Are Newspapers Outsourcing Core Features to Foursquare?

Megan Garber from the Nieman Journalism Lab explains in details how the Wall Street Journal uses Foursquare to offer geo-localized news:

[The Wall Street Journal] has also been making regular use of the Tips function of Foursquare, which allows users to send short, location based updates — including links — to their followers. The posts range from the food-recommendation stuff that’s a common component of Tips (“@Tournesol: The distinctively French brunches here feature croques madames and monsieurs and steak frites. After dining, check out the Manhattan skyline in Gantry State Park”) to more serious, newsy fare

via Location, location, etc: What does the WSJ’s Foursquare check-in say about the future of location in news? » Nieman Journalism Lab.

What it means: That’s a very nice implementation of geolocalized content within Foursquare. You can see more examples in the article. After reading it, something was bothering me (the same way the Facebook “Like” button bugged me) and I finally figured it out. I left the following comment in the Nieman blog: “what Foursquare is doing, newspapers could do themselves. It’s all about structured data. Most newspaper organizations have structured their content on topics/keywords/subjects but they forgot to structure it on geographical information (places, businesses, points-of-interest, neighborhoods, etc.). As soon as you have this 3D view of your content (vertical + local), you can syndicate it in a multitude of ways.”

We live in a fragmented/atomized Web now. We have atomized content, business models, functionalities, APIs. The smart internet companies are atomizing both content AND features/functionalities.  They become both media companies and technology providers. Their end goal is becoming a media. They use their technology to reach their end goal. That’s a very smart strategy. As a potential partner of these smart internet startups, you need to ask yourself if these functionalities are core business to you or not. If they are, DO NOT OUTSOURCE THEM to another media company! Do partner for content distribution though.

The Web is becoming more and more local. Newspapers should own the expertise of geo-localizing their content, displaying it that way within their mobile apps (or Web site) and then syndicating it to partners like Foursquare. It’s core business.

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On Atomizing Your Business Model: The Newspaper Industry

Continuing our series on the atomization of content and business models, today I look at the newspaper industry.

First, from the user point of view: online (vs. the print version), it’s much more difficult to find the glue that will make your news container (your URL) stick together. if you have a strong brand (the New York Times, for example), people will navigate directly to your site but readers can now access your content via RSS readers, blog posts and news aggregators like Google News. These have been flourishing, reorganizing newspapers’ articles (the new content atoms), into flexible reading formats. For newspapers, it’s a catch-22. You want to be indexed by news aggregators to drive traffic back to your site but you wonder if you’re losing brand equity at the same time. Efforts at trying to get readers to register to newspapers’ sites (to generate potentially valuable socio-demographics information) have been a major failure. Clearly, the only strategy now is building a strong brand online while allowing readers to access your atomized content via a variety of vehicles but that creates problems from a monetization point of view.

Traditionally, the newspaper business model has been found in these three revenue categories: reader subscriptions, traditional display advertising and classifieds. Except for a few exceptions (the Wall Street Journal comes to mind), experiments in paid online user subscriptions have been failures as digital content is much more difficult to sell as an aggregate than print content. Classified revenues are being nuked by free sites like Craigslist or Kijiji, or aggregators like Oodle. Newspapers have been also forced to offer free classifieds, managing to generate some priority placement /enhanced content revenues but not to the previous print level. Online display advertising is working but it does not monetize as well as print advertising.

To better monetize their destination site, newspapers have been looking at various new solutions. One is in-line text ads (double-underlined sponsored keyword ads appearing directly in the article text) delivered by companies like Vibrant Media but, as I mentioned yesterday, the blurring of the line between editorial and advertising content has created ethical issues within news organizations. Already in 2006, in an article called “Is It News…or Is It an Ad?”, the Wall Street Journal exposed the various issues around the product:

“This type of online advertising within the text of an article, known as in-text advertising, has been around for a while. But it used to be relegated to niche sites like the videogamers’ haven IGN.com and ScienceDaily.com. Now it is appearing on some mainstream journalistic Web sites, like those of News Corp.’s Fox News, Cox Enterprises Inc.’s Atlanta Journal-Constitution and Hearst Corp.’s Popular Mechanics magazine. That marks a departure from a long-observed tradition in the print medium of keeping editorial content separate from advertising. “Journalism ethics counselors decry the trend. “It’s ethically problematic at the least and potentially quite corrosive of journalistic quality and credibility,” says Bob Steele, the senior ethics faculty member at the Poynter Institute, a journalism school in St. Petersburg, Fla.”

