May the post Summit interviews continue.

This one with Dave Chase from NewWest and Sun Valley Online. (Learn more about NewWest from this interview with Jonathan Weber from the 2007 Summit)

Click To Play

[Disclaimer: The audio isn't perfect. This is interview #2 via Skype. I'm using iShowU to record my screen. I will soon find a way to get the interviewee's audio higher quality. In the meantime, bear with me. Feel free to ask Dave Chase follow up questions in the comments - I'll track him down to respond.]

[From Chris O'Brien with the Next Newsroom Project]

The biggest challenge the news industry faces these days is creating a new business model to sustain journalism as we move forward. Digital tools have created enormous opportunity to tell stories in new ways and forge deeper connections with our communities. But once you get past that, the discussion always circles back to one question: How are you going to pay for it?

On Oct. 23, the CUNY Graduate School of Journalism gathered 120 folks at its mid-town campus for the New Business Models for News Summit. The event was hosted by Jeff Jarvis, associate professor and director of the interactive journalism program at CUNY who blogs at Buzzmachine.com.

CUNY’s j-school is fairly new, and just moved into a new facility a couple of years ago. CUNY has received a $3 milllion grant to create a Center for Journalistic Innovation. One of the goals of the summit was to help CUNY further define the mission of that center. CUNY needs to find another $3 million in matching funds.

By the end of the day, we probably had more questions than answers. No surprise, right? If a solution could be found in one day, it probably would already have been discovered.

I was blown away by the caliber of folks in the room that day. The conference kicked off in the morning with a series of lightning presentations. The full schedule is here. There were too many presentations to discuss them all. Most folks had five minutes to talk, and usually I was left with about a dozen questions I wanted ask. I’ll probably do that via e-mail over the coming weeks.

My main takeaways from the day were far different what I would have expected going in. I’ve been in search of new ways to generate revenue to maintain the newsrooms we have (or some version of them). But the big lesson of the day was to focus on the other side of things: Cost. There was widespread agreement across the day that cost structures of newsrooms need to be dramatically lower. But before you think I’ve become a cheerleader for the rampant corporate cost cutting plaguing us, hear me out.

The cost reductions being discussed at the summit were aimed at being “smarter” than the strategies we’ve seen. This needs to be done in a different way than most places are trying to do it now. The content creators are the last things you should be cutting, not the first.

Second, at the same time costs are being reduced, the newsroom needs to be transformed into a network to leverage more out of what remains. As Jarvis likes to say, “Do you what you do best, and outsource the rest.” The focus of the newsroom in this new era needs to be more outward focus than inward focus.

Jarvis kicked things off with an overview of the day. He sees news as being distributed, rather than centralized. Instead of going to the news, people expect the news to come to them. “If the news is important enough, it will find me,” Jarvis said. “That’s a whole new world view.”

“Do we even have a newsroom?” Jarvis asked. “Do we need the room? What do we need it for? Do we just need a network?”

Here’s his presentation:

Read the rest of this entry »

Opportunities:

1.  Local - While we didn’t get to the local discussion until the end, this was clearly seen as the biggest opportunity.  And not just because we want to help Google’s Eric Stein hit his numbers.  The reselling of AdSense by news brands who have local salesforces is a substantial opportunity.  Businesses like Reach Local are ready to cut out local newspaper salesforces.  And, there’s an opportunity even if you don’t have a salesforce to work through businesses like Clickable to help Joe the Plumber reach the local audience through the newspaper’s site.

2.  Data Sales.  It’s already a vibrant business for many publishers.  Whether it is through selling data to providers like Tacoda or Ascerno, using other data services to create B2B or local services, news publishers are sitting on top of a meaningful amount of data that can drive revenue.

3.  Ad Networks, when managed right, are also an opportunity.  When tied in with data, ad networks can unlock value that publisher otherwise can’t sell.  Whether this is good or bad over the long term is still a question.  Should sites follow the Washington Post and ESPN and cut out Ad Networks entirely?  Many in the room felt that Ad Networks allow the best news brands to focus on selling their high-value inventory themselves while delivering extra monetization for unsold inventory.   The other side of the argument - that Ad Networks create channel conflict and undermine brands - carries merit.  Success comes from managing what inventory is given to Ad Networks and what isn’t.

