News Innovation

Lessons from SeattleCourant.com

Posted on 08. Jul, 2009 by Matthew Sollars.

We’ve tried to highlight some successful local news sites out there in recent weeks (and we’ll do more, so please take our survey!), but there is no question that for most start-ups life bends more towards the Hobbesian view. The story of the SeattleCourant.com, which shut down late last month, is a stark reminder of how tough things can be, especially in Seattle–a hot-bed for local news innovation.

Founder Keith Vance wrote in a farewell blog post that the Courant failed because it couldn’t bring enough money in quickly enough to support his vision for a 5-person newsroom. He figured that would cost a bit more than $500,000 per year while he worked for free for the first year. Here is Vance’s revenue plan:

I envisioned levels of customers. Some businesses might just want a simple banner ad, but the more sophisticated customer could purchase custom landing pages for events, sales, etc. Or they could buy full-blown Web applications, databases and custom business applications. The Courant would essentially be a technology firm that focused on creative online publication, advertising and business services.

Sounds like a pretty good concept. But, in the end, the Courant suffered from the same flaw that kills so many small businesses (and not just news organizations) trying to get off the ground: under-capitalization. Vance writes:

The Courant failed because I didn’t have enough cash and I didn’t find someone who could handle the business side, such as finding customers, technologists and managing projects. The trick I had to pull off was to be able to fund the Courant while I not only built a newsroom, but also a technology firm to support it. I couldn’t do it all.
My advice to anyone who seeks to create something like The Seattle Courant is to make sure you have at least enough money to get you through the first year and someone who’s as committed as you are to the business. To generate revenue, focus your efforts on providing technology solutions to your customers and not just selling banner ads. You have to be able to do something that other people can’t, or don’t want to do. Going to city council meetings and covering press conferences counts as something people don’t want to do, but news doesn’t make money it costs money. One way to think of it is that instead of a print shop that supports a newsroom, we need to build a technology firm that supports a newsroom. It’s really not that different, it just requires a different skill set.

Meanwhile, Seattle PostGlobe, a site run by reporter-refugees from the online-only Seattle Post-Intelligencer, has put out a call for new donations from readers. The start-up launched in April and now says it has enough money to keep going for 3 more weeks.

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News Innovators on the Frontline: MGoBlog

Posted on 07. Jul, 2009 by Damian Ghigliotty.

Brian Cook — a longtime University of Michigan sports fan — runs MGoBlog.com as a solo operation and brings in enough money to keep his blog up to speed with the likes of freshman quarterback Denard Robinson. Brian launched his site in December 2004 and has watched its audience grow to 100,000 unique visitors to date. Since taking on blogging as a full-time gig in mid-2006, he’s relied on the sports-based ad network Yardbarker for half of his monthly revenue. The rest comes from t-shirt sales, ticket links and reader donations, allowing him to fully dedicate his time to managing the site’s content and writing in-depth posts that sometimes hit the 10,000-word mark. We spoke to the Ann Arbor-based blogger yesterday about his business and his belief that traditional sports coverage needs more room for conversation among readers and fans.

Brandon Minor Logo

What got you into sports blogging?
In college I had written for the school’s satire newspaper, their version of The Onion, and I had been looking for a job where I could keep writing after I left. I tried a few things that never panned out, and then it occurred to me that I spent a lot of my time following the Michigan football team. Whenever anybody ever asked me, I would rattle on for about 15 minutes, usually until their eyes glazed over. So, I figured there might be a better spot for that kind of knowledge other the disinterested ears of my friends. From there I started my blog and went about feeling my way.

What was your level of business and sales experience at that point?
Zero. And it’s pretty much stayed that way. Luckily I’m in a nice position, since MGoBlog is probably the number one college football blog in terms of traffic. When you’re in that position, the ad networks that want to get you in the fold will offer you certain CPM minimum guarantees — shares of the advertising dollars they make, as long as your site gets enough traffic. So, I’ve stayed with Yardbarker for the past couple of years, and that’s really helped me out. At this point, they’re still in the venture phase and don’t mind spending money to keep me.

And I’m able to supplement that with other revenue sources. One of the nice things about being a sports blogger is that there are ticket and betting companies that will pay you just to put text links up. I’ve also been selling t-shirts through the site, which have done very well. And then there are donations from fans, which bring in a couple of thousand dollars a year.

Have you ever thought about hiring a sales person to help expand your advertising reach?
Yes, I have, and I’ve thought about adding some freelance coders to help out as well. But it’s hard to tell if that would be worthwhile at this point. Before I get there my biggest priority is to expand the amount of traffic I’m getting. One day the site might hit a saturation point, and stop growing as quickly as it has been over the past few years. If that happens, then getting more mileage out of my traffic will probably become more important.

