30 Responses to “Bring On The Techies: How Silicon Valley Can Help Save Newspapers”

  1. Nate,

    Finally had a chance to read and consider this. Nicely written and reasoned, and even has some smiles. One portion gives me pause:

    “Portals should agree to show search results only for the original sources of news content, as opposed to outlets that have repurposed that content.”

    That kind of restrictive thinking seems fair at first glance — after all, shouldn’t the one creating the content be the one who reaps the benefit? — but it goes against the grain of the way it’s been done not just for the past 10 years of Web journalism, but for the past 40-50 years, with broadcasters and others picking up information, and, if fairly, attributing it to the original source.

    Today’s model calls more for incentive than restriction. Perhaps we could allow for some kind of prioritization in the search algorithm for the originator of the content. And some sort of additional revenue to the creator, where there is a shared revenue scheme.

    But by highlighting only the creator (which will often mean the large player), Google and the other search engines would be alienating a significant chunk of their constituency, favoring one business over another, and potentially violating tenets of free speech. For example, commentary on a piece of journalism or even pickup of a small portion of it might be fair use, and thus deserve to the be linked to from the search — and something the searcher would want to see. If the algorithm excludes those results, because they weren’t from the originator of the content, it might be a disservice all around. (Not to mention that the original’s SEO ranking would suffer because of fewer links and accesses to it.)

    A final thought: Where would PaidContent be had the system of excluding repurposed content been in place?

  2. Eric Morton

    It is great that all this talk of saving the newspaper business is going on. I have a really different and innovative solution to the whole approach and I would like to see if I can get some strategic partners (the companies in silicon valley which want a serious solution) to come on board and give the paper readers a innovative make over that may get some of the online readers to take notice. I am very serious and this will change a lot of things in the industry.

    Yes I will be asking for a non disclosure agreement

    Eric Morton
    Future Creative Designs

  3. Actually, there is no "newspaper business" just like there was no "railroad business". The business is the availability of professionally vetted information. Much of the historical media have proven that they do not understand this. They bend and twist information to their goals instead of simply reporting (see, for example, this CNN article on the value of social networks for news: http://bit.ly/yYcgV).

    The point is that most of professional journalism does not understand the business that they are in: gathering, vetting, and delivering unbiased information. That's the reason that many outlets are dying. They are no longer trusted.

  4. Nathan –

    Well written and insightful post and great group of comments. Thanks.

    Glad to see in your own later comment in the thread you addressed the age issue both from the second paragraph of your post (re newspaper person asking how old you were implying you were too young to have any ideas), and your own earlier comment re now seeking advice from 25 year olds (as if "older" have no insights in digital space.

    We know that both are false assumptions. When people use age – too youg/too old" to write off someones ability to add to the conversation, they loose .. and no wonder are in trouble.

  5. No less than radical innovation is required to preserve an old idea from a few companies, mismanaged by Luddites, who currently publish large, regional titles in the U.S.

    The portals and the techies can help save them, says Nathan. Yet they have been unwilling to pay full value for something that is costly to produce and exceedingly difficult to do well.

    What is the value of journalism in a connected society? Who does journalism? Who pays for it? How? These are the issues of an innovation recession where the losers desperately cling to the mythologies of the past. More:

    Latest post: http://wemedia.com/2009/03/05/journalism-democracy-and-the-laughter-of-gods/

    Thinking Paper: http://wemedia.s3.amazonaws.com/papers/tp/ifocos_wm_innovation.pdf

  6. My company, Kachingle, has developed a crowdfunding financial service for all forms of online content. We are in preview mode now with selected sites & blogs. For more information please visit our corporate blog for news about Kachingle. (http://corporate-blog.kachingle.com/?p=24).

    Content sites interested in learning more please contact me directly (cynthia dot typaldos at kachingle.com) .

    Cynthia Typaldos
    Founder & CEO

  7. Ron S and A.G.Shadsforth have it correct – you are arguing about how to rearrange the deck chairs on the Titanic. The paper print news has hit the BIAS iceberg, and unless the load of biased, "progressive" garbage that is forced down people's throats is thrown overboard, news print SHOULD drown in red ink.

