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June 12, 2014, 4:15 p.m.
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LINK: www.aeaweb.org  ➚   |   Posted by: Caroline O'Donovan   |   June 12, 2014

A paper by the University of Chicago’s Matthew Gentzkow, published last month in the American Economic Review, is making headlines. “Trading Dollars for Dollars: The Price of Attention Online and Offline” looks at advertising spending based on time spent engaging with news content. In it, Gentzkow contends that the conventionally held belief that the dawn of the Internet destroyed the business model for print newspapers is false.

Contrary to most popular accounts, the growth of the Internet has not obviously caused a large decline in newspaper readership. Readership has fallen steadily since the Internet was introduced in the mid-1990s, but it had been falling at almost the same rate since 1980, and the small acceleration of this trend accounts for a drop in readership of only about 10 percent. This is consistent with more systematic evidence in Gentzkow (2007) and Liebowitz and Zentner (2012), suggesting that online-offline substitution is relatively limited, as well as survey evidence showing that the Internet currently accounts for less than 10 percent of total time spent consuming news (Edmonds 2013).

In addition, he says print news lost more revenue when it lost its classifieds to sites like Craigslist than it ever did to online news.

For data, Gentzkow relied on comScore for online news traffic and the Video Consumer Mapping Study for print. Obviously, it’s much harder to measure minutes spent reading print than spent reading online, however, Gentzkow writes in an email:

…they actually had observers follow participants around and record what they do minute by minute. They find that the average person who reads a newspaper on a given day reads for 41 minutes.

Now these aren’t exactly comparable — one person could make multiple visits to a website on a given day, and subscribers probably read more than the average reader. But I think it’s clear as a ballpark estimate that the print number is an order of magnitude bigger than the online number.

Based on these numbers, Gentzkow calculates that, although more money is spent on print advertising, when you look at spending per hour of attention, the rates for online are much higher.

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Gentzkow offers a a few rationales for why online advertising might be valued more highly in the market.

Each newspaper has physical space for exactly one advertisement. All readers of the newspaper must see the same ad. The marginal cost of printing ads is zero. Each website also has physical space for exactly one advertisement, but these ads are targeted, so the website can show different ads to different consumers. Consumer types are observable to websites.

In other words, whatever online news lacks in eyeballs, it makes up for in delivering the intended viewer.

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LINK: firstlook.org  ➚   |   Posted by: Caroline O'Donovan   |   November 25, 2014

First Look Media announced today that Racket, the political satire magazine originally headed by Matt Taibbi, is shutting down.

Since Matt Taibbi’s departure, we’ve been working with the team he hired to consider various options for launching a project without him. After multiple explorations, we’ve decided not to pursue the project. Unfortunately, this means that the team Matt hired will be let go.

The announcement follows weeks of seeming instability at the company. New York Magazine’s Andrew Rice broke the news last month that Taibbi, who had been brought on to run the magazine, would be leaving the project. The team at First Look’s The Intercept followed up with a detailed explanation of the management and culture clashes that led up to his departure. Shortly thereafter, Glenn Greenwald announced that editor-in-chief John Cook was leaving The Intercept and returning to Gawker Media.

In the wake of Taibbi’s departure, the remaining staff of Racket, presumably under the leadership of Racket executive editor Alex Pareene launched a new project that fit in well with what was to have been the magazine’s satirical tone and penchant for pranks. RacketTeen, a somewhat inscrutable Tumblr account, poked fun at everything from Defense Secretary Chuck Hagel to media insiders to parents.

The announcement, which leaves the entire staff of Racket without jobs, was met with consternation and general upset by those in the media who had hoped RacketTeen was the sign of more cutting-edge commentary to come. Some also expressed concerns for how the staff had been treated by First Look.


What’s next for the staff of Racket, and for First Look, remains to be seen.

I reached out to Racket staff members for comment, but so far haven’t heard anything back.

Amid the wry jokes, though, it’s important to remember that Pierre Omidyar, First Look’s founder, promised $250 million to the project last year. The organization is often cited on the list of new media projects that are cause for optimism about the state of the industry. With plenty of funds and talent on hand, there’s considerable confusion over what is causing First Look to falter.

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LINK: www.nber.org  ➚   |   Posted by: Joshua Benton   |   November 24, 2014

When I’m asked about the future of news, I always say I’m optimistic, at least on net. But that doesn’t mean that there won’t be holes, and the holes I worry about most are at the local level. The pre-Internet journalism model was highly localized because distribution was highly localized; the web changes that dramatically.

That’s the context for this interesting new paper from Horacio Larreguy, John Marshall, and James Snyder, Jr., looking at corruption in Mexico and how it gets reported — and how that that reporting impacts elections (emphasis mine):

We estimate the effect of local media outlets on political accountability in Mexico, focusing on malfeasance by municipal mayors…In particular, we compare neighboring precincts on the boundaries of media stations’ coverage areas to isolate the effects of an additional media station.

We find that voters punish the party of malfeasant mayors, but only in electoral precincts covered by local media stations (which emit from within the precinct’s municipality). An additional local radio or television station reduces the vote share of an incumbent political party revealed to be corrupt by 1 percentage point, and reduces the vote share of an incumbent political party revealed to have diverted funds to projects not benefiting the poor by around 2 percentage points.

We also show that these electoral sanctions persist: at the next election, the vote share of the current incumbent’s party continues to be reduced by a similar magnitude…However, we find no effect of media stations based in other municipalities.

