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Sept. 29, 2016, 7:01 p.m.
Reporting & Production

For many legacy news organizations in Europe, digital disruption comes with new ideas but few answers

A new Reuters Institute report reaffirms familiar trendlines in digital publishing: “People are using mobile more and more, but we are not yet getting the revenue out of it that we would like to get.”

It’s hard not to sound like a broken record here, but the digital media environment has upended everything legacy publishers have relied on for decades: a robust print product, advertising revenue, loyal readers who get their news directly from a news organization, and even the good old written word.

A new Reuters Institute report detailing these changes at 25 private-sector legacy news organizations across six countries in Europe reaffirms familiar trendlines in digital publishing.1 Through dozens of interviews with senior leadership, editors, and strategists, the report also pulls together insight on new initiatives many of these publishers have undertaken to set their news operations on the right digital course — though there is, of course, no consensus on what that right course should be. (The authors tried to strike a balance between national newspapers, commercial broadcasters, and regional newspapers, so the challenges do vary sector to sector.)

In Finland, France, Germany, Italy, Poland, and the United Kingdom, newspapers and commercial broadcasters together actually “reach more people with news online than public service media,” and more people are still getting their news from these sources online than from social media channels. Pay models are gaining some traction, and there’s an increased focus on appealing to smaller, but more dedicated, audiences online. Yet for most of the news organizations analyzed in the report, 10 to 20 percent of their revenues come from digital — a percentage that’s slimmer overall for broadcasters.

“Television hasn’t yet had the same decline that newspapers saw,” said one broadcast staffer, who was interviewed anonymously. “So, in many ways that presents a challenge because the necessity is not quite so…the time span is much longer so there isn’t like a [situation where] we have to sort it out now.”

News organizations are busy overhauling their websites to be mobile-first. But monetizing mobile of course remains an open question. “People are using mobile more and more, but we are not yet getting the revenue out of it that we would like to get,” Antti Haarala, head of digital services at the tabloid Iltalehti in Finland, told Reuters. Another person interviewed anonymously by Reuters was significantly more pessimistic: “Honestly, now, I think there is no business model.”

Here are a few interesting case studies from the European outlets highlighted in the report, which is available here.

Expanding the digital audience, expanding advertising opportunities

French newspaper Le Monde has spun up two prominent digital projects: the tech and gaming-focused Pixels in 2015, and fact-checking site Les Décodeurs, which was first launched in 2014 and expanded in 2016. The sites help extend Le Monde’s readership and ultimately can help open up advertising opportunities. From Nabil Wakim, director of editorial innovation at Le Monde (and former Nieman Fellow):

[With Les Décodeurs] we adapt our journalism to a bigger audience. This doesn’t mean we focus on stupid subjects; it rather means that we use new formats, native web formats, to explain complicated topics in the simplest way possible. When we were working on the project development, we called it for fun ‘the serious version of BuzzFeed’…The Les Décodeurs team also worked on the Panama papers…and they were successful in explaining this difficult topic in an understandable way. The public response was very good. It may generate between 10% and 15% of Le Monde traffic.

Finish tabloid newspaper Iltalehti has launched a simplified news app called IL Pika, which features 25 curated stories and is an alternative to Iltalehti’s main app:

One opportunity for news organizations to use their content efficiently is packaging. This strategy, which was also mentioned in the New York Times Innovation Report, means that content already produced is repackaged, for example in special reports, to better meet the needs of certain users. At the same time, this also allows news organizations to monetize content they already possess at almost no additional cost.

IL Pika is a ‘curated view of what’s the most important news of the day and a quick glance at most recent stories.’ The app presents news in several sections: main topics, news, sports, entertainment, and lifestyle. For more topics and articles, the user is recommended to use the main Iltalehti app. Content on both apps is free of charge.

Beware of distributed platforms (OK, mostly Facebook and Google)

News organizations largely feel they cannot not be on Facebook, or play nice with Google initiatives like Accelerated Mobile Pages, but are hesitant about losing more control over their brand and ability to make money. Some have refused outright to put their stories on Facebook’s Instant Articles or make their sites Google AMP-compliant. From Jean-Luc Breysse, deputy general director of Le Figaro Group:

Obviously there is a risk that eventually, when the majority of the media companies’ audience is generated by dominant social media platforms, which is already the case in some countries, our ability to leverage that audience is not in our favor. It is a risk, all the more so, since these social media platforms have a track record of changing frequently and often radically their content promotion policy.

Instant Articles also doesn’t really accommodate publishers with paywalls. Stefan Plöchinger, from German paper Süddeutsche Zeitung:

We do not feel badly treated. But you can become disillusioned very fast when you realize that for a project like Facebook Instant Articles, there is no effort, for example, to enable a subscription model. Therefore, we will not be part of it because subscription is an important part of our business model…We realize that communication with them immediately stops when we want to discuss business models that also work for us.

German commercial broadcaster RTL is also also avoiding Instant Articles, using using social media platforms “only as teasers are to ‘market the content ourselves and monetize the reach.’” Le Monde, too, opted out of Instant Articles and Google AMP, and into Snapchat Discover, because “Snapchat is seen as an opportunity to reach new audiences rather than a competitor in the advertising market.”

Monetizing digital video

In every country in the Reuters report, “video advertising yields are growing fast and are already higher than display advertising yields.” Broadcasters certainly have an advantage here. But who has a stable strategy for monetizing digital video?

Italian newspaper La Repubblica has a visual team of about 30 people responsible for publishing 130 to 150 videos per day (a mix of videos produced in-house, purchased from news agencies, and videos from its videographer network). Its strategy, from Pier Paolo Cervi, general director of the digital division at Gruppo L’Espresso (which owns La Repubblica):

[I]n the first phase of online video development, La Repubblica moved from text-based news to video-based news, whereas in the current second phase the brand is expanding its online video offer to cover also entertainment and lifestyle topics. Within this strategy, the Italian newspaper has recently launched Webnotte, a weekly music programme that hosts the most popular Italian bands and singers. The gigs are both live-streamed and curated to produce short VODs that are distributed in particular through Facebook. Generally, each episode is watched by 300,000 to 400,000 unique visitors. Investing in a format that has little to do with news allows La Repubblica to reach new audiences and to attract new sponsorship.

Le Figaro is aiming to launch an online TV channel by the end of the year, according to its general director Breysse:

The channel won’t be a classic 24-hour news channel. It will have ‘the Figaro touch in terms of political stance, tone and atmosphere’ through commentaries and analysis on current affairs, but with a live stream and also a video-on-demand offer. The channel will focus on topics such as politics and economy, but also entertainment.

Content syndication is another strategy. La Voix du Nord, a French regional daily newspaper, built a platform for hosting regional-focused online video called My Video Place:

The hosted videos are also produced by other regional newspapers and TV broadcasters involved in the project. Other news organizations can host the videos on their own platforms and the advertising revenues are shared between the three parties: the host, the producer, and the platform My Video Place. Pierre Mauchamp, deputy editor-in-chief of La Voix du Nord, explains that this platform is an increasingly important source of revenue because national news brands often need video material when important events occur at the local level.

Photo of fractured mirrors and caution tape by Retrofresh, used under a Creative Commons license.

Notes
  1. The organizations covered are listed in table 1.1 on page 12 of the report
POSTED     Sept. 29, 2016, 7:01 p.m.
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