Staffing in the New News Organization
Posted on 17. Aug, 2009 by Damian Ghigliotty.
As a news business that performs several functions — metro-wide coverage, community training, business-to-business services — the New News Organization will have a small, but diversified staff of 40 in its first year, ramping up to 54 in its third year. Each staffer will gross an average salary of $78,000 a year, including a 25% benefit charge, for a total salary cost of $97,500 per employee.
Out of the 40-person staff for year one, 26 are editorial and the other 14 are sales, administration and development. Below is a breakdown of the NNO’s first-year staff. (Click here to view the NNO model as a Google Document. Be sure to click on the Staffing tab at the bottom of the spreadsheet to view all figures related to this post.)
Full first-year editorial staff:
- 1 top editor
- 5 other editorial staffers & fact-checkers
- 20 journalists (community managers/curators/beat reporters)
Editorial breakdown by beat/area of coverage:
- Police, Crime & Accidents (5 beat reporters and 1 community manager/curator, with the help of local bloggers, citizen journalists, databases and witnesses)
- Local Government (4 beat reporters and 1 community manager/curator, with the help of local bloggers and citizen journalists)
- Education (1 beat reporter and 1 community manager/curator, with the help of local bloggers, citizen journalists and local experts)
- Business (2 beat reporters and 1 community manager/curator, with the help of local experts and databases)
- Sports (1 community manager/curator, with the help of local bloggers, experts, databases and syndication agreement with national outlets)
- Local Entertainment (1 community manager/curator, with the help of local bloggers, and databases)
- National & International News (overseen by a top editor, 1 news aggregator, with the help of experts and syndication)
- Weather & Traffic (1 community manager/curator, with the help of databases/syndication and citizen journalists)
We expect the editorial staff to grow by 7 in the second year and 7 again in the third year, as advertising and other revenue grows. The NNO will also be able to grow its staff by cutting back on some particular costs, i.e. seeking office space in a low-rent market, requiring editorial staffers to use their own laptops (we’re not advocating either of these, just exploring possibilities.)
Full first-year sales, admin and development staff:
- 1 CEO/CFO/COO
- 1 sales & marketing director
- 5 other sales staffers
- 4 payroll/tech support/other admin
- 1 search engine optimizer
- 2 developers
Download the NNO Excel file here.
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FOCAS: Live from Aspen
Posted on 17. Aug, 2009 by Damian Ghigliotty.
The CUNY New Business Models for News Project, funded by the Knight Foundation, is presenting its work at the Aspen Institute’s Forum on Communication and Society today. (You can read about our project here and dig into the new models here.)
Below is Jeff Jarvis’ presentation, which he made using new software from Prezi. Just click within the screen and advance to the next slide.
Click here to see the presentation in full-screen.
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The Models: Hyperlocals & the Framework
Posted on 17. Aug, 2009 by Matthew Sollars.
This set of spreadsheets incorporates two models: hyperlocal and the sales, support, and technology framework that we believe is necessary to optimize businesses in the ecosystem. We believe an organization that enables advertising networks and other services to support the local news ecosystem is both a sustainable business and will make individual hyperlocal news organizations more profitable. We divided a sample metro market of 5 million people into many smaller markets (20k, 35k, and 60k) to reflect the towns and neighborhoods that comprise a large metropolitan market. Note: all models assume the local daily newspaper has gone away.
View the Framework/Hyperlocal business model as a Google Document here. (To make changes to this document, simply click File>>Create a copy or File>>Export.)
Or, download it as an Excel file here.
Highlights & Assumptions:
- Operating income (EBITDA) for the framework, year three: $1.3 million.
- Operating income for hyperlocal businesses, year three: Large, $66k; medium, $32k; small, $26k.
- In this new ecosystem, we envision a mature market of 5 million people supporting 99 small, medium and large blogs.
- Hyperlocal news organizations are viable without the framework, but are more profitable with the ability to sell ads across a wider network.
- Likewise, the framework can scale to other cities and become more profitable. For ease of projecting, we’ve limited that company to one metro market.
Click here to see the other models. (The New Business Models for News Project has been funded by the Knight Foundation.)
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The Models: New News Organization
Posted on 17. Aug, 2009 by Matthew Sollars.
