Journalism 2019: A year of hard graft

Nic Newman was one of the three people who interviewed me for the role of the BBC News Online’s first overseas journalist based in Washington (a few liftetimes ago), and we have stayed in touch. I am one of the hundreds of digital leaders he reaches out to every year to inform his annual predictions. This is what I wrote to him in full albeit slightly edited for his 2019 edition of a look ahead to the year.

1.     What was the most significant development in 2018 in terms of digital media?

I think we’ve reached an end to this round of the innovation cycle with respect to digital media, the Rise of the Platforms. Let me explain. Gartner has its Hype Cycle, but over the years, I’ve begun to see an Innovation Cycle in terms of digital media. We see a period where a new idea or usually group of ideas emerges. It is tested, and then we see wider adoption until we start to explore the limits of that idea. After that adoption, we usually a lull before we see another flowering of ideas. Sometimes, the lull is down to an economic trough such as following the crash after the dot.com boom, and sometimes it is simply the playing out of an idea, such I think we’re seeing with platform-focused strategies in media, well as well as the strategies of the social media platforms themselves.

It’s more cost effective for Google and Facebook to reach billions than it is for news content companies to reach millions…

As an example, think about the metered paywall by the New York Times. Yes, it was pioneered by others, namely the Financial Times, but the New York Times won over sceptics who thought it only worked for financial publications. Then we saw wider adoption of the idea: The pivot to reader revenue.

Let me lay out a few epochs that I have seen:

• The dot.com boom. – Digital Media emerges

• The Web 2.0 era. – Networked Media emerges.

• The Rise of the Duopoly – Consolidation.  (I originally wrote The Rise of the Platforms, but it really is more about the rise of Facebook and Google.)

We’re coming to the end of the Rise of the Duopoly and what that means for media. Google and Facebook are globally dominant – apart from the Russo and Sino-spheres – when it comes to digital advertising, and I think pretty much everyone understands it. Everything that has happened is in some way a response to that. Of course, during this particular epoch, other things happened, but they have been driven by the rise of these platforms. Yes, print has declined or, in some countries – such at the US – one could say is in the process of collapse, but one of the challenges that they face in their efforts to transition to digital business models is down to the dominance of the Duopoly.

There has been a lot of focus on the consolidation in the VC-funded digital media start-up space, but that was bound to happen sometime. And that consolidation has been going on for two years, and again, that has been driven by the Rise of the Duopoly. VCs want growth. They demand scale. But those pursuing scale don’t understand that it’s more cost effective for Google and Facebook to reach billions than it is for news content companies to reach millions, and that’s just on the editorial side. On the advertising side, Google and Facebook have built technologies that are more efficient at reaching their billions than news content companies’ technology to reach millions.

I hope that the humbling of companies like Mic and Mashable, which sold for a fraction of their worth as reflected in their funding rounds, is a wake up call that the scale strategies that were fundamental to mass media in the 20th Century operate differently for original content companies in the 21st Century due to the differences in economics between platforms and content companies.

And this collapse of the scale strategies isn’t limited to startups but should be clear in the failed consolidation strategies in the US and UK for legacy publishers. These roll-ups haven’t delivering long-term sustainability but have only bought a little time to figure out a longer term strategy at best, or in the case of Alden Global been a way for a handful of hedge fund managers to enrich themselves at the cost of staff, communities and society. Legacy scale strategies are based on the idea that economies of scale wring out cost in a business, but if that new combined business cannot reverse revenue declines, that business will still fail. How many times have seen these combined businesses deliver and enterprise that is less than the sum of its parts, whether that was AOL-Time Warner or the large newspaper chains?

We know some strategies that work, largely around reader revenue, focusing on a small but lucrative niche – Skift focused on the business of travel or Penny Hoarder focused on millennials making less than $50,000 – or businesses focused on affiliate marketing, Penny Hoarder again or the Wirecutter.