More recently, Tim McGuire from the Walter Cronkite School of Journalism in Arizona wrote about its use in the Arizona Central web site:

Michael Coleman, Vice-President of Digital Media for AzCentral, told me late Friday that the site has been using Vibrant Media for “two or three weeks.” Coleman described the relationship as a test and said this is not a “Gannett roll-out” of the concept even though some Gannet papers are using the system. “We’ve got a pretty non-committal contract with them, Coleman said. “The publisher made the call, and we decided to try it and see what happened.” Coleman said the experimental aspect of the deal explains why nobody has announced this deal.

Business Week wrote about the phenomenon in December:

Many journalists believe that selling the words in a story blurs the line between editorial and ad content. Some worry it creates an incentive to insert ad-linked words or order up certain types of stories. Forbes’ online arm caused a ruckus in 2004 when it rolled out in-text ads. After an outcry among the editorial staff and negative media coverage, Forbes ended the practice. (…)

Publishers are paid by Vibrant and other marketing companies based on how many times readers scroll over a word. Advertisers only pay Vibrant for how many times a reader actually clicks on an ad. In-text ads draw a higher response than traditional Web ads: About 0.2% of Web users click on posterlike ads known as banners; Vibrant CEO Douglas Stevenson says 3% to 10% scroll over and click on in-text ads, depending on the category.

I think the use of in-line text ads might be problematic thus far because newspapers have been using the technology to better monetize their destination site. I would suggest that the better use of this new ad vehicle would be to monetize a smaller atom of content, i.e. the news article, decentralized from the destination site. Embedding in-line text ads within RSS feeds or other distribution mechanisms might be a small price to pay to allow readers to access news article outside of the newspaper’s site. Another option would be to have RSS ads, like the Feedburner Ad Network.

I think the general takeaway here is that newspapers shouldn’t look at the same business models to monetize centralized and atomized content.

Update: The Kelsey Group discussesNewspaper Next 2.0, a “progress report” by the American Press Institute on the evolution of newspaper companies beyond the print edition.” I took a quick glance at it (it’s a 110-page document) but it does not seem to address many of the business model issues that newspapers are facing. As my friend Peter K. says in the post, “The report has a better fix on consumer-oriented solutions than business solutions. But that’s not surprising for a newspaper industry (i.e. editorial-driven) product. If the Yellow Pages Association commissioned similar research, it would probably be the other way around.”

Will Teenagers Continue Living their Online Lives in Public as they Grow Up?

Jason Fry from the Wall Street Journal writes about one of my favorite topics : “Will the kids who grew up with the Net (After Netters) become more like their elders (Before Netters) as they take on full-time jobs, relationships, children and the other stuff of adult life? Having once craved attention, will they now shun it? Or will they continue to live their lives in public, chronicling their ups and downs in ways their elders will find befuddling and disturbing?”

The origin of his article is a story that claims that “a quarter of human-resources decision makers had rejected job candidates because of personal information found online. ” Fry thinks that teenagers will continue to live their lives in public. He illustrates his thoughts with an example of what’s going to happen in the future: “Today, it’s pretty obvious that having the HR guy at your prospective employer find photos of college beer bongs isn’t a good idea. But that guy running HR isn’t going to be in his job forever. Before too long he’ll give way to an After Netter with an old MySpace page of her own out there for anyone to find. Will she conclude drunken snapshots are a sign of bad judgment and hire someone else? I very much doubt it. ”

And talking about your online persona, he adds: “What do you do when you realize how public your online life is? You could retreat into anonymity and try to ensure you leave no trace online (…). You could try to scrub your online image, getting rid of the things you’d rather not have people see and/or taking steps to elevate what you do want people to see in search results. But that generally doesn’t work. ”

“Or you could say “So what?” and accept that every aspect of your online life is out there for people to find and judge as they will. (…) That’s the strategy the After Net kids have pursued — not consciously, but because it’s the only world they’ve ever known. Will it cost some of them jobs? Undoubtedly — but not for much longer. Because it’s their world view that will win the day as they assume the positions of authority vacated by people my age. The ones who’ll struggle? Here’s betting it’ll be Before Netters like me, with our weirdly sterile Google lives that begin in middle age and our old-fashioned skittishness about online embarrassment and criticism.”