This model envisions a new, metro-wide news organization serving a market of five million people that operates on a smaller scale and performs a wide variety of tasks. It will produce original unique beat and investigative reporting and it will also work collaboratively with the other members of the ecosystem and its readers to add value. Advertising will remain the key business driver, but to maximize profits the new organization will diversify its revenues. Note: all models assume the local daily newspaper has gone away.
View the New News Organization model as a Google Document here. (To make changes to this document, simply click File>>Create a copy or File>>Export.)
Or, download it as an Excel file here.
Highlights & Assumptions:
- By year three, operating profit (EBITDA) of $9.8 million.
- Revenue breakdown, year three: Advertising $11.7 million, other services $8.6 million.
- Editorial staff starts at 26 and grows to 47 by year three.
- Audience, year three: 3 million.
- Page views per month per user, 12; CPM, $12 base.
Click here to see the other models. (The New Business Models for News Project has been funded by the Knight Foundation.)
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The Models: Not-for-Profit News
Posted on 17. Aug, 2009 by Matthew Sollars.
A number of promising not-for-profit news organizations, providing both national and local coverage, have launched recently. We want to show the level of resources that might be available in a given market to augment local news gathering efforts. Researching the available charitable money in a market, we picked a hypothetical bottom line of $3 million and built one possible organization to augment journalism in the market. Note: all models assume the local daily newspaper has gone away.
View the Not-for-Profit business model as a Google Document here. (To make changes to this document, simply click File>>Create a copy or File>>Export.)
Or, download it as an Excel file here.
Click here to see the other models. (The New Business Models for News Project has been funded by the Knight Foundation.)
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New York Times Trains Local Youth in Blogging Workshop
Posted on 13. Aug, 2009 by Matthew Sollars.
by Mike Reicher
What do you get when seasoned professional journalists train novice teenage bloggers in the tools of the trade? We’ve started to answer that question this summer at The Local, The New York Times’ collaborative blog covering neighborhoods in Brooklyn and New Jersey.
Ready...Set...Blog! student Kaseim Watts (Photo by Tamara Best)
Since launching in March, one of our goals at The Local has been to publish work by contributors from many perspectives in the community. But since the infants of ex-Manhattan moms are still a little too young to blog, The Local sent out word to high school teachers, community leaders, and youth groups that we wanted to recruit neighborhood teenagers interested in journalism.
We didn’t just want to give them a video camera, though, and say shoot. So, the students went through a three-day intensive workshop, called Ready…Set…Blog! Fellow CUNY Graduate School of Journalism student and Local intern Lois DeSocio and I developed the curriculum and led the workshops.
On day one, students learned the basics – how to write a news story, how to conduct an interview, how to sniff out news and a primer on journalistic ethics. The next two days they learned media tools – how to shoot photos and video – and they hit the streets.
Samples of the students’ work, which we’ve already posted on The Local, are available here, here and here. And then there’s this video of a local musician.
In total, we trained 16 students – eight in Brooklyn and eight in New Jersey. For the most part, though, we weren’t doing the teaching. Lois and I recruited volunteer professional journalists and journalism educators who wanted to train teens how to effectively cover their own communities.
Ready...Set...Blog! students taking diligent notes. (Photo by Mike Reicher)
In Brooklyn, Indrani Sen from the CUNY Graduate School of Journalism, who also teaches high school journalism in The Bronx, led the discussion on news values and the elements of a news story. Two local reporters, Jennifer Maloney from Newsday and Sophia Hollander, a freelancer who contributes to The New York Times, taught interviewing and ethics.
Sandra Roa, a grad student at the CUNY J-School who interns at NYTimes.com guided the students through the basics of photojournalism, and I led the video seminar.
The next phase of the program is to pair students with reporters from The Local and from The New York Times, so they can work together to produce at least one story this summer. We’re anticipating a range of topics, from youth summer employment to teen violence.
Just last week a group of teenagers allegedly beat a college student into a coma. As many stories tend to do in this neighborhood, it has evolved into a discussion of race and class. This is the type of divisive local issue we’d love to have covered both professionally and from a teen’s perspective.
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News Innovators on the Frontline: Sun Valley Online
Posted on 10. Aug, 2009 by Matthew Sollars.
