Lessons from succumbing to the perverse incentives of a rented audience

This was a week in which all of the harsh lessons and dangers for media of relying on rented audiences were on display. For one, Facebook completed its divorce from news media and told Australian news outlets that it would stop making payments to them. Facebook also announced that it was retiring its news tab in Australia and the US and would soon be doing so in other countries as well.

Alan Soon of Splice Media and Adam Tinworth have both said that it was time for media to move on, and Social Media Today gave a reason for media to do so with confidence. Research from “media insights platform Memo” found “no direct link between how much engagement a post gets in social apps and how many people then read it”. People aren’t reading the article but merely reacting to the headline, Social Media Today goes on to say. No journalist or journalism business wants that result.

And all the data shows that referrals have plummeted from social media over the last few years. Through my work over the past decade, I have seen the data of hundreds of publishers, and while Facebook used to drive significant amounts of traffic, it has been declining for years. Social Media Today says that there is still value in brand awareness, but research has shown that correct attribution is much lower for visitors from search and social than it is from direct traffic.

More than that, the research in Social Media Today found that negative content received more engagement than positive or neutral content. Outrage on social media drives more engagement than positive or neutral content. While it will surprise no one, it still underscores the perverse incentives that have operated on social media that have damaged not only media businesses but our societies and democracies.

Of course, social media still has a place in audience development. As Adam Tinworth says, we are moving to a platform+ era in which platforms and rented audiences play a role, but the focus must be on the KPIs that favour converting the relationships developed on social media into direct relationships. In my previous role, we used organic as well as paid social media to drive newsletter subscriptions. I’ll be honest, the newsletter we got from Facebook weren’t as engaged as those we got directly from our marketing or on our properties. And membership and subscription services like Poool are creating opportunities to convert social media users into known, registered users.

And on Bluesky, this was shared from Josh Marshall of Talking Points Memo. It showed the collapse of programmatic ad revenue for TPM over the past eight years. “As I think is pretty clear, if this is your business, you’re dead. You don’t have a business,” he wrote. The scale model of digital media was all about using social media to build huge audiences that could then be monetized through programmatic. I even remember hearing media executives talk about how they would make newsrooms pay for themselves through traffic and programmatic ads. It didn’t play out.

And that brings us to the current sad state of affairs for the scale players. This is how it played out. For groups in the US, many of them took on unsustainable amounts of debt in their pursuit of scale as they bought up more and more properties. They were forced to make cuts, in both the newsrooms and in their ad sales staffs, which meant that they struggled with direct ad sales. The newsroom cuts ran deep, and they made tepid efforts at reader revenue experiments with little conviction. The experiments usually failed because often they came at a point when the product was so gutted that it didn’t attract enough takers to offset the loss of advertising. The paywalls came down and the ad loads went up. (My wife used to say that she knew when she was on a news website because the fans on her laptop would spin up so high that it sounded like it was ready to take off.) Invasive ads made the user experience horrible, driving down traffic and yields even further. In a slow-motion car crash that played out over years, social traffic collapsed, pushing ad revenue down even further. It is sad. Poor user experience and poor products have turned off users, and after endless rounds of cuts, the content isn’t local enough to serve communities or good enough to convince people to pay.

That brings us to where we’re at now. And now, as we see from the latest print circulation figures in the UK, newspapers will have to develop digital revenue streams. There is no other option available.

Here are some steps to start that journey:

  • The first step should be a range of tactics to convert unknown audiences to known audiences, and they need to do this with all urgency. It has shown such promise for so many publishers and has so many benefits.

  • They also need to get closer to audiences. In the past few years, I have developed such an appreciation for qualitative research. I have been a ‘numbers guy’ for most of my life, and quantitative data is a great way to measure what your audiences are doing, but qualitative data tells you why they are doing it.

  • Use all of that rich first-party data to improve all of your operations - product, revenue and marketing.

We have models of how to make this work at almost any scale, and it’s sad to see how much damage is being done to journalism and media brands by doubling down on a strategy that has not worked for years - chasing scale via rented audiences.

The chains in the US have turned to try to capture some of the philanthropy cash that is now flowing to communities, but look at this story. Report for America says that they won’t put their reporters in hedge fund-owned publications.

Google is paying some publishers to test an AI product on their content. As publishers develop their strategic guidance on AI, they will need to define their terms of engagement with AI players just as they should have with social platforms.

I am sad for all of the journalists, photographers, ad staff and others who have lost their jobs over the last 20 years in the US and UK, where I have predominantly worked. But I do see green shoots of growth now as small start-ups launch with the MVP of the day, a newsletter, and then build out from there. They are far from replacing the reporting capacity that once existed, but I do hope that it is clear that it is time to close this disastrous chapter in journalism and move on.

Now to the round-up for this week. Like other major responsible news publishers, the BBC has announced their well thought through plan on how to use generative AI. The announcement looked at experiments in three areas:

  1. Maximising the value of existing content

  2. Reaching new audiences

  3. Improving processes to make them more efficient

Meanwhile, Mattie Peretti who started out during an ICFJ Knight Fellowship to find out how AI could be used to help news organisations serve their communities better. After four weeks, he found the problem statement was wrong, and he says: “we can’t make our industry more sustainable without radical new solutions and creating products that users actually want. The role AI might play in creating them is somewhat irrelevant.” Amen and read on.

A blockbuster piece from the New York Times looking at how Google and Meta have benefited from a Chinese e-commerce spending spree to crack the US market.

How the media lost the future, and how we might regain it

My first glimpse of the future of media came in a student computer lab at my dorm at the University of Illinois at Champaign-Urbana in August of 1993. (Yeah, I’m that old.) My friends were buzzing about a new app that was in beta, something called a web browser, Mosaic, which had been developed by Eric Bina and Marc Andreessen at the National Center for Supercomputing Applications on campus. Before Mosaic, I couldn’t imagine my parents ever using the internet. It was just too technically complicated, but Mosaic made the internet visual and accessible. As a journalism student close to graduation, I know that it would change my career, and it did in so many ways I never anticipated.

In 1996, I had my first proper digital journalism as a digital news editor at WWMT - a local TV station in Kalamazoo Michigan. The next year, I moved across the state to work as a special projects producer at Advance Local’s MLive. The next year - 1998 - I became the first digital journalist for the BBC outside of the UK, working in their flagship bureau in Washington DC.

But I was not the first wave of digital innovators by a long chalk. My friend Steve Yelvington was the founding editor of Star Tribune Online and has written about pre-internet online efforts by newspapers. He was building that service as I was exploring the web with Mosaic. And there was Roger Fidler, who I knew about by reputation but never had the honour of meeting. He envisioned a future of “tablets and e-readers” in 1981 and spent the early 90s trying to build that tablet at the Knight-Ridder Information Design Lab! This is to say that plenty of visionaries were already working towards a future of media before I had even left university.

Now 30 years later, the New York Times interviewed Fidler in “How the Media Industry Keeps Losing the Future”. "After decades of decline, their collapse seems to be accelerating,” writes technology reporter David Streitfeld, adding how Fidler “helped develop technology for lightweight tablets that would use flat-panel displays that were low cost but clear and bright with a relatively long battery life”.

What went wrong?

I was too narrowly focused. I didn’t consider all the possible cross impacts of emerging technologies that would lead to Craigslist, alternative news sites, social media and other products that would greatly diminish newspaper circulation and advertising revenue.

