The Re-Rise of the Newsletter

The professional news industry is being forced to return to its roots by a world it doesn’t — and probably never will — fully understand. It began with the industry’s initial response to the digital disruption, which was to reproduce its entire finished product for the web. The web, however, wasn’t built by newspapers; it was built by highly creative and rebellious geeks who changed the world without the status quo telling them it needed changing.

The web was a brand new communications invention, not a new distribution channel for old ways of doing things, and in missing this truth, the industry was completely lost. The newspaper people wanted to present their finished product online, but the geeks knew from the start that this was inefficient and a cheap substitute for what was possible.

Blog software, with its reverse chronological flow, came first, quickly followed by ways to distribute content apart from its host. Social media is, at core, the news “audience” talking amongst themselves, which was contrary to the top-down relationship that the press had with its readers. The shift to mobile brought new challenges, the biggest being a playing field built around scrolling and video in portrait mode. News drifted away from the finished product variety and into the world of continuous news.

Of course, the biggest disruptor by far was how advertising was changing to adapt to the new, and a realization that smart marketers could provide ads at the browser level and based on the behaviors of that browser. This offered a much greater likelihood of advertiser return-on-investment. History books will cite this as causing the death of newspapers, but it’s really more a case of ignorance, for newspapers still lack the technology and the networks to provide this to local advertisers. The industry has ceded defeat to Google without even firing a shot.

And, now comes the newest era of the email newsletter, a technology that’s been around since the dawn of email but generally only used to provide links to the industry’s “real” content online. The shift today, however, includes those who give the energy it takes to produce actual content for newsletters, and it’s a godsend to overwhelmed news consumers. This trend is going to continue until a company’s online newsletter will become the primary method that news organizations use to disseminate news and information.

People can pass them around, which often results in new subscribers.

The first trader newsletters during the Middle Ages — actual letters from observers in far away places — were the precursor to the newspaper industry. Wikipedia notes that “Trader’s newsletters covered various topics such as the availability and pricing of goods, political news, and other events that would influence trade.” This is the essence of today’s developing process, and it suits not only the web’s unique abilities but also that most precious of earthly commodities: time.

I’ll be 74 this summer, and I spend most of my days online in an endless search for knowledge. Even with all that time, I still feel uninformed, because studying modern times is like trying to take a sip from a firehose. It’s the primary reason I’ve turned to newsletters. They’re out there; you just have to find them. Here are five newsletters that hit my inbox overnight or every morning:

The New York Times: While this is primarily a tool to “drive traffic” back to its newspaper site, the content is growing to include small story summaries throughout. It’s a way to follow the Times without subscribing to its main product.

Mondoweiss: I have family of Palestinians that lived in Amman, Jordan for a great many years, so my window on the Middle East is a little different than most. I don’t trust the Israeli’s, and I need an outlet that understands this. Mondoweiss is a terrific example of a point-of-view news organization that represents an extreme minority in the West. I need that to stay informed.

Dave Winer: Dave is one of the real gems in providing important technology news in a highly conversational format. I also really like Dave as a person, and his takes on life in general also give me food for thought. Dave’s is a constant voice on Twitter, and he uses his newsletter to summarize those thoughts. Moreover, and this is important, Dave is always a yard ahead of everybody else, and if he’s taking the trouble to produce a newsletter, it’s something that requires my attention.

Mathew Ingram: Mathew provides summaries and links to the stories he finds important. I trust Mathew and lean on his understanding to help my own.

Brian Stelter and Oliver Darcy: CNN’s Reliable Sources is (by a mile) the most useful contemporary newsletter in the market today. It is the model for others to copy, for it’s loaded with content written for readers of the newsletter. What a concept! Oh, it contains marketing and links, but it is written to be read, and the summaries are specifically aimed at people such as myself and all of those who just don’t have the time to invest in reading complete stories.

There are many others out there, and I’ll probably be extending my subscription list as I find those suited to my tastes. The point is that I get to decide what I wish to influence my thinking, not the forced and irritating offerings of the artificial and manipulative hegemony known as objectivity. That old standard disappeared with the advent of continuous streams of news. Journalism has always spoken with the authority of overseers, which is the luxury afforded to those who could afford a printing press. Today, every single person on the net is a media company and able to distribute their content just like the big boys.

