Modernize Newspapers

Proposed Newspaper Resolution for 2010

Here's my proposed newspaper resolution for the next year/decade... put the best way I have ever seen:

Newspaper and local media companies need to embrace innovation by either incubating innovation or partnering with innovators.  Great developers are the key to the future.  It's the only way to stay relevant long enough for online business models to catch up.

Happy New Year everyone!

IT will set local media, newspapers free

Maybe I'm naive as someone who has built a career in the Internet, but I still don't understand a fundamental issue about local media.  IT departments at most local media companies are more often an afterthought than a strategic asset.  Local media has dealt with the Internet as a "necessary evil" instead of an opportunity for disruption.

The tech industry has examples of things that appear to be "out of left field."  Consider the case of Amazon -- originally founded as an online bookseller, they branched out into other retail products.  Then they did the unfathomable:  they launched Amazon Web Services to get into the application and data hosting/services business.  They didn't know where that business was headed, but they knew there was growth.  Google has launched a variety of experiments -- some fruitful like Google Docs and others not so successful.  But they're willingness to think expansively about their business is a major contributor to shareholder value and to serendipity that drives future growth.

I don't see similar experimentation yet in the local media business.  I am not sure if it is a lack of commitment, the lack of developer & IT business talent, or what.  But you'd think that there would be a few cases of major media companies tackling new challenges.

As a direct result, you've seen innovations from disruptors like Craigslist, match.com, eHarmony, Zillow, blogging, hyperlocal publications, Google (News) itself, and others.  None of them could take down a local media powerhouse, but collectively, they have the potential to take all the economic value once owned by the local newspaper.

So here's what I don't get...

If local media sees all this disruption coming from IT, why wouldn't local media treat IT as a STRATEGIC IMPERATIVE moving forward?

Why Google, Microsoft, IBM, Oracle Solutions to NAA Problems All Miss the Mark

I thought I'd share a few quick thoughts today on responses to the NAA's request for information from the technology/internet industry on monetizing local media.  I've reviewed proposals from Google, Microsoft, IBM, and Oracle and a few new entrants so far in preparation for sending the NAA an unsolicited proposal of our own specifically around local advertising.

Microsoft did the best job IMO of translating "techspeak" into a workable vision for the future, although it appears to be as others have suggested somewhat of a ripoff of TweetDeck.  Interestingly enough, Microsoft's response suggested that the newspaper business utilize 15 products in unison to make their ambitious proposal a reality.

Quick sidebar -- in my 3 1/2 years at Microsoft, we occasionally ran across opportunities like this.  We similarly responded because there were two benefits for our business:  1) revenue, 2) case studies.  There is no case study quite like solving a contemporary problem (like "saving" local newspapers w/ Microsoft technology in this case.)  So when something like this would happen, we'd eagerly participate.  Granted, we really couldn't offer "true innovation"... Microsoft really doesn't innovate all that much... but we could enable things to happen with a great Web tools and technologies platform.

This effort by Rainer Kellerhals and the team at Sobees (a Swiss startup as far as I can tell) is about as good as Microsoft can do IMO without reaching out to a broader range of startups to build a truly innovative and effective solution.  Microsoft needs a handful of other "Sobees" for other parts of a solution for it to be truly effective -- more on that in a bit.

But my point is that big companies like Microsoft, IBM, Oracle, and to some extent Google have conflicting goals.  Sure they want innovation, but first and foremost they want adoption/sales/increased revenue of existing tools and technologies.  Innovation is a justification for using their offerings.  Innovation is not central to their existence or participation.

The startup community, on the other hand, is always pushing at the edges to find new ways of doing things.  This typically involves finding new opportunities, cutting costs where possible, and working with new technologies to become more efficient.  I would venture to say that the startup community has very few peers when it comes to the clever & inventive utilization of real-time, social media, and mobile technologies.

Similarly, innovators like the Huffington Post, Mashable, Craigslist, Digg, Stocktwits, Fark, and others have built very profitable businesses utilizing Internet technologies in interesting ways.

If the NAA and the newspaper business truly wants to innovate, it needs to look to the future.  Microsoft, IBM, Oracle, and Google are great companies that have done great things in the past -- and they can certainly be part of a solution.  But these companies can't do it alone.  The NAA must actively engage the startup community and new entrants, or the it will continue to create rivals with the wherewithal and motivation to compete.

Introducing the Modernize Newspapers Blog

Among the entrepreneur community, it has become a "fait accomplis" that newspapers are dead. Look around the blogosphere or run a newspaper search on Twitter and you'll find people reveling in the creative destruction of the media business.

I don't think newspapers and local media are dead, but clearly established newspapers have to do a lot of things differently.  Well-documented problems exist at both the top and bottom line -- so newspapers have to do more with their obvious advantages in local markets and they need to do things more efficiently.  That's what I'll cover in this blog -- interesting developments that help newspapers better monetize their existing local reach *and* technologies or tactics that newspapers can use to operate more efficiently.

We have spent the last six months or so talking with people at different newspapers about local online advertising.  Why?  We see the same trends you do -- antiquated local advertising methods like billboards, print ads, yellow pages directories, and other relics of the past no longer provide effective advertising options for a lot of local businesses.  Customers are spending more and more time on social networks and mobile devices, but newspapers have little/no way of selling products that take advantage of these trends.

All of that is why we built MinutesNotice -- MinutesNotice is a new self-serve ad platform that helps newspapers and local media companies offer social, mobile advertising to local businesses.  We are currently negotiating with several major newspaper groups to offer MinutesNotice in their local markets.  We think these deployments will be very successful.

Working with people in the newspaper business has been very interesting over the last few months.  Without getting into a lot of specific detail, allow me to generalize it this way.  Newspaper people realize they need to embrace innovation to succeed in the future.  They also remember that they have huge advantages in local markets where they operate.  Some people consider these advantages to be a lot more permanent than others -- skeptics realize that those advantages will go away if they don't modernize and embrace new innovations.  Newspapers tend to bog down when folks who believe in modernizing their business collide with stakeholders who see things differently.

If this continues, newspapers will fail to make appropriate changes until it is too late.  Time's ticking.

So here's my bias:

Newspapers have to act fast and embrace experimentation.  Embrace the golden rule of the Web -- iterate or die.  Innovators work fast and big media does not.  Big media will have to adapt or the economics of innovators will prevail.

Let's see how this all plays out.