Monday, March 31, 2014

State of the news: Shakier than you think

Excuse me for not cheering the renaissance of journalism in the digital era, which I would be pleased to toast if there were one. 
But the reality is that the businesses that historically have funded local journalism are cutting coverage at the same time that most of the hundreds of new digital entrants are struggling to achieve financial sustainability. 
We know this – and much more – from the annual State of the News report from the Pew Research Center, which was released last week. The key findings in this report are must-reading for anyone who worries about who in the future will produce comprehensive, consistent local coverage and rigorous public-interest journalism.  
Here are the most salient, and sobering, points in Pew’s data-rich report:
Fully 93% of the 70,000 journalists in this country actually continue to be employed by newspapers and local TV stations, not the digital newcomers. All but a handful of large and well-funded digital news start-ups have no more than four overworked and under- or un-paid employees. (Pew did not count radio journalists, though the Radio Television News Directors Association reports that the average is one newsperson per station.) Here’s where most American journalists work: 
With newspaper advertising revenues plunging by more than 50% since hitting a record $49 billion in 2005, newsroom staffing at the chief industry employing journalists has dropped by a third from its peak in 1990. Because the remaining reporters are required to tweet, blog, take pictures, make videos and more – sometimes even held to demanding productivity quotas like these at the Portland Oregonian – there is less time than ever to mind beats and chase enterprise projects. As you can see from the annual newsroom employment census conducted by the American Society of News Editors since 1978, the ranks today are at a historic low:  
Although Pew reports that network news divisions have been trimmed by nearly half in recent years, staffing has remained flat at local TV stations, which employ the second greatest number of journalists after newspapers. But local station owners have thinned the gruel by increasing the number of daily hours they broadcast news by an average of 46% since 2003 without increasing news-gathering resources. As illustrated below, 235 of the 952 of local TV stations – fully 25% of them – have no news staff at all, preferring to fill their air with recycled coverage provided by other broadcasters in their markets. The number of outsourced newscasts is likely to rise in the wake of $8 billion in consolidations last year that saw more than 300 TV stations purchased by companies who in many cases already operate a competing channel in the market served by the new acquisition. Pew says the number of outsourced newscasts “has grown exponentially in just the past two years.” Stay tuned for more.      
Pew reports that most digital news start-ups, including the likes of the Huffington Post and Global Post, have yet to figure out sustainable, profitable business models. This is especially true, as discussed here, in the case of non-profit ventures. As an indication of how far digital news organizations have to go to approximate the economic strength of the  traditional media, digital news outlets have captured barely $5 billion, or 7%, of the $60 billion in annual advertising and subscription revenues generated by news organizations. Here’s the breakdown: 
Noting that “many native digital outlets are still unprofitable,” Pew concludes that “the question of whether digital news outlets can ultimately replenish the loss of legacy jobs and reporting resources hinges on creating the kind of successful business model or models that have proved elusive…. Most analysts say this growing investment in digital news does not mean the industry has figured out a consistent formula for monetizing that news.”
Amen to that.   
While the digital revolution has created unprecedented capabilities for everyone to publish and promote content (which may or may not qualify as journalism), we are a long way from the point that the newcomers are strong enough to replace the traditional media whose businesses are being challenged by said revolution. 
So, the State of the News at the moment is, at the very least, shaky. If not a little scary. 

Wednesday, March 12, 2014

Get ready for the Internet of Everything

What do smart smoke detectors, interactive underwear and electronic toll tags have in common? 

They, and a growing number of sensors in myriad places, are linked to the Internet, creating vast new sources of real-time and individualized data that can be sliced and diced in ways that, for good or evil, will change information consumption and commerce – and roil the media business all over again. 

By most accounts, the Internet of Everything, Everywhere, All the Time and Almost Everyone is coming soon. 

The number of Internet-connected sensors on inanimate devices (like milk-expiration apps in refrigerators) and living creatures (like ovulation monitors implanted in cows) is expected to quintuple to 50 billion by 2020, according to Cisco Systems (video), one of the many companies counting on the next turn of technology to help sell all sorts of new hardware for homes and business.  

Sensors that passively record the air quality in your home, your heart rate at the gym and the moment you cross the Tappan Zee Bridge will capture an unprecedentedly “holistic picture” of your behavior and your environment, says Shawn G. DuBravac, the chief economist of the Consumer Electronics Association.  

“While one sensor might tell us something we want to know, multiple sensors deployed in conjunction might be able to tell us something previously unobserved,” writes DuBravac in this whitepaper. “Recommendations derived from these sensor arrays can become more than the sum of their parts.” 

Although the brewing tsunami of holistic information may be valuable to individuals and businesses, it also could turn out to be invasive and creepy. Only time will tell. 

But Google left little doubt that ubiquitous tracking is on the way – in a big way – when it purchased a company called Nest for a nifty $3.2 billion in the opening days of the year.  Nest makes Internet-connected thermostats and smoke detectors that continuously monitor the environment in your home to turn down the heat if you sleep late on Sunday or ping your smartphone when the toast burns. One appealing feature of the $130 smoke detector is that it can be silenced by a flick on your phone or a wave of your arm. 