In my idea of an innovation cycle, we will see companies fine tune their strategies and get their heads down on executing them. At some point in 2019, we’ll enter an economic downturn, and that is never a good time for media businesses. For those who have built out solid reader revenue strategies, they will have some insulation from the ravages of the economic cycle, but for others, there isn’t a lot of good news. You look at the Gannetts of the world, and they saw their profits dwindle this year even in arguably the best economy the US has seen since 1969. If they can’t grow aggressively in an up cycle, then it is sobering to think of what happens as the cycle reverses. We’re already seeing it as a majors in media and advertising – WPP, Reuters and others – are cutting staff now. That to me is the canary in the coal mine. The media business cycle is turning even before as many media companies struggle to right their businesses. 

2.     Any thoughts on one key development in 2019

2019 will be a year of optimising these business models and building out businesses. As we saw after the dot.com boom, there will be innovation, but it will be quiet as attention turns to survival for some of the big beasts.

We begin 2019 with a scepticism about social media that will open up opportunities for new spaces in media. Messaging has been and will be an interesting space to watch as more people turn away from open social networks to quieter, more closed spaces.

Just as with the beginning of the Web 2.0 era, the changes will initially fly under the radar, but when they come into the mainstream, they will drive the next round of innovation.

If I were watching one development, I would say it is around the development of the video market. Facebook continues to try to go after the multi-billion TV advertising market with video strategies. As I write this, they are again pulling back support for news on their Watch platform, and there are reports that they are in talks with HBO. Are they trying to recreate a cable network? I shake my head at the increasing desperation Facebook has with their video strategies.

But beyond Facebook and its flailing attempts to crack the video market, I think it will be interesting to watch what happens in the pay TV market in the US. What does this have to do with journalism? Most cities and towns in the US have three or four local TV stations, and as local newspapers continue to cut, more local news coverage falls on these local TV stations. The local TV stations or more to the point, the groups that own them, are flush with political advertising cash.

Journalism 2019: Don’t stop at hello

Hello … by Iain Farrell

A few years ago I spoke about Peak Content, the distortions that I saw in the Attention Economy. As I wrote then:

The democratisation of production brought by digital technology has made it easier than ever for people to create content, but it has also made it more difficult than ever to get paid to create it, both for individual creators and many companies. This cannot last.

When I wrote that two years ago, venture-capital funded digital media companies were ascendent, and with money flowing from VCs and the funds of legacy media companies, it seemed like we were set to see a new wave of truly digital native media companies unbound by legacy concerns.

Unfortunately, even at that time, it was clear that a digital shake-out was beginning, and it only accelerated in 2018. And sadly, for all of the money poured into these start-ups, I don’t think we’ve really moved the dial much. I mean, Buzzfeed has gone from native advertising pioneer to flogging tote bags in a half-baked membership scheme.

Where does that leave us?

I recently spoke with Emily Lowes with the Online Journalism Blog about the daily newsletter that I’ve been writing for the last six months or so. Refining what I said to Emily, my newsletter is grounded in my view that one of the things that is broken in the Attention Economy is the glut of content.

One of a journalist’s roles is to help people understand what to pay attention to. And in a world where there are so many things – many of them good, some of them excellent – to pay attention to, a trusted guide is invaluable.

Like the Nieman Lab piece which talks about blending algorithms and AI with traditional journalism skills (“growing hooves” as the author calls it) I have always sought ways to use technology to help me filter information, find patterns and, to be honest, cut out repetitive tasks. I’d rather robots do the robotic work so I can focus on the human part.

That’s why I use Nuzzel for my personal newsletter. It is the latest tool to use social media networks to filter content and pick out what’s relevant to my professional interests.

But no matter how sophisticated the technology, I have always found that I need to periodically retune my filters. At the moment I have to wade through more content than I would like because of all the noise generated out of 1600 Pennsylvania Avenue that journalists share on Twitter. If I were starting from scratch with Nuzzel, I would create a very finely curated Twitter list with media business professionals who mostly tweeted about strategy and who did little media criticism.

