The Publishing Industry

One of the original ideas of our company was to help publishers utilize their readers to generate more high quality and relevant content.  Because of this we love and respect others in the crowdsourcing community. 

One of the experts in the crowdsourcing field is DailyCrowdsource.  Over there they have built a new crowdsourcing forum to help others find their way through this broad new industry, in their open-format website.

The questions range from the very broad general crowdsourcing questions such as, “Is there a clear line to define what is and isn’t crowdsourcing?” (link) to stories: “2011 NFL Mock Draft Grades to be Crowdsourced,” to even more specific areas where they talk about real crowdsourcing projects.  

The resources for Crowdsourcing here are unbounded – there are podcasts, videos, and even widgets and tools. It is truly the go-to spot on the Internet for crowdsourcing.

So, if you’re into the new field of crowdsourcing, have some questions about it,  or want to participate within the community, go check out DailyCrowdsource and their forums.  

Find Them:

• Facebook.com/TheDailyCrowdsource
• Twitter.com/TDCrowdsource
• http://dailycrowdsource.com

The changes in Google’s search algorithms are creating flux in the content world, particularly the “content farm” segment. Today Demand Media announced that they are increasing how much they are paying for content up to $350 per piece in an effort to improve quality.

The search robots are getting smarter, and the days of making money off of trashy content are fading fast. Even before the search changes, other factors were already in play, particularly the rise of  social channels (Facebook, Twitter, links, etc.) as a vehicle for content discovery as opposed to search.

So the junk content trend is drifting away and the pendulum is swinging back towards quality, where it belongs. However the need for that content to be cost-effective remains as strong as ever. How to achieve both?

Well the appeal of “outsourcing” your content production to a farm like Demand Media or Associated Content is low. While their operations provide low-cost, the inability for editors to really know the authors and manage the process will lead to mediocre content at best.

The best balance is to use the technical and operational tactics that Demand and Associated have used to make their operations cost-effective while managing the process yourself, to optimize quality. That’s what we do at Kapost: provide publishers the newsroom platform that squeezes out low-value costs (i.e. tracking payments, checking emails, arranging editorial calendars) while allowing the best of editor-contributor interaction to still operate, maximizing quality.

What is the right ratio for the number of editors required to manage a number of contributors? And as the economics of content change and publishers try new models, should that ratio change? Must it change? 

Matt Marshall, editor of Venture Beat, yesterday wrote a post about AOL’s prospects. He critized the recent move by Patch to recruit another 8,000 contributors as “naive” saying: 

it takes at least 20 percent of extra management to organize it all — that is, AOL will need at least 1,500-2000 extra editors to manage the writers, if you take the editor-writer ratio norm of other major news organizations.

A good point. But do we have to accept that overhead ratio of 1 editor : 4 contributors in stone? It has been the model for the past, but media must innovate in order to succeed in the digital future. 

Undoubtedly there will always be editorial management of contributors. But how much of that is adminitrative tasks, and how much of it is the real value-add from editors, i.e. strategizing about audience and what stories are needed; reviewing and revising posts? 

In our discussions with editorial teams, a good amount of that is adminstration: tracking editorial calendars, figuring out payment, etc. And productivity gains consistently come through technology that automates repetable taks. Which is just what Kapost’s online newsrooms do. 

So Matt Marshall has a point, but only from a backward-looking perspective. Kapost has numerous customers with a 1:10 editor:contributor ratio. We salute Patch for striving to innovate around content production. It is what media needs. And we stand ready to help all publishers looking to make that happen. 

Ken Doctor–the man who I think better than any one is tackling the new reality of media–put together another great post today on Newseconomics. In it he tackles the changes at the bottom of the income statement for media companies. Media is in a state of tremendous transformation, and not only its revenue sources but its cost structure as well must adapt in order for publishers to continue to prosper. 

He begins by pointing out that cost accounting for content production is an issue that had been rarely analyzed but now must be: 

So, let’s ask about that daily story. What’s it cost? Of course, we’ve never looked at it that way. We’ve hired people, told them to write, . . . but rarely taking a look at the cost of what they’re producing. Given the pressures of the day, given the Demand Media model and given the predilection to start counting whatever can be counted, story cost accounting is inevitable. . . . 