I was too narrowly focused as well. I thought the cost savings of digital distribution would open up a new era for journalism. However, if you save money but can’t earn it, it doesn’t matter. Your business will still fail. I started thinking about digital revenue at MLive, but then I went to the BBC. We had the luxury as a public media outlet to produce incredible, ground-breaking digital journalism without having to think about a business model. When I worked at The Guardian (2006-2010), it had an almost anti-commercial culture. I did not turn my attention back to thinking about revenue until I joined Gannett in 2014, and by that time, it was too late.

How we might regain the future

During the pandemic, I finally fulfilled a promise to myself and got my master’s degree in innovation, management and leadership. I try to apply what I learned to help media companies as the consulting director at Pugpig so that publishers, their reporters, product managers and the technical and commercial staff have a brighter future.

One way publishers need to adapt is to consider their marketing orientation, which is the process that a business engages in to identify and satisfy the needs of its customers. First, let’s discuss who the customer is. In As a journalist, we always thought our customers were our audiences, but when I started working in the industry in the US, 80% of our revenue came from advertisers. People seem to think that delivering eyeballs to advertisers is a recent development of the digital age that sullied the noble profession. When I was in journalism school, my professors were honest and said that subscription revenue paid for the cost of paper, ink, presses, and distribution but not our salaries.

I’m going to reference this incredible graph from 2016 by Thomas Baekdal. It tells the story quite clearly about what happened in the US.

Search and social media advertising became a much more effective way to reach audiences than newspaper ads. What would have happened had we poured as much innovation effort into the commercial side of media as we did into the editorial side? It was done in fits and starts. Gannett owns a digital media marketing company. The Dallas Morning News bought up several local digital marketing companies in the middle of the last decade. So much more should be done in terms of digital publishing commercial innovation.

However, with the major focus now on reader revenue, our readers are our customers, which brings me back to the concept of marketing orientation, I am going to focus on three: sales, product and market orientation.

  • A sales orientation focuses its energy on selling its product to its target audience. “In a way, it does prioritise its customers but not in a sense of listening to their needs and wants – it simply wants to sell to them,” according to Orientation Marketing.

  • A product orientation focuses on continually improving its products to deliver the highest quality product possible. “Premium products fall into this category, but the approach does not always offer what its target audience actually wants or considers the factors that the audience uses to form its purchasing decision,” Orientation Marketing says. The benchmark is competitors.

  • A market orientation considers the target audience before any product is created. Audience needs are taken into account. “Market orientation, in marketing strategy terms, commonly revolves around culture, values and other internal behaviours focused on satisfying customer needs that are usually well-researched prior,” Orientation Marketing adds.

The marketing orientations all have their pros and cons. A sales orientation can be effective when you have proven the product-market fit and have a relatively stable market environment. However, that isn’t the environment that newspapers have been operating in for decades. How long did we cling to a sales orientation? How long did we simply focus on selling what we had always done without listening to our audiences? Too long.

And how many times have I heard a product orientation from news leaders who thought that quality would always cut through? Reflexively saying that “content is king” has too often been used simply as a thought-terminating cliche. It rallies the troops. But what content? In which format? Delivered in what way? Recently, there was a discussion in an industry Slack in which an exasperated product manager asked if a podcast could gain an audience simply on quality alone. It was an assertion made by a producer where she worked. What arrogance! Such self-importance! It’s as if the audience is an afterthought and the only thing that is required is to produce something that passes exacting quality control based on journalism’s own professional standards.

For product managers who use tools like design thinking or jobs to be done, we have a market orientation. We ask who is the audience for this news product. We think of the audience in granular terms and consider their needs. We actively seek out quantitative and qualitative data, and we understand the variety of news and information needs that exist in our audiences. A good example is Schibsted, which sent three qualitative researchers on a road trip for a week to find out if people outside of the two main cities in Norway - Oslo and Bergen - had similar media habits. They have balanced editorial and algorithmic curation of their homepages based on a range of criteria. They understand that providing a homepage for the “average user” would present news that appeals to a white man in their 50s, and they want their homepage to meet the needs of the range of users and engagement levels that they know they have.

And we need to break down our internal silos so that editorial, commercial and technical can think broadly about how to solve the existential crisis facing journalism. We need this kind of collaboration to create products and revenue models that will pay living wages for the journalists, editors, sales staff, developers and other staff. ader revenue, a

And now onto things that caught my eye this week.

I start with a fascinating case study from Romania. It highlights how newsletters have become the MVP for media, and it is a rare examination of the revenue sources involved in local media start-ups, a mix of reader revenue, ads and grants. The case study also highlights how scrappy journalists have had to be to make a go of it over the last decade or so.

Three young leaders shared advice for meeting challenges including imposter syndrome and having to remake a media brand to help it move upmarket. I particularly enjoyed Aliya Itzkowitz of FT Strategies view on the value of voicing uncertainty. When you’re dealing with innovation, you have to deal with uncertainty and find a way to systematically work your way through it.

My former BBC colleague Alf Hermida has just released a paper with Seth Lewis and Samantha Lorenzo on Clay Christensen’s jobs-to-be-done framework and how it can be applied to improving the products of local journalism. This was a popular framework in the first decade of this century, and there were a lot of advocates of it, including Steve Yelvington who I mentioned before.

The FT seems to be going from strength-to-strength, and now it is prospecting for new opportunities with its own venture fund.

In AI news this week, OpenAI alleged that the New York Times hired someone to manipulate its systems to make it appear that it frequently plagiarised the newspaper’s material. It was a forceful response to the Times’ lawsuit.

Having worked in US public media for four years, this makes me sad. It was one of the early efforts by public media to move beyond its traditional audio and video content to provide local news in a digital-first way. It speaks to the challenges facing US public media in this soft ad market.

Journalism needs to open up new career paths as it faces a talent crisis

Burnout, frustration at the lack of opportunities for advancement or growth, and the hollowing out of the industry: Journalism is facing a talent crisis. While some of the crisis is driven by the collapse of the business at multiple levels, some of it is self-inflicted. Yes, journalism is shedding staff at a furious pace, but it is also is driving people filled with passion for the mission and the work away by having rigid, outdated career paths. And it’s failing to take care of leaders exposed to incredible levels of stress as they must make painful decisions during what feels like endless rounds of cuts.

The loss of reporters

I don’t want to gloss over the loss of reporting talent as well. More than 8000 jobs in journalism disappeared last year across the US, UK and Canada, according to the Press Gazette. Not all of these positions were reporters, but the cuts were still deep and broad. More than 500 journalists were laid off in the US in January alone, according to Politico.

It’s grim, and this crisis has hit so many people. And I know how challenging it is to remain resilient in the face of this. I took a buyout from the Guardian in 2010 and joined my wife in her media consultancy. I had a fascinating role with the Media Development Investment Fund that only lasted a year in 2012. I joined Gannett as a regional executive editor in 2014. I survived the first six rounds of cuts large and small but not the seventh, and the position was eliminated in 2015. I went back to consulting and training before returning to full-time employment in 2018. I have been grateful for more stability since then. And now I work as the consulting director for Pugpig, a company that builds apps, websites and digital archives for publishers. I love helping publishers succeed, but I am wary about doing it inside the burning building.