Suw also tells me that Nuzzel has proven less effective for niche subjects, such as the women in STEM content that she’s looking for. She’s actually been having to search elsewhere for content to put into a daily Nuzzel newsletter but, with only 60 subscribers, she’s moving to a weekly schedule to cut down the time demands.

Learning How to Earn Attention

But the biggest challenge is that there are so many things vying for our attention that building an audience is one of the key challenges in the 21st Century for a content maker. A newsletter is a good place to learn lessons on how to earn attention and build that audience.

You can learn not only curation and reporting, but also how to build a voice and a brand. I didn’t learn this at journalism school, but I have learned them throughout my career not only as a journalist but also as a business owner.

Constantly Learning

The other point I was trying to make in my interview with Emily is that newsletters are also a good format for journalists to learn how to use data to learn how to better serve audiences. Nuzzel emails me every week to let me know the stories that my subscribers read, and it gives me subtle cues on what they are most interested in. As much as this might sound like a cliche, my readers seem to respond most to actionable intelligence, strategies that they can apply, and developments with respect to the social platforms.

Throughout my career, I have always been challenged by people who say that by taking the pulse of my audience like this that I’m pandering to the audience or veering towards producing clickbait.

It all depends on what you’re using the data to optimise for. I never lose sight of my public service mission. And for those who say using data to maximise impact I would say this: If you create a piece of journalism that no one watches, listens to or reads, have you actually committed an act of public service?

From Platforms to Personal Commitment

And that brings me to my final point. For the last few years, there was such an obsessive focus on platforms that we mistook ‘Hello’ for ‘I love you’. What I mean by that is that there were strategies that thought the platforms were the end goal. Instead, platforms should be considered the top of the conversion funnel – the hello, the introduction to our journalism and to our brands.

What we need to do is cement that relationship with our audience, our customers, our public, and newsletters are a good next step after the platform. For some businesses like The Skimm, the newsletters are so well done, the engagement strategies so effective, that they are a standalone product unto themselves.

For many other brands, like The New Yorker, newsletters are integral on the journey from hello to I love you, from casual consumer to subscriber. As the data scientists at The New Yorker found out, the single strongest predictor of whether someone will subscribe to The New Yorker is whether they first subscribe to one their newsletters.

Success depends upon developing strategies that invite a deeper connection to your journalism, from the casual user via social or search to a newsletter subscriber to an app user to a paying subscriber or a member. It takes determination, focus and patience. Here’s to beginning that journey.

Hire a journalist, you’ll get a lot of talent

As I walked in the door as a regional executive editor with Gannett in 2014, the features editor over the two newspapers I managed walked out the door, and so began the next 21 months during which only a couple of weeks I wasn’t recruiting. I wouldn’t have managed nearly as well as I did without a solid HR partner who helped me navigate the internal processes and also hone my skills as a manager. In the second year in the role, the recruiting crunch went to an entirely new level as I had nine open positions across four papers with a total headcount of 32. And of those nine open positions, three were for the four management positions at the papers.

I lost count how many resumes/CVs I looked at. For the entry-level reporting positions, many were people in other industries hoping to get a break or simply applying to meet an unemployment benefit requirement, but for the management positions, I saw a lot of resumes where the stories were fractured. These were not the tidy resumes of someone effortlessly climbing a career ladder. Some had left journalism for a time or drifted in and out of the industry. I remember interviewing one woman who was working in communications for the state of Minnesota and had read some of my blog posts and was excited about the opportunity of getting back into the industry and working together. Unfortunately, I knew that the position she was interviewing for would most likely be closed not long after we could have offered it to her. And I remember one person – who I eventually hired – and that one of my HR partners said had a resume that didn’t make sense. To which I replied, “Show me a mid-career journalist who has a resume that makes sense.”

Failing to impress the algorithms

Journalism – especially print journalism – was only one of many industries that took a beating in the Great Recession, but what a beating it took. As Pew recently reported, newsroom – digital, print and broadcast – employment has fallen by 23 per cent since 2008. In the same period, newspaper newsroom employment fell by a stomach-churning 45 per cent.