Sun Valley Online, a news site covering the ski town of Ketchum, Idaho, launched in 2004. Dave Chase came on board as a business partner in 2006 after spending a number of years at Microsoft and working on various other media/technology projects. He is also a principal at the newly minted local news infrastructure company, GrowthSpur. As Chase describes it, SVO follows a “pro-am” model, will take submissions from citizen journalists, drawing upon its readership for insights on subjects like riparian habitats and endurance sports. The discussion that follows was edited from a series of emails.
What have you done to build your advertiser roster?
Establishing thought leadership around Internet marketing has been pivotal. I wrote about what we did on OJR. I have given a lot of seminars that have had anywhere from 7 to 75 attendees who are small business owners. In a nutshell, we believe that if we are top of mind when a business owner thinks about Internet marketing, we are going to get our unfair share of the market. A fairly recent example was a restaurant owner who gave us a call out of the blue to do a Twitter campaign for him even though we have no formal offering. I’ve also written a few related pieces on this topic that blend some of what we have done on our website with what my consulting firm has done on behalf of others.
Partnering with various non-profits has been a key part of our strategy for both building our audience and building our advertiser base. We have had a matching program with some non-profits to add value to their sponsorships. For example, we partnered with the local Rotary so that they could say to their potential sponsors that for let’s say a $2500 sponsorship that we’d do a match. That is, for every dollar they spent with us, we’d double it in value up to $2500. I wouldn’t say this approach has been a barn burner but it has helped us land some new/big advertisers.
Of course, good ol’ shoe leather sales has been a big factor as well. There’s no substitute for that early on in one of these ventures.
So, how much hand-holding do you end up doing with your advertisers?
A ton. For most of our advertisers, this is the first ever Internet advertising they have done. One bright spot of the downturn is that it has caused some advertisers to question every dollar they are spending. As I have often said, as online-only play, our biggest competition is inertia…they have always spent the bulk of their ad budgets in newspapers and yellow pages. Since we lost 100% of the deals we didn’t compete in, just the fact that we are in the consideration set is a big win.
There has been a lot of discussion about the self-serve ad model as a way of serving the so-called hyperlocal advertiser. My belief is the self-serve ad model is like many things in tech — overestimated in the short term and underestimated in the long term. My consulting firm has worked with one of the leaders in the self-serve ad space. Though I can’t go into the specifics, I can unequivocally tell you that the self-serve ad model isn’t yet the “next Google Adwords” by any stretch of the imagination. What I am more bullish on is what I call the “publisher assist model” using those same tools to serve local advertisers better, faster, cheaper.
Sounds like you’d advise local publishers to pair self-serve with another revenue opportunity that seems available–training advertisers. Is that what you mean by “publisher assist model”?
My hunch is that there are three stages to full self-serve advertising adoption.
1. Publishers use the “self serve” tools strictly as a way to produce online display ads more efficiently as many of us have been doing one-off ad creation for small advertisers who don’t have their own resource to do this.
2. Publishers spend time to familiarize and train small advertisers as a co-pilot of sorts.
3. Many, not all, advertisers begin to use the self-serve ad tools as they take advantage of price incentives when using self-serve and they also appreciate the quick turnaround of using self-serve ad tools (e.g., they have a special for the day and don’t want to go through the publisher for quicker turnaround items).
What is the obstacle you’d most like to get over?
Scaling up our ad sales and account management. After having seen hundreds of millions hemorhaged in the local Internet sector, I vowed that I would go to the other end of the continuum and only bootstrap my local venture. That forced discipline would enable me to create a sustainable and scalable model. The irony for me is that I haven’t put in place many of the things I put in place for my consulting clients in terms of more sophisticated sales infrastructures as I have put our limited profits back into other areas of the business.
I am in the formative stage of setting up an industry group of local online-only publishers. I have seen industry associations work very well in other areas so I want to pull together a group that can compare notes, share best practices, etc. If it makes sense, we might formalize the group.
Do you think the local online news model will get past enforced discipline and begin to expand more rapidly?