An exodus of product talent

“Cats need to be herded. Cats don’t like being herded. How does that make the cat herder feel?” That is my tongue-in-cheek summary of my master’s dissertation. Kidding aside, the research looked at how the cross-functional coordination work - known formally as boundary-spanning - affected the professional well-being of product managers at news organisations. Were they thriving, surviving or burning out? Of the 17 product managers I interviewed for my research, five had left a role or the industry entirely not long before the research. Another data point to consider: Although the sample was evenly split between men and women, of the five who left the industry, four were women. That is a topic unto itself, which I’ll touch on in another newsletter.

I was reminded of the conversations I had with these amazing product managers this week when a community I’m part of was expressing frustration about the lack of advancement opportunities for product-minded people in the journalism industry. They told stories of being passed over for senior leadership positions in journalism groups because they hadn’t come up through the editorial side of the business. They believed that their cross-functional skills, particularly business skills, made them uniquely suited to meet the challenges facing news organisations. Like the subjects of my research, some were so frustrated that they were considering leaving the industry.

I won’t say more in detail about the conversations in that community, but I can add some of the findings from my research. One product manager had grown frustrated by what she referred to as HiPPO decision-making - strategies decided and driven not based on data and research but rather based on the highest-paid person’s opinion. It was just one example of a lack of alignment at levels of management above the product manager. Without that agreement on high-level goals, stresses built up on the product managers and they burnt out.

Market leaders like the New York Times have invested heavily in product talent, In other news organisations, managers need to understand that product managers who started as journalists still have aspirations to manage and have influence over wider parts of the business. There need to be clearer paths of progression for these valuable employees. Many of these product leaders have developed expertise across the business, and that would be valued and rewarded in other businesses. In my research, product managers naturally developed cross-functional relationships, many even before taking on formal product roles. Cross-skilling across editorial, commercial and technical roles should be formalised and used to train product managers and product-minded editors to become future leaders.

And now onto the media news for the week. AI is the topic of the year, and in this article, Ross Sleight, chief strategy officer at digital transformation specialists CI&T, talks about the changes that are coming in the industry. Google’s Gemini will change the search experience, and that is just one change coming in terms of interfaces. Changes in technology and the business will continue. New organisations need to do what so many are doing right now, experimenting with proofs of concept, working for internal alignment and adoption and scaling what works.

“Generative AI is an epochal development—less like social media and more like the advent of the internet itself. Much like that moment, this technology is transformative because it empowers people in how they create and find information.” This piece raises questions about how IP should be licenced and how business models will evolve. And it will allow for the rapid development of new products. This is a good piece that covers the complexities of the changes AI will bring.

WAN-IFRA, which I have had a long-standing relationship with, has just launched an AI programme for the year, and they highlighted how major media companies in Europe and Asia are using AI in their newsrooms. I like how Wang Yin of Mediacorp put it in saying that the Singaporean broadcaster was “making (AI) an assistant and not a replacement”. They are looking to use AI to make workflows more efficient. Smart.

The latest Reuters Digital News Report “suggests that knowing your audience is key and media publishers should target readers who are already considering paying for news”. If there is a theme to this newsletter, it is the call to focus on your audience and get close to them. Inside Story in Greece has 4000 paying members, and they connected with many of them through in-person workshops. Ah, the value of relationships.

Google has launched a new tool called Offerwall that allows a new “range of options such as purchasing a subscription, viewing a video ad, sharing data, or making a micropayment for short-term access”.

With Press Forward starting to name partner communities and states, Dan Kennedy says that there must be other models that reach smaller communities and smaller news start-ups.

My friend Adam Tinworth takes a look at the end of the era of platform dependency. “All this talk of “gatekeepers” and “platforms” disguises the brutal truth: we let other companies come between us and our audience.” Amen. During the platform era, we got focused on the needs of platforms rather than the needs of our audiences.

More media business turmoil: Buzzfeed to sell acquisitions and CNN stars face pay cuts

Anderson Cooper makes $20m a year, and Wolf Blitzer makes $15m a year. This level of salaries are unlikely to remain so high as CNN struggles and new CEO Mark Thompson reviews budgets. As The Wrap points out, Thompson is not accustomed to seven-figure on-air talent salaries, and the market simply won’t support these excessive salaries in the future.

Media has always been a star system, and TV is much more so. The median TV producer salary is $53,000, but small station salaries can be a lot less. Wolf Blitzer’s makes 283 times more than the average TV producer in the US. The cable TV news market won’t justify that premium going forward.

Two years after Buzzfeed went public to raise capital to go on an acquisition spree, it is now having to sell some of those acquisitions as it struggles to hold on, Sarah Fischer of Axios says.

Information wants to be expensive – rethinking the value exchange of news and information

With such a grim start to the year for media, some analysts are predicting an ‘extinction-level event’ for the media, and it is not hard to imagine that we’re facing this in the US and UK. Brian Morrissey sees this as the end of the mass media era. I think it will result in a painful winnowing. As the Reuters Institute has been saying for a couple of years now in their annual Digital News Report, we are in a “winner takes most” scenario in which a couple of major brands e.g. the New York Times in the US, capture a good chunk of news digital subscription revenue.

This sums up the Platform Era.

Even as Buzzfeed reached more and more people on platforms like YouTube and Snapchat, traffic seemed to be losing value at the same rate. When it came to traffic, there was too much of it out there, and Facebook and Google were too good at selling theirs directly to advertisers.

It is not a particularly cheery piece, but like any New Yorker piece, it has some wonderful lines. Clare Malone writes that many will be left out and the focus will be on audiences that will reliably pay - mostly old, rich men. “There will be idiocy and the enablement of rich idiots,” she writes.

But as with the extinction of the dinosaurs, this will give way to new life. Some publishers are serving lucrative niches, such as Politico or Punchbowl DC. In the UK, we’re seeing a new level of local experimentation. Of course, in buzzy Bristol, there is the Cable news co-op. The Manchester Mill is expanding after a £350,000 investment last year from CNN’s new leader, Mark Thompson, Nicholas Johnston the publisher of Axios and others. And just today, the former editor of the Journal in Newcastle announced a well-funded launch of a weekly subscription news site to cover northeast England.

All of this disruption reminds me Stewart Brand’s famous quote, which is rarely quoted in one. “On the one hand you have—the point you’re making Woz—is that information sort of wants to be expensive because it is so valuable—the right information in the right place just changes your life. On the other hand, information almost wants to be free because the costs of getting it out is getting lower and lower all of the time. So you have these two things fighting against each other.”

For most of the internet era, the focus has been on the information wants to be free part of the quote. The casual use of the quote suffers both from the dual meaning of free in English and also from a lack of deeper analysis. Brand was saying that distribution costs were going to decrease in the digital era. The consolidation of local newspapers in the 1950s meant that newspapers became local monopolies. Print distribution became a valuable local business for newspapers. Brand was saying that the internet would render that print distribution monopoly irrelevant.

Let’s focus on the other part of the quote. Information also wants to be expensive. Yes, this means that certain types of information like the financial data that flows through Bloomberg terminals or the financial news in the Wall Street Journal or the Financial Times remain extremely valuable. What is rare and valuable? That can be information, or it can be other things. It can be a sense of belonging, which is why the intersection of media and community has been a major focus of my career. Community and belonging in short supply, and those outlets or individual journalists and creators who provide that are doing quite well. Think of your personal passions and think about the creators who inform and entertain you and make you feel a sense of community. Think of how valuable that is to you.