From October 2015 until February of this year, I held two full-time jobs. I was building a successful international digital media consultancy, and I was a job seeker, albeit most of my job search took the form of trying out future employers as clients. It was by far the oddest job search I have ever had. (I’ll detail all of the really odd behaviours in another post.) I hadn’t sent job applications out into the ether since my first job, but I can understand why many people became discouraged. You send them out into the great void rarely to hear anything back.

Do a search on resume algorithms or ATS and algorithms, and you’ll find that you’re not having to impress HR staff or hiring managers, you’re trying to catch the attention of algorithms or ATS – applicant tracking systems. As Muse says:

Undoubtedly, this saves HR managers the time and trouble of sorting through irrelevant, underprepared, and weak resumes to find the golden candidates. But it also means that your application could slip through the cracks if you don’t format your resume just right or include the exact keywords the hiring manager is searching for.

I broke one of Muse’s prime bits of advice, I stuffed my resume with keywords. No, that didn’t work. And I did feel as if I was flying blind at times as I applied for jobs in digital fields outside of journalism. I have to thank a couple of friends and a few recruiters who gave me advice on how to re-format my resume for non-journalism jobs. But I rarely was interviewed by employers outside of media, apart from a couple of times. Those times were usually due to extraordinary interventions by people in my network.

Journalists’ transferable skills

Fortunately, I didn’t have to transfer out of journalism or media, and I’m incredibly happy that I found not just a job but very much the right job for me in the right place. But there are so many journalists on the market right now, that many will have to complete a career pivot.

And this is my plea to hiring managers: Hire a journalist. Journalists, especially those with digital experience, are incredibly valuable employees. We’ve had to fight for customers (audiences) in a highly competitive market. We know how to work Google and social media to reach customers (audiences), and we know how to communicate. Many of us have run marketing campaigns on Facebook or possibly using Google AdWords. They work in highly data-driven businesses and have used digital analytics packages including Omniture, Google Analytics, Chartbeat or Parse.ly to grow their businesses. Many of us have great multimedia skills and know how to create videos that engage social media audiences.

I am quite happy in my new role, but there are a lot of other journalists, editors and multimedia producers out there like me. If you want to hire one of them, please get in touch. I know a few who are looking.

Creating journalism to engage as well as to inform

The media world is in full freak-out mode about the changes at Facebook, both the changes in the news feed but now its decision to let the Facebook “community” decide which publications are credible. For the record, I find the latter move much more problematic, but I want to focus on the shift to reward engagement. Like a lot of people, I see the shift as an opportunity for news organisations rather than a threat.

The change in the news feed is only a bad thing for news organisations addicted to passively playing the algorithm for cheap clicks. Even if it juices the pageviews for a while, the end of 2017 showed that simply chasing scale without a method to convert those users into loyal, returning users will not deliver a sustainable business model.

Meanwhile, a model built on winning loyalty was winning. As The Economist pointed out last autumn, many successful news groups are succeeding by working hard to convert the casual users, often from social media, into loyal users, loyal enough that they become subscribers. Those groups have married an engagement strategy with data science. Moreover, as Digiday pointed out with Aftenposten, your content strategy is very different if you focus on keeping paying subscribers happy rather than chasing traffic.

The challenge for many groups will be that as they have with many digital innovations, they treated Facebook as just another channel to passively share their content. They didn’t make an effort to engage with their audience, but rather, they prayed to the gods of virality that their posts would be shared widely. Virality would lead inexorably to clicks, and advertising would lead to revenue. As I said, the end of 2017 put paid to that strategy. It doesn’t work.

What to do?

Martin Giesler highlighted the conundrum for news publishers in a very good post on the feed changes. Jump to his immediate, medium and long-term steps to take to respond to the changes. He said:

As there’s no point in betting on traffic, many publishers will now focus on engagement. The problem here is that journalism is not primarily intended to generate interactions. Rather, it is primarily a matter of informing. In a journalistic sense, passivity is not a bad thing – quite the opposite of Facebook logic.

