The $10 million Tow-Knight Center will receive $3 million in funding from the Tow Foundation of Wilton, Connecticut, and $3 million from the John S. and James L. Knight Foundation, supplemented by additional foundation grants and in-kind contributions of staff and technology from the CUNY J-School.

The Center, under the direction of Professor Jeff Jarvis reporting to the School’s Founding Dean Stephen B. Shepard, will work to create a sustainable future for quality journalism in three ways:
- Education of students and mid-career journalists in innovation and business management;
- Research into relevant topics, such as new business models for news;
- Development of new journalistic enterprises.

“We are optimists about the future of journalism,” Professor Jarvis said. “We tell our students they will build that future. To help them do that, we realized we have to give them the ability to create and run new products and new companies. We must train not just journalists but entrepreneurial journalists.”

More info here.

Although these genericized models are supported by extensive, well-documented research, they are but one possible view of the future. They represent a stake in the ground. Clearly, our models cannot address the specifics of every individual local market. That’s why we invite you to download our spreadsheets and plug in your own assumptions. The latest spreadsheets and business plan summaries are available here.

(Note that our work in new business models is underwritten by the McCormick Foundation and the Knight Foundation.)

Xarc’s Dan Conover says that the models we presented look a lot like present models, only different. Fair and true. Our goal was to look at what news in a metro market would look like if the large daily paper died today. — not in the la-la land of the future of news and media I often write about here (more on that in a minute) — but today.

So we based our assumptions on known realities: on local bloggers who are making a living and how they are doing it today, on new news organizations that are springing up today, on the proportion of digital revenue being earned today.

If you’ve heard any of my presentations of the models, you have heard me lament that we chose to work in the lingua franca of the present: CPM-based display advertising and criminally low engagement numbers that are sinfully standard in the newspaper business. Neither is good enough. But we wanted to use a language and precedents that people in this space would understand. We then pushed development of new models for revenue and of networks that must be used to increase value.

Conover says that without an “exit strategy” a hyperlocal blog is not a business but merely a job. With respect, he is judging the entrepreneurial future of news through old, institutional glasses. Much of the work of very local journalism will be done by these new, single-proprietor businesses (and volunteers). If we took his perspective, then there would be little potential in the restaurant, drycleaning, plumbing, or dental industries because many of their practitioners have no exit strategy, only sustainable jobs. Welcome to the new, small-is-the-new-big world. This is precisely why we propose that critical mass will be reached not with old companies owning the market but with new companies operating together in networks. See: Glam, the largest women’s brand online. New model.

Conover is fair to say that the future – not today but tomorrow – won’t look much like the present, including the present we postulate in our models. I do indeed agree that the future could look wildly different. I have speculated about systems for sharing information that will reduce the marginal cost of news to zero with journalists adding value only where appropriate and where that value can be recouped. I have blathered on and on about hyperpersonal news streams replacing the article as the atomic unit of news. I have predicted a world with networked journalism, news made by Wave, and similar outlandishness. If I had tried to present all that as a vision for the news of today – the day a paper dies – I would have blown brains and been laughed out of Aspen and with good reason. But that was not the goal of the New Business Models for News Project. It was to get people to see a new today.

Believe me, Dan, if you want to have a future-shock derby with far out ideas for what news will look in the future but sooner than we think, then I’m happy to compete. But that wasn’t our job here.

And don’t blame the funder of our work for that. Connover is unfair to slap the Knight Foundation, which paid for the first phase of this work, saying: “In the short term, foundation money is likely to continue producing studies based on business models that reflect conventional wisdom about media.” The Knight Foundation did not tell us how to envision our models; that is an allegation without evidence.

It’s particularly unfair since the Knight Foundation – more than any other foundation – has been aggressively pushing inventors to imagine and create new visions and realities for news. The Knight Foundation generally does not favor institutions over entrepreneurs; quite the contrary. You’re free to judge my defense of Knight in light of the fact that they did fund this phase of my work. But I think Knight’s work defends itself.