    The NYT should go bankrupt. I have gone to my local newspaper to tell them to stop delivering, BECAUSE of their bias, and they still deliver this birdcage liner (and I refuse to pay for it!).

    As far as bloggers being unable to cover news stories accurately – why don't you argue that to Sam Donaldson? (Forgive me if I got the name incorrect – individuals like the phony who reported the George W service papers are eminently forgettable in my value system…)

    Newpapers – go objective, or be gone.

  8. A.G.Shadforth

    Saving print media as it existed in the past and present is not going to happen. It will not happen for many reasons some of which are the direct responsibility of the owners, editors, reporters and the industry in general. The reason are biased reporting, editorial policies on reporting, lack of objectivity, cost of print media, inability of lower income levels to read, and the list goes on and on. Face it the internet is cheaper and more varied, TV and radio are cheaper yet and topping the list causing the demise of newspapers and magazines is the pompous egos of our self styled guardians of the publics need to know, as long as it is what these want them to know. The great unwashed masses are saying NO!

  9. Olivia Ralston

    I find it a bit rich to propose that AOL and Yahoo should lead anything given the state they're in, and Microsoft given its efforts in the digital media space. They're not doing any better than newspapers.

    I have always thought it was crazy how much you get in a newspaper on a daily basis for about a buck. I suppose in the pre-digital era this pricing made sense as newspapers were a scale business in a monopoly environment, but now, with so many more alternatives to the newspaper and therefore fewer paying newspaper customers, the readers who actually value what they get from a newspaper will have to pay fair value, which has to be a whole lot more than $1 for a newspaper.

    Like Chris H, I think of myself as a typical or target newspaper customer. However these days I rely on headlines online for day-to-day reading and the Economist for in-depth analysis and understanding of what's happening in the world.

    The fundamental issue is that there are no barriers to entry in either news producing or aggregation – never have been – and now none in distribution. It's a totally competitive business and my guess is that the fallout will be unpredictable and ugly.

  10. Greg Schwartz

    I subscribe to the journalism = democracy argument. Flourishing local journalism (the professional stuff) is critical to ensuring minimal levels of citizen control over our government. Delivering journalism in a printed form certainly isn’t required though. What is required is that consumers be willing to pay for the product. The news business has little hope to survive if purely dependant on the online ad business – the online news category has terribly low CPMs…

    So how to convince consumers to pay for what many view as a commoditized, ubiquitous product? Deliver something unique, authoritative and packaged however the consumer wants to consume it . Rewritten AP stories aren’t going to get it done. My home town (NYC) has a wonderfully unique product in the New York Times iPhone ap. Would I pay for it – sure. How much? Not sure but if someone from the NYT is reading this, email me (I’m on LinkedIn) and make me a reasonable offer, I’ll send a check the same day.

    The portals certainly wont like the outcome of this inevitable march to a paid online newspaper product, they stand to loose a great deal if the paid walls are erected. So giddy up Yahoo, AOL, MSN, GOOG, throw the papers a bone or two or you will be left linking to a paid subscription wall and little else.

    The SF Chron & Seattle PI are worth saving…. Lets pony up.

  11. Perhaps if the newspapers would return to true journalism instead of biased liberal reporting, they wouldn't be in financial trouble. I never bother to read a paper anymore because they never tell me anything I can't predict ahead of time based on their biases.

    I know that these my comments will fall on deaf ears because when you are an insider, you only believe what other insiders tell you. So continue to ignore these observations at your own peril.

  12. Let's hope the newspaper people are reading some of these great ideas & comments. In posting– I was hoping for dialogue and realized that my ideas and anecdotes were not "the" answer but an attempt to get dialogue moving…
    Perry's ideas are all spot on — hopefully he works in a play that these can be advanced!

    1-Paternalistic & Price Control: I love this comment because it can be viewed as such but the reality is that most industries have some level of price "coordination." The newspaper industries value chain is riddled (or should I say sadddled) with a paper cartel, trucking mafia and unionized newsrooms that mandate 3-5% pay raises even in times like these. I guess if I had my choice of dealing with Google & Yahoo to innovate or people killing trees, thugs shaking me down to deliver papers and unions that can write about how unions have saddled auto makers to uncompetitive cost structures but not in the mirror…I'll take google & yahoo!

