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Idealog—in the ideas business

The plunge

Matt Cooney

There’s a certain delight in watching someone else in your industry tempt fate. National Business Review publisher Barry Colman invited a firestorm when he announced that the NBR would stop publishing all its content online for free, and instead would save some of its material for paid subscribers.

The idea was probably bound to draw ridicule, but Colman’s slagging of the “hysterical” blogosphere in his announcement made it a certainty. There was some measured reaction too, notably from Bernard Hickey and Lance Wiggs. I thought I’d wait a week to see how the experiment goes.

Colman is taking a stand on the meme of the moment: free vs paid. Wired editor Chris Anderson, who has made a career working on decidedly paid-for publications like The Economist, is about to release his book Free, which has been widely pre-empted on his blog and his magazine. And media barons everywhere are preparing for a major scrap with their online audience, aggregators and search engines over how they should be paid for their content—if at all.

The Associated Press, for example, appears to think it will be able to attach some kind of DRM to its articles. With ideas like that, the AP is buying itself a big bag of disappointment.

But ‘free’ has its limits. If your content is valuable enough—and particularly if it might make you money—somebody will pay for it. So the NBR is probably the mainstream media outlet most likely to actually make a paywall work. And Colman apparently feels he has little choice: if he’s at the point where the alternative is laying off journalists, then the viability and future credibility of the NBR is at stake.

Like most observers, I don’t think the NBR’s plan will work—at least in its current form—but unlike some others, I’d be thrilled if it did. The NBR has set the standard for online general business news over the past year or so, and it’s important that we have comprehensive, independent business journalism in New Zealand. I’d hate to rely on the Herald or Fairfax to provide daily business news. And I like the idea of an Internet ecosystem with space for every type of venture: professional, amateur, aggregated, paid-for, ad-supported, sponsored, free and every permutation thereof. If software as a service has value, why shouldn’t other services?

When Rupert Murdoch bought The Wall Street Journal it was with the stated intention of making its news free online; that plan has gone nowhere and the Journal remains paid-only. The New York Times, which abandoned the paywall around its columns just two years ago, is set to limit all its content to paid subscribers. It could happen as early as next month. Sure, the NBR is not The New York Times, but it doesn’t need a million online subscribers. A few thousand might make all the difference, and that is doable—the site currently gets around 10,000 visitors a day.

And yet … as Colman said in his letter, the success of his plan will depend on the quality of subscriber-only content. So, after a week, how’s it looking?

Here are the stories last week that were limited to subscribers. On Monday, we learned—or, most likely, didn’t learn:

On Tuesday:

On Wednesday:

On Thursday:

And on Friday:

Colman promised subscribers would get “only the best news stories, scoops and commentary pieces”, but there’s nothing in that list that the NBR wouldn’t have covered the week before. It’s also a weird selection: opinion, breaking news, markets and industry news. It’s hard not to think someone is checking the Herald and Dominion-Post twice a day and restricting the stories that the papers don’t have. Ideally, the NBR would be able to produce a string of stories that would give subscribers a clear competitive advantage. Most interest is probably in the Rich List story, but it’s only two years ago that the Rich List was the vehicle chosen to launch the short-lived NBR Magazine. Hopefully that’s not an omen.

It’s a balancing act, of course. Despite Colman’s diatribe, the NBR needs news aggregators to attract viewers, bloggers to link to its stories and search engines to index pages for the future. So NBR can’t afford to close off the good stuff, but until it does, there’s little reason to subscribe. Just to complicate matters, the product that is actually paying the bills—the printed paper—can’t be undermined. And so there’s the bizarre situation that stories in Friday’s paper aren’t available that day on the website, even to online subscribers.

And here’s a question: let’s say that tomorrow, the NBR has a huge story. A minister on the take, or fraud in a big boardroom. That must be a subscriber-only story, right? No way—as soon as the NBR’s story is behind a paywall, they lose control of it. The Herald and TVNZ—and those hysterical bloggers—will follow it up and they’ll get the eyeballs, the links, the ad impressions—and the kudos.