News creation used to be a sunk cost, with headcount a small and usually polite battle between editors and publishers. That was in stable times. In these times, knowing business drivers, down to the dollar, is going to be part of the new world.

He goes on to identify some of the cost levels that different, innovative publications are using in their accounting and the mix of contributor types that make up that cost structure. He identfies 3 major buckets of contribution: 

Original content — content that distinguishes news brands — is at the top, and, yes, is the most costly. At the bottom is clearly aggregation, because as Morgan points out, “[readers] can’t easily find and read what’s of interest to them.” Then, there’s the middle third or so. For regional news companies, that includes hyperlocal bloggers and subject-specific (transportation, public health, sports) experts; for national sites, it’s non-staff “contributors” of differing skills and costs. That third is quite open to innovation.

At Kapost, we’ve seen most of the change, the expansion and the emerging success come out of that middle third: the increasing use of a larger number of external contributors–whether thought leaders, professional freelancers or citizen journalists–as a source for content. 

But critical in the cost equation is not just the cost per story but the amount of overhead involved in managing the operation. He mentions the approach of John Paton of the Journal Register Company: 

[John has] taken dead aim at the cost of getting content through the mechanics of a newsroom. Saying that about half of U.S. editorial staffs are engaged in producing content for publication — not creating it — he’s focused on changing that ratio. Instead of five of ten journalists engaged in production, he’s aiming for two of ten, to be accomplished through centralization and templating of the production functions. “Then, two or three more of the ten can create content,” he says.

How can that increased efficiency / reduced overhead be achieved? In particuar how is it accomplished in a more complex operation using more external, distributed contributors? 

Across all industries, the step-function increases in productivity that occur in reaction to changing market dynamics almost always occur through technology. Which is precisely what Kapost does. Its online newsroom technology allows fewer editors to manage more stories produced particularly by distributed, external contributors. For all publishers who are looking to evolve their cost structures along the lines of what Doctor outlines, Kapost is ready to assist you with the key software platform that will help you succeed in that new world. 

Today Amazon announced the launch of  ”The Backstory,” a content destination that includes interviews with authors, guest reviews, authors’ favorite playlists, recipes, podcasts, essays and more. Amazon is of course the world’s biggest bookseller, and it is using the power of content to drive even more sales for its business. And it probably won’t stop there, as TechCrunch mentions: “I’m curious if Amazon will extend this strategy to other e-commerce verticals (i.e. fashion, gadgets).”

This annoucement is part of a growing wave where businesses are using content to power their sales and marketing. As more and more commerce goes online, businesses want to attract users to their sites and convert them and they are finding great content as the best tool. 

So how do you cost-effectively produce great content? Well a modern content production operation is key, and the platform to manage that operation is, of course, a Kapost online newsroom.

Credit.com is a great example of a Kapost customer using this model. Credit.com provides financial products and services to consumers and uses a powerful content production operation to produce great content and attract visitors. And that team uses Kapost to manage that operation. 

If you’d like to talk to Kapost about helping your content operation, just let us know. And that includes you too Amazon. 

Mark Potts is a veteran of the digital journalism industry, having lead washingtonpost.com among others. Today in StreetFight, he talks about where he thinks local journalism needs to go for a successful future.

Potts calls for a radically lower cost structure:

You have to keep costs absolutely minimal. That there’s definitely an appetite for local news and information, and I think you’ve got to find a way to deliver it in the lowest-cost-possible way. You cannot recreate giant local newsrooms.

And to him, key to that cost strucutre is a new composition of contributors:

Do you think it can be done with professional, full-time journalists?
On a very, very limited amount. I think what we’re seeing is a fantastic explosion of what I would call, “passionate, accomplished amateurs.” Amateur in the sense that they’re not being paid.

The economics of media today insist that publications work on the top and bottom of their income statements: revenue models need to be evolved, and cost structures need to change. And Potts is right in describing the magnitude of that change as a transformation, not an evolution: the newsroom model of the past is not going to do it.