To those who would drag out the ol’ echo chamber meme to accuse me of circular logic, let me state once again that my experience in helping to create right wing news means that I know that it’s just political propaganda disguised as news. Give me a little credit for that tidbit, because I’ve already turned the page on it.

If you don’t subscribe to newsletters, my advice is to begin today. Click on the links I’ve provided, if you’re interested in those. If you find yourself being fed content that you find bitter or tasteless, unsubscribing is just a click away.

To those in the news industry, if you don’t produce a newsletter, what are you waiting for? The only rules are that it can’t be a vehicle that merely “drives traffic” back to its point of origin, and ads should be presented as content, perhaps even written by the newsletter’s author(s).

The future of paid content

The hopes of newspapers to shift their Web users from free to paid models suffered a fairly substantial setback this morning with word of a new study from the folks at Nielsen. According to a report in Online Media Daily,

A new Nielsen survey says 79% of users would no longer access a Web site that charges them. The finding also assumes that consumers can find the same information at no cost. The new report from Nielsen surveyed 27,000 consumers from 52 countries.

Looking at new fee-based areas, the survey shows that 71% of global consumers say that if have to pay for online content it must be considerably better than what is currently available for free.

Paid Content conference logoObviously, media companies need to get paid for their efforts, so this disconnect between users (let’s remember that they’re real people, see below) and the copyright community needs resolution somehow, and fortunately, there are smart people trying to work on the issues. A lot of them will be on hand this weekend at a new conference in New York on the concept of paid content by the people who report daily on the subject, The scope of “Paid Content, Discussing The Economics Of Content” includes:

  • Business strategy and models that are working across news, information and entertainment
  • The people and companies driving innovation
  • The cross-platform approach to developing these diverse revenue streams
  • Music, TV and movie downloads
  • Subscription streaming
  • À la carte payments, micropayments, subscriptions, donation models, subsidy models, and mobile payments

Staci Kramer, courtesy James MontagueIn other words, just about everything involving people paying for content. I caught up with ContentNext Media EVP and co-editor of, Staci Kramer, with some tough questions about the idea of paid content:

Q — What is the future of paid content? Content that used to be ad-supported is now competing with content that IS advertising, and I’ve read from many knowledgeable observers that “content” is no longer king. Given that this is the namesake of your company and your conference, what are your thoughts?

KRAMER: Our flagship site,, was founded by Rafat Ali in 2002. As we added sites and other elements to the company, the corporate name became ContentNext Media — chosen in no small part to reflect a constantly changing area. To me, all content is paid content — the differences are in who pays for it. With our sites and newsletters, advertisers pay to gain access to our readers. In theory, and often in practice, readers pay for “free” and ad-supported content with attention. Cable, newspaper and magazine subscribers pay for access and delivery, usually subsidized by advertisers; some are willing to pay more to get media and entertainment without ads. You get my drift.

So what is the future of paid content? Nothing that makes money now is going away any time soon. We’re in an age of maintenance mixed with experimentation — keep as much money coming in as you can while you look for solutions. It’s also an age of opportunity. That’s one reason we’re having paidContent 2010 — to hear about what’s working and to explore the possibilities.

Q — Your speaker list is a veritable “Who’s Who” of the content world. Do today’s “content” people really have a handle on what’s disrupting their world, and, more importantly, what to do about it? I’m partly referring to the issue of aggregators, like Google.

KRAMER: A lot of them do — or at least are trying very hard to get one — and our speakers reflect that. John Squires, for instance, is heading Next Issue Media, the joint venture of five major magazine publishers looking for a solution together, They want to create an electronic newsstand that gives each publisher control over its own pricing, customer relationships, etc., but solved the technological and marketing issues as a group.

Google News’ Josh Cohen is on the news panel so I expect we’ll hear a fair amount about why Google doesn’t think aggregation or search should be the bogey man. Most publishers want to use search literally as an engine for traffic to their sites so cutting it out completely isn’t an option but the “solutions” are all over the map. The FT’s Rob Grimshaw will talk about how they’re limiting full “first click” access from Google, while the New York Times has already said it won’t block in-bound links.

Q — Do you think content people will be able to successfully pull back on “free” content to bring about another revenue stream? This must be a constant source of your attention, so your view is pretty important (I think).

KRAMER: Thanks for thinking my view is important. I’ve been through this drill before. When I was at, the site had an enormous amount of buzz from its free content, which was meant to fuel subscriptions. When we went behind the paywall, the buzz died down. If you can calibrate the launch of a new product with a blend, you have a chance at success.

