• News businesses that try to copy their print media ways to the Internet are dead in the water.
• Contrary to what print news companies believe, readers never paid for news. They paid for the paper on which the news was printed. Having something tangible made it seem as if it should be paid for.
• Internet users will eventually pay for content. They, however, will not pay for content that they don’t feel they need. News as presented on cnn.com or msnbc.com or even nytimes.com is not news the average person NEEDS. There is no compelling reason to pay for it. The results of this poll by PaidContent UK and Harris Interactive prove the point that consumers aren’t interested in paying for news online.
• B2B news outlets face a larger uphill climb to the pay wall. Their news can often be found on blogs, forums and Twitter long before the small staffs at B2B media companies can even write a story and vet their sources. By the time they post the story, readers have already moved on.

The second part of the post pointed out that print media companies are still living in the days of the Internet boom. They’re presenting news much in the same way they did on print. Essentially, they are stuck in uni-directional print mode rather than harnessing the bi-directional benefits of the web. To get out of this rut, they need to focus on three core ideas (or tenets):

1. Be a Resource – Create products/applications online that are compelling to users. These products will keep users coming back even when they believe your news is boring. Organize your content in ways that establish your site as an expert on relevant topics. Become almost encyclopedic on those topics and offer numerous ways to browse relevant content.
2. Make Life Easier – Use all of the tools in your online toolbox – behavioral modeling, personalization, customization, site search, path tracking and others to learn what your customers want. Then present them with that functionality wherever they want it – mobile apps, web and desktop widgets or on your site. That’s how people start associating your brand with innovation, new thinking and value within your industry.
3. Focus on the Money – Both of the tenets above have to be done with the idea of how you’ll generate revenue from them in the short-term and in the long-term. Ideas for which you cannot demonstrate ROI are ideas that should not be pursued.

Success is dependent upon thinking about the news differently. Come to see your company’s core competency as providing functional access to information and you’ll win. Stay stuck in the thought that you’re providing news and it’s likely your company will join the dead pool.

I suggest checking out Bloomberg, L.P. for a company that gets news right. Also, while I focused on the news business, the tenets here are applicable to every print media company in the process of transitioning to the web.

Rupert Murdoch is perhaps the top news mogul in the world. The online edition of the Wall Street Journal, which Mr. Murdoch owns, is one of the few remaining newspapers with a pay wall through which people must go to access content. To the Wall Street Journal’s credit, they reportedly make close to $80 million per year from the subscriptions to their online edition. This revenue, apparently, gives Mr. Murdoch the legitimacy he needs to lead the charge of convincing other newspapers to charge for their online content. The problem, however, is that he is leading news organizations down a very dangerous path.

Before I go on, I want to offer the caveat that I am not one of those who believes everything on the Internet should be free. Whether through ads or subscriptions, users should pay for content. With that said, I’ll continue.

People have never paid for the news. Sure, we’ve all purchased newspapers or news magazines. By doing that we paid for the news. What we actually paid for, however, was the paper on which the news was printed. The $0.75 we pay for a paper today or the $3.95 price of a magazine doesn’t cover the marginal cost of producing that paper or magazine. If it did, magazines with large numbers of subscribers wouldn’t go out of business. In the minds of consumers, paying for paper makes sense. We can feel it with our hands and see it with our eyes. We can take it and use for kindling for our grills or put it at the bottom of our pet’s cages. Of course we paid for paper. It’s tangible. Internet news is not tangible. We already pay our ISP for access to the Internet. Why should we have to pay to get the news too? Unfortunately, that’s but one problem.

Another? The news is pointless. Why does the average person need (not want, need) the news in their daily life? That people would pay for it implies some degree of perceived need. But what need is there? The weather – there’s some value there. Should I wear a coat or not? Will I need an umbrella or will it be too windy? There’s a valuable service with the weather. The news, itself, however offers little value beyond the moment for the average person. How does it truly affect my life to know that the war continues in Afghanistan or that the President’s poll numbers are down from last week? The average person does not NEED that information to go about their day. It is simply a nice to have. Nice to have news is not compelling. The results of this poll commissioned by PaidContent UK and done by Harris Interactive prove the point – consumers aren’t willing to pay for news they get online.

This unwillingness to pay for news is even more pronounced in B2B news media. With a few exceptions, the news stories that tend to grab readers’ attention are first leaked on industry blogs, then bantered about on forums and ultimately tweeted about by that guy down the hall who doesn’t seem to do anything but surf the web – all before a professional journalist can vet their sources and write an official story. Then there’s the reality that many B2B news outlets do not have sufficient staff to write daily news stories. By the time the next web update is made, readers have cross-checked the story topic on three major blogs, Digg and Google. Face it. The news is a commodity. In fact, the news as it is currently known must become the “loss-leader” for most news organization.