So, yes, Dan, I do agree that the models were based on present realities. That was precisely what we set out to do: to envision an immediate future that will be credible in present terms. But I also take the challenge to envision more futures for news and – if you watched my presentations – you’d see some I hope to work on. I want to examine the workings of the link economy I talk about so much and prescribe how to exploit it. I want to examine new content exchange models. I want to examine entirely new forms of news and the exchange of information.

This Wednesday in my entrepreneurial journalism class at CUNY, my students will present to a jury 15 businesses, some of which begin to imagine fairly radical new visions of news. They hope to win some of the $50,000 in seed money we have from another foundation, McCormick. And then they hope to go build those businesses and make them sustainable the day after tomorrow. Thursday, that is.

CUNY Graduate School of Journalism Professor Jeff Jarvis, business analyst Jennifer McFadden, and Jeff Mignon and Nancy Wang of Mignon Media follow up their morning presentations at the New Business Models for (Local) News Conference with a Q & A session.

]]> http://newsinnovation.com/2009/11/23/newbiznews-video-business-models-and-q-a/feed/ 0 http://newsinnovation.com/2009/11/20/newbiznews-conference-the-videos/ http://newsinnovation.com/2009/11/20/newbiznews-conference-the-videos/#comments Fri, 20 Nov 2009 13:03:35 +0000 Peter Hauck http://newsinnovation.com/?p=2694 Videos from the New Business Models for (Local) News Conference and HyperCamp will be posted over the next week. Here, Jeff Jarvis presents an overview of a new ecosystem of news.

The presentation: (Hat tip to Prezi for their great new tools.)

The putative war between mainstream media and bloggers has been declared over again and again (myself, I reported a truce three and a half years ago… oh, well). So I won’t act as there aren’t still the lone snipers in the mountains. Bloggers from medium-sized cities had plenty of complaints about the disrespect they see from their local medium-sized media outlets.

But importantly, I did see a shift in the balance of power yesterday. The big media guys on this reverse panel made it crystal clear that they not only respect but need the work of the bloggers/citizens/little-media-guys/whatever you choose to call them. The big guys acknowledged openly that they are shrinking and can no longer even pretend that they can do it all themselves.

For their part, the bloggers also made it clear that they respect and thus want attention – promotion and credit – from the big guys.

Group hug.

We are at various fulcrum points. The big, old media outlets can no longer act as if they have no problems; it’s obvious, they do. The upstarts are beginning to catch a glimmer of critical mass; we see blogs starting up all over and there are lots of new news organizations – most of them not-for-profit – rising in San Diego, Minneapolis, San Francisco, Austin; now they are joined by the for-profit local Politico. Even if you disagree with me that the future of news is entrepreneurial, there’s now no denying there is a future there.

And so the room was filled with people who were, each in his or her own way, building that future and they all recognized that they have to work together to do so. The future of news is also an ecosystem. That’s what became apparent yesterday and that, for me, was the highlight of the event.

* * *

We’re doing our post-mortems on the event at CUNY to figure out what to do better next time – and it’s clear there is a need for more of these gatherings here in New York and, we hope, across the U.S. and elsewhere in the world, bringing together builders. We heard a lot from the room about what they want next: More best practices from the kind of real experience that fed our models…. More practical advice for making money…. More education…. I’ll come back with additional thoughts after my thorough-going exhaustion wears off.

My personal thanks to the team at CUNY – led by Peter Hauck, Jennifer McFadden, and Matt Sollars – for doing great work in the models and the event and to the funders who made it possible: The MacArthur Foundation funded the events (and the prior summit led directly to a request to do the work we presented at this one); the Knight Foundation funded the work on our models and presentation of them at the Aspen Institute; the McCormick Foundation is funding ongoing work on new business models; and the Carnegie Corporation is funding work on hyperlocal labs. We’re also grateful to Mignon Media – Nancy Wang and Jeff Mignon – for their incredible work on the models; David Cohn for his tireless efforts helping us organize the events; Borrell Associates for their data and advice; and all the companies and individuals who participated yesterday. And we want to thank Ted Mann of inJersey/Gannett and Jim Schachter of The New York Times and their colleagues for helping to organize the event. Thanks.

