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Death is not the end

datePosted on 16:54, November 25th, 2009 by Lew

A curious post from Marty G at The Standard, who asks: “as newspapers die?” This is part of a wider debate about the future of the media, which I’d like to expand beyond just newspapers. As a caution to those who would conflate ‘newspapers are dying’ with ‘the media is dying’, I would suggest that the demise of the mainstream media is, in words incorrectly attributed to Mark Twain, greatly exaggerated. Fundamentally this comes down to the following:

1. If people care about it, it can likely be profitably monetised.
2. If it can be profitably monetised, big business will eventually come to dominate it.
3. The existing newsgathering infrastructure, brand authority, networks, subscriber bases and institutional expertise are still held almost exclusively by big business.

Big business may not be good at innovating, but it is very good indeed at buying innovation and covering the last mile. That’s what it’ll do, and in some cases, what it’s doing already.

There will be changes — in terms of how content is created and distributed, to the revenue model and in particular to the specific media consumed — but fundamentally the mainstream news media will continue to do what they do, which is tell people what they need to know.

The media do not predominantly provide consumers with a good — news or information or something to wrap fish and chips in or something to watch while eating dinner) — rather, they provide a service — a filtering system which sieves out and highlights the things which people need to know to function in their social and professional and ideological worlds. There’s already more news and information out there than anyone can possible pay attention to. We all have our preferred filtering systems — The Standard and Kiwipolitico are two; who you choose to follow on Twitter is another; whether you wake up to Morning Report as I do or Marcus Lush or The Rock or Southern Star, you’re relying on those sources to give you the information you need to function competently in your world that day, and in the days to come. This is the Ralph’s Pretty Good Grocery principle: “If you can’t find it at Ralph’s, you can probably get along (pretty good) without it”. At present, mainstream media filtering models are more advanced than they’ve ever been — but extremely crude by comparison to the sorts of models employed in new media.

Adopting the filtration models which are being developed in new media will require media companies to adopt some of those media forms, and abandoning the old forms. To take one thing (there are plenty of others) which newspapers, radio and television don’t really do at all: interactivity. So we’re going to see things become more interactive, and that interactivity become part of the filtration system. This is how Google’s advertising functions: your usage choices are a source of data about you, and that data is a pretty good predictor of what you’ll click next. That’s good for advertisers, because it offers them a chance to sell you stuff you might want, and it’s good for you, because of all the zillions of pieces of media out there in the world, it allows a media provider to better determine which are more likely of interest to you.

We’ll also see much more device integration, and in particular the development of e-reader hardware which acts and behaves like paper, and the development of news products which use that hardware to mimic newspapers in function — providing the visual grammar of headlines, columns and images on a broadsheet or tabloid page, a form which is very highly developed and so well-understood as to barely be considered a semantic form any more (like continuity editing, or 4/4 time) — but which is almost entirely absent from existing internet news media. I understand that Apple Computer has on order a couple of million high-resolution low-power 10-inch touchscreen LCDs to make a next-generation reader device for market in the next 12 months or so.

But these things are largely cosmetic. Overall, the fundamental nature of the media market will not change. Some of the big companies might die or fall apart, but they’ll be replaced. It won’t be independents and startups for ever, and there will never be a persistent community-of-knowledge citizen-journalists-ruling-the-roost utopia such as many in the blogosphere so desperately wish for (because it would allow them to quit their jobs and get paid for doing this full-time). The main reason for this is that news costs money, whereas opinion (i.e, 90% or more of bloggery) is mostly free but is reliant on news. The money for the news machine comes from the interesting fact that, in the commercial media industry, the ‘product’ and ‘consumer’ are the reverse of what most people think they are. The ‘product’ is not programmes or articles or news (that’s a service); and the ‘consumer’ is not the person reading, watching or listening. That person — you, and me, and everyone else who consumers the media — is the product, and the consumer of commercial media services is the advertiser whose products you also consume. The media, by functioning as an effective filtering system, serves you up content you want and serves up your eyeballs, earholes, networks and ultimately your wallets to advertisers who pay the media handsomely for doing so. Everyone wins — or at least, everyone goes away thinking they’ve gotten a good deal. This model, at a fundamental level, is not under threat, because there is no other ready means of monetising news. That’s not to say it will always be so. It’s possible that a media business model will emerge which doesn’t rely on advertising, but one way or the other, someone is paying, and if it’s not the advertisers paying for you, then in all likelihood it will be you paying for yourself. How much would you pay? Would that be enough? These are real questions, because talk might be cheap, but news ain’t.