    2-Innovation: Yahoo Finance was a #3 or #4 in our space but we did a few things to make our user experience much richer, stickier and essential through technology. We didn't received our traffic via inboxes– we had very organic, direct traffic because the product was much more comprehensive & we refined it all the time. In another instance we looked at our value chain and saw that Reuters was charging us multiple millions of dollars to handle delayed quotes– we looked to buy which was millions, partnership alternatives were limited and we built a feed handling capability for our core product that is now managed by 1/2 an engineer in Bangalore.

    3-News Agencies & Investigative News: Reuters, AP, Bloomberg & DowJones Newswires are not alternatives for great investigative journalism however there are other alternatives to investigative journalism such as propublica, freelancers that get picked up by the Yahoo's, and others. The news agencies have their own challenges however we did a lot to bring AP a news business line which I hope helps bridge their leap from being supported by struggling papers to digital support. In reality the NYTimes & WSJ barely have journalists covering some of the largest international tragedies– having served my country in Africa for two years and been back to serve as head of relief agency– it is shocking that the NYTimes relies on one person to cover a continent, Africa, that has two of the most shocking genocides (Darfur & Congo) occurring in this day & age. We can't wonder why people seeking the highest office in the land think Africa is a country when we give it short shrift.

    4-Ideas: No one has asked what I had suggested at the Journal? I suggested putting a "whispernet" like device into printers that allow print die-hards to get a free printer from HP when they sign up for a WSJ subscription. WSJ could beam down a print version if their is paper in their printer; cut down on delivery costs; shift paper costs to the user; allow HP to monetize on cartridges and continue to place ads on a page. Not brilliant but feasible & worth trying in a test market. They give printers away why not for this…

    As a note, I am a Kindle subscriber to NY Times & WSJ. My former employer charges me more for a Kindle subscription without access to the online version HOWEVER my old prints subscription was $40 less and I had online access. What does that say about their thinking? I will leave you to judge given I like those former colleagues who are intelligent enough to know what I think but working on the smarts to communicate this to Amazon or marketing…

  13. Nathan,

    My contribution to this dialog will be as an end user simply describing my experience as a NYTimes consumer. Perhaps I flatter myself a bit, but I believe I am a part of the audience that newspapers want/need. Maybe some of those folks like the one that "leaned on the table and asked you how old you were" are reading now…

    I am a 46yo white male, wife, 3 kids, mortgage holder, veteran, BS degree, union member, online probably 6 hours a day. While my retirement and college savings have been devastated recently, my job is secure, and I can wait out this downturn, fortunately.

    What the large flagship newspapers give me that I do not get elsewhere is the big picture of a news story updated (most) everyday with complete continuity and context.

    A good example is the NYTimes and their coverage of the impeding diabetes disaster in the NY Metro area. The short summation is that people make poor food choices, don't exercise enough, and the health care industry has no financial stake in setting up support groups to counter these conditions, while the profit margin on the lower limb amputations that these patients will eventually get (>80,000 nationwide in 2000-01 ref. CDC) ensures that this situation will continue unchanged. There is no cure for diatetes…..diet and exercise is the best defense.

    If the Times was not covering this story, who else would?

    No amount of Twittering, blogging, or whatever else appears can take the place of the depth of coverage that the Times has already produced on this topic. This is the strength of these old line newspapers.

    Closer to my home in California, the state budget crisis has been well covered by the NY Times, although I had hoped that the paper would be more biased towards an attitude of fiscal responsibility rather than simply adopting the tone of a blase bystander. (Since when is borrowing more money actually balancing a budget?)

    The NY Times also has news alerts which are delivered to my Yahoo account, which is very nice, but recently, I have not used the NY Times as much, because….. Until late last year I was able to bookmark news stories inside my NY Times account…..this feature made me a frequent user. The stories had permanent links that I could save and use to email to friends or co-workers.

