One of the Internet’s preoccupations recently — at least in the parts I frequent, which admittedly probably aren’t that representative — has been the physics, if you like, of data. There’s a lot of writing out there, much of it (like this piece from Tom Armitage) excellent, about treating data as a material; understanding it as a physical thing with seams, grains, symmetry and cleavage planes. This is true, but I’m beginning to suspect that it’s incomplete. Data’s not solely a static thing. It bounces, usually somewhere behind your eyeballs.
I don’t want to get unnecessarily tree-in-the-forest about this, but if no-one sees a piece of data, it doesn’t exist. Data only exists inasmuch as it supports either communication or decision-making. When it’s not being looked at, whether by a person or a process, it’s as if it had never been at all. So if it’s a material, it’s a profoundly weird one. It’s not even as material as fields are; anything with mass bends space-time. Unobserved data is truly weightless.
So right now, I prefer not to think of data as, primarily, a material. In fact, I prefer not to think of data as having any independent existence at all. Instead, I think about processes. How do people make decisions? How do they communicate and support their viewpoints? These processes are supported by technology, but they’re rooted in psychology and economics. When you view data mining this way, it looks a lot less like physical mining and a lot more like the newer, nerdier brother of user-experience design. User experience design is, loosely speaking, applying the lessons of graphic design to the design of intellectual processes. Data science is, loosely speaking, the application of mathematical and information-theoretic ideas to the design of intellectual processes. They’re both part of a wider field; that of service design.
Half the battle’s already won; people, like me, with science backgrounds are reading the design literature and trying to follow along. We’re waiting in the middle. When recently-graduated designers start talking about dimensionality reduction, though: well, then we’ll really be moving.
When I arrived at Nokia, the folks down the road at NRC were very proud of something they’d ginned up: an NFC-equipped, but otherwise entirely conventional, vending machine. At last!, I thought, here’s a concrete step toward the future of everyday transactions.
I was given an NFC phone, and told to tap it against the item I wanted from the vending machine. This is what happened next: the vending machine teeped, and the phone teeped, and six or seven seconds later a notification popped up on its screen. It was an incoming text message, which had been sent by the vending machine at the moment I tapped my phone against it. I had to respond “Y” to this text to complete the transaction. The experience was clumsy and joyless and not in any conceivable way an improvement over pumping coins into the soda machine just the way I did quarters into Defender at the age of twelve. It’s not that the NFC-based, phone-to-object interaction didn’t work. Of course it did: it had been engineered perfectly. But what it hadn’t been was designed. Those responsible for imagining the interaction apparently wanted to protect users against the (edge case!) contingency of someone making off with their phones and running up a huge vending-machine tab. They failed to understand that, for low-value transactions like this, at least, the touch gesture is a useful proxy for consent — and that if someone’s got physical possession of my phone, I’m likely to have bigger problems than whether or not they order a few cans of Coke with it. A designer committed to the user and the quality of that user’s experience gets this in a way only the rarest engineer seems to. Designers are also, by training and predilection, inclined to design for the usual, where engineers are taught a kind of rigor that compels them to account for, and overweight, low-probability events.
Let’s try a thought experiment. The current newspaper business model is beyond fixing. What happens next? A bunch of companies need to find something people want. We’ve got companies like that: lots of talent, some capital, no business model. They’re startups. Here, newspapers now have more in common with three guys in a back bedroom than the company they’ve been keeping up to now. They’ve got some unique issues, too, like huge and inappropriate cost and capital structures, but they have the nucleus of really strong teams and they’ve got fantastically strong brands, public goodwill and link equity. What can you make from that? What will people pay for?
Whatever it is, it’s likely to be something new. How do we know what’s fundamentally new and what’s just cosmetically different, though? Sometimes they’re hard to distinguish. Take tablets, for example. The Times is betting heavily on the iPad. Ever since Christmas Day, ads for their app have been showing up in every other break on Sky TV. It looks… alright, I guess. Pretty nice. Similar to the WSJ app I’m trialling.
I’m an iPad-toting media junkie. I can’t be bothered to even download the Times app. That’s not promising for team Murdoch. Actually, I’m finding it hard to see how it can work at all. Simply put: after the novelty wears off, who are the customers who are going to pay for this thing?
At Timetric, my bluntness sometimes stresses my colleagues out. I’m not exactly a model of diplomacy. However, I believe the alternative, when you’re talking strategy, is worse; woolliness is at best a sign of magical thinking and most likely one of full-on self-delusion. If you can’t state your customer proposition simply and clearly, explaining who gets what benefit and how and why they’ll pay for it, and back that up with actual people who confirm your hypotheses, then you’re spinning yourself a yarn.
In the last post in this series, I talked about selling benefits. The benefit of reading the content the WSJ pushes to me — and the WSJ, like the Times, is branch of News Corporation — is straightforward: it helps me understand economic issues I need to understand in my professional life. Delivery to my iPad is convenient and a nice gesture, but it’s a fringe benefit; a reason to pick the WSJ over another source of market intelligence. In other words, I had a need which I previously filled in other ways. It’s competing against CityAM and forbes.com and FT Alphaville, not a vacuum. However, I’m willing to pay for the WSJ content package, because that package could make me more successful, because parts of it are genuinely unique and because the package itself is assembled by experts. I trust it as information I can act on.
It’s straightforward tactics. If the WSJ app switches enough people like me — consumers of economic and business news — away from Fortune or Bloomberg Radio or CNBC, or if it reduces subscriber churn enough, then it’s likely to justify the development cost and to be a smart move.
In comparison, the Times apps on iPad, and indeed most newspaper apps, and indeed most newspapers, are harder for me to make sense of. The commercial team at News Corp are smart, so I’m probably missing something, but…
They look innovative; possibly part of their value, internally, is that they’ll make it look like you’re doing something when you have to justify your worsening bottom line. But as an effective business strategy, I’m not so sure. The iPad is, above all, a great web browser, so any iPad news app is competing against every site on the Web, as well as every other app in the store. Even comparing like with like — as with the WSJ, apps are usually a little bit nicer than websites — what distinctive advantage does the Times app provide to me over, say, the BBC News app, plus Twitter, plus Flipboard pointed at Pitchfork, ESPN and Serious Eats, plus timeshifting long articles through Instapaper? Very little. I’d say the Flipboard/Instapaper pairing’s probably better. And while the Times has fine journalists covering mainstream news, so does the BBC or CNN or the Telegraph. The Times isn’t politically distinctive, it doesn’t have an instructive, characteristic worldview, and it definitely doesn’t have high-value exclusive information I can act on. Its sports and entertainment coverage aren’t typically as in-depth or compelling as the specialists. The Times’ proposition is a convenient and entertaining package of basic information on politics, economics, news and sport. You can get that almost anywhere for free. Therefore, the Times, alongside most other newspapers, is competing on style, not relevance or substance.
(Incidentally, this is one of the reasons why, long term, I think the US will wind up with around four to six newspaper-like organisations. There are only so many styles with mass appeal and winner takes all. I’ll come back to that in the future.)
It feels like the Times is making a big, simple, bold gamble; that there’s a mass market, at least the size of their print readership, who can wither be transitioned from print to online/tablet (without them bleeding away to a free competitor like BBC News) or who are neophilic enough to own an iPad yet neophobic enough to be persuaded by a combo of the Times brand and the convenience of not having to stop at a newsagent in the morning. The Times on iPad is the Times on paper in techno trousers. Betting the farm on that is risking a lot on basically cosmetic innovation. At least people with an iPad likely have disposable income, and no doubt the Times have done their research, but fundamentally I just don’t like, or believe in, that bet. The Times doesn’t have a form problem: it has a content problem. I don’t care about its content nearly enough to pay. I didn’t care enough when it was free, and now it’s trying to charge me money in a saturated market for an inferior experience. Short of the industry bullying the legal system into creating an artificial monopoly, I can’t ever see myself paying.
Put another way, tablets are always-on, tactile, completely reconfigurable, great-looking, permanently jacked into the Internet plumbing, and you’re using them to make skeumorphic newspaper clones? When there are thousands of new, more direct, more usable, more valuable experiences you could build using the same technical and journalistic skills, and when you’ve already established I wasn’t willing to pay for your paper in the first place?
Seriously: what the hell are you thinking?
If I care enough about your content, you can give it to me on stone tablets in cuneiform and I’ll find a way to use it. If I care a bit, I’ll go where it’s the right combination of easy, affordable and reliable. (But: if you want me to pay, I’d better be making money or having fun somehow.) If I don’t care at all, there is nothing you can do, not even really nice swipe effects, which will make me care. Come back when you’ve fixed the content. Come back when you can show me a new perspective. Come back when you make me faster or smarter. Come back with fundamental, not cosmetic, innovation. We’ll talk then.
(And that’s the intro of this little series done! In part 3, I want to get back to principles and start thinking about that fundamental innovation. Weigh in in the comments below.)
So, News Foo Camp. There’s been a lot of writing, as you’d expect for a conference full of news junkies; most of it linked in Alex Howard’s article on O’Reilly Radar, all of it excellent.
Still, after the conference, what do I feel? Anxious. A bit conflicted, really. Thinking hard about something Alex Hillman wrote:
I wasn’t in the room to know the context of this quote, but the most important word I see in it ISN’T courage, as some might expect. It’s just.
I spent the last 48 hours outside of my comfort zone being exposed to the current outcomes of those philosophies and values, and the sad reality is, that I don’t know how much longer those philosophies and values are going to be able to be sustained the way they are being funded.
In the same article, he quotes an off-the-cuff remark I made while we were chatting by the conference schedule:
…while journalism deserves a right to exist, the business of journalism doesn’t have that same right.
I regret that quip, a little, for two reasons. Firstly, it goes way too far: secondly, it doesn’t go nearly far enough. I love news and newspapers; a lot of my happiest memories as a kid are of reading my Mum’s paper, even though it was bigger than I was. As a teenager, it was the NME, and the one time I got my byline in there — writing some of the Cambridge student guide one year, of all things — meant, means, a hell of a lot to me. I love how newsprint feels and how it smells. Newspapers are fantastic.
But I rarely, if ever, buy one. Newspapers aren’t useful, or at least not as useful as other services. The centre cannot hold.
Too far and not far enough. Too far: no business has a right to exist if it can’t pay its way, however nostalgic it makes us. Not far enough: what is the business of journalism? Without defining that, it’s just an elegantly hollow turn of phrase. That’s what’s been bothering me since News Foo. What’s the social function of journalism? If newspapers die, what do we lose?
What’s really at stake here?
That’s an ethical and economic question. Ethical in a Reithian sense: the duty to educate, inform, entertain. That’s newspapers as a pillar of democracy, as the fifth estate. But, instead, to the Gradgrind school newspapers are nothing more than a bundle of facts and opinions wrapped up entertainingly and subsidised by advertising. They exist to make money for themselves, at least in theory, and they supply information to readers who can then use that information to make, or save, money.
Splitting the difference, and looking at this like a marketer, what are some of the benefits of reading a newspaper?
- Directly actionable, useful information
- Social context — making sure you don’t look like you just fell off the turnip truck
- Tribal identity and political affirmation
Of course, different papers have emphasised different things. The FT and WSJ push economically-useful information so heavily that they’re virtually the financial trade press; the tabloids are about being entertaining, often through writing about entertainment, and that sports and entertainment news is in itself what you need to know to talk to your mates — assuming you’re in the paper’s core demographic.
Let’s look at those benefits again. Actionable information: Bloomberg (or, to declare my own interest, Timetric). Social context — Facebook or Twitter. Need something more specialised? Gawker Media will be happy to help: just name your niche. Entertainment: TMZ, Pitchfork, or to pick another Newsfoo delegate’s baby, the Cheezburger Network (which is "and finally" gone metastatic). Tribal identity: political blogs, sports blogs, forums and chatrooms. (And Facebook, again.)
None of the consumer benefits of newspapers are unique to newspapers anymore. For none of them is the newspaper the cheapest choice.
I believe that talking about “saving journalism” or “saving newspapers” is a category error. Newspapers don’t exist by themselves, so there’s nothing there to save; they’re a part of a much larger ecosystem of infotainment services, within which newspapers do a bundle of things adequately-to-well. That worked when there was no competition in the same niches, but now there are a bunch of services which do just one thing, but do it exceptionally well. What’s more, papers’ rivals aren’t saddled with newspapers’ cost structures or pricing policies. Bloomberg can charge $1500 per month per terminal and no-one blinks, because the information’s worth more that to the person buying. At the other extreme, Demand Media can arbitrage AdWords and AdSense and trim its content costs to fit.
In that spirit, “saving newspapers” is confusing means with ends. Our problem isn’t saving newspapers. It’s protecting the social mission that journalists have taken on, and saving (or creating) jobs for the people, including journalists, who work in newspaper companies. The papers, as they exist now, are a distraction!
Take, as an example, the Postcode Paper. It was printed by a startup called Newspaper Club. They let you print your own newspapers; taking a newspaper company and throwing away everything but the printing operation: taking a chunk of a vertically integrated news organisation and making it a platform. This shows that you can back out the printing operation from a newspaper and get something interesting. What about the reverse — if you took a newspaper company and threw the newspaper away entirely?
Newspaper companies have strong brands, talented staffs, huge customer loyalty (even now), excellent link equity. Startups would kill for those assets. But while these businesses continue to think of themselves as newspaper companies, they’re tying themselves to a model which no longer looks fixable.
That’s what I want to dig into and what I’m planning to write more about for the next few weeks. I’d love it if you joined me.
I’ve just got back from News Foo Camp, an event built around trying to imagine new futures for journalism. It was fantastic. The next few posts on here are going to be little shards of things I’ve been thinking about since.
Here’s the first of those. American newspapers are terribly proud of their objectivity and impartiality. They’ve elevated it to a creed. But is this virtue actually a weakness?
At the conference, one session compered by Howard Weaver on the nature of “fact” in journalism digressed into a discussion of ethics and objectivity in news organisations. I’ve got to admit that for a few moments I was perplexed. Growing up with the British media landscape, even the idea of an unbiased newspaper seems quaint. Our newspapers despise each other, even as writers move between them; the Guardian thinks the Telegraph's cryptofascist, the Telegraph thinks the Guardian simple-minded, and everyone thinks the FT is looking down on them (which it is). What you might miss, however, is that this means they leave political space for each other — each has something unique to offer the reader.
By contrast, American papers have often felt flat and affectless to me, sanctimonious and dull. It’s not the writers or the culture: some American political bloggers from all ideologies are as smart, sharp, witty and aggressive as the very best British political writers. The arts and sports coverage, where personality and taste shine through, are likewise as good in American papers as anywhere else. So, for the formerly-print media, it’s not “can’t”, it’s “won’t”.
But why? That decision looks strategically indefensible to me: you just commoditized yourself. The facts of any news story are available almost anywhere, for free, immediately. Your facts aren’t factier than another paper’s, you probably won’t scoop CNN, and you definitely won’t scoop Twitter. (Could this be why is investigative journalism is so lionised in the US? It’s the only way to own facts, and hence a story, at least temporarily). So any business value in that content is marginal and temporary at best.
To expand on that, it’s because you’re squeezed on both sides: Demand Media and friends have better SEO than you and will best you on the long tail search terms. What’s more, mass-production data-distribution platforms - like Bloomberg or Timetric - are even flatter and more affectless than the newspapers: through that, though, we’re less biased, and through our economies of scale we can do whole classes of facts faster and cheaper than newspapers can. Taking technology firms like us on at our own game seems, well, brave.
There’s an alternative, though, and the British press points to it. Why not try taking a side? It’s got some real virtues. It gives you clear strategic space: imagine a Republican and Democratic pair of national papers scrapping it out. Reading one becomes a statement of identity, and that gives the readers a sense of belonging. The debate’s sharpened, the media overall represents all viewpoints, or at least all the viewpoints of the economically-significant parts of society, and two papers might be able to coexist in one metro without fighting to death.
It’s a huge change in style, though, and one which might be a bit much to ask. Still, it’s hard to dismiss out of hand.
I saw a very interesting post from Suw Charman-Anderson today. She’s working on a new journalism startup called NoThirty, and struggling with working out how to fund it:
I certainly don’t want to generalise about the motivations of angels and VCs, but generally speaking I don’t think that they have the stomach for the kind of long-term investment and support that news ventures are going to need. Private equity investors seem to prefer start-ups with simple concepts, potential for mass market adoption and a quick route to profitability.
Journalism innovation certainly isn’t simple – all the simple stuff has been done already. It’s not mass market either – the fragmentation of the market is one of the key problems that any start-up would have to overcome. The fact that audiences are time- and attention-poor and have a myriad options to choose from when it comes to how they spend that time and attention has pretty much destroyed the ‘monetise eyeballs’ business model, so any new model has to depend on niche markets. And as for profitability, given the potential need for extensive research, experimentation and change, I don’t think that many journalism start-ups will find profitability within three years, and it’ll probably be more like five. How many VCs would be happy to fund a start-up that is complex, niche, and slow to profitability?
I’m not a news insider — I’m, I guess, an entrepreneur, so the VC part is all I’m (semi-)qualified to comment on. However, before I get into that, let’s take it as read that we all agree on how important a free press is. The whole situation around news makes me feel dreadful. But I keep coming back to one business question which I can’t find an answer for.
Is there such a thing as a “journalism business” per se, any more than (as a former academic) there’s an “academic research” business?
I don’t mean to play semantic games here. There’s a “newspaper” business and a “scientific journals” business, but they’re ways of exploiting the content produced by journalists and by academics. Through that lens, journalism’s a method and a community of practice, not a business in itself. The revenue lives in three places – selling information, selling entertainment, or aggregating an audience you can sell to advertisers.
I think the simplicity argument is something of a red herring. Venture investors want outsize returns. To get those, they’re willing to cope with complex business models, as long as the entrepreneur can point to exactly where the money is made. They can be patient: a five year exit horizon won’t faze a VC fund. And they’ll deal with niches, as long as they’re lucrative enough. But there needs to be enough “there” there; it has to be possible to build a really large business. Is there a billion-dollar market which can be tapped through the techniques of journalism? As Suw alludes to, in journalism, fragmentation of the audience makes the revenue model really unclear. Worse still, even when you build an audience, you might not be able to sell your ad inventory. Bad news stops people buying things.
In summary, I really want there to be a billion-dollar market addressable through journalism, but I don’t think anyone’s worked out where it is yet. Without that, it’s difficult to prove that the business could scale, and without that proof, it’ll always be hard to raise money.
At the other extreme, information companies definitely work. Bloomberg do $6bn a year in revenue. In Britain, there’s Markit Group — they raised $250m at a pre-money of $2.75bn this January. They’re a financial information firm, and probably the biggest British startup most people haven’t heard of. The banking crisis of ‘08 and the sovereign debt crisis of now ? The data largely came from Markit. It’s not traditional reportage, but it is new information. It’s the bones of a story. So: I wonder if revenue’s migrating to these kinds of services, to financial data brokers, to intermediaries, and to photo libraries (which are, in many ways, the same business as Bloomberg – sourcing, management and curation of digital assets). If you can find information people need in order to run their businesses or their lives, and then identify ways to get it to them, then you’re in decent fundraising shape.
So here’s a poser: is there an information business, buildable through the techniques of journalism, where the commercial necessities won’t distort that journalism beyond recognition?
So, startups then. Way too many pixels get spent on talking about those, not enough on doing them. But when has that stopped me? Here’s another metaphor. I think there might be something in this one:
The accepted wisdom’s that a startup isn’t a business until it’s hit product-market fit. Instead, it’s a search to find a big unmined seam of customer desire. Once you’ve done that, and you’ve worked out how big the market is, you go and raise money, build your team, and grab as much land as you can. That’s a superficial view, I know, but all the really important elements are there. Startups are mining operations. (I knew everything would come back to minerals sooner or later.)
Let’s push this metaphor all the way to breaking point. When the gamble’s paying off, and prospecting looks easy, you get gold rushes. Maybe we should be calling the 90s bubble the Second California Gold Rush; the economics probably look fairly similar from far enough away. Maybe the lean startup techniques are doing to startups what modern seismology did to fossicking.
I’m probably going too far, but then: what we’re talking about here is risk control, avoiding wasted effort, making expensive processes (like building a product or digging a hole) cheap: and there’s hundreds of years of economic precedent to look at here. There might be something in these hills. Hand me my pickaxe.
Yesterday, a friend and I saw Adam Rutherford compere In the Shadow of the Sun, a panel discussion on science and art inspired by the big ball in the sky. It was all pretty great, but Honor Harger's bit in particularly got to me. Honor spoke about the paradoxical centrality of the Sun in art. Light's the prerequisite of all visual art, yet you can't even look at the Sun directly without damaging yourself. You can’t see the sun. You see a painting, or a photo, or something else inferred or glimpsed or mediated through technology. Speaking of which, here’s something she played for us; Semiconductor’s Black Rain, made from satellite data recorded in the space between our home and the Sun.