As for “successfully”:– that may depend on your definition of success. If you’re trying to take back something people already get for free — like Newsday did late last year — be prepared to pay the consequences in lower traffic and possibly lower relevance. Newsday and parent Cablevision think they can win by creating a higher-value, more targeted local audience.

On the broadcast/cable side, because so much cable video is out there, most people don’t realize that more than 80 percent of full-length cable programming hasn’t been available free. When Hulu’s’ investors talk about subscriptions, they’re not looking at making everything on Hulu’s’ pay only. The focus will be on video that isn’t out there yet or is made available in different ways That has a better chance of succeeding. Disney’s Bob Iger has already said broadcast programming won’t be moved to pay only.

Q — Finally, like so many people who’ve been around this for awhile, I’m proud to know both of you and to have watched your business — and stature — grow. How have things changed for the PaidContent empire?

KRAMER: It’s been about 18 months since we were acquired by Guardian News & Media, which is the biggest change for the company. We have the resources of Guardian to draw on and share a CEO, Caroline Little, with Guardian North America and operate independently editorially. But our focus and that of paidContent and ContentNext remains the same: doing our best to keep up with this crazy space so we can help all of you keep up with it. We’ve come a long way from 2004 when I joined — with Rafat working from his home in California and me from St. Louis — to a full company with a nice (but not glam) office in New York and staff in Seattle, LA and London. One of the best parts is so many people like you have been on the journey with us.

We’ll be watching the conference closely and hope to report on it next week. Like last week’s conference with Gordon Borrell’s company, this one is being organized and planned by people who really know the space. And the exciting thing to me is that neither conference existed last year. It should be good.

(Originally published in this week’s AR&D Media 2.0 Intel Newsletter)

Back To The Future: The Disruption Is Not What It Seems

Early promo picture of The DoorsI watched an old documentary about the 1960s band “The Doors” on one of the VH1 channels the other night and was struck by a PBS interview with the group in 1969. Jim Morrison had his full beard by then, and the band was on the downward arc of its short but influential career. There was a certain sadness in watching the interview, but it also contained revelatory messages for today.

Two things in this interview stood out. One, Morrison talked of the future of music and said that people like himself in the future would be able to make entire cuts of music “using just machines.” The comment was prescient and spoke of today’s reality in a way that I’d not heard expressed that long ago. Morrison was clearly on the outer edges of creative energy, and to hear him speak in such a way was gripping and profound.

Keyboardist Ray Manzarek also touched a note in talking about the difference between the energy (“the vibe”) inside one of their concerts and what happened when concert-goers went home. He bemoaned the lack of a way for people to sustain the connection they had during the concert and how, if such a thing was possible, it would change the world.

In John Markoff’s brilliant book What the Dormouse Said: How the 60s Counterculture Shaped the Personal Computer, the essence of personal computing and the power of personal publishing are all found in what people like Morrison and, especially, Manzarek believed and had to say. The counterculture movement itself struck out against the authority of our institutions, and today, the chaos of the Web that such institutions feel is, in fact, a power grab by the the culture’s grassroots — a continuation, if you will, of that same energy.

Manzarek’s vision, for example, is now found in social media, where empowered people are now connected in ways they could not have imagined in the sixties. It’s about by-passing traditional methods of staying in touch and enabling the “change the world” concept promulgated by the era’s charismatic leaders. This is why what’s taking place today — the world’s second Gutenberg moment — is much bigger than most people can currently see.

The great thinkers of today — people like Kevin Kelly, Clay Shirky, Umair Haque, John Hagel, Jay Rosen, and many others — all seem to have been shaped by this same kind of thinking, and I believe it’s smart for us all to pay attention. The business disruptions of today, for example, are not simply “adjustments” such as we’ve seen in the past. They represent a great upheaval, revolutionary changes from convention, history and tradition that will shape new ways of doing things downstream. “If you think the disruption to newspapers was bad,” wrote Seth Godin, “wait until you see what happens to education.” It is in this environment that we must think about reinventing what we do, for we cannot cling to archaic beliefs and practices when the culture itself is being recreated.

For what it’s worth, “the Dormouse” is from Alice in Wonderland. What he said was “feed your head, feed your head, feed your head.” It’s good advice for today.

