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Sept. 22, 2016, 1:24 p.m.

How the new director of Philly’s Institute for Journalism in New Media is approaching his job

Longtime media consultant Jim Friedlich discusses his vision for a sustainable metro newspaper.

The Institute for Journalism in New Media, the nonprofit that now owns Philadelphia’s two daily newspapers, announced on Monday that it had hired media consultant Jim Friedlich as its executive director.

jim-friedlichFriedlich is a former Wall Street Journal executive, and in 2011 he co-founded the media consulting firm Empirical Media, which has advised outlets such as the Dallas Morning News and Reuters.

H.F. “Gerry” Lenfest, the former owner of the Philadelphia papers, launched the Institute in January with a $20 million donation. As part of Friedlich’s hiring, Lenfest also bought the assets of Empirical and donated them to the Institute.

Even though the Inquirer, Daily News, and are now owned by the nonprofit, they are still for-profit entities and they report to Philadelphia Media Network publisher Terry Egger, who reports to a separate board from Friedlich.

The Institute is only allowed to fund specific PMN projects, as a result the papers still need to find ways to make money. Their underlying business challenges, the same challenges that face all metro newspapers, still exist.

On Wednesday, just two days after he started his job as executive director, Friedlich and I discussed his plans for the Institute and how he views the state of local news. Still, he cautioned that he was speaking as the “consultant of the past, not the executive director of the future.”

“I’ve been in my new role as executive director of the institute for all of two days, so the perspective I’m sharing is based upon our previous work with newspapers and digital news organizations around the world,” he said. “As Institute director, I plan to look, listen, and learn from my colleagues in this market and others to help determine where we can be most effective and where we can best invest our time and resources.”

What follows is a lightly edited and condensed transcript of our conversation.

Joseph Lichterman: What attracted you to the job in Philadelphia with the Institute for Journalism in New Media?

Jim Friedlich: I was compelled by three things: The mission of the institute, the history and heritage of the Philadelphia news properties, and by Gerry Lenfest personally.

I’m deeply compelled by the mission to advance journalism in digital form. I’ve really focused my career on that. I have personal ties to Philadelphia, part of my family is from here. I have a deep reverence for these news properties and a history of 20 Pulitzer Prizes, etc. And I think it’s vitally important that we advance them in the future.

I’m also deeply enamored of Gerry Lenfest, who I’ve gotten to know over the past six to nine months. He’s a media pioneer in his own right, he’s a philanthropist, but really he’s a venture philanthropist, a very inventive, active philanthropist. He’s 86 years young.

I said to the newsroom yesterday during a townhall that I thought of Gerry as 86 going on 18, and I said that I look forward to working with this young man. I mean that in not quite literal terms, but very sincerely.

Lichterman: What was that conversation like with staffers? What types of things did you tell them and what types of things were people curious about?

Friedlich: It actually was both news and business. It was an all-company meeting.

People were most curious about how we would work together in the future and what the appointment means for them — all politics is local.

My team and I have been here for about nine months working on different parts of the digital transition of the Philadelphia Media Network. We have a project here called Accelerating Digital Growth at PMN, so we’re familiar faces to many. I think there was curiosity from one part of the organization about what we’ve been doing with other parts of the organization.

Lichterman: Can you tell me a bit about the work you’ve been doing over the past few months with PMN? What types of things have you been focusing on?

Friedlich: We’ve been working in three principle areas. The first was with a very representative team from the news department. We created the moral equivalent of a New York Times Innovation Report that has been called a Call to Arms. That is the newsroom’s own view of where they need support to transition more aggressively to digital first, everything from new technology, to additional training, to changes in process and workflow. So, topic number one was news and storytelling.

Topic number two was audience development. That again was a multi-disciplinary team of seasoned veterans and relatively new hires from different departments. We worked with them on how to engage and expand the digital audience and how to evolve to an audience-first organization.

The third area was on product, and that was again a multidisciplinary and multi-generational team helping create a product road map and improvements in user experience, particularly on mobile.

In all cases it was very hands on, very collaborative, and driven by the needs and desires of the organization rather than the views of an outside consultant.

Lichterman: And I have to imagine that you’ll be continuing with that work in your new position.

Friedlich: That work is ongoing. The Institute’s work will include, but not be limited to, advice and counsel to heritage newsrooms like PMN.

So, to be clear, that’s one of the functions moving forward, but not the entirety of our mission or our scope.

Lichterman: It sounds like you’re hoping to be able to take some of the learnings that you’re getting from PMN and other newsrooms, and share them with other newsrooms, as well as publicly.

Friedlich: That’s exactly right.

The focus of the institute is on sustaining and advancing great journalism at the local and metro level. This is where we’ve seen some of the greatest challenges in news, and where we think we’ll see some of the biggest opportunities. In that context, we’re focused on leveraging our presence in Philadelphia to experiment and reinvent in the Philadelphia media ecosystem that’s inclusive of, but not limited to, the PMN properties.

The goal then is to take what we learn here and apply it to other major metro markets, and vice versa, to take learnings and best practices from other markets with which we’re familiar and apply them in Philadelphia.

We’ve worked as Empirical in newsrooms and media companies in Dallas; Los Angeles; Chicago; New York, Sydney, Australia; Bogota, Colombia; Richmond, Virginia; and elsewhere. The idea of sharing across markets and being a clearing house for best practices comes very naturally.