While fiscal discipline is always a good idea, I have no doubt that as soon as there are some successes that prove they can scale beyond a single site, we’ll see money flowing rapidly into the category. That is, there are now several isolated successes where individual sites such as ours have gotten profitable. However, from an investor standpoint, they might consider it an anomaly since there’s so many tales of failure in the local arena. Once there’s a broader set of successes particularly if they emanate out of a common model, investors will support it. The good news is that local information is consumed more than ever. I’d never underestimate the ability of entrepreneurs to meet the needs of a category of businesses.
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News Innovators on the Frontline: San Diego News Network
Posted on 10. Aug, 2009 by Damian Ghigliotty.
When Neil Senturia and Barbara Bry launched San Diego News Network in March 2009, their vision was to create a nationwide news organization of local sites that could cover breaking news, politics, business, sports, lifestyle and entertainment in each respective city.
After watching the San Diego Union-Tribune shed nearly half its employees over the past two years, the husband and wife team saw an opportunity to fill the void with an editorial, development and sales staff of about 20 people supported by outside freelancers and bloggers for their first site. “Ad revenue at the San Diego Union-Tribune has dropped 40% since 2006,” Forbes.com recently reported in a story on the future of journalism in San Diego. As an incentive to pick up those advertisers, as well as additional new ones, SDNN allows its most successful freelancers to take a cut of the ad money generated by their stories, along with a smaller stipend, if they so chose. The site’s full-time staffers get regular salaries. In terms of its readership, the SDNN averages 156,000 unique visitors a month in the U.S., according to Quantcast. 
Senturia, an adjunct professor of new venture creation at San Diego State University and a former software entrepreneur, acts as the network’s CEO and software manager. Bry, a former journalist who started her career as a political and business writer for The Sacramento Bee and the Los Angeles Times, acts as the network’s publisher and executive editor. We spoke with the couple last Friday as they sipped Martinis and Pinot Grigio in their hotel room in celebration of the near $2 million investment they received for their second site: Southwest Riverside News Network, which they plan to launch in the next few weeks.
What does the geographical plan look like for your upcoming expansion?
Neil: After we launch Southwest Riverside News Network, we’re going to roll out in another city in Southern California. After that we’re going to start to roll out in somewhat larger cities over the next 24 months. We’ve identified about 20 cities in total across the country, but I can’t tell you which ones yet. What’s interesting is that we picked those cities in varying configurations; some are big, some are small. The way we’ve gone about it is by asking, where is the biggest need and where is the biggest potential for profit?
While we think we know what we’re doing, we’re also willing to concede that we’re not sure whether it’s better to be in Billings, Montana, which has a local University, or Baton Rouge. We certainly want to be in Seattle, Denver and Phoenix, but we also want to be in small cities that get less coverage, like the Twin Cities.
One thing we do know for sure, it’s not a one-size-fits-all business. There are some parameters, but each city is different, so we have to learn as we go. The holy grail is a national network of local online sites working seven days a week, 365 days a year.
How much will that cost per city?
Neil: To do about 20 cities takes about $22 million, and this $2 million covered San Diego and Southwest Riverside. On average it’ll run us about $1 million to $1.5 million for the larger ones and $350,000 to $400,000 for the smaller ones. Plenty of the bigger guys like CNN have thought about this, but the key is in daily execution, cost construction, cost containment and web analytics, which we do a lot of. What we’ve leaned is that this is a business of picking up nickels. You’ve gotta pick them up one at a time, and you’ve gotta bend over to pick them up. There are billions of nickels, but there’s no vacuum cleaner.
In the past I ran a half-dozen software companies and that was great because you build a piece of software and you can sell it over and over and over again. But the news business is different. Everyday there’s a different amount of real news. Some days nothing happens, and some days you blow the door off. It’s the same whether it happens for us or for CNN.
How does your San Diego staff break down?
Barbara: It’s about 20 people, including the two of us. That encompasses the full-time journalists, the sales staff, and the technology staff. And then we have another 20 freelance writers and contributing editors and columnists.
San Diego News Network Newsroom
Neil: On the management side, which includes marketing and analytics, there are 6 or 7 staffers. On the editorial side, there are 8 full-time journalists, and then we have 4 sales people.