(Originally published in AR&D’s Media 2.0 Intel Newsletter.)

Advertisers claim to exclusively “own” site data

tug of war between advertisers and publishers over dataWPP’s GroupM, the biggest buyer of media in the world, took the unusual (and quiet) step this week of updating the Terms and Conditions (T&Cs) it requires of media companies who run the ads it serves. The most important change involves the data that its advertisers gather in the serving of ads. GroupM claims that the data belongs to them and their clients, not the media company sites on which the ads run.

This is a bold challenge to media companies, and a pre-emptive strike against anybody wishing to run a business based on that data. Online Media Daily broke the story.

The wording in GroupM’s new T&Cs, which are attached to all the insertion orders and contracts it submits to online publishers beginning this year, amends the current industry standard by adding, the following: “Notwithstanding the foregoing or any other provision herein to the contrary, it is expressly agreed that all data generated or collected by Media Company in performing under this Agreement shall be deemed ‘Confidential Information’ of Agency/Advertiser.”

Experts familiar with online advertising contracts say the term is a smoking gun, because it raises a broader industry debate over who actually owns the data generated when an advertiser serves an ad on a publisher’s page. Is it the advertiser’s data? Is it the agency’s data? Is it the publisher’s data?

GroupM Interaction COO John Montgomery said that the move is designed to protect the confidentiality of the data, so that competitors can’t learn the strategies and tactics its clients are using. This explanation is not likely to satisfy media companies, and it’s one they would be wise to challenge. Of course, GroupM holds the purse strings for hundreds of millions of dollars in online advertising, so challenging these Terms and Services is problematic, to say the least, for companies that need any dollars they can find. GroupM knows this, and it’s using the current seller’s market to force a change that will have long range ramifications for media.

To restate something I wrote a few weeks ago, the IP address records and cookie data obtained by ads that are served on media company sites rightly belong to the media company. Until this move by GroupM, the industry generally recognized that data ownership was shared three ways — the agency, the advertiser and the media company. GroupM is now saying it rejects the ownership claim of the property upon which the ads are served.

ESPN, Forbes, Martha Stewart and others abandoned third-party ad serving last year, because they felt their properties were being undervalued. Make no mistake, however, this issue of data ownership was a factor. They’re serving their own ads now, which allows them to claim ownership of the data.

This is the biggest issue facing media companies today, although most aren’t even aware of it. It’s a case of understanding how the back end of the Web works instead of concentrating all our efforts on the front end. The Web is not TV or newspapers, and nowhere is that more evident than here.

(Originally posted in AR&D’s Media 2.0 Intel Newsletter)

“Hustle” is the most important word — EVER!

As I have for many years, I try to examine the world of technology from the side of the disruption, not the side of that which is being disrupted. The longer I do that, the more I’m convinced that media people need to come over here — at least occasionally — because the view of what’s happening is entirely different than what traditional media people see.

One thing that has never changed for me is the reality that the tech community — and, by proxy, tech media — is way out ahead of traditional media, both in terms of vision and practical application for the flow of information. Media is so driven by revenue (and that means revenue attached to content) that it will always lag real technological innovation. But what’s troubling is that once media latches onto something from the disruption that can be monetized, all else is set aside in favor of what may or may not be the gravy train that media companies seek. If it doesn’t make money, it’s ignored, so the best we get is elements of the disruption bolted on to the increasingly archaic business model of ad-supported content.

Alien mothership from the film Independence DayMany people wrongly interpret these events as where the two worlds (the disruption and that which is being disrupted) “touch.” The reality, however, is that the worlds never touch, for one is overtaking the other. Think of those giant alien ships from the film “Independence Day” as their shadows loomed over the world’s biggest cities. The only time they “touched,” was when the aliens destroyed the cities. A shadow is not touching, not in science fiction and not in disruptive technologies.

Broadcasters and print executives live in a static world. The templates for success need only to be filled with fresh content, but everything else sits still. Elaborate and sophisticated industries have sprung up around this, not the least of which is advertising, but the essence of what drives business is the foundation of a static world.

But the disruption does not sit still and routes around this static world. There was a time when the Web consisted of static sites with static pages, but that’s long been replaced by the live, dynamic Web. Browsing has been replaced by searching and subscribing, but media companies cling to static representations of their core businesses. To the tech community, the Web is cyberspace, a fabulous and innovative place where people meet, information flows and commerce is conducted. To the media community, the Web is a series of pipes for the transportation of content, or perhaps more realistically, a series of pipes leading to their distribution points.