That is one half of the equation. My editor at my college newspaper, Theo Francis, who now works at the Wall Street Journal, told me how a relative framed the other half of the equation. You know you can create value. But can you capture it? If you are starting a new media venture or looking to remake the one you have, you have to think about how you capture value.

Speaking of capturing value, the New York Times has been building a formidable subscription bundle. Puzzles have been an important part of their bundle, and I can tell you from my day job that puzzle users are a small but deeply engaged segment of the audience. With all of that great engagement, they are now looking to earn revenue by selling advertising around games.

The New York Times is looking to innovate how they sell advertising in the face of ongoing declines in the revenue source. Fortunately, they have continued to grow their subscription numbers.

Last year, most publishers finally realised that the Platform Era was finally over, but some publishers still see value in using social media as part of their audience acquisition strategy. In this INMA case study, Argentina’s ViaPaís pivoted after Facebook killed Instant Articles. But even before the end of Instate Articles, they found that awareness on social media wasn’t translating to traffic back to their website to generate revenue. They decided to tease content to bring more visitors to their owned properties, and true to the trends of the TikTok era, they are leaning into short videos.

Building on the theme of attracting more traffic to your owned properties, my former Gannett colleague Amalie Nash writes about the need to build more direct traffic. It is why a few major news sites that have remained as destinations have continued to enjoy success.

We have a stark warning from ITN in the UK. Deepfake videos of their high profile presenters are making the rounds on social media.

WAN-IFRA CEO Vincent Peyrègne shared this excellent report on AI and journalism. It’s a great long read for the weekend.

I’ll write more about this next week because I think that the picture is more complex than simple predictions of “peak subscription”, but Axios serves up several data points.

How to develop innovative news products that meet your communities’ needs

Last week, I wrote that one of the two guiding principles was that journalism needed new products for new realities and the new audience behaviours. For much of the past decade, a dominant strand of audience and product development reflected the fact that audiences had flocked to social media platforms. In 2023, there was a realisation that renting an audience brought profound risks. The threat had been there all of the time. I had worked for newspaper groups that saw a 40% drop in traffic overnight when Facebook rolled out a new algorithm. And Facebook made it clear that it was de-emphasising news over the last few years. Last year, long-simmering issues came to a head.

Suddenly, there was an emphasis on renewing direct relationships with audiences. At a national or international level, the product mix was there: Newsletters, podcasts and apps. As I say in the Media Bulletin that I write for Pugpig, the Platform Era has given way to the Push Era. Instead of focusing on attracting a large, loosely connected rented audience using social networks, publishers are now focused on building relationships with audiences using content that they had opted receive via push, in their inboxes, their podcast apps and all on their lock screens. Here’s an interview with FT Strategies head of insights about these trends.

Let’s talk about local news. My journalism career started in a local newsroom, the Hays Daily News in Kansas, and a decade ago, I returned to local journalism, managing small newspapers for Gannett in Wisconsin. I love community journalism because I love being a part of and serving communities. But we all know that it is in crisis.

One of my favourite innovation frameworks is Clay Christensen’s “jobs to be done”. As Clay said: “If The New York Times doesn’t understand why I might choose to ‘hire’ its product in certain circumstances and why I might choose something else in others, its data about me or people like me is unlikely to help it create any new innovations for me.”

As a journalist, my professional values tell me that people ‘hire’ what I do because they want to be informed. Dmitry Shiskin’s user needs model accepted the reality that audiences were ‘hiring’ the BBC’s journalism for a range of jobs they wanted to do: update me (inform), keep me on trend, inspire me, amuse me, educate me and give me perspective. The analysis found that the BBC World Service was producing too much “update me” content and underproducing other forms of content. It helps deliver what product leaders call product-market fit. It does the job that audiences need doing.

Let me give you an example. People move around a lot more than they used to. Having moved across the Atlantic three times now, I’m this person. The jobs that newcomers need to be done are different from the jobs of someone who has lived in your community for years or their entire lives. One of the products that has been developed by local newsrooms to cater to these newcomers is a welcome email series. It helps them understand It’s free and starts a relationship with those new community members, and it starts the relationship so that they might hire you for other jobs that they need to do.

Good journalists know their communities deeply. To build products that do the jobs that communities need to be done, journalists need to deploy that knowledge differently. What are your community’s needs that journalists’ capabilities can uniquely satisfy? Ask them, and then reflect on what you can do. (And check out human-centred design if you need a process.)

This will go beyond articles and with good reason. Meta is not going to hold an event about key issues in your community. They aren’t going to create a podcast about local school or amateur sports. Local media innovators will have to balance effort, impact and financial return with all of these products. And one key thing that I learned is that while operating at a small, local level allows you to be nimble, you will always have to be thinking about sustainability - not only in financial terms but also in human terms. One of the lessons from my master’s degree is Michael Porter’s line that managers are the guardians of trade-offs. Too many managers do not wrestle with trade-offs. That lack of focus is never successful, and it comes at a high cost to the people who work for them.

And now into the round-up. With social media declining as a source of traffic for news sites, journalists at a non-profit newsroom got creative in coming up with new ways to reach audiences. Students at New York University’s Studio 20 masters program decided to go low-tech to reach older adults. They leveraged a marketing service from the US Postal Service that allowed them target specific areas affected by the stories that they were covering. And they could target areas “30 times smaller than that covered by the Facebook ad”. They also ran an A/B test by running a Facebook ad. They found that the audiences who came from the postcard promotions were more engaged. Fascinating!

Did Sports Illustrated need to fail? “…interviews with shareholders and current and former employees suggest that Arena missed the licensing payment by choice, not because it didn’t have the money to make it”. Read on.

Apple wants to use news to train its LLM, and it’s offering better deals and terms than other AI groups. But as INMA says, news publishers are wary.

The Messenger was killed

News came out last week that The Messenger was shutting down. It was a surprise to no one who was watching it closely. Digital media veterans including Brian Morrissey and Nieman Lab’s Josh Benton roasted The Messenger’s owner. The model was based on wistfulness for not only a pre-internet media landscape but a pre-cable TV world and a trying to run a digital strategy that might have made sense in 2014 but not at all in 2024. He managed to blow through $50m in nine months. It was a disaster from the start with editorial leadership defecting almost immediately after launch when it became clear that the site was more content farm than a hearkening back to some vision of the glory days of journalism.

Brian Morrissey said in his Rebooting newsletter:

After The Messenger, burn that playbook and disperse the ashes in a burial at sea.

Platform updates: Poynter calculates how much Meta and Google owe news publishers and validate your email your domain now!

Two researchers have calculated just how much Google and Meta have profited from news publishers, and they offer up a robust defence of their methods and explain what it means.

If you are a publisher and send more than 5000 email messages a day, you need to validate your domains or your emails will go straight to spam for Gmail and Yahoo users. And this isn’t just these platforms being bullies. Email fraud has spiked.

My wife publishes newsletters on Substack so we have had plenty of conversations about whether or not to abandon that platform that has been described as having a “Nazi Bar problem”. In a well-reasoned piece, The Fix’s David Tvrdon explains that for people feeling ethically uncomfortable about Substack there are other choices out there that make it easier to leave.