We also have bloggers from the community that contribute for free. Those bloggers are important, but the truth is, at the end of the day people want substantive content and you cannot get around that. Blogging is interesting, but it’s like whipped cream on apple pie. If you only had whipped cream, you’d get clogged arteries and drop dead.
How much do your full-time reporters make?
Barbara: Right now they make just below the market rate in San Diego, which is about $60,000, and they get health and dental insurance as well.
Neil: And every single person has stock in the company. Each person is a brand and a part of the process. The view is that if we don’t make it, our employees won’t get anything. You have to understand that a journalist has never in his life had equity. The people who get paid $180,000 a year at the LA Times and The Washington Post don’t own stock, unless they bought it in a public market. So there is a whole concept that says you now have a vested interest in this thing. It is no longer us and them; the worker and the management. Now there’s a correlation between how well we do as a whole and what you make.
But there’s also a correlation between salaries and the economy. When advertising picks back up, we’ll be able to pay our journalists more. We’d like to run cpms of 14, 15, and 16, but right now we’re running cpms of 8, 9, and 10.
What does it take to make a slimmer news organization work efficiently?
Barbara: For one, we’ve cut down on the amount of people proofreading and copyediting a story. Last Sunday there was a New York Times column by the public editor about Alessandra Stanley. Apparently over the years, she had made so many mistakes that at one point she had a copyeditor assigned to her to fact-check her work. First off, we couldn’t tolerate that at SDNN. If somebody made that many mistakes, believe me, they’d be gone. Secondly, in Stanley’s case, more mistakes were then made in the editing process. Ultimately, there were too many fingers on her stories.
Neil: Software is also a key component. I think The New York Times may have the best website and content management system in the world — navigating through their site is like cruising in a Lamborghini — and they easily spend $10 million to $15 million on it. One of the places where we’ve excelled is that we built really good proprietary and easy to use software, which we spent an initial $300,000 on, plus monthly fees to keep it up-to-speed and add new features. That’s nothing compared to The Times, but compared to other small news organizations that are trying to put their papers online, it’s a lot.
Neil Senturia and Barbara Bry
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News Innovators on the Frontline: Pegasus News
Posted on 06. Aug, 2009 by Matthew Sollars.
Mike Orren launched Pegasus News in 2006 with the idea that local neighborhood news is more important “than things happening on the other side of town.” Now the site covers what appears to be every neighborhood in the Dallas-Fort Worth area. Although Pegasus has gone through some corporate turnover, it is now owned by Gap Broadcasting, which runs 116 radio stations in 24 markets. That alliance has Pegasus poised for an expansion. We spoke with Orren late last month.
Pegasus News was founded around local news, but you don’t like the hyperlocal tag. Can you tell us why?
We launched at the time when hyperlocal was at the peak of being a big buzzword and we were sort of lumped in with that movement. But, I actually don’t believe there is a business model with hyperlocal. What we went after is what I call pan local.
You’ve got to have the hyperlocal neighborhood information in the context of what’s going on in the larger market. There is such a finite universe of people in a specific neighborhood that care enough to go out of their way to look for information and news about where they live, that universe is not enough to sell advertisers. But if you can put that in the context of ‘where am I going to go eat tonight, what’s going on locally in niche areas of interest that I have,’ that’s an opportunity to bring a lot more people into the fold. Then when you put neighborhood information in front of them they’re more likely to engage with it.
We cover all of Dallas-Fort Worth, but then we slice it up for the user geographically and behaviorally based on information that we gather from your clicks around our site.
We are not covering any one neighborhood at near the level of specificity that say a West Seattle Blog is. Though, there are some niches in those areas that we probably cover in that depth.
Still, local news is key to your editorial model. What is the plan for Pegasus News if the daily newspaper goes away?
A database of local political campaign contributions maintained by Pegasus News staff.
Even though The Dallas Morning News isn’t going away tomorrow, we think they’re going behind a paywall soon. On the one hand, it’s a great opportunity for us to fill a void, because I don’t believe a substantial number of people are going to pay for that content. The flip side is it’s very expensive content to produce.
My view is that ten years from now you’re going to see more good real useful local news coverage than at any time in our history. But, between now and then there is going to be something of a dark age. Say the Morning News quits covering city hall. We haven’t yet grown enough to have people covering city hall. I believe there comes a point where the models cross and Pegasus or a network of blogs become sustainable to fill that void and even surpass it.
