Archive for July, 2009

India’s Flourishing Newspaper Industry and Its Internet Future

Audience Demographics, Internet, Journalism, Media, Newspapers | Posted by Larry Greenberg
Jul 30 2009

Imagine that in 1979 U.S. newspaper publishers somehow had had access to a time machine that revealed how the advent of the internet would impact their business 30 years hence.  What steps might they have taken to ensure continued profitability in an age of instant, free access to information?

In a sense, India has such a time machine in North America and Europe.  According to a recent article in Foreign Policy, the newsprint industry in India is expanding so rapidly that it resembles the heyday of newspapers in the United States, which was about a century ago.  Back then there was enough demand in New York City alone to support 20 daily papers, one scholar notes. Today, the article quotes a government report, India has more than 62,000 newspapers in circulation, and that number is expected to continue to grow.

Rising income and literacy rates are driving this dramatic increase in print readership in what is the world’s largest democracy. Another key fact: the Internet has yet to become a major player.

According to internetworldstats.com, as of November 2008, there were 81 million internet users, a penetration rate of 7.1%, and as of March 2008, just over three million with broadband connections.  A 2009 study by Akamai Technologies reported that India “has an average internet connection speed of just 772 Kbps compared with the global average of 1.5 Mbps.”

Those numbers may seem small now, but in a country with a fast-growing middle class, widespread broadband adoption seems inevitable. Are the consequences of such adoption, as experienced in the U.S., also inevitable for the Indian news publishing industry? Or can news publishers in India learn from the missteps of their U.S. counterparts?

Harjiv Singh, Co- Founder and CEO, International, of Gutenberg Communications, a global agency with offices in New Dehli, Mumbai, Bangalore and Hyderabad, said it’s important to remember that there’s a clear link between democracies – whether it’s in the U.S., UK, France or India – and a vibrant media industry

“India is clearly at the cusp of a phenomenal growth phase in its economic cycle,” Singh said.  “It will at certain times leapfrog ahead in terms of technology and at other times forge its own path unique to its needs and aspirations.”

“It will be interesting to watch how India’s media industry evolves given that it has the world’s second largest population,” Singh added.

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Desperation is the Mother of Invention: Papers Trying New Revenue Models

Free Content, Internet, Journalism, Media, Newspapers, Paid Content | Posted by Larry Greenberg
Jul 20 2009

You’ve heard the cliché: ‘necessity is the mother of invention.’  When it comes to the newspaper business, one might also substitute ‘desperation’ for necessity.

In Chris Anderson’ new book, Free: A Future of a Radical Price,  the Wired Editor-in-Chief talks about the psychological barrier that free represents for consumers.  Once the ‘free’ line is crossed, at least when it involves digital content, it’s very hard to convert consumers of free into paying customers.  While representing an existential threat to the traditional media model, Anderson also relates how free could drive media companies to innovate. Such innovation might entail the creation of new profit-making models based on free, as well as alternate sources of funding that match supply and demand with long-tail precision.

Needless to say, many publishers are not giving up on paid content, at least not yet.

News Corporation’s The Wall Street Journal (subscription) and the Financial Times (freemium) are two examples of publishers who already charge for online access. Not surprisingly, News Corp CEO Rupert Murdoch and Financial Times editor Lionel Barber predict that most papers will go from digital free to digital fee in the not-so-distant future.

It’s important to note, however, that The Wall Street Journal and Financial Times both serve a business audience that places a great value on the timely delivery of financial and market data (not to mention it’s covered as a business expense).  What about publications catering to a general interest readership, such as The New York Times?

The New York Times, which has already switched from paid to free, seems less sure about its plans. After having discarded its online pay plan in 2008, The Times recently floated a trial balloon to gauge how readers would feel about paying a $5 monthly online access fee, with a discount for print subscribers. (Considering that an annual subscription is around $600, offering print subscribers an online discount might seem more like an insult than a deal.)

Uncertain about the prospects of a paid model, The Times is also exploring other options.  Craig Whitney, an assistant managing editor at The Times, recently told Poynter’s Bill Mitchell that the paper was weighing the possibility of seeking funding from foundations, a la National Public Radio.

Mitchell’s piece also alluded to a pending collaboration between The Times and freelancer Lindsey Hoshaw, who is using Spot.Us, a crowd-funding start-up, to raise $10,000 in expense money to write about a massive garbage blob –  twice the size of Texas – that’s currently floating in the North Pacific. Given the concept’s newness, the paper finds itself deliberating both the financial and ethical considerations of such an arrangement.