While the price Google paid for Nest represents less than 6% of the ample cash in its coffers, the transaction raised eyebrows – and some hackles – because it was another step in the tech giant’s growing ability to meticulously monitor our movements. 

Google already has the capability to learn the location of our smartphones, the pattern of our searches, the contents of our emails, the engagements on our calendars, the names in our address books, our activity on Google+, the media we consume and a good deal about how we shop and spend our money (as mobile payment technology rolls out, Google will know even more).

With the acquisition of Nest and the additional home-security products (baby monitors, burglar alarms, electronic door locks, etc.) that undoubtedly are on its roadmap, Google will have the theoretical capability – which it so far says it will not use – to seamlessly monitor your activities while you are in the comfort of your home. If and when Google perfects the self-driving car, the company also will be able to track your movements when you are on the go.   

Although everyone loves the idea of a smoke detector that can silenced without fetching a ladder, the Internet of Everything – as suggested in the cart0on below – means our lives will be monitored, measured, managed and potentially manipulated in ways we cannot fully appreciate today.  

With respect to the media business, we already are well into the early days of data-driven content presentation and consumption: 

∷ When you search “weather” on Google, Bing or Yahoo, you get the forecast for your precise location. 

∷ Once you select a few songs to launch a custom Pandora channel, the site learns from your ongoing behavior the sort of music you like. 

∷ Based on the movies you watch, Netflix suggests additional programs you might want to see.  

Going further, Amazon long since has mastered the art of using data capture and predictive analytics to make the cash register ring. As you contemplate a buying a book or power drill at Amazon, the site skillfully points you to additional products that “customers like you” have bought. The recommendations are almost always spot on. 

The good news is that the Internet of Everything creates new opportunities for media companies and the marketers who buy advertising from them. The bad news is that it creates new threats for media companies and their advertisers. The challenge is figuring out which is which.  

Although the full implications and opportunities of the Internet of Everything remain to be revealed, it needs to be on everyone’s personal and professional radar. Ladies and gentlemen, start your sensors.  

© 2014 Editor & Publisher

Tuesday, March 04, 2014

So long again, Chicago Daily News

On March 4, 1978, the presses fell silent for the last time at the Chicago Daily News, an iconic and crusading newspaper that was unable to adapt to changing times. The following article, which originally appeared here in 2005, is reprinted as a reminder of what happens when a paper runs out of readers, revenues and ideas.

"It's fun being the publisher when things are going well," squeaked the young man who stumbled awkwardly to the top of a battered desk in the unusually silent newsroom of the Chicago Daily News. "But it's no fun today."

Swallowing a nervous giggle, Marshall Field V cleared his throat and read the assembled staff the short, typewritten death warrant of one of the most distinguished newspapers in American history.

An agonizing month later, on March 4, 1978, the Daily News signed off with the jaunty banner, "So long, Chicago."

The line was written by the late nightside copy desk chief, Tom Gavagan, a chain-smoking, working-class Irishman who seemed to own only two shirts -- one in burnt orange, the other in avocado green. The tears in Gav's eyes weren't from the smoke.

Although it happened 35 years ago, the story is worth telling today, because many of the zany, brainy people who made that paper sing aren't here to talk about it any more. They were my mentors, comrades and friends, and I cherish their memories.

But this isn't just ancient history. It is a valuable reminder to today's media companies of what happens when you run out of readers, revenues and ideas all at the same time.

The Daily News, like most afternoon newspapers, succumbed at the age of 102 to a declining audience and rising expenses.

Its readers had moved on. On to the suburbs, where delivery trucks couldn't reach them with a paper that didn't come off the press until afternoon. On to the sofa, where they favored Three's Company on television.

There were no home computers, no Internet, no iPods and no cellphones to get between our readers and us in 1978. Still, circulation dropped. The management was changed. Circulation dropped. We redesigned the paper. Circulation dropped. We tinkered with the product. Circulation dropped.

In the end, there was nothing left to do. Some 300 people lost their jobs, and Chicago lost a great newspaper.

The Daily News, in its best days, was a cutting-edge conscience in conservative Chicago, a husky, brawling town that wasn't always ready for reform. The paper stood fast against official incompetence and government corruption and stood tall for civil rights and the little guy. For years, the Daily News stubbornly held its price to a penny, so as to be affordable to laborers heading home from work.

It was one of the first newspapers to have foreign correspondents, to print photographs or to cover that new-fangled medium, radio. Its widely syndicated coverage won 13 Pulitzer Prizes, including three for meritorious public service.

The Daily News cultivated a limitless array of talent over a century, including Eugene Field, George Ade, Ben Hecht, Finley Peter Dunne, Carl Sandburg, Peter Lisagor, M.W. Newman, Lu Palmer, Lois Wille and our latter-day franchise player, Mike Royko.

The list is too long to print here. But the Daily News, in its classy way, printed the name of everyone working on the staff on the day the paper folded.

My name was on that list. It remains one of proudest, and saddest, moments of my life.