How the third era of community strategies could restore trust and revenue for media organisations

Over the last two weeks, I have written about the crisis in media, particularly local journalism, and ways to address it. For much of my career, I have worked with two assumptions:

  1. We needed to create new products for the new ways that people consumed and interacted with media.

  2. We needed to develop a new relationship with “the people formerly known as the audience”, as Jay Rosen, Jeff Jarvis and Dan Gillmor talked about this shift in the early part of this century.

    The first decade of this century was heady days for digital media innovation, and the media is launching a new wave of community strategies as publishers and broadcasters seek to reclaim their relationships with audiences and drive higher revenue as those relationships develop and deepen. Reflecting on community strategies and the media for Pugpig’s Media Bulletin, I believe that we’ve seen three eras of community strategies in media.

The first era: Forums, blogs and podcasts

The first era began in the late 1990s and early 2000s with forums, blogs and the first generation of podcasts. Quite a few media organisations, like the BBC and the Guardian (I worked at both during this time - the BBC from 1998 to 2006, and the Guardian from 2006 to 2010), launched blogs and podcasts. I wrote a guide to blogs and blogging for the BBC that supported those efforts. At the BBC, we often used Jeff Jarvis’ phrase that news had become a conversation, and as public service media, it was our civic and missional responsibility to take part in those conversations, whether we initiated them or not.

I was asked to write the guide to blogging because I had written a blog for the BBC during the 2004 US presidential election, but I had been involved in very early experiments in audience engagement dating back to the 1990s, with Talking Point at the World Service, which allowed audiences from around the world to pose questions to newsmakers. During the 2000 election, we took this a step further. We took questions from the BBC’s global audience and hosted webcasts using a portable satellite data uplink allowing voters and experts to answer those questions.

When I was writing the guide to blogging, it was the beginning of the rise of media critics who referred to the BBC and other traditional outlets as the “lame-stream media”. Defensiveness led many media outlets not to engage with the critics, but I did, often directly. When I was covering Tony Blair’s visit to George W. Bush’s ranch. I referred to a local news story jokingly discussing cow tipping. An angry reader wrote to us assuming that I was a member of some coastal elite who wasn’t aware of farming. My mother grew up on a farm, which is still in the family, and I grew up helping friends on their dairy farms. I responded directly to the reader in good humour about my farming experience. It broke the ice, and I had a wonderful exchange, converting a critic into a supporter. Trust is based on relationships, not just professional standards.

However, during this first era of community strategies, many other publishers simply added comments to the bottom of their articles. Journalists wrote and audiences were consigned to the comment sections, which often became toxic and combative. Many media outlets didn’t adjust their editorial strategies to this new interactive era. It reinforced the us vs. them strategy. It didn’t deliver increased engagement or increased revenue because moderation costs often outweighed any benefit.

The second era: The rise of social platforms

The second era shifted community efforts from publishers’ and broadcasters’ websites to social platforms. It seemed to make the most sense to follow where the audience was, and audiences had moved en masse to myriad social platforms before settling on Facebook’s platforms and, to a lesser extent, Twitter (well and now TikTok).

As I said in the Media Bulletin:

“Eventually, those early on-site community projects were shuttered. NPR, Reuters, Recode, The Verge and USA Today closed their comment sections. As NPR’s public editor said of the decision, “The audience itself has decided for NPR, choosing to engage much more via social media, primarily on Twitter and Facebook, rather than in the NPR.org comments section.” Unfortunately, outsourcing their relationships to audiences on social platforms has had disastrous effects on publishers.”

The Third Era: Membership and Community

Now publishers and broadcasters have a renewed interest in membership and community. While NPR - US public radio - has had a membership strategy since its inception, the model is expanding, from small local start-ups to large publishers. For community outlets and public media, membership means a sense of belonging and connecting to the mission. But membership can also mean exclusivity, which is what Elle is trying to do with its membership model with its Collective. Hearst and DC Thomson are rolling out several different approaches to community depending on the product. DC Thomson’s newspapers are leaning into the nature of community and place. It’s Stylist title is focusing on activism and empowerment for the women who read it.

For news publishers, I believe relationships are key to responding to the decline in trust in journalism. Trust is not abstract, and it is built on genuine engagement between publishers and their audiences.

The challenges are strategic, cultural and organisational we well as material. Strategically and culturally, organisations will need to develop clear propositions and the capabilities - editorially and technically - to carry out these strategies. Organisationally, it will be a challenge to develop and find the talent as well as reconfigure their operations to manage these strategies. And lastly, it will be a material challenge. It takes time and investment, and those are in short supply in media now.

The technology has matured with services like Coral and Viafoura, which leverage AI to ease the management of comments and offer new ways for publishers to interact with audiences.

Viafoura has some excellent data on why the effort is worth it. They say that audiences actively engaged in comment communities are six times more likely to subscribe. It proves the hypothesis that drove a lot of original engagement strategies - that engagement would lead to more time on-site and a deeper relationship with the media outlet. Moreover, with reader revenue now a meaningful part of many publishers’ and broadcasters’ strategies, this engagement translates to revenue. Greater trust and higher revenue are the key KPIs that will measure the success of these strategies.

Now onto the key media stories from the past week. David Cohn has worked at the intersection of media and technology for years now, and at this moment of immense change in media, he riffs on the environmental three Rs - reduce, recycle and reuse. says that publishers need to reduce reliance on platforms - the issue of an owned or rented audience. Read on to find out how he thinks recycling and reuse are relevant to publishers.

The Fix spoke to Mattia Peretti about his career river - the unique path professionally that he has taken. From a local radio station in Italy to LSE working with JournalismAI, he talks about that professional journey. This is just one bit of insight from the piece: “A helpful distinction Peretti suggests is discerning ‘knowledge tasks’ from ‘language tasks’. Current generative AI systems do a poor job producing content just based on prompt, but they are much better with repackaging existing content, meaning “language tasks’”.

One of the major changes this year will be the end of third-party cookies. The Press Gazette says that publishers must fight this new move by Google. During a time when digital advertising revenue has fallen dramatically for many publishers, the PG says that this will only make the situation worse.

For one of the UK’s largest publishers, Reach, they have announced a strategy to respond to the end of third-party cookies:

  • First-party data collected through its customer value strategy

  • Contextual advertising through its in-house AI-powered tool Mantis

  • And industry ID and cookie-less solutions.

A very bad start to 2024 for US media

Last week was particularly grim for US publishers, the LATimes laid off 20 percent of its staff. There was a strike at Condé Nast due to the expectation of job cuts while the company is engaged in contract negotiations. And there is a story about how all of the turmoil is making journalism students concerned about their professional opportunities

The local journalism crisis and non-commercial models to address it

I was all ready on Friday to do a normal roundup of media developments, and then my wife shared this with me from Bluesky, which from other comments that I have seen is making the rounds on eX-Twitter as well. It shows the decline in newspaper employment in the US from 2010 until now. It’s harrowing.

