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Penny Abernathy:

Penny Abernathy:

When are you going to come up with The Model.

He says there will be one national aggregator brand and it will be Google.

The path to renewal:

  • Shed legacy costs
  • Reestablish community

accomodation never works, what you need is this creativity.

"The likelihood that the structure of this medium will remain as before is nil."

Strategy guy for The AP:

He has an idea for the New Model for News.

Their view of the new model is how to harness the new forces of nature we now

epxiernece on the internet.

He puts of a search term in Google. And he put in first two paragraphs of an AP

story AP IMPACT on Child Porn and he got 32,900 responses on the web. "We don't

have that many members. "THis is not a judgement about the blogs or that practice."

"What signal do you get from that search result?"

Watertown Daily Times -- in a death match with NewszJunky.com Northern New York's 24/7 news source.

"My point ot view is not to bemoan the rise of these new models, but how to make

this new news ecosystem work better. The old model has been upended and the peice

sof news fall out.

Young consumers saw the news as facts, updates, back story and future story. The

young consumers said they were overloaded with the facts and updates and weren't

getting any context or backstory. People aren't going to home pages, they are going

in through back doors.

"This pattern is not connected. We are mostly moving through this in a random

fashion. People are going through these patterns through the front door, teh back

door, it is not a good experience, and it doesn't really serve the stakeholders,

principally the users."

"The old business model of the packages really doesn't work any more. We can't push

them out anymore, the user is in control."

He illustrates the packages to atoms:

1) Old system was package -- the newspaper 2) We put it all online 3) Google game along and broke it into atoms 4) What needs to happen is to get the atoms back into some format again

"WE are trying to hard-wire the connections."

Digital Platform News Registry Search Strategy Social Media Model

"WE hope we'll convince the search engines to take a look at this and use it. We

would hope that they will use information if we can show them an index of

authoritative news."


Difficult to complain about everybody taking those 32,000 copies.

What JO is trying to do very briefly is not create a new model. ... We're trying to

create an old model and the old model is if you produce journalism the readers pay

for some portion of it and the advertisers pay for some portion of it.

the model by which you depend on adveritsing on a website is the broadcast model

except there are 2 million competitors.

"They each will have a common account and a common password."

"We are going to help them, not with a paywall but help them to set various dials,

turn various dails so they can once again have a mix of circulation and advertising

revenue." ... "You gradually wean people off the idea that everything is free."

"What we are trying not to do is lay down some blanket paywall ... but a gradual

process, a flexible process that publishers can do and the way they will do, the

reason they will do it is quite simple -- the stuff that they have to sell has real


"Putting that kind of economic power back into the

"We have now signed up over 1,200 affliates to do this so maybe we are on our way."

"It's about correcting a hickup, if you will when everyone said the Internet is

such a cool thing, let's just make everything free.

Now Robert Picard is talking. His title: "Paid Content: Is it the Future of the

News Business?"

Robert Picard: "When people say there are not resources in the newspaper industry

that support news, they are wrong. There is a lot of resources that support other

than news.

He sees a big push for paid content. The arguments are grounded in comfortable

content. But the convesation should be focused on the product, not the money. "You

have a huge product problem; if you solve that, the money problem will take care of


He keeps hearing newspaper people talking about pricing, not business models. What

are you offering people that is unique, valuable to them and gives them an

incentive to pay you something?

There are assumptiosn in the pay wall arguments.

Paying for news is the same as paying for music, video and other content.

  • Online content is the sanme product as print content
  • Online economic and marketing environment are similar excpet for printing and


  • Online payment systems are efficient.

There is far more demand to pay for entertainment services than for news content.

For every dollar advertisres spend to support informaiton in the U.S., consuemrs

paythat much. The price for non-news content is much higher than news because of

that willingness to pay. CD prices 10X higher than newspaper prices, DVD prices 15X

higher than newspaper prices.

The product is only partly the news, he says.

Is the online product the same as the offline product? Print news consumers payfor

may things. Online navigation is harder than in print. The experience of online

news sites is not very pleasant. Not much personalization, not a lot of service

that goes with that experience.

Hae to start about what are we delivering online before we think about paying for

it. Online the average costs don't delicne with increased readers. Problem:

Consumers don't know quality of content before purchase -- that's a problem.