Lichterman: More broadly then, what do you see as the future? How do you get to a sustainable path for a metro newspaper? There was a story earlier this year that 85 cents of every new online ad dollar goes to Facebook and Google. Print continues to decline. How do you create a sustainable business model in that environment?

Friedlich: I’m an optimist by nature, but I think in this case with good reason. There’s reason for great encouragement across the news landscape. You have innovation and reinvention in newsrooms large and small, at heritage newspapers, most prominently the Washington Post, the Wall Street Journal, and The New York Times, but also in properties like the Dallas Morning News, the Minneapolis Star-Tribune, the Los Angeles Times all of whom are moving to audience-first, digital-first news organizations. That’s reason for cheer, number one.

There’s significant evidence that readers are willing to pay for high-quality journalism. You have significant digital subscription revenue not only at the major national newspapers like The Times and the Journal, but also at places like The Boston Globe, the Minneapolis Star-Tribune, Miami Herald, Dallas Morning News, etc. Reason for cheer number two is that users are beginning to value their news online enough to really pay for it. That’s really a key factor in sustainability.

The last is that there is this enormous and extremely gratifying collection of young companies like, or Vox, or Business Insider, which is a little bit more established, that have created substantive audiences and are building very real businesses. You put it all together and there’s every reason to believe that they’ll be a vital place for journalism and the business of journalism for a long time to come.

Lichterman: That being said, all the newspapers you’ve mentioned have gone through staff reductions and other cuts to try and make ends meet as well. Do you think the Philly newspapers will be able to stay viable in their current form? Do you anticipate having to reduce staff or that even having two daily newspapers in a city like Philadelphia is viable?

Friedlich: There’s a vital tradition of great news content and strong news brands in Philadelphia, and I think there’s every reason to believe that that will continue for a long time into the future.

Lichterman: Do you think then that the market is able to maintain two papers, both the Inquirer and the Daily News?

Friedlich: It has been for decades and decades. It’s important to point out that the two newspapers and their digital equivalents serve very different audiences with a very different voice and a very different ad base.

Lichterman: Another thing I’m curious about is you mentioned digital subscriptions as well. Do you think that’s key to the business moving forward?

Friedlich: It’s been our advice to newspapers around the world to find ways to create a paid digital relationship with their best readers just as they have a paid relationship with their print readers. The best practice in doing so has been the creation of the metered model which allows content to be consumed up to a certain level before the user is asked to pay, as opposed to a hard paywall. We’re a believer in the former, not the latter. But, yes, it’s critical that that leg of the stool be strong and vital.

Lichterman: That’s interesting that you refer to it as a stool. It seems like that there’s not going to be one silver bullet that will be the future of newspapers, especially metro newspapers. It seems like it’s going to require a combination of revenue sources.

Friedlich: I absolutely agree that multiple revenue sources are required to sustain great journalism. That’s kind of my point. The traditional model was you hire a great news team to create great content that the community needs and consumes voraciously, you ask readers to pay for that privilege and that pleasure through the newsstand or home delivery, and you charge advertisers for access to that engaged audience.

Somehow along the way, when news became free on the Internet, you lost one pillar of that business relationship. The New York Times proved beyond a shadow of a doubt that if you have a large audience and an engaged audience you can convert them from free to paid, and they now have on the order of 1 million paid digital subscribers. That’s key to their future and that’s key to the future of news around the world. At the same time, the device that all of us have in our pocket and consume our news on, the smartphone, is also one of the greatest inventions in the history of the world for creating a paid relationship. We pay for our music, we pay for our movies and Netflix, and, increasingly, people pay for news.

Lichterman: Aside from subscription revenue are there other types of new revenue streams that you’re looking into?

Friedlich: My role at the Institute is about a day and a half old, so the perspective I’m offering comes from the time spent advising media companies through Empirical and as an operator at The Wall Street Journal.

Whenever you have an engaged audience and the ability to target, both of which digital provides, there’s an opportunity to create value for marketers and advertisers.

Digital has disrupted traditional ad models, but it has also created a collection of powerful new ones, and those relatively new models range from different forms of social engagement, to native digital advertising, to behaviorally targeted display advertising, which remains successful for advertisers. Digital advertising is under reinvention, but it’s a big and rapidly growing business.

I think there is an increasing desire for face-to-face and live media in a digital age. Local and metro news organizations do a superb job of hosting events. The convening power of news organizations and brands like the Philadelphia Inquirer remains quite powerful, so events are another area of real business and future potential. Those are just a couple of examples.

There’s a growing business for local news organizations in providing marketing services to their advertisers as well. This is a part of the strategy of the Dallas Morning News, it’s a growing business at The Boston Globe and the Minneapolis Star-Tribune, and it’s a key focus here in Philadelphia.

Again all of these are representative of our past work rather than a future focus of what is still a very brand new institute and leader.

Lichterman: The last thing I wanted to ask was that it seems like in the past few years there’s been a new model of local media pop up like Billy Penn in Philadelphia or Denverite, which I know you’re involved with in Colorado. Do you think metro newspapers like the Inquirer or Daily News can learn from those types of startups?

Friedlich: I think there’s a great deal that the very established metro can learn from the local startup and vice versa.

Startups are distinguished by their ability to move quickly, their ability to iterate, their ability to focus on typically younger audiences and new models. Established news organizations are distinguished by their thoroughness, their depth, their resources, and their market reach. If you combine those qualities in the future, you’ve got the winning team.

Photo by Peter Miller used under a Creative Commons license.

POSTED     Sept. 22, 2016, 1:24 p.m.
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