The newspaper industry, particularly local newspapers, has been in freefall since 2008, the Great Recession. It was buoyed by real estate advertising and the last gasp of the power of local print monopolies. Since 2006, the decline has been devastating, for owners, large media groups, the communities they serve and the people who made their living from the industry - the journalists, photographers, the press operators, the ad sales staff and designers. There are important nuances in the data that tell a fuller story of commercial collapse and societal crisis. However, the decline of newspapers both in the US and the UK has been going on a lot longer than this century. Rasmus Kleis Nielsen of the Reuter’s Institute for the Study of Journalism at Oxford included the following chart in a 2017 paper - Ten Years that Shook the Media World. It shows that the circulation of newspapers in the US has been declining since 1950. Radio and then TV probably had an impact, but the decline of newspaper circulation had been going on for four decades before the Internet was widely available. That being said, an inflection point is visible at roughly 1990, and circulation decline charted a steeper decline than in the decades before.

Paradoxically, you’ll see that revenue took off from 1955 and boomed until 2000. After a brief pause around the time of the dot.com recession, revenue recovered until 2008 when it craters. What happened? As Rasmus and many others have said, the initial decline in US newspaper circulation brought about the first great wave of newspaper consolidation in the US. Initially, this happened at the local level. One of the newspapers I edited for Gannett - the Manitowoc Herald-Times-Reporter was at some point in the past three newspapers, which seems incredible for a town that today has a population of just over 34,000. Local market consolidation gave rise to local print advertising monopolies, particularly in communities not served by a local TV station. From 1970 until 1990, it was a golden age for the newspapers that remained.

The way that the newspaper industry kept the revenue rising after 1990 was to cut costs, and just as the circulation decline began long before the internet, the newspaper employment crisis began before the search, social and mobile disrupted the revenue of newspapers. This is from a MarketWatch story in 2009.

Employment in the US newspaper industry increased even as circulation declined, all the way until the early 90s. That is what is interesting. Employment peaked more than a decade before revenue peaked. More than that, employment began to collapse well before revenue did. Higher revenue in the early 2000s was driven by the beginning of tremendous cuts in employment that only accelerated by the Great Recession. The crisis in local journalism in the US has been decades in the making, and the starting point depends on the metric that you want to focus on. But from an employment standpoint, the sharp decline began late in the 1990s. I initially thought it might have been driven by a decline in advertising spend, but that wasn’t the case (there was a drop in 2001 and 2002 before it recovered). It was most likely driven by the continued decline and search and the beginning of the shift from advertising from print to digital. This famous graph from the Newspaper Association of America with an addition by Thomas Baekdahl shows the decline of newspaper revenue with the rise of Google and Facebook illustrates what happened, although the causal reality is more complicated. And this doesn’t account for the billions of dollars of classified advertising revenue that shifted from newspapers to Craigslist and speciality classified sites.

As Rasmus points out in his 2017 paper, the majority of original reporting has traditionally been done by newspaper reporters. Up until the middle of the last decade, the argument could be made that reporting jobs were shifting to digital, but those jobs weren’t in local journalism. A 2017 analysis by Politico found:

What does the future look like? Over the next decade (2022-2032), the US Bureau of Labour Statistics forecasts a 17.6% decline in “analysts, reporters, and journalists” at newspaper publishers but also a -14.8 drop in similar roles at radio broadcasters and a -2.4 in roles at TV stations. (A small bright spot is a 5.7% increase at media streamers, social networks and other media outlets.)

And these two stories were already included in my roundup. While ownership, by benevolent billionaires has helped some newspapers and magazines, it hasn’t been a panacea. Many of them are struggling.

What’s the solution to the local journalism crisis?

It is going to require new solutions - commercial, non-profit and public - to address this crisis that has been in the making for decades. In many ways, the crisis in local media mirrors the broader crisis in societies: Wealth and jobs are concentrated in a smaller number of cities, which is driving opportunity and affordability crises in countries around the world. I want to think about solutions for rural communities, where I’m originally from, and towns and smaller cities. Policy has a role to play. In many cases, de-regulation has played a role in consolidation that has left broadcasters and publishers burdened by debt from several rounds of highly leveraged acquisitions. It started before the era of digital disruption and has continued or even accelerated. Smart regulation should focus on policy that ensures that communities have access to local information. And care must be taken, as we saw in Canada when a law intended to support local journalism ended up hurting small, local and independent publishers.

Emily Bell, Director of Columbia’s Tow Center for Digital Journalism, says that independent co-ops are the future of local media.

As I said in the last edition of the newsletter, it is going to take a range of approaches that include co-ops and reader revenue-driven outlets. Co-ops are not a panacea as I saw when I was still living in Ohio and Akron’s Devil Strip news co-op imploded. Ultimately, it suffered from a poor governance structure and lax financial management, which is a bit of an understatement. The Cleveland Scene gave an update and explained that the financial records were so sparse that it made a forensic audit impossible. Ouch. It’s a cautionary tale for local publishers exploring the co-op model

Moreover, reader revenue and co-ops might work in relatively affluent communities larger than 50,000 people, these most likely won’t scale down to smaller communities. Some of those communities are served by strong weeklies, but for many others, there will have to be new solutions.

This is already going on a bit long so I’m going to highlight one: Information Districts. Simon Galperin has been a vocal advocate of the model. He explains that in the US, taxpayer-funded “improvement districts that fund public goods, such as libraries, fire departments, and waste-management services”. The idea would be for a special information district that operate independently of the local government. What is interesting is that in 2020, Simon and Co. found broad, bi-partisan support of the creation of such districts both in individual communities and across rural communities, which needed to pool resources to provide the level of coverage for sparsely populated areas.

The Media Roundup

And now we start the normal media roundup. A survey in the UK found that 37% of Brits were considering cancelling a news or magazine subscription. The biggest reason was the cost-of-living crisis. While this research was done in the middle of last year and there has been inflation relief since then, housing and energy affordability are still major issues.

INMA has an excellent interview with OpenAI looking at AI and news organisations. One thing that caught my eye was new talk of ‘smart agents’. Wow, I remember this idea being floated back in the early part of the 2000s, when techno-utopianism was rife in the early Internet era. And I have to admit to really liking the idea of a smart agent aggregating headlines, but then it would make this newsletter largely redundant.

Nieman Lab looks at how the NYTimes is developing handwriting recognition for its crossword. I think that this is fascinating, especially as study in how major media companies can develop applications using machine learning. However, I also think that this is a data point of how the NYTimes stands alone is many of the things that it is doing.

This is an example of rethinking news products to serve the needs of audiences who may be turning to other sources or other formats. Moreover, I think it requires user research, particularly using the ‘jobs to be done’ framework. More on this in the coming weeks.

Apple has changed how it measures podcast consumption. If you’re like me and haven’t used their app to listen to podcasts recently, then you won’t count as a listener after not listening to five episodes. It has already hit some major podcasts.

The end of third-party cookies is almost upon us, and Digiday has a round-up of ways that publishers are experimenting with responses.

Apple’s AR headset is soon to be released, and TechCrunch’s Brian Heater spent a morning with it.

In other ad developments, Google has laid off hundreds in its ad sales team. Google has already been testing how much they can outsource to AI. As even I have found in my work, this can lead to poor service and opaque issues around even getting Google Ad Manager set up on a site.

The capabilities and revenue streams essential for small newsroom success

In a recent editor of the Media Bulletin that I edit and write with my colleague James Kember at Pugpig, I used an interesting conversation the INMA board had last year to cast a look forward to this year. “What if the news industry’s total focus on subscriptions as the saviour of journalism has unintended consequences for the impact and influence of news brands,” asked Alexandra Beverfjord, executive vice president of Aller Media in Norway. Central to the question are several competing demands that media leaders must address such as the fundamental challenge of balancing the editorial mission with the need to fund that mission.