So, how do you keep Michigan sports fans coming to your site?
There’s a lot of advice out there. It’s always like write this or do this, and I kind of defy it. My signature post is something called Upon Further Review, which is a play-by-play break down of every play in every Michigan football game, which usually runs about 10,000 words per game. And I split that up into offense and defense. My strategy has always been to just kill a category. If you want analysis of a Michigan football game there’s nowhere else you can go.

A lot of newspaper sports writing strives for objectivity, and it holds itself a little bit aloof. And then when it tries to talk to about the intense emotions inspired by a game, it kind of falls flat. To the readers it’s like asking a virgin for his opinion on what an orgasm feels like.

The Ann Arbor News recently reported that it will become an online-only news source this month. What impact will that likely have on MGoBlog.com?
I don’t know how much of an impact it will actually have, because the kind of people who are still subscribing to The Ann Arbor News aren’t my core demographic. My core demographic is very male, very young, highly educated, and I would assume, highly internet-oriented. The kind of people who are affected by The Ann Arbor News becoming annarbor.com are generally less hardcore about their sports coverage.

But with the transition to the web, they are promising to link out a lot, so having more of a two-way relationship with the local news sites would help, probably just in terms of Google ranking and maybe some traffic. Right now I link to them and The Free Press fairly often, and I don’t think I’ve ever received a link from any of those sources. That seems a little unbalanced.

Click below to hear an audio clip from our interview with Brian Cook.

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News Innovators on the Frontline: WestSeattleBlog

Posted on 03. Jul, 2009 by Matthew Sollars.

The husband-and-wife team of Patrick Sand and Tracy Record run WestSeattleBlog.com. She is the site’s primary reporter and editor, while he handles advertising sales and business development. Since January 2006, the pair have covered the bedroom community of West Seattle (over 65,000 residents) seven days a week, 365 days a year. They started selling ads about a year later. The site now has about 60 advertisers and brings in enough to support the couple and their teenage son, and to pay for occasional freelancers. Next on the agenda: hiring a Saturday editor so they get a day off. We spoke with Tracy earlier this week.

What have you done to build your advertiser roster?
We’re involved in the chamber of commerce; we joined more than a year ago. We sponsor a number of community events. It sounds mercenary, but there’s a lot of ways that you end up networking out of those. We run a banner on a local foot ferry to downtown Seattle.

We offered a free seminar to help businesses interact with their customers on the web. It wasn’t an advertising pitch, we provided some basic information like setting Google alerts so you know if your business is being discussed someplace on the web. Way before you get to Facebook and Twitter, that’s something that a lot of people don’t really know a lot about.

So, how much hand-holding do you end up doing with your advertisers?
That’s my husband’s full-time job. He explains how this is going to work and how we’re going to build a relationship with the business.

I have this disagreement with several people here—we don’t believe people are ready for self-service advertising yet. In some contexts they are, but a larger portion need service. I’m not being stupid like the travel industry that said people are always going to need travel agents. It’ll get to the point where people are ready for self-serve, but it isn’t there yet.

We have learned over the year and a half to better explain to people upfront, before they ever make a commitment, what this is all about and how it might work for them. This is display advt, this is not click-through, this is not conversions.

Overall, as the site gains more of an audience, it becomes something that people are proud of, they say I want to be part of WestSeattleBlog.

Also, when people join, we offer them the chance to have a little advertorial story published, just a couple of paragraphs and a picture. We thought the most interesting reaction came from readers who say it helps them learn about local businesses they didn’t know were here.

What is the big challenge, the big obstacle, you’d most like to get over?
It’s been a struggle invoicing and we’ve just hired a part-time bookkeeper, because it’s clearly getting beyond something we can deal with ourselves. If you try to do that too, besides dealing with clients and covering the news, it just gets out of control.

But, the next obstacle is finding additional advertising opportunities on the site without clutter.

We’ve had inquiries about sponsoring certain parts of the site, but right now it would require some design work.

We also want to be fair. We’ve set up a first come, first served positioning. And to say we’re adding a feature at the top of the page that is a sponsored traffic camera, do we need to tell all 60 advertisers that we have this opportunity and we’d like to offer it to all of you?