L

categoryPosted in Blogosphere, Media | printPrint

8 Responses to “Death is not the end”

  1. Ag on November 25th, 2009 at 17:39

    1. If people care about it, it can likely be profitably monetised.

    Except that, as the hippies say, information “wants to be free”. It is impossible to stop people cutting and pasting or aggregating. That’s why Rupert Murdoch’s paywalls won’t work.

    2. If it can be profitably monetised, big business will eventually come to dominate it.

    Well, the BBC seems to be doing better than any of the private media companies. There’s a lesson there: the public model flourishes the freer information becomes and the private model withers.

    3. The existing newsgathering infrastructure, brand authority, networks, subscriber bases and institutional expertise are still held almost exclusively by big business.

    True except for the authority part. I don’t know many people who think the news industry has much credibility at all. Part of their problem is that they often aren’t allowed to tell the truth. For example, few British newspapers could get away with a masthead declaring “Tony Blair is a Liar and a War Criminal”.

    “The Daily Show” has more brand authority than any of the cable news networks because they tell the truth. It says all you need to know when the jester is the only one making sense.

    If I need news, I go to the Beeb, more often than not. If I need commentary, I go to a selection of blogs, which are much better than anything the papers can offer.

  2. Jake Quinn on November 25th, 2009 at 19:04

    What an interesting post. cheers.

  3. Lew on November 25th, 2009 at 19:41

    Ag,

    Except that, as the hippies say, information “wants to be free”. It is impossible to stop people cutting and pasting or aggregating. That’s why Rupert Murdoch’s paywalls won’t work.

    Quite right. But you’re misunderstanding the same way as Murdoch: the information is not where the value is. You’re dead right that Murdoch can’t get away with monetising their content, because people will find their own ways of distributing it, and for that reason the paywall idea is stupid. But Murdoch’s companies could monetise their filters — the decisions as to what is news and what isn’t for a given audience member. That’s a different story.

    Well, the BBC seems to be doing better than any of the private media companies.

    Depends how you define ‘better’. It has the advantage of being government-subsidised.

    One thing to note about public service media is that they’re funded on similar lines to commercial media — on the basis of audience reach and retention, and programming decisions are largely made on the same basis. Obviously, there’s a lot more flexibility there, with public service obligations and so on, but the principles of the model I describe above still hold for the most part.

    There’s a lesson there: the public model flourishes the freer information becomes and the private model withers.

    This doesn’t hold in the slightest. The BBC’s success has nothing to do with information freedom; you’re mistaking correlation with causation based on a cherry-picked sample of one (which you admit you favour).

    True except for the authority part. I don’t know many people who think the news industry has much credibility at all.

    Many people will tell you they think the news industry has no credibility, and in the same breath will talk with conviction and belief about a topic that they only know anything about because of the media. The simple fact is that the news media, credible or not, are most peoples’ predominant source of information about topics outside their immediate (very narrow) experience. It is pivotal, and until people’ve gone without it for a few months, they tend not to realise how much they rely on it for their everyday functioning.

    Part of their problem is that they often aren’t allowed to tell the truth. For example, few British newspapers could get away with a masthead declaring “Tony Blair is a Liar and a War Criminal”.

    Truth according to whom?

    “The Daily Show” has more brand authority than any of the cable news networks because they tell the truth. It says all you need to know when the jester is the only one making sense.

    This is just made up, plain and simple. With the caveat that ratings are a poor measure (on which I’ve posted before), pick almost any show on Fox and it’ll be more authoritative than The Daily Show. The O’Reilly Factor is the most-watched cable news show of all — more than the headline news shows of any of the other networks, more than Fox News bulletins. Hannity and Beck are right up there as well, and have loyalty, retention and switchover figures the other networks would kill for. The Daily Show ratings peak at a little bit over half an O’Reilly, or a little bit less than a Beck. You’re mistaking some subjective measure of quality with an ideological gloss for actual market relevance.

    If I need news, I go to the Beeb, more often than not. If I need commentary, I go to a selection of blogs, which are much better than anything the papers can offer.

    And you prove my point right there: you rely on a (fairly complex) filtering system. It seems to work, doesn’t it?

    L

  4. Idiot/savant on November 25th, 2009 at 22:41

    This model, at a fundamental level, is not under threat, because there is no other ready means of monetising news.

    I agree with the latter, but the conclusion does not follow. Newspapers are under threat precisely because that revenue stream – advertising – is breaking down and going elsewhere. There’s no money in online advertising (and its easily screened – thanks to a handy plugin, I never see any of it), so newspapers get very little revenue from their online sites. Meanwhile they’ve basically lost the classified advertising which paid for a lot of their hardcopy publication (and newsgathering apparatus) to online sites like TradeMe.