Stuck in the Boom

A sad reality is that most news outlets are so focused on the Chicken Little cries from the industry that they are unable to see that the problem may not be the sky but rather, the problem is within…

Remember the Internet boom when it seemed that all one had to do to make loads of money on the Internet was create a site that simply read “Sign up for beta testing” and procure really nice business cards. Those were the days. Back then, corporate marketers struggled to understand the Internet. They would put up brochure-ware sites, laying out the proverbial red carpet, and hope people flock to the sites. People didn’t. The sites were boring and did little to take advantage of the interactive nature of the web. The sites were very uni-directional. The Internet bust changed that.

After the bust, people saw that it wasn’t enough to just hang out a web shingle to make money online. You had to provide a service that was valuable, appealed to a target and, most of all, it had to be functional. Corporate e-business teams began to get that message and they’ve created some great applications that allow their employers to interact and engage their customers. The corporations learned to use the bi-directional nature of the web to provide functionality that made their customers lives easier. What they learned in the process is that offering such services allowed them to save money over having customers call in and take up the time of customers service reps. They also learned that great online customer service helped improve their brand positioning in the minds of their customers. The transition from delivering unidirectional brochure-ware to providing bi-directional products became a win-win for corporations. News outlets can learn from that example.

The news outlets that survive will be the ones who stop seeing the Internet as digital paper and start determining how to take advantage of the capabilities of the Internet. These outlets will find that by changing their thinking about the news business they can seize opportunities (and revenue) much in the way corporations did when they began looking at the Internet as a way to lower costs and provide better service to their customers.

How can your company get moving in the right direction? Naturally, that’s a question the answer to which can only be determined after careful analysis of your own business. However, there are three key tenets on which you should focus to achieve success:

1. Be a Resource – Your online news site has to be known for something. For a consumer-focused site, maybe you’re known for having encyclopedic quality information on the hot button issues of the day. Users visiting your site to look up healthcare reform can find the bills, video interviews you’ve done, C-SPAN clips and chronological and indexed views of stories done by your organization. Give them a reason to come back.
   
   

   In the B2B space, your company’s focus has to be on products that target the people in your primary industry. Knowing that company X wants to acquire company Y has little bearing on the average employee’s day-to-day. Changing your focus from delivering news to being a resource, however, would mean that you provide those in your industry with tools they need to do their jobs.

2. Make Life Easier – Simply providing products that your readers see as tools is not enough. You actually have to be focused on making your customers’ lives easier. This means getting them the tools they want, when they want them, where they want them. It means using all of the tools in the online toolbox to know what your customers want before they tell you they want them. Behavioral modeling, personalization, customization, site searches, path tracking and numerous other methods can give you the insight you need to get your customers to the tools they need quickly. Moreover, by offering these tools in various forms including web and desktop widgets and mobile applications, you make it easier for people to associate your brand with your industry.
3. Focus on the Money – Your customers should pay for access to the tools that make life easier. Very few businesses can afford to provide their services for free. I doubt yours is the exception. That being said, getting customers to pay for services on the Internet is a challenge but it can be done. The WSJ can generate its subscription revenue (in addition to its estimated $120 million in ad revenue) because the articles on the site are designed to provide its users with information they can use to make prudent decisions about their businesses. The New York Times (NYT), on the other hand, had to remove their pay wall because users were unwilling to pay for standard news online and the subscriptions were impeding the NYT’s ability to generate ad revenue.
   
   

   By becoming a resource rather than simply delivering news you can improve your company’s value to your core audience and increase the likelihood that they will be willing to pay for access to your site.

For all intent and purposes, the news as we know it is dead. The news organizations that avoid the dead pool will be those who start view the Internet as a way to interact with customers in ways not at all capable in print. These companies will provide content and functionality their audiences need rather than want and they will focus on increasing their core competencies beyond just delivering individual news articles. Servicing the customer, rather than just serving up the news, will be the key to survival for tomorrow’s news organization.

I suggest checking out Bloomberg, L.P. for a company that gets news right. Also, while I focused on the news business, the tenets here are applicable to every print media company in the process of transitioning to the web.

The reality we as Americans have never paid for news. It may seem as though we have. In reality, we’ve been paying for the paper on which the news was printed and by which it was delivered to us. Think about it… News came out today of the pilot from the USS Alabama, Richard Phillips, being rescued from hostages. Once you’ve heard that three pirates were killed, one was arrested and the pilot is safe, what else do you need to know? Nothing – with the exception of a small few of us. Your friend who happened to catch the news elsewhere can give you those details. The same can’t be said for music.

