I am more bullish about the future of the news industry over the next 20 years than almost anyone I know. You are going to see it grow 10X to 100X from where it is today. (...)
The news business is a business like any business. It can and should be
analyzed and run like a business. Thinking of news as a business is not
only NOT bad for quality, objective journalism, but is PRO quality,
objective journalism. A healthy business is the foundation for being
able to build high quality products, and to do so sustainably. That
includes journalism. Analyzed as a business, the news industry is going
through a fundamental restructuring and transformation, for worse and
for better.
The end of monopolistic control doesn’t mean that great news
businesses can’t get built in highly competitive markets. They just get
built differently than before.
Now, with everyone on Internet, three things are happening simultaneously:
1. Distribution is going from locked down to
completely open, anyone can create and distribute. There is no monetary
premium for control of distribution.
2. Formerly separate industries are colliding on the
Internet. It’s newspaper vs. magazine vs. broadcast TV vs. cable TV vs.
wire service. Now they all compete.
Both No. 1 and No. 2 drive prices down.
3. At the same time, the market size is dramatically
expanding—many more people consume news now vs. 10 or 20 years ago.
Many more still will consume news in the next 10 to 20 years. Volume is
being driven up, and that is a big, big deal.
Right now everyone is obsessed with slumping prices, but ultimately,
the most important dynamic is No. 3 – increasing volume. Here’s why:
Market size equals destiny. The big opportunity for the news industry in
the next five to 10 years is to increase its market size 100x AND drop
prices 10X. Become larger and much more important in the process. (...)
So it is logical to expect the big winners in the news business to either be the broadest or the deepest: To go maximum mass, or maximum specific.
With that as a backdrop, here are eight obvious business models for
news now, and in the future. This isn’t a pick one model and stick with
it prospect, news businesses should mix and match as relevant.
Advertising: Advertising is still central for many news
businesses. But they need to get out of the “race to bottom” dynamic of
bad content, bad advertisers, and bad ads. Quality journalism businesses
need to either take responsibility for their own high-quality
advertisers and ads, or work with partners who do. There is no excuse
for crappy network-served teeth whitening come-ons and one weird trick ads served against high quality content. Disastrous.
Subscriptions: Many consumers pay money for things
they value much of the time. If they’re unwilling to pay for a news
product, it begs the question, are they really valuing it?
Premium content: A paid tier on top of free, ad-supported
content. This goes after the high-end news junkies reading the likes of
Bloomberg & Reuters. It will work for more and more new outlets.
Again, value equals people paying money for something.
Conferences and events: Bits are increasingly abundant, and
human presence is becoming scarce. So charge for that scarcity, and use
bits to drive demand for human presence.
Cross-media: Tina Brown was right but too early with Talk. News is a key source of material for books, TV, and film—which happen also to be growth businesses.
Crowdfunding: This is a GIGANTIC opportunity especially for
investigative journalism. Match people with interest in a topic to the
reporters on the ground telling the stories. Click = vote = $. (Helpful
hint: Start today with Crowdtilt. Easy-as-pie.)
Bitcoin for micropayments: Easy to get started now (checkout Coinbase).
As the consumer use of Bitcoin scales up for transactions, it becomes
easy to ask for small amounts of money on a per-story or per-view basis
with low or no fees. (A lot more of my thinking on the subject of
Bitcoin here.)
Philanthropy: Today the examples are Pro Publica and First
Look Media, tomorrow the could be many more examples. There is around
$300 billion per year in philanthropic activity in the U.S. alone. It’s
WAY underutilized in the news business.
If we look at the specific example of investigative journalism,
believed to be least commercially viable type or news, you start to see
how these models can play together.(...)
The challenges and opportunities that these news businesses face can
be rethought, addressed, and fixed. It’s similar to what any successful
business goes through. The guidelines and the characteristics for
winning are the same.
It requires the following.
Vision: The difference between vision and hallucination is others can see vision. It is critical to articulate a bright future with clarity that everyone can see.
Scrappiness: Tough challenges call for resourcefulness and
pragmatism. You need to stay close to the ground, wallowing in every
detail and all over any opportunity that arises.
Experimentation: You may not have all the right answers up
front, but running many experiments changes the battle for the right way
forward from arguments to tests. You get data, which leads to
correctness and ultimately finding the right answers.
Adaptability: Ask yourself, would you rather be right or successful? That needs to be top of mind at all times because times change and we change. You want strong views weakly held.
Focus: Once you gain clarity from experiments and adaptation,
then it’s time to focus on a small number of ultra-clear goals. When
those are defined then it’s all-hands-on-deck.
Deferral of gratification: You need the stomach (and
resources!) to reject near-term rewards for enduring success. In
journalism this means refusing to participate in the race to the bottom.
An entrepreneurial mindset: This is true both for new
companies and existing companies. It’s a bit of a mantra. We own the
company. We make the business. We control our future. It’s on us.
in The Future of the News Business: A Monumental Twitter Stream All in One Place