Ultimately, I think the question also is important to consider because as Earl Wilkinson of INMA says, subscriptions alone will not sustain an editorial business. And the issue is especially acute in light of Nic Newman’s latest survey in which he found that most media leaders surveyed said that subscription revenue was only up a bit. Reader revenue has provided an important foundation for publishers, but they are now seeking new sources of revenue. Revenue diversification will be a major focus for publishers in the coming year.

I shared the post on LinkedIn, and Anabelle Nicoud, who works as a news editor for Apple News, asked if I had any examples of revenue diversification with smaller newsrooms. Having worked in and with small newsrooms over my career, this is a subject near and dear to my heart. A decade ago, I left the UK to go back to the Midwest of the US, where I’m from, to manage two small Gannett newsrooms. The passion and dedication of the teams I managed made a great impression on me. I also know the pressures on those newsrooms. I started my role in February 2014. My job was eliminated in a round of budget cuts in October 2015. By the time I left the area in 2018, the newsrooms were just a quarter of the size they were when I started in 2014.

When it comes to what revenue streams work in small newsrooms, I will say all of them, well at least the most common ones of reader revenue, advertising, events and philanthropy. The challenge is to make informed choices of which ones to pursue based on mission, non-profit/for-profit status and market environment. For small newsrooms, focus is essential. Editorially, you can’t and shouldn’t try to be all things to all people, and from a business standpoint, focus is critical to survival and sustainability.

The revenue mix for small newsrooms

Some of the journalists whose jobs were eliminated have started news start-ups to continue to serve the communities where they live. Fortunately, in the US, they have organisations like LION Pubs - Local, independent online news publishers, to provide them with support in developing the business skills and capabilities that they need to create sustainable news organisations. Last year, they published the results of a survey of their members to see how their members were earning revenue. A few revenue diversification case studies:

  • The Springfield Daily Citizen wanted to add events to their business, but they didn’t want to “transfer the costs to attendees” so they sought corporate sponsorship to pay for the events.

  •  The Hingham Anchor had focused on direct sales advertising. They decided to “revamp their website rather than the costlier, longer process of migrating to a new CMS”. It allowed them to attract more advertisers.

  • The Press Gazette in the UK covered the Shawnee Mission Post in the US and its path to sustainability. It was grounded in providing essential information to their community and asking their readers to support their work.

The survey broke down revenue sources for their members, showing the difference between non-profit and for-profit organisations.

The most common revenue streams for for-profit members are:

  • Direct sold advertising: 55.8%

  • Small individual gifts (Less than $1,000): 20.2%

  • Subscriptions: 19.2%

The most common revenue streams for non-profit members are:

  • Philanthropies/Foundations: 66.9%

  • Small individual gifts (Less than $1,000): 64.2%

  • Major individual gifts (More than $1,000): 43%

Here in the UK where I am now. Independent news organisations like the Bristol Cable and the Manchester Mill have leaned into events. And if the New Year message from the Mill’s founder is any indication, things are going quite well.

To be honest, the revenue streams aren’t all that different from much larger news organisations: events, advertising and reader revenue. A much more common revenue stream, especially for non-profit newsrooms is philanthropy, although larger commercial publishers are now starting to get into that act as well. Some small publishers also branch out into digital marketing skills.

Solopreneurs cobble together revenue streams

Poynter has just drilled down even one layer further to the smallest newsrooms - the solopreneurs. Newsletters, WhatsApp groups and podcasts, solopreneurs are launching new news sources. This is a story about cobbling together revenue streams in novel ways. Hanna Raskin, who had been a food critic at Charleston’s The Post and Courier, found out about Substack’s local journalism programme. She was one of 12 winners, and for the first year, she earned $70,000. After that, she has worked to grow her paying subscribers on the platform but has also entered into a partnership with another publisher, The Assembly, to provide editing support on a part-time basis.

The message is the same as the INMA conversation: Reader revenue will not be enough to sustain a news organisation. “Diverse revenue streams are key, whether that’s through sponsorships, advertisements or even partnerships, like Raskin’s with The Assembly,” Elizabeth Djinis of Poynter said.

Will a new group of local media service providers open up new revenue opportunities?

I see another option for the future, a new set of revenue and business services that support local news sites. Instead of each outlet trying to develop its revenue infrastructure, some people see an opportunity to build services that can support local news entrepreneurs. These are just a couple of examples I know of from people I know. I would be interested to hear about more projects like this.

Steven Clift is building a service called Good Carts, which bundles purpose-driven businesses together in an affiliate network. “Be it a reward for signing up for an e-newsletter, subscribing to the news site, or an ad, the media site invites their visitors to check out some exclusive discounts via a dedicated coupon page of the brands that opted-in to their program,” Steven told me. The media company earns a commission from sales through their channels. It’s an affiliate marketing service that works with companies that would be consistent with the mission of journalism organisations.

Another example is News Oasis, founded by Former Dallas Morning News chief product officer Mike Orren. He hopes to provide business support services for news outlets serving news deserts. “We will achieve this via a hub-and-spoke model that is logistically not too dissimilar from what large-scale chains currently execute. We will have a centralized (but virtual) ‘home office’ with editors, designers, product managers, developers, business development, finance, and any other service that is not directly reporting the news.” The difference between the chains and News Oasis is that Mike wants this to be a force for local news renewal, to support the growing number of news entrepreneurs.

I’m so excited about the experimentation going on in the local news space, and I know how much effort these folks are expending to try to serve their communities. Fortunately, we are starting to see models that work and that might be the basis for rebuilding local news. And in the US, there is Press Forward, the half-billion dollar effort to regreen news deserts.

How to choose your business model

As I wrote in the Media Bulletin, one criterion for choosing revenue streams and an overall business model for news organisations large or small is that the revenue strategy needs to be aligned with the organisation’s mission. Anton Protsiuk at The Fix covered this well recently.

Small, start-up news organisations will also need to make sure that in addition to a strong editorial vision and capaibilities that they have some other skills as well. From my own experience, small newsrooms face a paradox. Decision-making can be quicker because there are fewer layers of management, but they also have fewer resources. While product management may seem like a luxury in small newsrooms, product thinking is critical because setting priorities is essential. It might not be a full-time position, but it is an audience-focused product mindset.

Business skills are essential as well. Chris Krewson, the executive director of LION Pubs, has done a great job of supporting members to have a business plan. Many journalists start these local, independent publications by seeing an unmet need, and of course, they approach their projects with an editorial focus. Making sure that they also have a strong business leader who shares their vision is critical to small newsroom success as well.

One last thing that I will only cover briefly, but which I have been thinking about for a long time. Most journalism entrepreneurs and investors say that for a commercially viable news organisation, you need an addressable market of at least 50,000 people. This can be geographically bounded in some way or a collection of people interested in the same issue or topic. If you are doing a local news start-up and it is focused on a particular area, you need to assess the local market conditions. When I was in Wisconsin, the communities that the newspapers I managed were very different. The Sheboygan Press served a city of 50,000 and a county (to a lesser extent) of 150,000, but the county boasted the headquarters of several national and international companies. Kohler, which made not only kitchen and bathroom fixtures but also power generation equipment, had its headquarters there. Bemis, a major plastic injection moulding company, had its headquarters and plant there. Sargento cheese. Johnsonville sausages. The list goes on. It still had an industrial base which provided jobs and a robust economy. It had a lot of civic capital. A news entrepreneur could tap into local philanthropy and serve a highly civically engaged audience.