    TV has a secure revenue base. Publicly-funded news has a secue revenue base. Which in turn means their stuff goes online for free, which screws newspapers’ revenue model even further. They can’t charge their online audiance – doesn’t work when they can just go elsewhere – so they have to either raise dead tree advertising rates, or raise subscription rates. Or slim down, and try to “do more with less” as they say on The Wire – with a consequent loss in that core newsgathering and filtering function.

    In

  5. Pablo on November 25th, 2009 at 23:19

    Lew; I think that I/s is on to the crux of the matter.The issue is not how the “media” disseminate the news, but how they collect and edit it. It can go all on-line for all I care, but the integrity is in the reporting.

    The problem with the MSM (as Fox would call it) is not how they choose to broadcast their message but in the hollowing out of their news collection/reporting functions, and then the editorial/production decision to go with vicarious fluff rather than hard news.

    The good part of the story, which you allude to, is that a new equilibria will be established under market conditions in different formats to accommodate all needs.

    BTW–thanks for coming back. I think I shall rest now.

  6. Lew on November 26th, 2009 at 10:31

    It’s certainly not true that there’s no money in internet advertising. It is the case that there’s no money in internet advertising if advertisers and media treat it like print or TV advertising. Google has provided an early demonstration of how you can use context and audience behaviour to build a targeted advertising model based on relevance, and make money from it. It’s pretty crude stuff in terms of the potential new media can offer. As to ad blockers and such — they’re a bit like muting the ads on your TV. Most people don’t bother, and some content slips through anyway. TV survived the advent of the mute button, and internet advertising will survive adblocker. The bigger challenge facing advertisers is in making the advertising relevant to audiences, so the incentive to block it isn’t so great. Because ultimately while you or I don’t want to be advertised to, that’s not universally true. Advertising serves a useful function for people by informing them about stuff they might want or need. (Whether or not this entrenched materialism is a social good in itself is a different debate, of course).

    TV has a secure revenue model for now, but more and more of this will be displaced to the internet in time, and convergence will mean that it’s no longer time-bound or platform-bound as it is now. Public service media has a secure revenue model for now, but on a miniature scale compared to corporate media. And in any case, public service media aren’t enough — concentration of media control is bad, whether it’s concentrated in the hands of corporates, or whether it’s concentrated in state-funded public service media. Both need the others for a range of reasons, the primary two of which are to keep each other honest, and to provide a sort of network effect, whereby each medium gets leads from others, and we get a relatively rich and multi-faceted view of events.

    The ‘hollowing out’ of the news industry is both a cause and a consequence of the ongoing revenue decline. The process of running lean began well before the internet came along and undercut the advertising and distribution model, but has certainly exacerbated it. More importantly, though, the heavy lifting of newsgathering isn’t (and hasn’t been for ages) predominantly done by the organisations commonly thought of as media providers — publishers and broadcasters — but by backend specialists such as wire agencies. These rely on the publishers and broadcasters for their revenue stream, so the distribution problems do impact upon them, but not as directly as it might seem and in different ways. Of course, the papers and stations and the journalists they employ do play a role in this, but it is predominantly a secondary, supplementary role.

    Moreover, because of the way the revenue model works, you can’t separate the quality of the distribution mechanism — the filtering, form, final editorial decisions and presentation — from the quality of the content, because the former to a large extent determines the latter. Good newsgathering practice can’t be funded by poor distribution and audience outreach, because the latter doesn’t provide the revenue to fund it. The better the distribution models, the more resources can (I won’t say ‘will’) be ploughed back into gathering and creating quality news. Part of this will require rebuilding audience demand and desire for ‘quality news’ beyond that which simply makes people sit up and say ‘gee whiz’, and that’s a very large and fraught project. But the technology behind the filtering and targeting models currently being developed can be put to this purpose — it’s just a matter of figuring out how to do it.

    Pablo, I think you’ve earned a break. Thank you for keeping the fire burning in my absence.

    L

  7. cowbell on November 27th, 2009 at 18:24

    I’m not convinced that the value added by the news media filtering the news for me is very significant. http://news.google.com demonstrates that news can be filtered automatically, by a computer.

  8. Lew on November 27th, 2009 at 18:52

    cowbell, that reasoning sort of fails when you consider that Google News filters existing news sources, all of which content is the product of a large number of different filters.

    It’s easy to misunderstand this filter model, so I’ll be clear: the news machine doesn’t filter news, it filters events and decides which are news. When you see something in the news — it’s an event which the news machine has decided you need to know. Once you see it in the news, it’s too late to complain that the filter system is not working — it already has. If you don’t see something in the news which you wanted to see there, and find out about it later from other sources — then it’s a fair criticism.

    L

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