So you see the conflict and why there’s really no “touching” taking place whatsoever.

“Where’s the money?” is the relentless cry from media company board rooms, but it’s the wrong question. The only answer is the same one that everybody involved in the disruption knows well — it’s all about hustle. Gary Vaynerchuk (a.k.a. “GaryVee”) says it well in this video clip from the Web 2.0 conference.

Do yourself a favor and watch it, but if you can’t, here’s the relevant part:

“Stop crying and keep hustling. Hustle is the most important word — EVER. And that’s what you need to do. You need to work so hard. Guys, we’re building businesses here. This isn’t about parties. We’re building businesses!”

Traditional media people don’t know how to hustle, and this is where we’re getting beat. The disruption doesn’t ask for the business model; it goes out and makes one happen, even if it takes a whole lot longer than anybody thought. GaryVee’s two key words for business success in the new world are “patience and passion.” Of these, we cannot possibly have too much.

I had a discussion this week with the head of a major media web unit who made the comment that he knows what he could and perhaps should be doing, but that he’s making too much money doing things the traditional media online way to just up and stop. He knows, as most of us do, that the world of online traditional media — as is — will never replace the dollars being lost by our legacy platforms, even though the revenue we are making may be significant. It’s damned-if-you-do and damned-if-you-don’t. (See: Let’s Be Serious: Online Display Ads Will Fall Sharply In 2009)

But we’ve got to stop crying and keep hustling, especially in these times of uncertainty and opportunity, for to do otherwise is to cede defeat to the alien spacecraft looming overhead.

(Originally published in AR&D’s Media 2.0 Intel newsletter. Hat tip to Fred Wilson.)

If pageviews are your goal, it’s time to revisit that strategy!

Websites run by local media companies are worth a whole lot more than their owners think, according to fascinating new research from Borrell Associates and BIA Financial Network (BIAfn). Gordon Borrell told me a few days ago that this may be the most important research he’s done, because it may finally move local media groups to accept that their web properties are worth more than most think. I will tell you that the report does that and more.

What emerged was another strong indication of the fundamental changes taking place in the media industry: local Web sites generate important value for their owners, especially for owners that have positioned their sites for growth in key high-demand advertising categories such as e‑mail, streaming video and paid search. Some of these local Web sites are worth between $300 million and $450 million, and even small sites are seeing values in the low millions of dollars.

The thing that first leaped out at me was a portion of the sentence above referring to “high-demand advertising categories such as e‑mail, streaming video and paid search.” This does not bode well for media companies who have bet the future on strategies that emphasize page views with multiple display ad impressions. The report shows that category is in decline.

“Sites relying primarily on banners and classified listings can expect flat to declining ad revenues,” the report says, “and, therefore, diminished valuations.”

The chart below from the report shows why, because valuations are all about the future. Display ads are in decline while streaming audio and video are projected for significant increases. The problem here is that even television stations aren’t fully taking advantage of this, choosing instead to opt for newspaper-esque “information portals” that are built on the paradigms of print (display) advertising.

chart from Borrell report

Newspaper sites top the list for valuations with the median being over $3.5 million. TV stations are next with just over $3 million, followed by pureplays ($2.4 million) and radio ($1.2 million). The median values for newspaper Web sites in different revenue brackets range from nearly $500,000 to almost $30 million; for TV sites $500,000 to $9 million; and for radio sites $250,000 to nearly $6 million.

Local pureplays, the report says, are just beginning to make inroads, and they could be substantial. They are at a disadvantage, however, because they lack what websites with a traditional media partner can provide: promotion, content, and current advertiser relationships. Pureplays include companies such as AOL, MSN, Google, Yahoo and Monster, as well as vertical directories (“”), geo-domains (“”), and many others. Despite the disadvantages noted, these companies provide a profound threat to the well-being of any traditional local media company, but only if we do nothing.

chart from Borrell report

This report is another wake-up call for mainstream media groups, but this one is written in the language of the boardroom. Investors and investor groups understand things like valuations, cash flow, value magnifiers, and discount rates, so it’s likely to open a different set of eyes. I certainly hope so.

Access to the report and a free copy of the Executive Summary can be found at the Borrell Website.

(Originally published in today’s AR&D Media 2.0 Intel newsletter)