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LINK: mobilemediamemo.com  ➚   |   Posted by: Joshua Benton   |   November 18, 2014

You may known Cory Bergman as the cofounder (and now general manager) of the innovative mobile app Breaking News, or as the cofounder of Seattle hyperlocal network Next Door Media. But now he’s got a new email newsletter, Mobile Media Memo, that I suspect a number of Lab readers will be interested in. (Subscribe here.) The first issue just went out and features some smart thoughts on a pet peeve of mine: Journalists’ obsession with equating length and quality.

In the world of media, longer content is heralded as higher quality. A six-minute piece is more prestigious than a minute-twenty package. Full-length features trump shorts. Shows beat webisodes. Two-thousand words are better than two hundred. There are lots of reasons for the industry bias toward longer content. Legacy platforms and business models. Prominence and awards. Creative freedom and journalistic context. Ask just about anyone in the content business, and they prefer longer work.

[…]

That doesn’t mean there’s not a market for longer-form content on mobile. I read books and watch movies on my iPhone while flying back and forth from NYC. Tablet users, especially in evening and nighttime hours, read longer-form stories and binge on Netflix. But on average across the mobile universe, shorter content is consumed more. It’s also the gateway to longer forms of content: social apps act as recommendation engines for your attention. That’s how Facebook’s app became the “home page” of mobile, accounting for more time spent than all mobile browsers combined.

[…]

Part of the problem is the industry’s fixation on “time spent” as an engagement metric. I remember a Poynter study a couple years ago that discovered the average “bail out” point on a tablet is 78.3 seconds of reading. The recommendation? Write the story in such a way that gets users to keep reading. The obvious solution: write a shorter story.

It’s often better to maximize “time saved” rather than time spent, especially on a per session basis. Imagine, for example, that you can get the nugget of a 2-minute video in a 24-second clip, or 80% of the value in 20% of the time. For most mobile users, that’s more delightful than watching the full 2 minutes. The more delighted the users, the more frequently they’ll return, which all adds up to a lot of time spent/user at the end of the month.

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LINK: ww2.cfo.com  ➚   |   Posted by: Joshua Benton   |   November 17, 2014

CFO magazine has an interview with Victoria Harker, the chief financial officer of Gannett, which is one of a number of news companies in various stages of splitting off its print properties (newspapers, mostly) from its broadcast and digital ones. The positive spin is that it’ll let each type of company pursue the best approach without strategy tax; the negative spin is that it’s sending print off onto an ice floe where its continued decline will no longer infect the other side of the business. This question would seem to position Gannett as a candidate for the newspaper industry rollup (or mop-up) many have been anticipating (emphasis mine):

Q: Some people praise Gannett because it isn’t burdening the newspaper spin-off with debt, as other media companies have done. Others criticize Gannett for not including, say, Cars.com in the spin-off to provide more advertising revenue. How do you respond to these views?

A: Relative to the debt, we felt very strongly that the publishing segment — which has its own digital properties, by the way — needed to have the kind of capital structure that will enable them to be a consolidator in the industry, should that be the strategic decision they make. They have produced a very efficient model for running the newsroom of today and tomorrow. So we didn’t want to saddle them with a lot of debt. We wanted to enable a good revenue stream, a good cost structure, and good cash production, so they can do the kinds of things they need to do to create longevity within that business.

Relative to Cars.com, we will have affiliation agreements with the publishing business for five years after the deal closes. In our way of thinking it’s the best of both worlds, in that Cars.com will live in the broadcast and digital company, where it will have the right type of capital structure and investment, while the publishing side will continue to be able to leverage that relationship.

You know, we spent a lot of time with investors during the last 10 days, and a number of them asked how they can become an investor on both sides of the house once we spin. So it’s not that everybody wants to go into growth and be in broadcast and digital. We have a number of investors saying, “We’re very interested in publishing, this is an interesting story for the value side of our investment house.” And it’s a dividend-producing entity, which is very attractive to them.

Getting external capital for that sort of move will likely only get tougher, so flexibility on the balance sheet is important.

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LINK: blog.pastpages.org  ➚   |   Posted by: Joshua Benton   |   November 13, 2014

Hopefully you know about PastPages, the tool built by L.A. Times data journalist Ben Welsh to record what some of the web’s most important news sites have on their homepage — hour by hour, every single day. Want to see what The Guardian’s homepage looked like Tuesday night? Here you go. Want to see how that Ebola patient first appeared on DallasNews.com in September? Try the small item here. It’s a valuable service, particularly for future researchers who will want to study how stories moved through new media. (For print media, we have physical archives; for digital news, work even a few years old has an alarming tendency to disappear.)

Anyway, Ben is back with a new tool called StoryTracker, “a set of open source tools for archiving and analyzing news homepages,” backed in part by the Reynolds Journalism Institute at Mizzou.

It offers a menu of options, documented here, for creating an orderly archive of HTML snapshots, extracting hyperlinks with a bonus set of metadata that captures each link’s prominence on the page and visualizing a page’s layout with animations that show changes over time.

The potential uses for researchers are obvious, but I could also imagine plenty of realtime uses. Tracking your own homepage over time, you could get good data on how the granular movement of stories there correlates with traffic over time. (To ask questions like: Is the top slot more or less valuable on weekends or overnight than during the day Monday to Friday?) You could track your competition’s homepages to get hard data on what stories they’re pushing hardest. And unlike the base PastPages, which saves screenshots of homepages, StoryTracker gets at the HTML to determine what stories are where. It’s all open source, so have at it. (Here’s a sample analysis to see what sources the Drudge Report links to most.)

Ben presented StoryTracker at a conference at RJI earlier this week; here’s the video and his slide deck.

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