The question becomes what happens during that interim period. I tell people all the time, if I were a small local government person who wanted to pull some shenanigans I would do it in the next three years. Seriously.
When we launched I set out to truly be a replacement for the daily newspaper, but the revenues aren’t there to sustain that. I would rather live and get our shots in and grow into that over a long period of time than kill ourselves and try to do something beyond our grasp.
What obstacles on the revenue side prevent you from taking that bigger role now?
The biggest obstacle for us on revenue has been brand awareness in the local marketplace. We’re pushing 500,000 monthly unique visitors. That is enough to sustain a business. The problem is we’re just now getting over the hump where we know when we go to talk to someone about advertising that they’re going to have heard of us. That’s starting to change, but it’s taken a long time.
What’s next?
We’re getting ready to launch sites in some of Gap Media’s markets. They own a bunch of the old ClearChannel stations, all in markets smaller than Dallas-Fort Worth. So, we will launch in Shreveport, Tyler and Yakima this year. We’ll have them on air constantly promoting us and their experienced sales staff out selling us.
First we’re doing a redesign, relaunch of Pegasus that will serve as the template for all of the sites to come. The database stuff is going to be done here in Dallas and we’ll have one person on the ground creating content in those markets.
Where do your revenues come from?
It’s all advertising, a combination of display, sponsorships, and direct marketing. A big part of our model is the ability to customize behaviorally and geographically. We’re able to sell ad campaigns that are very targeted. So even though it looks and feels like a display ad, there’s a lot more going on behind it.
We do some direct e-mail; some of our email blasts are ridiculously small. For instance, say you are FC Dallas and you want to push a ticket special for the game this weekend. We’ll send an email only to the 220 people who’ve shown an interest in FC Dallas based on their clicking patterns on our site.
We also have geo-located mobile ads on our iPhone app. Our app is much more transactional than news, so it lists garage sales, restaurants, concerts, gyms. We’ll show sponsored listings based on where the user is.
How much did the app cost to develop?
It’s hard to say because we developed it internally. It took two developers three weeks. It’s a very simple app. We’re starting to look at some of the iPhone 3.0 possibilities and that will cost us some money if we go forward.
How well has the iPhone app gone over with advertisers?
Really, really well. They’re very excited about it. I don’t think we have anybody running who’s just running mobile. Generally they’re doing it as an add-on. But when we tell them we’re going to reach out to everyone in a 3-mile radius of your business, they’re like ‘that’s awesome.’
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YouTube Makes a Local TV News Play
Posted on 05. Aug, 2009 by Damian Ghigliotty.
YouTube has big designs to take on local news broadcasting, The New York Times reported earlier this week.
News Near You, which the Google-owned site introduced this spring, detects the location of its users and provides lists of geographically relevant news videos using the same IP technology as dating and weather sites.
YouTube’s strategy differs from the path taken by GoogleNews, because it asks outlets to sign up and feed content to YouTube rather than “sending digital spiders around the Web to collect videos automatically,” according to the Times. Out of 25,000 invites sent out, just over 200 have signed up so far. YouTube expects that number to grow as the News Near You module becomes more familiar.
The module uses the Internet address of a visitor’s computer to determine the user’s location and whether any partners are located within a 100-mile radius. If so, seven days of local videos are displayed.
But in many places, namely urban markets, 100 miles can hardly be counted as a local area; Steve Grove, the head of news and politics for YouTube, said, “we’ll get a smaller radius as we bring on more partners.”
Mr. Grove said about 5 percent of users who see the News Near You module watch at least one local news video, a rate that YouTube sees as encouraging.
The Times cites VidSF.com as one of the independent video news operations taking advantage of YouTube’s distribution and marketing power. Here’s VidSF’s coverage of a “pop-up” wedding in San Francisco’s Mission neighborhood:
For national news networks, the added feature doesn’t signify much apart from the continual push towards local coverage. But for the local news stations that already have enough to worry about, News Near You may soon provide a fresh forum for independent broadcasters and hyperlocal videographers to post their content and keep it apart from stuff like crazy cat videos.