    New York Times killing Times File

    Now, if I click on the Share button on a story I like I get an array of choices like Facebook, MySpace, YahooBuzz and some other flash-in-the-pan options, while Furl, the service that the NY Times lined up to take the place of their in-house space for my personal favorites no longer appears as a choice to help me bookmark a story. This seems like an odd place to put frequent readers of the online NYTimes. (I am going to guess that the reason this unit of the Times was shutdown was because the individuals in that unit had very little seniority…)

    The strength of the NY Times is the depth and breadth of their coverage. That is what they should be leveraging.

    I don't want to scan the net for the particular bloggers and tweeters that are covering a particular topic. I don't trust them to get the full story correct anyway.

    (Not quite ready to stop writing, but I have reached the limit of time I can expend on this.)

    Chris H
    Mountain View, CA

  14. Perry Gaskill


    As much as I appreciate your effort to write the post and add to the general dialogue, I found it flawed on multiple levels. Here are some random thoughts:

    It seems to me that somehow there's a reversal of thinking going on in that if you save newspapers you'll save journalism. It should really be the other way around.

    The idea that some sort of triage "to just buy the top three newspapers and create an editorial trust" by Yahoo, Microsoft, Google or AOL is, well, bizarre. Sorry, but I stopped counting after coming up with at least a dozen reasons why this won't work.

    One of the current misconceptions is that the entire newspaper business has tanked. The reality is that a lot of independently-owned papers in smaller markets continue to be financially healthy. The big hits have been taken by large chains which have undergone leveraged buyouts and have a large debt-service burden.

    Because of monopoly markets, a lot of major dailies became fat, dumb, and lazy. For example, in recent discussions about the downsizing of the Los Angeles Times newsroom it emerged that current rule-of-thumb thinking is that a major daily should have a ratio of 1:1000 for newsroom staff to circulation. As a staunch defender of folks on the news side of the business, even I find that strange.

    Newspapers have lost readership because of two main complaints. The first is because of a lack of providing local news. Why read a bunch of wire copy you can get on the Web? The other is demographic. Younger readers want to understand local issues but have no easy way of grasping the background to issues because a lot of local stories are written with the assumption that the reader has been following the paper for 20 years.

    There are a lot of newspaper publishers who need to stop reacting to what the New York Times, or the Washington Post, or the Wall Street Journal do. Each of the three is an anomaly. What seems to be missing among publishers is the fundamental idea that all news is local whether it's an earthquake in Japan or a murder trial in Kansas. It seems to me the only thing the NYT, for example, has brought lately to the larger newspaper-business party is its recent release of an API to pull in stories via semantic meta data. The NYT deserves a huge attaboy for doing this, but it's flown mostly under the journalistic community radar in terms of what it means.

    If Silicon Valley really wants to help the online newspaper business, here are some specific suggestions for open source coding projects. And such projects could be paid for using emerging L3C business structures:

    1. Develop better open-source platforms for publishing news. The current choices are badly flawed. Most of the time publishers are either faced with a franchise model which tends to generate a generic presentation of local news, expensively re-inventing the wheel, or ineffectively trying to push the limits of an existing blogging or CMS platform. Such a platform should include a standard and reliable way of maintaining archives.

    2. Develop an open source alternative to Reuters' Calais project and move news content toward a more semantic web. This could help make original content more valuable than some tenth-generation derivative blogger's comments. Or worse, some link-farming SEO gamer.

    3. Work out better ways to split site entry points and content presentation so that local visitors to local sites move through pages– and local display ads– differently than for a random visitor from somwhere else on the planet. This could realistically push CPMs into double digits in a smaller-market but at a lower production cost.

    4. Work out mechanisms or APIs which would allow the advertising process to tie into local merchant inventory supply chains, co-op ad programs with manufacturers, or whatever. In addition to helping generate more ad revenue for the paper, it could also help level the playing field for local merchants up against big-box franchises. Newspapers are supposed to be advocates for a community and its unique sense of place. Or do we all want to wind up living in WalMartville?

    5. Work out ways to implement a "Freemium" content model instead of the classic one-size-fits-all subscription or micropayment model. The idea being that although there is some value to the original content, there is potential additional value in terms of what can be done with it.