So what else can NBR do? Wiggs and Hickey both suggest cutting costs. Wiggs refers to Hickey’s interest.co.nz as the online example and to Idealog as the model for print (thanks!). He has a point. Hickey’s blogs and reports on interest.co.nz are always timely and often brilliant. Idealog has a full-time staff of, er, me, supported by sales and design staff who also work on other titles. We commission photographers and writers to keep the content lively and varied and so we’re paying just for what we publish. Interest.co.nz is built on open-source software and infrastructure costs are kept to a minimum. This site is constructed in-house (designed by Su Yin Khoo and developed by me) using an open-source framework. Our print costs are kept as low as possible through sponsorship arrangements with like-minded companies.

Hickey says the best way to cut costs is to stop the press. Coincidentally, that’s the decision taken last week by the Australian magazine that’s probably closest to Idealog in its focus, Anthill.

I doubt that model will work for NBR, though it’s still preferable to the paywall. The fact is that the NBR has rarely spent money unnecessarily [update: and I should have pointed out that the NBR website, too, is already built on an open-source system]. No doubt there are savings to be made but they’re unlikely to solve the fundamental problem.

I would argue that to survive online, every publication has to closely examine its product. Newspapers are a product of the printing press, but the web is a different medium. Merely placing reportage on a website won’t cut it anymore. Just like the record labels, media companies are threatened by the arrival of compelling new technology. If you can’t beat it, embrace it.

In the NBR’s case, this means deciding either to make all its content available online for free, or none of it. And if the paywall is the only answer, make it so cheap—perhaps a dollar a week, billed monthly—that it’s an impulse purchase for as many readers as possible. And then you can finally turn off that expensive press.

But a more interesting approach would be to make the current content available for free, and use the unique reach and interactivity of the web to roll out new services that people will pay for. Become an expert in data—the Bloomberg of the South Pacific. Aggregate it, mash it, hyper-localise it, search it for trends and twists and tales that only data can tell.

Give people business tools. Buy the über-smart Valuecruncher.com (quickly!). Use it to develop a co-branded product for brokers to offer their clients. Become the authoritative source on finance and lending (Hickey has provided the template). Hire developers. Pair them with journos and tell them to find the most compelling ways to present business information. Make the NBR newsroom the place to be for a new generation of online newshounds.

If you’re thinking that doesn’t sound like what Idealog is doing, well, it isn’t. At the MPA magazine awards last month, Idealog won the top award in every design category: supreme designer, supreme cover and best use of photography. The fact is that feature-length stories are still best told in print, and we’re determined to take full advantage of the medium.

We’re not ignoring online, of course (we also won the best business website award). Just like the NBR, our print product effectively subsidises the website. But we know the web will steadily become a bigger part of the business and we look forward to being able to invest further in it. Whatever we do, our content will remain free. We do have some online stablemates, such as a New Zealand B2B version of Celsias.com, currently in soft launch.

And there are more to come. In August we’ll be launching another new online product that, of course, will be free. It’ll even be taking on an established, paid-for competitor. Chris Anderson would be proud.

But, like Barry Colman, we’d like our website to become a more fundamental part of our business. I’d be thrilled to hear your ideas.


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Comments

I pay for my news each week. Quite happily buying a subscription to the Economist and to be honest consuming it mainly by way of their superb audio-edition.

The most expensive part of being a news reader these days as actually taking the time to read the news.

Outlets that provide me with editorialised content, such as that from The Economist, in formats that I can consume easily while also doing other things with my time will get my dollars every day.

You're right — and public transport is a godsend for catching up with news. Suggestion for John Key: invest in light rail and save the Herald. (Or is that an argument against?)

The most expensive part of being a news reader these days as actually taking the time to read the news.”
That's a great comment Chris. I pay the Economist, Independent and WSJ for their content, but time is far more valuable than those dollars. NBR barely got any of my reading time before the subscription wall, and will now get even less.

Audible.com has a nice twist on this theme. You can download the unabridged, six-hour audiobook of Free for, uh, free; but the edited three-hour version costs US$6.95. Saving you three hours must be worth something, I guess. (How much to save me six hours then?)

http://www.longtail.com/the_long_tail/2009/07/free-for-free-first-ebook-and-audiobook-versions-re…

I liked Anthill but lost track of the print version since its hard to come by in NZ.