People on the business side would say, “Don’t worry about that, we’ll build enough inventory to provide other sponsorship opportunities and that’s the fairness.”
Possibly, but it’s the same challenge that I’m sure our parents faced in running their small businesses. We’re at that point where you know you are going to have to broaden the fold, to bring in someone, whether its on the business side or a Saturday editor, and that person is going to have some thoughts and some ideas. You know it’s not going to be just your little thing anymore.

We know that we’re at that point and we’re trying to figure out the right way to go about it. We feel blessed to get to that point.

You’ve provided a deep dive into your editorial process elsewhere, but do you use citizen journalists to provide coverage of certain events?
It’s a point of pride for us that we don’t ask people to do this volunteer, which even the local newspaper apparently does. If you’re going to write something for us then we’re going to pay you. So, if there’s something that needs news coverage that’s what we do, or we’ll pay a freelancer.

When it comes to reporting something you saw, either crime reports or a little league game, we have a fair amount of that. But, what we don’t do is say “here’s an upload tool, come and give us your stuff automatically.” All of it is done with actual human contact or via email where we write back to say thank you or to ask follow-up questions.

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Calling all Moms (that Blog)

Posted on 02. Jul, 2009 by Damian Ghigliotty.

Over the past week we’ve been reaching out to hyperlocal and highly targeted news sites to find out what business models they use to sustain and grow their businesses (see Matt’s post below.)

One of the quickest growing trends in blogging these days — along with sports, music, food and local news — is mom blogging. A clear sign of enthusiasm among readers has been the sprouting of mom-related ad networks like BlogHer and Child’s Play, where web-savvy mom’s and mom’s-to-be can connect with brands relevant to their interests.

According to a recent BlogHer study, there are “42 million U.S. women online weekly doing some form of social media activity.” Nearly half of them have children at home, while 60% are married or live with a partner.

And just like with sports, music and food, mom blogs run the gamut (check out Hipster Mom.)

So we ask you, experienced diaper-changing, news-breaking moms, please join us in our efforts to better understand the future of journalism and take our survey!

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Meet the New Boss

Posted on 02. Jul, 2009 by Peter Hauck.

With some newspaper companies facing the very real possibility of bankruptcy, Poynter Online’s Media Business Analyst Rick Edmonds asks “So what are banks going to do with newspapers and newsrooms once they are in charge?” 

Good question. And Edmonds provides some good answers from a “specialist in bankruptcy workouts and ownership change” that he spoke with at a recent conference. Bottom line: While “change is not as abrupt as one might think” in the earlier stages of a bankruptcy, there’s nothing pretty about reorganization.

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News Innovators on the Frontline: DavidsonNews.net

Posted on 01. Jul, 2009 by Matthew Sollars.

In the course of the coming weeks, we’re going to dig into what has worked—and what hasn’t—for news innovators across the country. These journalists and web entrepreneurs have all taken our survey, which we’re using to build the business models and identify the revenue opportunities that will sustain journalism for years to come. Take the survey here.

David Boraks, an experienced writer and editor, founded DavidsonNews.net in 2006 as a “volunteer community news website” for Davidson, NC. He and two other writers update the site at least twice daily with news from town hall and the people, churches and non-profits of this small community. Boraks finally cut a check to himself—so far he says the amount is “modest”—for the first time earlier this year. We caught up with him this week while he was on (gasp!) vacation.

What has made DavidsonNews work so far?
We’re moving more and more towards the public radio model. Since mid-2008, we’ve signed up 300 readers paying on average $60-65 a year. Before we’d taken donations, but now I call them “voluntary subscription payments” because I really want to reinforce that people are paying for valuable information.

I see our revenues being split 50/50 between advertising and subscriptions. I would love to have 1,000 people a year give me money—getting to that subscription level, plus the advertising revenue that we’re projecting, would allow me to pay myself and the other writers a regular salary. Then, I’d also think about a paywall. If I could transition from free to pay site, I would. I think that needs to be the way the whole industry moves.

Wouldn’t you lament the loss of readership that might result?
I feel like I provide content that’s of value to people and the readers have shown that they are willing to pay for it. There are 6,500 registered voters in our town and we get over 12,000 unique visitors per month. I look at that number and I see that about one quarter are one-time readers who come off of the search engines for one story. We have several thousand who read once a week or more. So, when I talk to folks I say we have several thousand readers.

At 1,000 subscribers we would have about one-third of the people who read the site right now. I’m confident that, if we asked, a substantial number of the others would sign up.