  15. Michael L

    Great article Nathan. Everything you outlined for newspapers can be applied to magazines. The print industry as a whole hasn't exactly been fertile ground for innovation. Technology and product development get treated as a commoditized cost center. Many of these institutions look at technologists as little more than internet printing press operators and not a potential source of innovation. The entrenched structure of editorial and ad sales leaves little room for product groups who end up having to deal the legacy mindset that you encountered. It's amazing in these desperate times how little the industry has actually changed. One answer has been to cut costs and water down the content which commodifies it further.

    I don't know if the portals will be altruistic enough to help save newspapers, even if it is in their long term interest. It may actually take the primary source of news to dry out before the portals and blogs who benefit from it take notice, unfortunately it'll probably be too late.

  16. Iam Hari from India researching on Media Management.The inputs and the comments are really fantastic and I would like to see innovative and new business models for newspapers and media.Help greatly appreciated.

  17. Excellent article Nathan. I've been thinking about this issue a lot lately and would like to draw your attention to what I believe to be a very relevant parallel.

    There is an opportunity for someone to do for the newspaper industry what Samir Arora and Fernando Ruarte, founders of Glam Media, are doing for women's magazines.

    Anyone who studies Glam Media will quickly see that it was started by technology entrepreneurs and its products run on technology platforms (e.g., Glam Media Vertical Content Network, Glam Evolution) and applications (e.g., Glam Applications Network) built from the ground up by Glam Media or by companies it acquired (e.g., AdaptiveAds).

    The newspaper industry needs a Samir and Fernando to give it new life.

    Here is an interesting read about Glam's history:



  18. Scott M

    Nathan raises some excellent points and, more than anything, at least proproses concrete solutions, which is a true rarity.

    Whatever mistakes this cratering industry may have made (and there are many), it is a true loss for society to see the great investigative staffs hacked back. That is a void the online world will never fill, whatever the blog or aggregator.

    Newspapers have missed the boat in monetizing their content online. They might well earn a bit of that back if they take a few of Nathan's suggestions.

  19. Nathan brings up some good points, but they seem to amount to a combination of paternalistic control and price-fixing. The real answer is a lot closer to 'old thinking': return to focusing on audience and subscription, rather than on content pushing models.

    The Tech companies that Nathan references have been successful, but if you look closely at their success, it has been largely based on Monopolistic business models: maximum marketshare (google), copyright protection (Microsoft), audience aggregation via inboxes (Yahoo), Audience control via proprietary platforms (AOL).

    Newspapers, in seeking the maximum distribution of their news, have spurned these models and as a result have destroyed their own financial footing. They are overly profligate with their IP. They value all their product at the same price point: $.50 cpms.

    Display ads would have to get to the $15 cpm range to cover the costs of their newsrooms as they are currently staffed.

    How do you get those CPMs? Know your audience the way they have known them in the past – via subscriptions. You don't have to even charge for the subscriptions. All you have to do is to get the consent to market to/advertise to subscribers in exchange for getting 'free' news. Targeting relevant ads via all different modalities pays for this. If you opt out of the ads, well you opt out of receiving the free news. It's that simple. Known, verified audiences get high cpms, lurkers and anon users get low cpms.

    We work with the newspapers and know they get this. Either they begin to own audiences or the search engines and aggregators own their audiences. Disintermediation = death. Newspapers used to know and monetize their audiences. The shiny object of the internet has temporarily stunned them. They need to wake up now.


  20. Nathan R

    Comscore– source/loss. It is a subscriptions service. Thanks for pointing that out, Karl.

    Music & Gaming are the two traditional industries which have transitioned to having the highest shift to digital revenue while books & newspapers are the two trailing. Check out Lauren Rich Fine's DIY report for the data.

    It is a combination of problems confronting newspapers– not just the monopoly issue but cost structures, delivery, usage, engagement and the digital world.

    The age comment is meant as a metaphor for "types of thinking" and innovation does generally prevail. I know my grandmother learned to use a computer at 70 years old in the 80s so hopefully the venerables will seek unique solutions that may not have existed in the past…

  21. Karl Eisenhower

    Your premise is flawed. You don't cite a source for the precise-sounding 50-to-65 percent of traffic to media sites that supposedly originate from portals. I'm assuming you didn't cite a source because you pulled the numbers out of thin air. I used to work at one of the sites you mentioned, and, while it's not my place to post their internal traffic data, I can tell you that your numbers are way off.