I did rather like the quote from publisher claiming “Mad magazine just went quarterly” as a precedent for moving to a quarterly publishing cycle.
The online ant version appears current unless I missed something there.

Aggregation of more specialised content and then doing a gapminder software treatment on it could work. Go deeper rather than wide.

Narrow-casting and more relevance of content will work. We also need to do better on the community side of media sites.

For example easier tweetbacks could lower the barrier for commenting & engaging. Editorial momentum is a fine thing.

We almost need to convene a comment festival with prizes to extract robust discussion.

The myth of the tall, strong & silent NZer might be real.

Another example: I don't think the auto notify of new comments is working here presently but on a number of sites I monitor that does help generate repeat traffic and engagement.

I do think that if anyone really cracks the business model they won't want to make it too obvious.

Perhaps part of the answer has to be how the split from ad systems works. 50% clip is too high for Google or anyone else.

Anti-competition laws should stop the big publishers all starting pay-walls at once / but it probably can't be ruled out.

I think we're still in the Godot Syndrome phase of market development for online publishing.

I want to see Barry succeed but unless he locks off the good columns I think it may not be sticky enough.

Doing that would be like introducing a capital gains tax. We sort of need to go there but no-one wants to be first.

Where is Godot when you need him?

I enjoyed your comment Jason, thanks. You're definitely right that some of our website could work better, such as comment notifications. We have some things in the pipeline there but as always, print deadlines come first. Chicken … egg …

Which is one of the reasons I hope the NBR succeeds in making money online—they have invested in their website knowing that sooner or later it would have to pay its way. I suspect they may have decided if they're going to implement a paywall, they're going to have to progressively block off more the good stuff from the masses. I didn't keep a running tally of last week's paywall stories, but I did notice a few that I would definitely have read if I were a subscriber. That wasn't true the week before. (But although Friday's NBR was trumpeting the success of the paywall, I reckon ‘hundreds’ of subscribers is probably to be expected in the first week. The big question is how many they'll have after six months, when they have a track record and the first-time subs start rolling over.)

Yo Matt

Seen Rupert's latest plans for pay-to-view in the Guardian (online)? Follow the link on the right for good comments from rival publishers. PS When can we hook up to discuss my online title idea?

Here’s the Guardian piece:

http://www.guardian.co.uk/media/2009/aug/06/rupert-murdoch-website-charges

Murdoch has been hinting he'll do this for a while. I wonder if The Sun will do better than The Times.

(And I’ll get back to you about the other …)

Matt

Do you see Idealog creating more and more video content in the future? If not, why not?

PS Brilliant thinking on NBR. How to monetise websites apart from the traditional advertising model is a burning issue (for me at least).

Thanks Gerry. And yes, we'll definitely be doing more video. On Friday and Saturday this week we'll at the wonderful Semi-Permanent design event and vidcasting from the show floor.

So far, our video efforts have ranged from professionally-shot studio interviews to lo-fi, handycam-in-yer-face Q&As. We probably need to discover our own style, somewhere in the middle there. Workin' on it …

I've been following the threads from Chris Andersen's blog. Here's one post I was particularly interested by:

How about this as a short manifesto for the future of 'the media':
* Media delivery is now free
* Media creators need funding and will find it most easily from businesses.
* Individual media creators or groups of no more than four (who between them cover the roles of presenter, writer, photographer, techie, fixer, cameraperson, sound engineer, film editor, producer) will replace the 'ant heap' media conglomerations we see today such as TV networks, newspapers and magazines.

My work is to find a subject suitable for what used to be called a 'feature' and produce an article and TV package about it (including a plug for my sponsors). I then put it out on all of the following: my website, a blogspot site, my Yahoo group, an eShot to my own list of subscribers, my YouTube site, my podcast site and iTunes, a subscription DVD, any magazine in that specialist consumer area, and any national newspaper website and local TV news network desperate enough to run free footage repackaged as 'news'. The only income I derive from this is from sponsors.
I used to edit magazines. I just resigned from my last one because this new model is more profitable. I expect what has happened to me will happen to everyone like me over the next ten years.
Posted by: Charlie Jacoby | June 30, 2009 at 11:44 PM


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