sight yet. You could wallpaper the bathroom using denials and announcements from News Corp on internal investigations that show no wrong doing, and the same may yet be true of Trinity Mirror.
No, the piece that got to me was a report by that doyen of Fleet Street rectitude, Roy Greenslade, in his Guardian blog. He quotes David Lis, at Aviva Investors, as saying in the Sunday Times that “Its imperative that there is consolidation within the regional newspaper space. It simply has to happen.” We must listen to Mr Lis with respect: his company apparently own 10% of Trinity Mirror, whose shares have fallen two-thirds in value this year, prior to that buy back rumour. One wonders what his position is on the buyback, or indeed on the dividend (axed two years ago and unlikely to return), or the advertising trend at Trinity Mirror (down 11.1% on the half year) And he wants to buy more of that? Nothing braver has been said in any walk of life since Neville Chamberlain returned from Munich promising “Peace in our Time”!
Is it not yet apparent that the managers of the major regional press interests have done everything that capable and reasonable men can to save the ship? We have now had a decade of staff cutting, regional print centres to raise productivity and reduce costs, regional editorial services producing look-alike products in the towns and cities of Britain, and exodus from locality to create a minimum service level on the narrowest editorial presence, churning out doctored agency text designed to keep the ads apart on the page – until all of a sudden there were no ads. And the flight to the web, in the jealous editorial hands of the existing print papers, proved to be a real failure either to create something new and local or to extend the hallowed brands of the print world into web presence. Having once almost succeeded and then failed to persuade Trinity to buy Thomson Directories, and having seen them developing directories in Scotland in more recent years, I hoped that a penny had dropped, and that they were about to embark on a complete local advertising strategy online, something we often anxiously talked about years ago when Fish4 was being created with their support. But, no. Courage and convictios fell at the final hurdle.
So why, Mr Lis, are you persuaded that putting together one cost-pared declining business with another with the same problems makes any sense at all? There are few more cost savings to make. Advertisers will seek greater discounts across more newsprint. There are no competitive positions to close out – these papers are all local monopolies anyway. The trick that your company needs to perform is to invent the equivalent service values of the once popular local press in an online and mobile context. You need to do it, despite the disadvantage of starting in print, with these factors in mind:
1. The newspaper was always a partnership with the community – but newspapermen forgot that.
2. You cannot press a format onto a geography and call it a community.
3. Format is created by need and formalized by experience. Formats that outgrow needs have to be re-invented, bottom up.
So can you recreate the newspaper? No, but you can certainly create answers in digital media for issues of local and hyper-local communication, trade and exchange. Will they look like newspaper websites? Not at all – news is only important when other needs, which may include targeted news, are satisfied. Can you create environments that link whole communities? Of course, given time, but in some places it will be the schools, in others local businesses, in some sports, in others issues outcry (like high speed trains in Bucks) that will create the initial focus. Once the flame is going, feed it with tools and apps, manage it for the community and monetize it through eCommerce and sponsorship. And make it mobile from the first instance.
Meanwhile, readers of my letter to the CEO of Guardian Media Group will have recognized what is happening there. Apax and GMG declared a “special dividend” for EMAP, taking out a £100m benefit from a debt restructuring deal, presumably so that GMG can plug the hole in its finances arising from this years’ losses. They will not need reminding that even family silver can run out, and plugging losses does not secure a sustainable future.
Jul
17
Life after Social Media
Filed Under B2B, Blog, data protection, Education, Industry Analysis, internet, mobile content, online advertising, privacy, social media, Uncategorized | 1 Comment
In a world of remarkable events (I am trying to write this against a background of Rebekah Wade/Brooks getting arrested, the likelihood of News Corp selling its UK newspapers being discussed as a serious option, and the suggestion that now is a good time for Rupert to start sacrificing some children, while Fox News suggests that we should put the phone tapping issues aside and maturely move on (http://www.theatlantic.com/national/archive/2011/07/the-most-incredible-thing-fox-news-has-ever-done/242037/) it is hard to concentrate. Part of me rejoices at the acceleration of change in media markets, part is saddened by the loss of jobs belonging to people with no share in the wrong-doing. Part of me stares in wonderment: there really is nothing to match the British in one of their periodic outbreaks of public morality; however hypocritical they maybe, the political and the chattering classes devour each other in the media with an energy unmatched since Herod’s slaughter of the innocents!
So lets discuss, in the spirit of Fox News, something that merits some consideration. During the time from when Rupert bought and then closed MySpace, huge changes took place. These were partly to do with the emergence of the Facebook hegemony, partly because of emerging valuations for that service, LinkedIn and Twitter, partly because the succession in fashion terms seems slow to hit its stride (though I am still betting on FourSquare). But they were more to do with the emergence of a new culture around networked relations with other people, which has driven us all into discussions of social marketing, exploiting natural communities, building loyalty through networking customers, and finding out much more about user behaviours. In the information industry we have seen these issues as extensions of our CRM, with the apparent aspiration that in the Salesforce world of tomorrow we shall be able to assemble everything we need to know about the user in some Cloud-based solution platform and feed our relationships with customers in a wholly personalised way.
But what if this is not so? Since the dawn of the Web users have been stronger in marketing relationships than vendors, despite belief by vendors that they can use real world techniques to establish virtual world advantages. We pay lip service to the idea that advertising may be affected, even replaced, by user recommendation, then spend longer periods of time arguing why it will never happen. Because, viscerally, we do not want it to happen.
And yet it may be the least of what is likely to happen, and if we seek evolution rather than revolution then we need to put our heads into some emerging user positions. An important one of these is VRM (Vendor relationship management), in which individual users decide how to hold and store critical information about themselves (not their descriptors – age, sex etc – but their performance as buyers and sellers, readers and browsers, etc). What will happen when statistically significant groups of people get far enough down the road to Data Literacy (probably the most important untaught subject in our education systems) to practise what one leading practitioner and media influencer in this sector, Adriana Lukas (http://www.mediainfluencer.net/), calls “Self-Hacking” and others term QS (Quantified Self). We are told on the Web that “markets are conversations”. Well, they are also relationships and transactions, and if users are able to hold and use aggregate knowledge of their web footprint then they have a considerable weapon in the battle to persuade vendors that free users are better than captive ones, and that each of us is likely to be the best advertiser of what we ourselves want.
What are the signs of progress towards this new world of “ambient intimacy”? Have a look first at the joint Harvard – Berkman Center programme around Doc Searls’ work on Project VRM (http://cyber.law.harvard.edu/projectvrm) and the EmanciPay work program. This has deep roots, and recalls Searl’s pronouncement in the Cluetrain Manifesto:
And if you think this is just a one-off research-funded effort, have a look at Diaspora’s alpha (http://blog.joindiaspora.com/what-is-diaspora.html) or at TrustFabric (www.trustfabric.org). As Facebook begins to slowly lose growth and start marginal decline, there may be space for a new/old view of networked relationships. Of course this is an issue intimately related to privacy (see what Mozilla propose in their Drumbeat environment with privacy icons :https://drumbeat.org/en-US/projects/privacy-icons/. And then look at MyCube (www.mycube.com), and, if you think that personal datamanagement does not relate to what the real world does , see what the Guardian does in its datastore environment (http://www.guardian.co.uk/data) to sort and re-aggregate diverse datastreams.
Still too distant to grasp? Buyosphere (http://buyosphere.com) paints a picture of semantic web based shopping in beta, and Zaarly (www.zaarly.com) is a first attempt at doing community cross-selling in geolocational contexts. This is the beginning of a new, post-Facebook world, and must be grasped now if we are to migrate towards it. Happy travels!
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