    I'm beginning to wonder what it will take to kill the if-only-everyone-were-as-smart-as-we-are-in-Silicon-Valley meme (which reached its most absurd extreme when Tom Friedman suggested that everything would be fine at General Motors if only Steve Jobs were in charge).

    The basic problem with the newspaper business is that most major metro dailies had enjoyed monopolies on certain kinds of advertising in their markets (or they belonged to JOA cartels that eliminated price competition). Now that the monopolies are gone, newspapers have lost all their pricing power, and their monopoly-era cost structures are completely out of alignment with their new revenue-side reality.

    Companies tend to fail when confronted with these sorts of changes, and there's often no right answer to save them (the hub-based legacy airlines still haven't figured this out after decades of trying). No under-40 out-of-the-box thinking will change that.

  22. Nathan R

    Great comments and the type of dialogue that I hope Silicon Valley will embrace as Google already has: http://googleblog.blogspot.com/2009/02/from-height-of-this-place.html.

    The newspaper folks need to allow new thinking in…not, uhm, surprisingly, they seem to be absent from commenting (it is a very digital way of engaging an audience.)

    Gordon was definitely not the publisher at the time- our Managing Editor (who once worked under the then publisher) pulled the publisher's name from my original story saying that naming her would be unnecessary…

  23. christian

    Ben, there may still be "plenty of people who find the newspaper the ideal medium" but that's a dyeing breed, sorry. I agree that we need a way to save the deep analysis and thorough reporting, but that doesn't require a dinosaur print product. It's a digital world now!

  24. Gordon Crovitz

    Excellent post by Nate, despite the fact that he admits to pushing 40 years old. However, I would like to set the record straight for the paidcontent.org community on one point: I was not the unnamed publisher of The Wall Street Journal in the anecdote at the beginning of Nate's post–an anecdote, by the way, colorful enough to be worthy of inclusion in an article in the Journal itself. I became publisher the following year, in 2006.

  25. Print NewsPaper should remain. Its feel can not be compared with anything which the Internet offers. It's a well known truth the print media is suffering in all countries who have high speed internet/broadband. But reading newspaper than straining your eyes in front of a monitor can not be equated. Feeling of newspaper is quite different.

  26. I think there's at least two questions which I think aren't being asked by anyone in the newspaper business: how do you save the physical "newspaper", and how do you save the deep analysis and thorough reporting which is the hallmark of what newspapers do? I think they're really two different things. One, is making the physical newspaper a profitable, yet relevant thing — there are still plenty of people (myself included) who find the actual, physical newspaper an ideal medium for browsing and reading news without the ADHD of Internet content — and the second, is somehow figuring out a way where long-form, in-depth reporting can be supported in a world where online clicks are worth a fraction of print ads. I don't think it's a question of saving the "newspaper industry" and newspaper companies (and their baggage/etc.), but instead, what new models need to be formed to still be able to serve the many readers who want their daily, physical paper; and also, but separately, support the huge costs behind deep investigation and long form reporting that newspapers bring to society–but instead, most likely on a web-based platform, driven by the models or similar ones you suggest in your post. I think those two questions are separate from "saving the newspaper" and are the key to breaking through the industry's issues.

  27. We were brainstorming of all things…the width of the paper." I wonder if the discussion was around turning the WSJ into a tabloid style(what others have done) to make it readable for some of the raveling audience among other reasons(I am not in the business. The look and feel of a paper is expensive to change (not just HTML) and if we in the valley were doing it we would applaud Ms Meyer for her attentiveness.

    As for ideas – my friends once said that people buy papers to read the 'agate' type – classifieds, sports scores, stock quotes, obits. When I used to contribute to a weekly industry pub, the old school managing editor used to tell me that my job was to "fill the space!" I suppose so the newspaper would have 'stuff'' around the agate type and advertisement. I think that stuff is now called content and this thread is about getting folks to read more of what they never did.

    The blue bags on my lawn
    Memories of time gone
    When with haste, I would review
    To see who died, no more bags blue

    I agree completely with this BTW, I would love to save newspubs – if only to make sure that stuff like this is assigned, edited, streamlined/cut or rejected, to save you the reader.