Exactly. Years ago when I was the blogs editor at The Guardian, the New York Times’ Sewell Chan met with me as he was launching the paper’s city-focused blog. I put the shift in publication to conversation this way.

A piece of journalism takes reporting and ties together as many threads as possible as quickly and efficiently as possible. A blog post teases out those same threads as the basis of a debate, discussion or conversation.

Slapping a comment box on the bottom of an article or column opened up a return channel, but especially on news articles, there are no calls to action. The intention of the content was to inform. What response did we expect from people?

Now, we need to think about content formats designed to engage.

  • We need a range of products and features that engage people whether they want to lightly engage or more heavily engage. Think of the range of engagement on Facebook itself. For example, news site Rappler in the Philippines has mood reactions on its content, giving people a lightweight way to engage.
  • Think of social media as the top of your engagement funnel and develop strategies that convert people into more durable, direct relationships with you and your journalism.
  • Work to convert users to products like an app, newsletter, podcasts, and events.
  • Develop novel ways to monetise that attention across the range of engagement products.

Successful media organisations have been doing this for years so should take Facebook’s changes in stride. You could never entirely base your business on the someone else’s business, especially one that introduces opaque changes so frequently as Facebook. Facebook is just pushing you to make necessary changes to end your dependence. Embrace it!

Why this digital media bust will be different (and ways that it will be the same)

By now, we all have heard reports that Buzzfeed and Vice will miss their revenue targets. Mashable has been sold for a fifth of its 2016 valuation, and there are more reports of chaos at Mic after its pivot to video. And Spirited Media, which was seen as a promising model for local media, laid off staff in what CEO Jim Brady called a “shitty week”. What does this mean?

  • I’ve been saying this for a few years now, the chase for scale with 20th Century mass media strategies doesn’t work in the age of the Duopoly. Their scale dwarfs the scale that media companies can cost-effectively create.
  • Advertising as the sole source of revenue has been looking shaky for quite a while, and with print advertising collapsing across the English-speaking world and digital advertising being eaten up by Google and Facebook, media companies will have to find other revenue streams. (Kudos to Jim Brady and
  • VC funding for mass Millennial media products is done for the moment.
  • The “pivot to video” was driven much more by advertising revenue than audience demand.
  • Look for 2018 to be the “pivot to affiliate”. Media folks are herd-like creatures, and the success of Wirecutter and Penny Hoarder will not have been lost on them.

I agree with Josh Marshall, we’re in the midst of a digital media crash, or more accurately, a VC-funded digital media crash in the middle of a broader legacy media crash wrapped in an even broader media realignment the likes of which we haven’t seen since the invention of the printing press. As I wrote about at the beginning of 2016, there has been trouble in the Attention Economy for a while. I thought that we were reaching Peak Content,  a point where the race to create more content in the foolish chase for scale ended because it just became economically unsustainable.

Of course, those who followed funding closely knew that there was trouble in VC-funding of media. I had heard from friends in funding circles that recent investment rounds were going for ridiculously low multiples in terms of earnings, and for those who follow media funding closely, like my grenade-tossing friend Rafat Ali, this reckoning has been coming for a while. And that reality is hitting start-ups big and small. Brady said that the layoffs at Spirited Media were caused by a lower than expected funding round.

Another media crash

I have lived through a few media crashes already in my career, including the dot.com crash and the Great Recession. I think this crash will be much more like the dot.com crash, which in media terms has long passed from memory because most of the media folks in digital media in the late 90s left. They struggled to get hired back into legacy media, and they simply pivoted into something different. I consider myself fortunate, I was working for the BBC as their first digital correspondent outside of the UK. Our unique public funding model allowed us to continue to innovate even in the teeth of the crash. It’s been tough for mid-career journalists like myself to stay in the industry since the Great Recession, and sadly, in 2017, I saw it get tougher for younger journalists as well.

But this crash in digital media will be different than the dot.com crash. In 2001, people questioned whether you could make money with digital advertising, and there are some who are asking the same question. But it’s the wrong one. People are making money, billions of dollars in digital advertising. It just isn’t the media, and that has been the problem for a long time, even before the last two years when it became clear that The Duopoly were gobbling up most of the digital advertising revenue in the world.

