How the web has changed the news economy in all media

Original author: Paul Bradshaw
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Listening to all the directors of media companies involved in the production of news, what they say about micropayments , Kindle , budget financing of the media , again about micropayments , conspiracy , Google ban and the like that could save their business, I come to the conclusion that the development industry has passed them for ten years. To them and all those interested, I propose the following theses to understand how everything has changed.

Anyone who wants to build a sustainable business on the news must accept and take advantage of these changes. Maybe I will miss something, but you, if that, add in the comments.

UPDATE: Jay Rosen recommendsread this article along with this one written by David Sull: “A newspaper is a delivery service that accidentally hired journalists.” He is right. This greatly clarifies the meaning of the following.

1. Atomization of news consumption

In the physical world, news came in a bundle. You read about politics, next it is written about sports, here is about finance, next - movie reviews. And you bought a newspaper, only to find out the score of yesterday’s match. No more of this.
It is probably not a coincidence at all that the majority has now moved from consuming news in general to periodic “tingling” .

2. Audience measurability

If you placed an advertisement on the third page of a newspaper with a circulation of 100 thousand, or in a program watched by 5 million people, you did not think about those who bought the newspaper for the two figures of a football match, or those who just accidentally ran into the kitchen to put a kettle during your transfer. But we were still convinced that 3-4 copies read every copy of the hundred thousandth edition.
On the Internet, you see a specific number of people viewing a particular page. Moreover, you know exactly how many clicked on your ad. And how much later did the purchase.
Moreover, you know where the user came from, where he left, what keywords he used when searching, what country he is from, what computer he has, and much more if he filled out your profile.
There are two serious consequences from this. They are only now reaching some players in the advertising market.
First, advertisers expect more. From the print / on-air pay-per-view model, they switched to pay per thousand clicks, and from there to pay per action (for example, a purchase).
Secondly, this means that editors and managers now know much better not only what readers are reading, but also what they want to read (what they are looking for). By the way, my name is Britney Spears.

3. Mutually conflicting business models

In the print media it was possible to take money for what gets on the cover, and for advertising. On the Internet, any attempt to introduce paid access dramatically reduces readability . Because you cut your own distribution channels, block access not only to Google, but also to the readers themselves, who, under other conditions, would send your content, link to it, copy to your blogs. It’s easier to calculate the quadrature of a circle than to make money in such a business model.

4. The fall in the cost of collecting and producing news

Technology became cheaper even before the Internet. Take at least satellite TV against a network of television towers, or a computer layout instead of a typographic set. But the web, and now mobile devices, reduced the cost of collecting, producing and distributing news to almost zero. And the decrease in value continues. When making publishing easier than making a phone call, this creates problems for any business that relies or pays a loan for old equipment and technology.

5. Time and place are no longer limited

Sometimes people have to remind the basic laws of supply and demand. Previously, there wasn’t enough journalists for everything, now there is as much content as you have not read in a lifetime. Any attempt to "sell" content will again come across a free alternative.

6. The depreciation of certain types of journalism

If the reader needs a book review, he will go to Amazon. Music? He will go to the social network,, iTunes, MySpace ... Sports? To any forum. All journalists who make products in these or similar fields will have problems.

7. The end of the monopolies

Just as time and place restrictions were overcome, distribution networks also occurred. Before the web, distribution was very decent. In the days of the web, email or a mobile phone is enough to distribute the material. Social networks are more powerful and efficient than newspaper trucks. And it’s not at all necessary to sell part of your space in order to pay for delivery.
Oh yes, here's another nuisance for the news.
The monopoly on advertising has disappeared. If before the advertiser could only choose between you and the local free classified newspaper, now he chooses from a dozen local media, national directories, search engines, social networks, or, God forbid, he will become a media producer himself. This competition has reduced value and exalted the value of innovation. What have you done to withstand this competition?

8. We remove intermediaries

Since everyone can publish and distribute now, the seller can communicate with the buyer directly. If Threshers can hand out discount coupons on their own , and it becomes (wildly) popular, then why should they advertise in newspapers and magazines? If the authorities can publish orders and laws on their own website, or even publish their leaflet , why should they pay newspapers for this? If Coca-Cola can organize brand testing on its website and collect consumer data, why should it limit itself to a 30 second video in the middle of Britain's Got Talent?

9. The emergence of monopolies

Google rules this space, not you. Amazon rules this space. iTunes rules. eBay rules. Facebook rules. Craigslist rules. If you want to edit in a new environment, you must learn to understand the context in which the user operates. Search engine optimization is just one aspect. Another is social media marketing. Understand how the dominance of one site in a particular industry affects your strategy, and admit that you are not the only one who determines your fate. Yes, Google stole all the trucks, Amazon stole all the newspaper stalls. Yes, and you yourself missed a lot of things .

10. Digitalization and convergence

When everything around is digital, something new has become possible. Audio, video, text, photos, animation, everything became ones and zeros. You need to understand what your new opportunities are: from broadcasting live from a mobile phone’s camera to publishing photos under the terms of the Creative Commons license , or to revealing all of your sources so that users can add value to your materials by using them in their products. The value of your company lies not only within the walls of the editorial office, but also outside it.

11. The rise of the PR industry

The PR industry is usually underestimated in terms of undermining journalism. Firstly, it provides cheap news, which as a result leads to a growing number of fictional events, reports and messages. This problem will only worsen as PR begins to remove intermediaries, addressing directly to the audience.
Secondly, PR strongly influences journalistic talents. In other words, news media has become a forge of personnel for the PR industry. It has already become the norm that journalists who fail to feed themselves on a meager newspaper salary work in PR. This means that the cost of recruitment and staff training for newspapers is increasing. Because among old journalists, few can educate young people informally. Moreover, the PR industry industry often takes excellent students of journalism even before they work in the media. Thus, journalism is having problems attracting precisely those brains that could save it.

12. New currency

Oh yes! What about the money? They have a competitor. What you should pay attention to is social capital. Anyone who considers unprofessional media to be unimportant because they do not have a brand, or because their fashion will pass, does not understand the dynamics of social capital. Many people read blogs or consume custom content because they trust that person, not the brand. Many are published independently based on the interests of reputation , knowledge and connections. Many people link to articles or contribute to the content because the journalist invested social capital in them, or his media created the basis for this.

Like this. Am I missing something?

Paul Bradshaw ( Paul Bradshaw )
June 4, 2009.

From the translator:
Article translated with the personal permission of the author. At his request, I indicate the address of the article directly in the text:
I hope the administration of Habr will take into account the request of the author and forgive me for compelled violation of the format.

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