Can you imagine someone telling you how the latest Coldplay song sounds? “Well, this guy is singing in a pseudo-melodic tenor over a repetitive bed while a mild drum plays in the background. The song goes for 3 minutes and 23 seconds.” I don’t do Coldplay justice – nor would the average person. A similarly poor telling of a movie would occur. We have to pay to get the full impact of that content.

What makes news valuable is its perspective. Fox News does so well because its stories are so obviously unfair and unbalanced. In this age where all news content is expected to be free, the winner of the news wars will be those who identify their voice and allow each story to be told in that voice – in a way that makes it more and more challenging to repeat the story without losing some meaning. If news sites want people to pay for content, they’re going to have to become more like the music and movie business. Make the stories an experience that cannot be easily retold and people will pay. It’s what National Public Radio (NPR) and it’s huge part of what makes people so willing to contribute to their local public radio station. The vast new media resources available make such stories more feasible than ever. Now it’s time for old media world to start doing some out-of-the-box new media thinking. If they don’t, it will certainly be easy to tell their story “They died off like the dinosaurs they were.”

Though I’ve never lived in Atlanta, I call it my second home because its someplace where I feel at home. So, it comes with some pleasure to find out that the major news paper in my second home, The Atlanta Journal-Constitution (AJC), has already done just what I suggested. They apparently built a classified site, ajcexchange, which competes head-to-head with Craigslist. Their goal was to provide local users with a Craigslist alternative that didn’t have some of the unsavory elements for which Craigslist has recently become known.

I have to tell you. I think they did a pretty good job. Go visit the site yourself and let me (and them) know what you think. It looks like they built it from scratch using Ruby on Rails. Kudos to the AJC team for leading and being imaginative about ways to get ahead of the troubles facing the industry.

The news has never paid for itself. Few newspapers, if any, survive solely by printing news. They rely on ads – classfied ads, ads from the little shop down the street offering 30% off of all shoes in stock and those very expensive full-page mea culpa ads companies take out when they’re caught doing something dastardly. Different styles of ads – all with the common purpose of generating revenue for the company. The Internet comes along and all of a sudden people aren’t buying newspapers any more and so people aren’t as willing to advertise in newspapers. They have to advertise someplace, though, right? Have people stopped wanting to sell things? Don’t people still have let people know about the 4 puppies they have available? Don’t stores still have to inform people about their upcoming sales? They do – and they are – just not in the newspaper.

Go visit your local newspaper’s web site. I can almost guarantee you it’s chock full of news. In fact, your newspaper was never so chock full of news. Sure, there are display ads but our Internet savvy eyes have been trained to ignore those. The classifieds section, the bread and butter of newspapers, is now relegated to a mention in the top nav or even worse, way down below the fold. Huh? And this is how you expect to make money?

Here’s the reality. Craigslist and Google AdWords are killing newspapers. Anything I want people to sell I can either advertise on Craigslist or buy some keywords and inform people while they’re doing their web searches. Who can blame marketers? Craigslist is free and with AdWords, I can track people from the click to the web site and to conversion. Try doing that with a newspaper ad. The sad part is newspapers are letting Craigslist and Google AdWords kill them. They sit there complaining about what’s wrong rather than thinking about how they can beat them at their own game.

Come on… One thing local newspapers have over Craigslist is regional insight. How can they use that to their advantage? Newspapers generally have significant reach in the local area and can perhaps reach people who might not visit Craigslist. Most newspapers, whether they know it or not, have a trusted brand recognition in their communities that can’t be easily dismissed. To my mind, newspapers can use these benefits to create local portals which serve news but also focus on what people got used to with their newspaper … ads – on every page, in any position there isn’t story copy. That’s not to say it would be easy to do but it would be a start.

Here’s why newspapers won’t get it right – too many people. Craigslist works because it’s simple. Very minimal design. Only a few clicks to get the info you need. That’s because it was designed by one guy. Like all large companies, newspapers have a lot of stakeholders who all want input into everything. Think about what Craigslist would look like if created by newspapers. I won’t bother with a description, but I’m pretty sure it wouldn’t be pretty.

It’s time for newspapers to head back to basics. There actually little simpler than placing an ad on a newspaper page – perhaps not in execution, but absolutely in concept. And what could be easier than turning a newspaper page and finding a news story surrounded by ads on the next page. The newspaper is just about as simple a concept as there is and it’s time newspaper folks went back to thinking simple and using their imagination to solve the problems they face. Pointing the finger at everyone else won’t prolong the industry’s survival. It will only make it so that people will be glad when they’re finally gone if only so they no longer have to listen to the yelling and screaming they did as they were going down. Now is the time to either figure it out or go down quietly. Personally, I’m hoping for the former.