How it is slightly different this time…

But this crash is different because unlike the dot.com crash, which wiped out an early wave of digital-first media companies, we do have models that are working. And I’m not just talking about the Financial Times or the New York Times. There are a lot of really fascinating start-ups that have solid models deeply serving much smaller audiences – Skift, The Skimm and Penny Hoarder. As Rafat, founder and CEO, of Skift wrote on Twitter.

There is a lot that is working, and I’ll go into that later. It will have to wait until taking a much-needed break over Thanksgiving.

The tension between local news needs and the economics of local content

With the recent closure of DNAInfo and the “-ist” network (Gothamist, Chicagoist, etc) by its billionaire owner, allegedly in a fit of pique over a vote to unionise, there has been more focus on challenges of local news. To me, this is the real crisis in journalism in the English-speaking world. The economic basis for local journalism, advertising, has come under extreme pressure as print subscriptions decline and Facebook and Google gobble up more of the digital advertising pie.

In a recent edition of my newsletter, I flagged up this interesting quote from Patch CEO Warren St. John, who told Axios:

“is that economically, good local news isn’t be designed to serve national or scaled interests, and the driving forces behind it need to come from the community level with community interests.”

This seems to run entirely counter to the consolidation in local news right now, but as local news becomes regionalised by groups focused on cost-cutting and efficiencies of an already lean business, there are opportunities opening up for local scale news businesses. The next few years will be interesting to watch. I predict a lot of experiments in communities smaller than 100,000 that aren’t close to larger metro areas.

Nuzzel: NYTimes creates a podcast winner and Damain Radcliffe looks at local trends

I do a daily international advertising and media newsletter. I’m going to start posting on days when there is a lot of good content. In today’s edition, we have Damian Radcliffe talking about trends in local journalism, and I also have a link to a very promising tool to add better metrics to your email newsletters. And the NYTimes has a podcast winner on its hands in the form of The Daily. Moreover, it’s not just successful in terms of reach, but it is also attracting some serious revenue. You can check out the other stories and also subscribe here.

Some advice to people thinking about studying journalism

Through my notifications, I spotted this on Reddit, a senior in high school thinking about studying sports journalism. The Redditer is concerned that jobs are scarce and that the pay would be crap unless he lands a gig at ESPN. In my 20-year career in journalism, part of me wants to say twas ever thus, but here is my response:

As someone who has worked in journalism for the last 20 years but now “does things to support my journalism habit” and am looking for a second act for the second half of my career, I would say that you can do this, but think of two things (at least): A) Transferrable skills B) a double major that gives you solidly marketable skills outside of the exceedingly competitive sports journalism market. That second major could be sports marketing or simply marketing. (Or if you’ve got the resources and the drive, get a master’s degree outside of journalism. You’ll have a better sense of what you want to do once you’re at university.)

Also, if you really want to go the sports journalism route. Get writing and doing video as soon as possible. It was true 20 years ago when I was starting and it’s ten times more relevant now that you need to start building your personal brand and portfolio immediately.

And a little context, my last full-time job in journalism lasted 21 months as a regional executive editor for one of the major US newspaper groups. The last round of cuts a month ago by the group in the region where I used to work wiped out half of the local sports staffs.

Let me end on a positive note. I may not be working full-time for a news organisation now, but I have had an utterly amazing career. I got my start as a cub reporter in western Kansas in the mid-90s. Four years after I started, I landed in the BBC’s Washington bureau as their first digital journalist outside of the UK. I moved to the UK in 2005. I worked for the BBC a little longer and then moved to the Guardian in 2006. In 2010, I took a buyout. It gets a little less predictable after that, which is the story for a lot of journalists my age.

But now, I have my own little media consultancy. Who am I kidding, I’m a one man consultancy. This year, I’ve written a report on newsroom innovation management for the Reuters Institute at Oxford. I’ve traveled to 11 countries already this year doing workshops, conferences and consulting with media companies and industry groups. I informally advise digital media start-ups and do some fundraising for them. It’s a lot of work. It’s a lot of fun, but it is a lot of create your own adventure too. Best of luck!