At the Foursquare conference last week, I was struck by the miss-by-a-mile worldviews held by the chiefs of big, old conglomerates and the entrepreneurs starting new, nimble companies. The conference is off the record, so I won’t quote anyone by name. And in truth, these are the same conversations I hear often elsewhere. Having these different tribes conveniently in the same room merely focused the contrast for me.

In one moment, a very successful mogully man was slack-jawed in amazement at how little money – “$50,000!” – one of three entrepreneurs had used to start another fast-growing enterprise. The big man thinks big – that’s what made him big. The small guys think small and get big by using existing platforms and depending on their users to like and market them. To the new guys, it’s so obvious.

Here was the key moment for me last week: In a discussion about the importance of distribution, some start-up guys – each the creators of new enterprises that took off like gun shots – were asked by a representative of the big, old club which company they would most want to do distribution deals with. The start-up guys cocked their heads like confused puppies. Why would we want to do that? they asked. What was unsaid: Doing a deal with one company would be so limiting. We get our distribution through customers and developers, through embedding and APIs and social connections. That’s how we grew so big so fast for so little. Don’t you see that?

No, they don’t.

This week, we see this contrast, too, in Rupert Murdoch’s threat – he thinks it’s a threat – to cut off Google. Nose. Face. Cut. Spite. Murdoch – whodoesn’t use the internet – does not see how distribution works today. He does not understand that being open to the link economy brings him free distribution, free marketing, great benefit. That’s because he, like his fellow old machers, won by taking control rather than giving it up. This new world is utterly inside-out from the world they built. It breaks all their rules and makes new ones (which is what I tried to analyze in What Would Google Do?). That’s what makes it so damned hard for them to understand it.

In our New Business Models for News at CUNY, we saw quickly that a big, old newspaper company was not going to be replaced by a big, new newspaper company but that instead, news would come more and more from ecosystems made up of scores of companies operating under different means, motives, and models, each dependent on the others to optimize their success. That is why we built in networks that enable separate sites to join, creating critical mass they can sell to advertisers. That is also why we factored in the benefit of platforms, cutting their infrastructure costs to near-zero.

And there, I believe, is the structure of the future of business in the new, post-industrial, decentralized, opened economy. Oh, sure, every economy has always been an ecosystem made up of interdependent relationships. But they were based on zero-sum arithmetic: take and control so others cannot. They work at arm’s length. They negotiate every relationship.

Sure, even in the huggy ecosystem, companies fight and compete. But in an ecosystem-based economy, companies benefit – they find efficiency and growth – by working collaboratively. As I see it, the new economy and its opportunities will be built in three layers:

1. Platforms. There’s tremendous benefit in building a platform and the more people use to succeed, the more the platform succeeds. Google, YouTube, Facebook, Twitter, Amazon, eBay – you know all the examples.

2. Entrepreneurial enterprises. Thanks to the platforms, it’s incredibly inexpensive to start new companies. It’s also a helluva lot cheaper to fail (and try again). This is why I believe that the future of news – and many other industries – is entrepreneurial: because it can be. It’s not just media and its bits. It’s manufacturing (because you can use others’ factories and distribution channels and your own customers as your platforms).

3. Networks. It is still necessary to gather the smalls together into bigs: audience brought together so advertisers can buy access to them more easily; purchasing brought together to get better prices. So there is business in creating and serving these networks.

For the sake a PowerPoint, a diagram of the three layers of an ecosystem-based economy:

In our New Business Models for News Project, this is how I (crudely) drew the ecosystem for news.

How do you draw the conglomerate-based industry? With boxes, each separate, with arrows pointing to each other at a distance. Simplistic? Sure, but the change in the worldview of the new economy looks that basic when you hear the two tribes trying to understand each other.

And if you haven’t had enough of my silly charts, here’s another on video.

UPDATE: For those of you who are wondering, here is a link to the models that are being discussed this morning.

And, here’s the livestream for your viewing pleasure: