It was with great interest, but also skepticism, that led me to read Marc Andressesen’s take on the Future of the News Business. Having been part of this business for more than a decade until I decided to shift to something else, I read, and re-read his thoughts about News being run as a business.
I’m expecting a lot of heads shaking from the world that weaned me into who I am today. The world of journalism, with the capital J, is not too accepting of the mere idea of having “business” mixed with “journalism.” There are so many situations and stories about the bad marriage of business and journalism. As Marc puts it, it is indeed a Great Wall separating these two areas in news outfits. Why? Money, while it is important to keeping the lights on, it is often used to influence or even dictate the news agenda. Who do you think owns media today? Media as we know it is an expensive endeavor, given how it was built and organized.
But, Marc disagrees and he listed down companies breaking out of THE mold. His list includes the traditional outfits that have “successfully” transitioned to being a digital powerhouse. Their business models, however, are not too disruptive if we compare them to how Apple changed the music, mobile, and computing industry. Perhaps I’m looking for more radical ideas out there–Vice would be one of them, or even Red Bull–yes, the power drink that is creating its own branded content by focusing on depth and a niche of extreme sports coverage.
I agree that news is more widespread today than, say, 10 years ago. News is now a commodity because distribution is so pervasive. And for any commodity, the value goes down. So in order to make profits out of a commodity, you have to have reach–and scale. This is the main motivation that runs today’s BIG media.
Let’s go to the money aspect of news. Unfortunately, advertising is a big motivation for BIG media. Subscription, premium content, and other more creative business models have yet to take off in countries outside of the US. Internet portals like Yahoo!, Facebook, and Google all thrive because of their immensity–and they will continue to grow bigger. They need to shoot for the stars and create huge demand in order to make profit. Each, however, has different means and motivation to get there. What about the traditional BIG media that is dependent on advertising. Now, that’s where all this fear of news being seen as a business arises. It’s a bitter pill to swallow for most journalists trained to be objective to even think how advertisers have greater influence on News. Without advertising money, how can BIG media get by?
Marc’s take on News as a Business is a step in the right direction, but as to the industry he wants to focus on, he may have a blindspot. Media, as we know it, has changed. It’s no longer the domain of the J-School-trained professionals. In fact, I should digress on the issue of why J-Schools should include a mix of “News as a Business” in its subjects/courses. And why entrepreneurship should me a must-have in their curriculum. Journalists should start thinking like entrepreneurs. But this is a discussion that will take another posting.
I go back to Red Bull, and why I think it is on to something. Take out the brand behind this venture, and we see how media and journalism can be a profitable business. Media has always been a generalist, and thus wants to spend all of its time covering the widest topics as much as possible. Thus, we’ve seen beats created in newspapers, which allows these news organizations to dip its finger on vertical topics of interest. But as we’ve seen how Cable companies have evolved–there’s money to be made in niche. And that’s where Red Bull Media is making a killing. Why? They practically own extreme sports coverage today–and by the way–their brand is all over the place. Isn’t that how advertising should be? Subtle and yet valuable?
I’ve seen this happen when I was still with an Internet portal. Digital ad spending is increasing two-to-three-fold. Big Media has seen this–and thus we’ve seen efforts shift to digital. Those who are stuck in their old ways will soon realize they’re at a tipping point where the curve is headed south.
I don’t claim to have all the answers at this point. But having seen what BIG Media has been doing all these years–trying to deliver the same s%^&* to its audience, in the guise of journalism, it pains me how it has forgotten the very essence of why we need to informed, and educated about things around us. Its motivations have changed. And so are the people running it.
Marc is right in picking out some lessons, but I totally agree with him on the idea of ingraining entrepreneurship to incoming journalists. Why? It pushes them not to accept status quo–and that’s where good, creative ideas start flowing.