4.  The technology to create a totally effecient market exists today.  While online ads are now part of a big distributed network where frequently the seller of the ad isn’t the publisher of the conent, the market is still inefficient.  Only reselling AdSense has delivered on this promise.  The other parts of the chain, including Ad Exchanges, are starting to gain acceptance, but are not yet easy for publishers to scale.  In the future this will change and create more opportunities.

5.  Smaller scale opportunities include:  Subscriptions for specific high-value content, but not for general news; Branded content, but more of a niche solution; In Germany, Focus is directly selling products as well as doing lead generation; Virtual currencies may present an opportunity down the road; Video is an opportunity, but it’s comparatively small.

So, why isn’t this working?

Measurement.  The lack of reliable metrics are holding growth back (note, this is a challenge for everyone in online advertising, not just news).  This is an issue that lacks short-term solutions.  But, incremental progress keeps being made and eventually a solution should emerge.

The challenge of creating a growth business inside of a mature business.  For instance, objectively, reselling ad sense makes sense.  But implementation has been tied up with internally slow decisionmaking and technical implementation.

The mindset of replacing print losses with digital presents a fundamental challenge.  It doesn’t align with where consumer behavior is going to be.  And, the timeline for building digital value doesn’t line up with the realities of the declining print business.  Competitors by contrast, are able to focus on just scaling their digital businesses at their natural pace.  News brands that solve this problem will be the big winners.

And now the list of ideas we came up with for further discussion:  AdSense, Display, Online Video, Lead Generation, Direct Transactions/Retail, Conferences, Co-branded content, Subscriptions, Syndication, Data Mining, Product placement, Auction Model, Market Research, Licensing, Republishing web to print, Sponsored Feeds, Virtual Goods, Email.

A quick video chat with Michael Rosenblum to discuss the aftermath of the New Business Models for News Summit.

Michael Rosenblum - Afterthoughts from David Cohn on Vimeo.

From Ben Wagner on behalf of the Networking Group.

If “the value of a network is proportional to the square of the number of endpoints,” then one task as digital journalists is to scale our networks — be they organically-grown, hyperlocal blogs or corporate-driven, international communities — as quickly and effectively as possible.

In a broadly-ranging, nearly consensus-free conversation, the “Networks” break-our group explored one case study, factors necessary to support network growth, and inherent challenges.
Tom Evslin provided two key points for our discussion of Debby Galant’s Baristanet, a blog covering news specific to Montclaire, NJ.

• The best Editorial networks grow organically from the bottom up.  Individual entities tend towards expertise and passion, but lack platform or ad sale expertise.
• The best Tool networks tend to form top down with standardized platform tools and metrics, plus centralized ad ops.

It stands to reason, then, that a top down initiative like Microsoft’s Sidewalk — possessing platform, metrics, and ad ops standardization lacking editorial expertise, flexibility and voice (see “The Cracks In Microsoft’s Sidewalk“) – might fail.

Likewise, though Debby’s Baristanet is a local success, her network value is less than it could be.  Moreover, she is forced to spend resources on platform and ad ops, instead of pure content creation.
Baristanet, then, would benefit from a broader, hyper-local site-supporting platform.

Outside.in’s Mark Josephson and NowPublic’s Merrill Brown contributed valuable insight from a platform perspective on incentivizing network engagement:

• Egos: We’ll make you a star!
• Revenue: My ads on your page.
• Reward/Reputation

In the waning minutes of our conversation, Harvard’s Thomas Eisenmann connected the conversation to a key question as news organizations continue to decline: If a city’s primary paper disappeared, would hyper-local coverage replace the centralized, enterprise-journalism oriented newsroom?
In the end, Thomas’s question lingered alongside a number of others:

• What are the best examples of journalism networks?
• Are journalism networks fundamentally niche?
• Can niche networks serve investigative journalism?
• How does a historically corporate, top-down infrastructure grow a network?

Jan Schaffer- J-Lab: rapporteur for the Public Support group.

Possibilities for public support of news media are clustering in some key areas – foundation grants, member donations, targeted micro-payments, and government support.

Our group discussed how some forms of public support can threaten a news operation’s independence, either by funding coverage of certain topics to a degree that can skew the overall news agenda, or by subjecting the newsroom to corporate or political influence.