At Kapost we agree with Potts that the composition of the set of contributors will change, and there will much smaller internal staffs. We think that contributors, even if external, will still most often be paid.

But his point on the transformation of cost structures and newsrooms are right on. The future of media will be won by those who can transform to this new model as quickly and as effectively as possible.

On NiemanLabs today Ken Doctor writes about a new metrics system launched at the Washington Post. He describes: 

Readership reports at the Post, as at many other newspapers, used to be on a “need to know” basis. Now that philosophy has flipped, with the company’s management saying lots of people need to know the numbers, that business literacy is an essential part of news people’s jobs

It seems incredible that it has taken this long for this transparency to be implemented. For years and years the Internet has provided the enormous advantage compared to print that you can actually tell how much your audience is reading your various articles. How incredibly valuable! Writers can learn directly what’s working and what’s not working. But it is only now that the sophisticated systems are being put in place to provide such information. 

The problem arises from how typical metrics tracking systems–i.e. Omniture or Google Analytics–are a separate system from the CMS. As a result, the metrics system does not know who the author of the post is, what categories are associated with the post, and could not provide defined views for each user (i.e. WriterX can see stats only for posts by WriterX). The systems thus were “all or nothing” systems–users could either access everything or nothing–and managment thus kept access limited to only the upper team. 

Folks like WaPo however are now making the investment to close the loop on author & category data, provide the necessary levels of access, and distribute the information across the team. 

The results are powerful. Doctor reports: 

Resource allocations, within the newsroom, can be better informed by data, says Narisetti [WaPo managing editor]. In the old, print world, as editors, we guessed or went along with our prejudices

Not every publisher has the resources to build the custom, powerful system that the WaPo has put together. Fortunately, Kapost provides performance tracking–including per writer, per post and per category metrics with appropriate access levels–out of the box delivered cost-effectively via Software as a Service. So get going with Kapost and harness the power of metrics transparency for your organization. 

On NiemanLabs today Ken Doctor wrote a great piece, “The Newsonomics of Oblivion.” In it he confronts a reality that too many newsaper companies are ignoring: they current model is unsustainable.

He leads with some thoughts from John Paton, CEO of the innovative Journal Register Company:

“The newspaper model is broken & can’t be fixed” and “Newspapers will disappear in less than 10 years unless their biz model is changed now.” His point: Piecemeal change is a dead-end, given the converging downward spirals of the business. Only massive, digital-first strategies and re-organizations that scrap old structures, budgets, job descriptions — and, massively, costs — have any hope of porting today’s newspaper companies to that other side of a mainly digital news age.

And then he recounts the state of affairs from the general set of newspaper leaders:

In fact, as I talk, privately, to those running the [newspaper] companies, they, too, are largely in agreement. While they talk little publicly these days, the fact remains: You can’t find anyone who says he yet has a proven, sustainable business model for moving forward. . . Even good growth rates of 15 to 30 percent in digital — helped by more “online-only,” and fewer bundled-with-print, ad products — can’t come close to making up for print decline . . . publishing houses with a big editorial infrastructure for daily quality news will not survive

That’s the key: “big editorial infrastructure.” There is still a great opportunity for newspapers, particularly due to the brands they have. They have to re-invent their cost-infrastructure in a way where they can still produce quality news but in a dramatically cheaper way. (And at Kapost, that’s what we help you do.)

So newspaper companies: look beyond your quarterly results (easier said than done). Radically re-invent yourself. Either do so and remain relevant, or don’t and be fully replaced.

Image by Thomas Hawk used under a Creative Commons license.

The business insider got a copy of AOL’s strategy deck, the AOL Way, and published it. It is their entire content strategy & operational blueprint.  Whether AOL succeeds is an open question, but they are certainly barreling ahead with what is the “model of the future” for publishers.  Some elements of the document that stood out: 

• Most striking is the “scientific” approach they take to content, not just looking at the content itself as was done traditionally, but instead the whole lifecycle: process by which it is produced, the economic value of content, measuring metrics, etc. 
• They have extremely sophisticated software tools to manage their workflow: concepts prodessing, assignments / editorial calendar, pipeline view, performance, payment