I’m not going to say that this is the end all and be all of advice. It’s an exciting time to enter journalism, but I think this Redditer also understands the inherent risk in the industry right now. It used to be that journalists graduated from junior reporting positions that paid two cents more than f*&k-all to gradually either well paid senior writing positions or leadership positions. At the moment, that career path is broken. Now journalism has a rise or retire system similar to the US military, well apart from the pretty good retirement benefits.

Most of the regional journalism jobs that are have disappeared in the US over the last ten years will not come back, and most of the digital jobs are in high-rent cities — New York, Washington, SF and LA.

We’re in a moment when what was is being slowly dismantled, and we’re not entirely sure what will be in the future. That’s exciting, but the ride is a little bumpy, to say the least.

Unsolicited advice to Gannett, from a shareholder

Before offering this advice, I should disclose that I am a Gannett shareholder as a result of being a former Gannett employee. My position with Gannett as an executive editor over a few of its small papers in Wisconsin was eliminated a little more than a year ago in a round of budget cuts. I’ve actually come out of that really well despite the position disappearing sooner than I anticipated, but as a shareholder by default of their 401K plan, I have legitimate concerns about Gannett’s expansion strategy.

Here is my advice not only as a shareholder but as someone who makes pretty good money giving such advice to media companies:

  1. Your USA Today Network strategy makes sense. Your local-to-national strategy does not. Your acquisition strategy makes less than no sense. Your Q3 results show that while you’re buying scale and adding revenue, you’re also adding costs at an unsustainable rate, especially with the double-digit quarterly decline in print advertising. If Wolfgang Blau of Conde Nast says the “war for scale” is over, why do you think your business is different?
  2. Look at your advertising base. You leave a lot of money on the table locally because you can’t afford to chase it on your cost base. The cost of acquisition for small local businesses’ ads in many small markets is too high for you. Your ad base is regional and national, not local in any meaningful way below a certain floor. That’s your business, and you need to build your content strategy off of that. (It’s also the reality of much of the media market in 2016.)
  3. On that assumption that you have a regional-to-national business rather than a local-to-national business, you should sell off the vast majority of what I’d call your hyperlocal properties, small sites like those I used to manage. Believing that the number of print properties you have translates into reach in 2016 is outdated print thinking that you need to jettison. You’re looking at consolidation through the wrong lens: Lots of properties != profit. If newspaper scale based on property count was the solution, it would have worked long ago. It hasn’t. Moreover, as Ken Doctor points out, the Street doesn’t believe you can wring out as much as savings as you think you can. Keep some local staff around the state, but be strategic about it. Look at your numbers, how often is there a story from these small sites that grabs national attention?
  4. Use the proceeds of these sales to buy a tent-pole property in as many states as makes sense. That’s the basis of a regional-to-national strategy, one that is built on  sensible cost basis. It gives you scale without the costs, tightly focused execution and dramatically fewer print properties to try to manage. You have been so focused on cost cutting at a ridiculous number of properties that the product and your focus on execution have suffered. Regional products will be stronger and more sustainable than local or hyperlocal.
  5. In states where you don’t have a property or it’s uneconomic to buy one, launch digital regional properties. It’s more cost effective, and it gives you a good place to experiment without print legacy costs or thinking. Or partner and invest in properties like the Texas Tribune. A national expansion strategy will have to be creative and use different tactics based on the realities of different markets and regions across the country. This is guerrilla warfare for your future. Be creative and nimble, not corporatist and monolithic in your approach.
  6. Get deadly serious about your customer data. I know that is part of your strategy, but if you want respect from the Street again, you need to put that front and centre. You’re still drowning in the red ocean of print and struggling in the red ocean of digital advertising where Google and Facebook, with their superior ad tech and mountains of data, are the Great White Sharks gobbling up the market and leaving little but scraps for the rest. The media companies that come out the end of this Great Disruption will be focused on their content and commercial customers. This is the Bletchley Park Project for media. Crack the code of data or resign yourself to annihilation.