So, how do you plan to go from 300 to 1,000 subscribers?
We will continue to do promotion and marketing to build our subscriber base. We recently hosted our first public event, which I called a subscriber party, at a well-known coffee shop downtown. Some local musicians donated performances and we had a few speeches. We had a promotional campaign in advance on the site, which cost us a few hundred dollars. We were hoping for 50 new subscribers, but I think we got 90 who donated $50 or above. Some gave more, I think the highest was $250.

Davidson is a small community. Do you have plans to expand your coverage area?
The total population in Davidson is 9,100 people, but when you include the surrounding towns there are several times that, closer to 100,000. In Davidson, you can’t sell one ad and pay for a lot of employees.

My plan is for a network of sites that connects those other towns. I think there is a market for a network of local news sites that are sharing content and advertising. Even if I don’t own those other sites, I could have my ad sales person selling advertising for the network.

What would you need to expand to those areas?
I would need a town editor, someone who could do there what I do in Davidson. Alternatively, I would need someone to take over Davidson so I could report and edit that town. I do not expect to find a volunteer, so I would need to raise some capital – either from myself or from investors – to finance the expansion. That would cost $50,000 or more.

Beyond that, I wouldn’t need much else. I would add to the part-time schedules of both my designer/assistant and my ad sales rep. As for our technology platform, both our editorial software and ad server software can easily be scaled up to handle an additional market, at no additional cost.

Are there any other revenue opportunities you see out there?
I have had offers from local print publications to republish work from DavidsonNews. I haven’t seen an arrangement that makes sense financially, though, and I’m concerned about diluting my readership. What happens to the value of my content if it’s also published elsewhere? Besides, more people in our town read me than read the local daily newspaper. Our reader survey found that more than half of our readers do not read the daily newspaper at all, which was surprising. But, syndication is something I’m studying.

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Let a Thousand Models Bloom

Posted on 30. Jun, 2009 by Peter Hauck.

Hat tip to Peter Kafka, who writes MediaMemo for All Things Digital, for sharing a business model — put together by Mark Josephson, CEO of outside.in — of a hypothetical online-only news organization. While Josephson’s metro news operation of the future sports a mighty lean staff — 20 bodies in all, of which six are “news gatherers” — it forecasts a pretty hefty 41% profit margin!

Josephson’s model is available as a Google spreadsheet. And like all good hypothetical business models, its hypothetical P&L looks downright rosy — the page view and ad revenue projections seem particularly bullish. But that’s what models are all about: State your case, make your assumptions and be prepared to defend or adjust them. Which Josephson does in the article’s good comment thread.

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An Iranian Journalist’s Invaluable Cause

Posted on 29. Jun, 2009 by Damian Ghigliotty.

Every journalist deserves to get paid for bringing new information to the public. Especially those who face direct opposition from foreign military regimes.

This morning I heard an NPR piece titled ‘Bureau Tehran,’ Live From Massachusetts. The subject of the story was Iranian journalist Kelly Golnoush Niknejad, who runs her news site Tehran Bureau from her family’s living room in Newton, a small suburb of Boston.

The story opens a new window to an area of journalism that’s quickly growing: International reporting on a do-it-yourself level. For most of her updates on what’s occuring in Iran, Niknehjad uses two laptops and often relies on emails from “contributors of Iranian descent, both in and out of the country.” As of now, those contributors provide her with information for free, and typically avoid taking bylines.

According to the NPR piece, Niknehjad started Tehran Bureau seven months ago and within the past few days her audience has grown from about 9,000 to 19,000.

Information “was coming at me like bullets,” Niknejad says in the interview. “I didn’t have time to sculpt it all into stories, so I just started posting it as fast as I could. The information was raw, so instead of going in and taking the blood out of it, I’ll just copy and paste to put out information.”

When I heard that I immediately thought of how blogging and twitter have become vital outlets for free speech in a country confined by religious despotism, political injustice and information censorship.

And then I heard the interviewer, Tovia Smith, say that when Niknejad migrated to the U.S. at 17 she had no intention of becoming a journalist, and instead coincidentally fell into a legal reporting gig after finishing law school. Smith explains that Niknejad had never intended to pursue the path of a reporter in school, but now, with the current lack of substantial Iranian news reaching the public, “she says reporting is her calling.”

That made me wonder how Kelly Niknejad values — in terms of revenue, and perhaps even profit — what she does for her country’s people and the broader global community. I went to her website and found a donations page that highlights the importance of her reader’s support to sustain ongoing coverage, since Tehran Bureau does not “accept funding from any government, religious or special interest group.”

So, I contacted Niknejad about her recent interview and asked her if she would be able to talk about the dollar/rial value she places on her and her colleagues’ coverage, especially while Iran remains conflicted and without a free press.