Finally, Journalism Online is presenting itself as a potential savior of paid online content. According to Daily Finance, the Journalism Online’s partners – author and media entrepreneur Steve Brill, former Wall Street Journal publisher L. Gordon Crovitz and telecom executive Leo Hindery Jr.  – will soon announce the names of popular newspaper and magazine brands that will be selling their content via Journalism Online using a variety of bundled pay schemes.

A year from now we may have a lot clearer picture as to how all of these initiatives have faired, how inevitable free – at least when it comes to digital media – really is.

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Today’s Media Industry: Death Throes or Birth Pangs?

Free Content, Internet, Journalism, Media, Newspapers, Paid Content | Posted by Larry Greenberg
Jul 10 2009

In March, at the South by Southwest Interactive Festival in Austin, Steven Berlin Johnson presented a framework for understanding how the media landscape has evolved over the past decade – and where it may be heading over the next.  (You can read Johnson’s speech on his blog, stevenberlinjohnson.com.)

Johnson suggested it’s too early to conclude that the disappearance of the traditional newspaper business model will result in dire consequences for investigative journalism, which is typically made possible by deep pockets.

Johnson correctly reminded his audience that blogging, social media and countless other Web 2.0 tools have brought readers more information and analysis about a broader range of topics than could have been imagined a little more than a decade ago.  In retrospect, the traditional newspaper model offered little that was truly local, and only now in hindsight can we appreciate that society was being underserved at the micro-news level.

Perhaps, as Johnson noted, the innovations of Web 2.0 that have enabled specialized coverage of technology, politics, local communities and other areas will free traditional newspapers with shrinking budgetary resource to focus on investigative journalism, which is what they do best. What’s more, traditional media could act as an authoritative filter of the original information already being generated on the web.  It’s a reasonable forecast.

In the meantime, how do newspapers and other traditional media companies and professionals cope with painful downsizing?

As reported by Fishbowl NY, Mayor Mike Bloomberg recently announced MediaNYC 2020, a program of eight initiatives designed to revitalize New York City’s media industry, a sector that accounts for $30 billion in annual revenue.  The program, developed after consultations with area media movers and shakers, includes various initiatives for supporting and attracting both new media start-ups and established companies. Among other things, the program will help fledgling businesses with IT purchases and attracting investment, as well as provide social and digital media skills training for laid-off professionals with traditional media backgrounds.

New York City is both a media center and home to Silicon Alley, a renowned incubator of emerging technology companies.  Hopefully programs like MediaNYC 2020 will facilitate greater cross-pollination of these two industries, helping both to thrive in the not-too-distant future.

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Anderson and Gladwell: A Healthy Debate about the Inevitability of Free

Free Content, Internet, Journalism, Media, Paid Content | Posted by Larry Greenberg
Jul 02 2009

The term “thought leader” is sometimes used rather freely, especially in the world of business.

For an example of genuine thought leaders, one need only follow the recent public controversy stirred by Malcolm Gladwell’s review of Chris Anderson’s new book, Free: The Future of a Radical Price.  Anderson, the editor-in-chief of Wired, and Gladwell, a contributor to The New Yorker, are perhaps two of the best-known commentators on societal and business trends.  Both have authored books whose titles (Anderson’s Long Tail; Gladwell’s Tipping Point) have become reference points for a wide range of discussions about the emerging global economy.

Although I have read Gladwell’s critique – and the subsequent critiques of his critique – I have not yet read Free, so I can’t comment on the substance of Anderson’s book.  The resulting debate, however, highlights the tensions between the traditional purveyors of content — the multi-billion dollar publishing, television, motion picture and music industries – and the businesses and customers who have wholeheartedly embraced digital media — that is, just about anyone who regularly goes online.

(To get into the particulars of the Anderson-Gladwell debate, be sure to read this TechDirt piece by Mike Masnick and associated comments.)

Naturally, the creators and distributors of professionally-produced content want to gain some measure of control, recognition and recompense for their efforts.  Is free, as some worry, a destructive force that must be contained lest professional producers lose incentive to stay in the content business and, therefore, we all lose? Or is free already leading to a reinvention of the professional media industry, in which customers become producing partners or where the product, which used to be sold at a price, becomes a valuable loss-leading marketing tool for an entirely new type of profit-making model?

These are both scary and exciting times for the industry.  The debate between these two thought leaders provides a useful framework for trying to understand this most fundamental development in the media world.

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