Let me end with this question: Did a Last Dead Man Walking strategy in print ever make any sense considering the swoon in print advertising over the past decade? Do you want to be a consolidator in a business sector in decline or a disruptor of your own business and others so you might have a future?*

* My day rates are well within your budget.

Which newspapers will survive?

For much of the nearly two years that I served as an executive editor for a shifting group of small Gannett newspapers in Wisconsin, I often asked myself: Which newspapers will survive? Trust me, it wasn’t an idle thought experiment. That’s the question I decided to try to answer in a recent piece for The Media Briefing in the UK.

The newspapers I oversaw were actually doing pretty well with growing reach and revenue. However, I know that the picture wasn’t so sunny across much of the industry.

Since my job as executive editor of a group of small newspapers in Wisconsin was eliminated in early October, it seems like a week hasn’t gone by when there hasn’t been announcements of cuts in newspapers – Tribune Publishing (almost 10 percent of its workforce is gone in 2015, the Boston Globe, swingeing cuts in Pittsburgh and Philly. It is pretty bloody out there, and we’re entering a final convulsion of consolidation in the industry as big groups like Gannett try to scale their way to compete with the big digital platform players.

Personally, I believe the next three to five years will see a major shakeout in English language media. Simply put, there is too much content chasing a finite amount of attention and advertising. Market corrections almost always overshoot, and this correction has been a while in coming so I expect that this will be bloody and brutal. And newspapers aren’t the only media that will suffer. As we’ve seen in the last month, premium cable sports giant ESPN and even early digital publishers like Gawker are having to retrench and retool. But print was in the vanguard of media to suffer, only really trailing music in terms of digital disruption. This leads me to the question: Which newspapers will survive?

Size matters

Simply put, quite a few won’t. However, I think that some newspapers will survive, and print will still be a pretty significant part of their business, although digital will drive a lot of their growth. I agree with John Stackhouse, the former editor-in-chief of the Globe and Mail in Canada, newspapers (and newspaper groups) will survive if they are either huge or small. The middle is getting clobbered, and that includes a lot of major metro and mid-size papers in the US.

The challenge for any newspaper group is that while on aggregate they fare pretty well in terms of scale, even when traffic from all of their properties are put together, they simply don’t reach the scale that the major digital platform players do. According to ComScore’s list of Top 50 Digital Media Properties for October 2015, Gannett, with the highest traffic of any US newspaper publisher, came in at number 17, just ahead of eBay. That’s not too shabby. But Gannett’s more than 101 m unique visitors were only 41 percent of Google’s uniques for the same month. That shows the challenge that most media companies are facing. ComScore Top 20 Digital Media Properties in the US October 2015

The major digital platforms are playing an entirely different game. When you look at Google and Facebook, they have all the advantages of massive scale and laser-guided ad targeting without the cost of running a large network of newspapers. Sure, they have their overheads, but they do not compare with the cost of running the 20th Century industrial legacy that is involved with a national newspaper group. And if you’re the Guardian or the New York Times, and, let’s throw a newly resurgent Washington Post, in the mix, you can have national reach without the expense of a local footprint.

For newspaper survival, I really think that small is beautiful. They are still rooted in their communities, but beyond good will, in Sheboygan and Manitowoc, two of the newspapers I oversaw as an executive editor, we didn’t have any local TV competition. They only came when we had a Rob Ford-esque mayor, had an odd crime or needed some snowstorm pictures.

So, size does matter but so does the economic health of the community. If your community is on the economic rocks, it makes it very difficult for a newspaper to survive. Sheboygan County is rocking it economically. It had the third lowest unemployment of any county in Wisconsin in September, reaching a 15-year low, and it has major national and multinational companies headquartered here.

There is a lot of opportunity in community publishing that serves communities like Sheboygan. Not only do I think that newspapers and their digital services will survive in the Sheboygans across the country, if I were an investor, that is where I’d be putting my money.