By far, the Holy Grail for public support is to raise an endowment big enough to generate the annual revenue needed to run a news initiative, be it a newsroom or a Pro Publica project.  This liberates news projects from continual fundraising and lets them concentrate on the journalism.
NPR-like drives for donor support have sustained public radio, but can contribute to tensions between the national programmers and local affiliate.

Several experiments are just now underway that involve soliciting micro payments from individuals.  Len Witt’s Representative Journalism project asks people to support a reporter.  David Cohn’s Spot.us project asks people to fund a particular story.  And Harvard’s Berkman Center has developed software, Vendor Relationship Management (VRM), that aims to engage vendors and customers in new ways.
Should government support the news media in a BBC-like model, possibly with an Internet tax?   Such ideas met with cautions of recent influence peddling by executives the Corporation for Public Broadcasting.

Could the cost of producing news content be supported by those who aggregate it, much like the cable companies support CSPAN? Or could major universities like Harvard shelter news projects? Perhaps.
Should philanthropic foundations be catalysts for what news media ought to  do, rather than simply funders of the status quo?

As important is the question of whether news organizations would be more successful attracting public support if they reframed their mission, less as an act of information, and more as an act of community building.

“Can you make the case that you are filing a need?” asked Jay Rosen.

Can you show that news media exist not just to cover community, but to build it as well?

From John Hassell - Star-Ledger, rapporteur for the News Efficiencies group.

We were the fun group — the cost-cutters.

Charged with finding new efficiencies for newsrooms, we struggled a bit to come up with a model that would produce useful lessons. Ultimately, we decided to focus on a market like Philadelphia or Dallas and, rather than tweaking the existing daily newspaper model, to start fresh with an online-only news organization.

Andrew Heyward of Marketspace LLC led the discussion, and we began with traffic and revenue assumptions, then worked backward to create a newsroom that fit within those limits. With Neil Budde of DailyMe doing the math on his iPhone, we projected a website with 800 million page views/year at $5 rpm, for total revenue of $4 million. We set aside $2.1 million of that revenue to pay an editorial staff of 35 FTEs $60,000/year.

Here’s how the staffing broke down:

-Content creators who do blogging/photography/video/curation of beats: 20
-Community managers who do outreach, mediation, social media evangelism: 3
-Programmers/developers: 2
-Designers/graphics artists: 2
-Producers who do site management, etc.: 5
-Editors: 3

There was a spirited debate about whether there should be a newsroom at all; in the end there was general consensus that staff members should be out in the community reporting as much as possible, but that a scaled-back newsroom provided a valuable space for collaboration.

Easier to agree on was a list of things our staff would not do:

-National entertainment
-National sports
-National/international news
-Editorial page

In the areas of primary focus — local government, education, high school sports, etc. — we envisioned beat reporters working with networks of local bloggers to expand the reach of the staff.

We left questions about how to monetize all of this to the revenue group, but as Michael Rosenblum of Rosenblum Associates put it, “We’ve created a digital aquisition machine, and we find creative revenue opportunities based on that content.”

Chris O’Brien from the San Jose Mercury news: I haven’t heard what the new jobs are on the business side.

Apparently the journalists are much more entrepreneurial than those on the business side.

Thomas Eisenmann of the Harvard Business School is surprised that journalists and business people are working so well together here.

Good job.

Jeff Jarvis suggests that the role of the newsroom needs to be reinterprted. Now, instead of being a place where news just emanates from, there is a need for greater training, not just on the craft of writing but in the tools of storytelling as well.

Rachel Stern of Ground Report.com has been broadcasting live all day. She’s got a layer of community editors that has “improved the quality of her reporting.”

She and David Cohn are using new ideas to shore up community reporting.

“Rachel and David are the future,” Jarvis said.

There’s a bit of a disconnect between what editors roles are in the newsroom.

Reporters think that they’re the enemy, but Dars of the Indiana Review says different.

“Editors are responsible for the look and tone of the paper,” she said.

David Cohn says that his type of journalism is different and questions whether or not he needs an editor. But Wendy Warren of Philly.com says that Cohn’s work sounds similar to that of the editor of a community paper. Imagine that.

Some, such as Larry Kramer, say that you need both.