I also managed the paper in Manitowoc. The community was on a different trajectory. Many of its major industries in Manitowoc and nearby Two Rivers had shuttered or relocated. It didn’t have the local civic or economic capital that Sheboygan had. To serve the community would require a much different approach and revenue mix, and to be honest, I am not sure that a for-profit model alone would sustain it. Communities like Manitowoc still deserve good local quality journalism, but I am not convinced that a purely commercial model is sustainable there. This topic is worth its own in-depth examination, and I would love to partner with a researcher to look into it. But hopefully, this is enough to jump-start a conversation about the wide variety of markets that are now news deserts or served by ghost papers and how to serve their information needs.

Reuter’s Institute annual survey: Media leaders are anxious about referral traffic and AI, leaning into reader revenue

Nic Newman at the Reuters Institute for the Study of Journalism has released his annual trends and predictions report based on interviews with 300 media leaders from more than 50 countries and territories around the world.

  • Less than half of the leaders - editors, CEOs and digital executives - (47%) say they are confident about journalism’s prospects this year, and 12% say that they have low confidence.

  • Chartbeat shows that traffic is down from Facebook by 48% to news sites, and two-thirds of the leaders said that they are concerned about this sharp decline.

  • More than that, there are concerns that search-generative experiences and AI chatbots pose additional threats to traffic to news sites.

  • While 2023 ended with Axel Springer striking a big deal with OpenAI, half of those surveyed thought that little money would come from AI companies for licencing. And almost a third thought the major cash would go to big players (like Springer).

  • A majority (56%) of publishers were looking to leverage AI for back-end news automation. The other applications for AI include better recommendations (37%) and commercial uses (28%).

  • More publishers will stop the presses this year.

Some leaders believe that they can or must build direct relationships with their audiences to break their dependency on the platforms. Much of this isn’t new, but Nic has quantified the level of anxiety amongst media leaders. And while some publishers feel so stung by the loss of referrals that they are questioning their past reliance on platforms, other publishers are looking for new platforms including TikTok and WhatsApp to reach audiences. I think that there is a middle ground in which platforms are understood as ways to raise awareness of your brand but that they are understood as a part of a larger conversion process to a range of conversion goals including newsletter signups, registration and subscription.

Reading this, I have concerns. Publishers are looking to create more video, more newsletters and more podcasts. Much of this feels like publishers are going back to the well, turning to traffic-driving formats as the traffic from search and social dries up.

Advertising was soft in 2023, and 80% of those surveyed will continue to invest in subscriptions and membership, more than either traditional display or native advertising. The survey also hinted that subscription growth is slowing.

It sounds like another year of upheaval in journalism. A year full of elections will drive traffic, but it’s unclear if that traffic will translate into more revenue or more trust.

The first story below is Nic’s write-up about the report, and the following are two summaries.

Building on the responses from the survey, big publishers and broadcasters will seek leverage to strike deals with AI firms. Exhibit A is Fox trying to use blockchain to help media companies keep track of how their content is being used. The system is designed to empower media companies to manage how LLMs use their content.

Here is OpenAI’s response to the New York Times’ lawsuit. It sounds conciliatory, and the company says that it wants to strike a deal with the Times and other media companies. However, they also accuse the Times of manipulating its system to create the ‘regurgitation’ that the newspaper cited in its suit, and they say that they are working to eliminate the LLM regurgitating aka copying/plagiarising content.

OpenAI launches a store to make it easier to create custom AI chatbots.

Stop treating AI like magic and start focusing on targeted, operational experiments

I did something rare over the holidays. I took a break and downed tools so that I could start 2024 recharged and ready for everything that this year will bring. I hope that all of you had some downtime as well.

My downtime has left me in a reflective mood. 2023 was a challenging year for people in the media, and back in the US where I’m from, tens of thousands of people working in the media lost their jobs last year. Mark Stenberg of Adweek called it the “worst year in digital media”. And in the UK, where I live now, friends of mine lost or left their jobs.

I’m a survivor and so will all of you talented folks, even though it’s stressful and extremely challenging. I survived the dot.com crash, the one that wiped out a wave of early internet companies but also wiped out the careers of an early wave of digital journalists. I know so many incredibly smart young journalists like myself who lost their jobs and couldn’t find work in the industry because it didn’t value their skills at the time. A few years later, they would be desperate for staff with their skills. Increasing precarity has been the trajectory of the industry. I worked for the BBC for eight years, and half the time there were cuts. I worked at The Guardian for three and a half years, and half the time there were cuts. I worked for Gannett for 21 months, and as I have told many friends, I survived the first six rounds of cuts but not the seventh. It has been a lot of turmoil, and it has not always been easy to keep my confidence.

Of course, the other challenge for me and so many others is a loss of professional identity. Who are we outside of newsrooms? How will we ever find a job with such purpose and meaning again? Trust me when I say that there are a lot of ways to use your skills to do meaningful work. My career has been a wild ride and a fascinating journey and will continue to be. If you know of someone who needs to talk, point them in my direction.

Now onto the new year. 2024 is already upon us. The Press Gazette has a good overview of the challenges that media leaders are focused on in this new year and how they are looking to respond. The challenges are familiar: loss of advertising revenue, loss of social and search traffic and anxiety over AI. I think a lot of this can be summed up by a renewed sense of ownership, with the shift to first-party data and owned platforms and owning relationships with audiences

Keeping our heads about AI

I’m not sure that I agree with the Press Gazette that the New York Times is seeking the “destruction of OpenAI and Microsoft LLMs”. I think they are rightfully offended by the lifting of their content. Plagiarism is a cardinal sin in US journalism, and the NY Times has found a wealth of examples of OpenAI copying and pasting their content. The New York Times want to be compensated for the theft of their content.

This is part of the response to LLMs by the industry. In my professional journey, I have seen too many folks treat technology as magic. They think what technology does is the realm of Harry Potter. It is much more like The Matrix: It is a logical system and sets of tools. AI offers up many operational benefits for many industries, including media. It can optimise front-page displays and tailor them for each known user. It can create personalised newsletters. It can support consistency of metadata, which can support improved discovery.

And my friend, Gina Chua at Semafor, has some other advice on how to use data and AI. He experimented building very focused chatbots to summarise reporters’ notebooks, develop interactive experiences and explain technical expertise to “resource-strapped newsrooms”. He came away impressed..

And now onto other topics. Puzzles and quizzes can build habit and engagement. Here are some examples of how to do that.

In the middle of the last decade, I used to hold up theSkimm and its newsletter-based business to help millennial women get informed quickly as an example of a great model. But like so many other millennially-focused outlets, it hasn’t aged well and continues to struggle to diversify.

It is interesting to see how many newspapers are getting into TV, not just video but TV. The Boston Globe (a customer of Pugpig, where I work) is just the latest example.

Podcasting is still attracting money. What is interesting about Podimo is that is operating in non-English markets - Denmark, Norway, Germany and Spain. Will this investment help it to break out into larger markets? (Colour me sceptical.)