“When we covered the Iranian election, we were working on a $0 budget,” she says. “Ideally we would have liked to have had correspondents in other provinces outside of Tehran, so we could have captured the atmosphere throughout all of Iran. But we didn’t have enough funding for that.”

“Right now we have about 20,000 people following our coverage on twitter alone,” she adds. “If every one of those readers donated $5, we would have enough money for a full year’s budget.

“Of course there are many people who have been incredibly generous beyond donations of $5, but in terms of covering our costs, it hasn’t been enough for us to expand. We have a dedicated core of people who are working for free outside of their own jobs, so it’s been incredible so far. But if we had the funds to pay them and they were able to make a living from this, our correspondents would be able to comit that much more time and energy to reporting.”

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MinnPost Tweets Local Ads

Posted on 26. Jun, 2009 by Matthew Sollars.

MinnPost.com launched an innovative micro-blogging advertising service yesterday that they’re calling Real-Time Ads. The Minnesota-based not-for-profit created a new sidebar widget that will publish messages from an advertiser’s Twitter account or blog RSS feed, as long as it has been updated within the last 72 hours.

In a post announcing the launch yesterday, MinnPost founder Joel Kramer described the Real-Time Ads product as “a fast-paced marketplace, full of advertisers’ messages that are newly posted and thus up-to-date.” Moreover, he believes this kind of “just-in-time” advertising provides a kind of information that could draw readers back again and again.

He wrote: “Imagine a restaurant that can post its daily lunch special in the morning and then its dinner special in the afternoon. Or a sports team that can keep you up-to-date on its games and other team news. Or a store that could offer a coupon good only for today. Or a performance venue that can let you know whether tickets are available for tonight. Or a publisher or blogger who gives you his or her latest headline.”

The service is in a free, four-week trial period and has already drawn over a dozen testers from a pool of over 30 invitees. The final cost to subscribe will be set at the end of the test period, but Kramer says it will be “below $100.” Each MinnPost page will carry three subscriber messages in the widget, selected randomly. According to their real-time ad media kit, MinnPost averages 700,000 page views a month, which means a subscriber’s message will be viewed roughly 70,000 times.

Certainly, at such a low price point and with only 32 slots available (for now), Real-Time Ads won’t be a revenue game changer right off the bat for an organization looking for a path to sustainability. Maximum revenues would be about $150,000 per year, enough to pay for another staff reporter, but not much else.

“We look for game-enhancers, and this could prove to be one,” says Kramer. “The important thing is that the current set-up is just the beta set-up; we can do many more things — at both higher and lower prices — if the demand is there.”

He says two ideas would be to create premium slots to guarantee placement at certain times of the day or a lower-cost model that would function more like a classifieds page.

Kramer says the widget did not cost much to develop—under $5,000—and Kramer says it will remain a relatively inexpensive, self-service product aimed at advertisers who already blog or tweet.

“We hope if people find it exciting it will encourage them to set up their own blog or Twitter account,” says Kramer. “But we’re not going to be their online advertising consultants.”

But, at least in the short term, even experienced online customers may need some hand holding. Although MinnPost is not the first site to use Twitter and RSS as an advertising tool—see TheDeets and The Windy Citizen—the concept confused some of the internet savvy advertisers they approached for the free trial.

“Only a few people understood it immediately,” Sally Waterman, the MinnPost advertising director, wrote in an email. “Most ‘decision-makers’ did not. I had to talk to most people about it at least once — and most of them had to pull in the people that are actually doing the tweeting and the RSS updating, and then I had to talk to them, too. Once they understood it, they liked it a lot. This has also been a catalyst for many of our clients to start conversations about social marketing and how it fits into their business.”

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Take Our Survey!

Posted on 26. Jun, 2009 by Matthew Sollars.

We sent our survey to nearly 200 independent local and hyperlocal websites this week. We’re looking for business and editorial information from websites across the country so we can develop a set of business models and best practices to make sure news has a bright future.

We’ve already gotten a great response from dozens of bloggers and publishers, including Anali’s First Amendment, based in Quincy, MA, and The Windy Citizen from Chicago, to name just two. Thank you!

But, we want to hear from all of you. Visit our survey page in the sidebar and follow the link to the survey. After you’ve finished, send it along to your your online publishing colleagues.

(If you did not get an invite from us, don’t freak out! We tried really hard to come up with a comprehensive list, but it’s just really hard to find all of you.)

Finally, rest assured that your information will be treated confidentially. The data we collect will be used only in the aggregate and will not be associated in any identifiable way with an individual website.

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