What it means: Not sure I completely agree with Jason Fry. I agree that we’ll see a generation who’s more comfortable with the multiplication of their online personas but I think they’ll be more logical about what’s out there. Anything that’s too fringe will have to be erased. We’ll see the rise of a new job: the Web Cleaner (a la Winston Wolfe in Pulp Fiction), who will go in, erase some stuff and create for you a new, more professional online persona. The explosive growth of Facebook, a site that’s more “serious” than MySpace, could also signal the maturing of the net native crowd.

Meta-Praized: YouTube Arrest, MySpace & Google, AdGridWork, Pixelotto, Google Click Fraud, James Kim, Jaman, Wall Street Journal, The Venice Project

Meta-Praized is a collection of links & stories we’ve dugg on Digg.com in the last 7 days. Feel free to add us as a friend: PraizedDotCom .

  • “Police track reckless driver on YouTube” via the Associated Press on Yahoo News
  • “MySpace.com Now Featuring Google Search” via Search Engine Journal
  • AdGridWork, the “First Free Targeted Ad Network” on their corporate Web site
  • “Million Dollar Homepage Becomes Multi-Million Dollar Homepage (Pixelotto)” via TechCrunch
  • “The Vanishing Click-Fraud Case” via Business Week
  • “Have Camera Phone? Yahoo and Reuters Want You to Work for Their News Service” via the New York Times
  • “Jaman – A New Global Movie Download Service” via NewTeeVee.com
  • “James Kim found deceased” via Cnet’s News.com
  • “James Kim Saga Tracked by Millions; MSNBC sets Record: 1 Million Page Views” via San Francisco Chronicle
  • “Wall Street Journal Gets Face-Lift: Smaller, Tighter, More Colorful” via MediaPost
  • “Kazaa Founder Takes On Network TV (The Venice Project)” via USA Today

Harry adds: About the Venice Project, two thoughts: 1) it’s about video + ads… hey! didn’t Google just buy YouTube?, 2) lots of very large ISPs are cableco’s with cash cow TV distribution businesses… no, they won’t block the Venice Project packets, but they will cripple them. It’s called packet shaping.

Meta-Praized: YouTube Arrest, MySpace & Google, AdGridWork, Pixelotto, Google Click Fraud, James Kim, Jaman, Wall Street Journal, The Venice Project

Meta-Praized is a collection of links & stories we’ve dugg on Digg.com in the last 7 days. Feel free to add us as a friend: PraizedDotCom .

  • “Police track reckless driver on YouTube” via the Associated Press on Yahoo News
  • “MySpace.com Now Featuring Google Search” via Search Engine Journal
  • AdGridWork, the “First Free Targeted Ad Network” on their corporate Web site
  • “Million Dollar Homepage Becomes Multi-Million Dollar Homepage (Pixelotto)” via TechCrunch
  • “The Vanishing Click-Fraud Case” via Business Week
  • “Have Camera Phone? Yahoo and Reuters Want You to Work for Their News Service” via the New York Times
  • “Jaman – A New Global Movie Download Service” via NewTeeVee.com
  • “James Kim found deceased” via Cnet’s News.com
  • “James Kim Saga Tracked by Millions; MSNBC sets Record: 1 Million Page Views” via San Francisco Chronicle
  • “Wall Street Journal Gets Face-Lift: Smaller, Tighter, More Colorful” via MediaPost
  • “Kazaa Founder Takes On Network TV (The Venice Project)” via USA Today

Harry adds: About the Venice Project, two thoughts: 1) it’s about video + ads… hey! didn’t Google just buy YouTube?, 2) lots of very large ISPs are cableco’s with cash cow TV distribution businesses… no, they won’t block the Venice Project packets, but they will cripple them. It’s called packet shaping.