Print readers are worth between $500 and $750 a year, double that because of the

advertising. It is taking between 50 and 100 readers online to replace that. And

you need 10-15 ads onine to get the same price as you get one ad online. So there

are huge challenges there.

If you are not paying for it offline, why are you going to pay for it online.

Online readers are characterized as monthly, not daily.

Have to look at consumers in diferent ways. "It is not as simple as saying we are

going to throw a paywall up there and make it work."

Tom Glocer also went to Yale Law School.

"What Steve's doing is I think brilliant because what he is giving back is control

and losing the controls and flexibility of the media back to the content providers

... and that's very creative."

Newspapers have lost touch with the balance between advertising and subscription.

"It's the mass suicide that Steve talks about."

Now you no which half of advertising isn't working.

Why is it so hard to build to POlitico, but so hard to come down from the

Washington Post.

Phyiscal paper: "We are obsessed with that as a media. I think we are going to look

back in a few years and think, what an amazingly stupid process."

"Why does the NYTimes have to do everything soup to nuts."

"I think there is a very, very bright future for journalism. We are a niche

publisher, our idea of niche is we get $13 billion a year on a subscription basis

from professionals, 90% electronic and we do it becuase we focus on what are the

real needs of those professional customers who don't want to be titilated or

entertained, they absolutely need that information."

QUESTOIN: Was it a mistake to give content away?

Kennedy: It made sense in the beginning. But when search took over, that's when the

industry should have switched gears. We should have innovate around that.

Brill: I think it was a mistake, and I'll give you an analogy from the print world:

He gives the example of

"The incremental revenue is tempting but it is really short sighted and it

continues to be really short sighted. ... we are not talking about a paywall. We

are talking about finding the 10 or 20% of most engaged readers

"It makes your point about micropayments completely irrelevant."

Brill: If you are giving away content stupidly.

"I will submit that it is better for the customer to get something for free than to

pay for it." But he thinks asking people to pay for it creates a much better

environment for journalism -- because it forces you to pay attention to your

readers instead of your advertiers. "That changes the culture of a newsroom. It

restores it."

"If the New York Times is going to charge $5 a month, it is concerned about its

readers. YOu know it is worring about its consumers because if it doesn't do

it,there isn't going to be a New York Times and there isn't going to be a

Huffington Post that exists off the New York Times."


Brill: "We see that for newspapers their model is they can get a small percentage

of their most avid readers to pay."

"Most newspapers who start with us in January, February or March ...."

Tom Glocer: Does a lot of work in news segmentation. They have gone from 1,500

journalists to 2,700 journalists in the last 10 years.

Robert Picard: Average U.S. newspaper is 38,000 circulation. About 90% of the ad

money going online is going to the top 10 sites. There is not a lot of ad money to

be made out there. He is creating some mechanisms where some of the local papers

can benefit.

For a small paper: If you go online, you've got to protect those 10 exclusive


Question: "The AP's vision is to do a command and control that will funnel me

around the Internet with an experience that will be useful to me .... we don't need


Kennedy: "Our point of view is search doesn't produce results, it produces

discovery." "You'll get storis, but in some cases it won't match up with the

geography. How do you sort through that? Maybe you are good and finding the needle

in the haystack, but a lot of people are not. We are just trying to make it

possible to have a machine assisted soution.

As we develop the Internet further, the machines and the individuals can find that


Brill: What does matter to cusomters is local news and local news if we just

redifine it as community news -- the state deparmtent, r people worriede about

Afghanistan, or the football game in WEst Texas. That is the news that people

really care about.

"Targeted publications are really giving up a lot when they don't ask people ina

community to pay something."

QUESTION: What about the loss of influence? People in newsrooms are worried.

Glocer: Maintains a public television service, if you go to opinion formers with a camera, they will speak to you and the smaller you are and the smaller impact you have the less you will get sources. In Steve's model, if you went to these same people and said I'm sorry I don't have a 100 million audience but I have 10,000 people of the same dmeographc, the entire US Senate and they pay me for it ... thats not invented yet.

Brill: There are only about four papers who have put up a pay wall. They just started for everything at once. If you did everything we tell you do as a local publisher, you might lose about 10% of our page views.

Glocer: He worries about subsidies.

Picard: Subsidies decline over time. The Scott Trust is now cutting and may stop publishing The Independent and may switch from a trust to a limited company.