Hyperlocal Slough of Despond. After EveryBlock, Hipster & Patch Will Authentically Local Create The Sustainable Model? February 8, 2013Posted by bernardlunn in Hyperlocal, Journalism.
1 comment so far
Today many online publishers will be eying the AOL Q4 results. A small sub segment will be poring over every number and word revealed about AOL’s expensive experiment in hyperlocal news called Patch.
UPDATED: quick look at Q4 results. Good overall, but this is all I could see about Patch – “lower year-over-year Patch expenses”. So, I assume that means no revenue growth or they would be bragging about that and starting to scale back quietly.
Coming the day after NBC closed down EveryBlock without any notice, bad news about Patch will signal that we have reached the slough of despond in Hyperlocal. If that is the case, those who still believe in Hyperlocal will be cheering. This will be like the days in 2002 when everybody declared that the Internet and software were hyped and useless. This Economics Of Dreams picture from the great Israeli entrepreneur Yossi Vardi says it all:
I think we are somewhere between Panic and Capitulation in Hyperlocal. If I am right, it is a wonderful time to be an entrepreneur in Hyperlocal. This is like being Mark Zuckerberg in 2003 or Marc Benioff in 1999 when everybody sensible had written off social networking and enterprise software.
Hipster was the other Hyperlocal experiment that died recently. Unlike EveryBlock, few attended that funeral. It passed unnoticed.
What all these experiments failed to understand is that there is no hip early adopter market in Hyperlocal. Hipster failed most obviously in this regard. That name is just so appallingly bad for Hyperlocal. The hipster market goes to Foursquare and Instagram. Young singles care about who is hot in a hot bar. They don’t care about the kid’s soccer match, the school budget, the town hall meeting. The hip young singles would not be seen dead hanging with the grannies and the kids at the street parties. To make it worse, Hipster forced you to download an app before you could report news (it even insisted on IOS6, so you had to get crappy maps as part of the package).
EveryBlock did a lot better. Lots of people mourn EveryBlock’s passing. The mistakes are not as obvious as Hipster. It also got some early adopter tech love because the founder of hipster framework Django was one of the founders of EveryBlock. I dropped in once on EveryBlock but did not stay. It did not have content for the place I cared about. But more important, the tone was wrong. There was a lot of do-gooder talk about caring about your neighborhood that did not resonate with me; people who care about the neighborhood are out on the streets and in town halls doing something about it. Being on a forum or tweeting about something that affects a neighbor next door is just weird. Why not pop in and say hello? I hear that a lot of the EveryBlock “community” (a horribly overused word) became very negative in the later stages. EveryBlock was also only a city thing, it did not speak to people in villages and small towns. It was also too US centric.
One blog comment about EveryBlock’s demise, from Mark Armstrong of Nieman Journalism Lab nails the issue. He says you care about Local when you have kids. As a parent I agree. I am not sure I agree that Local news will end up being a byproduct of a parenting app. The issue is broader. How do you reach a mass market without going through the hip early adopter market?
But the most fundamental problem was that EveryBlock did not have a sustainable business model. Getting a one off grant is the worst way to build a sustainable business. VC will at least force you to make business decisions. EveryBlock went straight from philanthropy (money is there to do good) to corporate world (money needs to make a lot more money and it needs to do it this quarter) without going through the normal rigors of start up life that force you to connect to a real need that will generate revenues and profits. There was no real editing of the content, because people have to be paid to edit (curation eventually turns into spam and scam, people need money to do a real job).
That is what AOL is attempting with Patch, paying reporters and editors to cover local news.
AOL’s Patch experiment is a big one. Tim Armstrong, CEO, has made this his big bet. It therefore does not lack for investment and commitment. But he is running a public company and that means he needs to show results that show up in quarterly statements. If the results don’t show up, he will be faced with a “kill Patch or kill my career” decision. An entrepreneur like Steve Jobs or Marc Benioff or Jeff Bezos, with a track record or going against the herd and winning, can play that contrarian game. Tim Armstrong does not yet have the track record to thumb his nose at Wall Street and have Wall Street come back and ask for more.
I think Tim Armstrong made the right bet on Hyperlocal. Whether Wall Street gives him enough runway to prove his thesis, is another matter. I think there is a pony in there somewhere. I am not sure that AOL has found the pony and that it is called Patch. Maybe if Google was doing Patch it would be different. Their massive cash cow can withstand years of investment in dreams until they pay off. AOL only has the dwindling cash cow from dial up subscriptions. But Google would not do Patch, they fundamentally don’t believe in the model of paying reporters and editors to cover the news. I hope Patch makes it. Lots of jobs are at stake. If Patch does not make it, something else will. The reason is very simple and Warren Buffet articulated it years ago when he called local papers the best toll booth around. Buffet is back buying local newspapers. Of course now he is doing it at very low valuations (like 4x EBITDA). That shows the problem. Hyperlocal comes from a Silicon Valley world that wants 10x revenue and 100x EBITDA. That is what you need at exit to fund the start up risk. When Buffet buys at 4X EBITDA, he can wait for a decade for his bet to pay off.
In fact Hyperlocal is a horrible name. I use it because it is the accepted name. I think of it as Hype? Err. Local. It was a pathetic attempt to hype an unsexy business. Local News does not sound like something that will get a VC or Wall Street Analyst salivating. Yet Local News is what this is about. Call it Hyperlocal and you can call it Color and raise $41m in VC funding. Or you can do Yet Another Daily Deals site and get funding. Daily Deals are about connecting you to local merchants. Like Coupons – remember that is where the name Groupon comes from. But do you buy a local newspaper to get the coupons? No you buy it to get the local news and a few coupons fall into your lap. The Daily Deals business is unsustainable without Local News and vice versa. That is a blindingly obvious insight but nobody has connected those two dots yet to create a sustainable business. Somebody will, once we get past Capitulation.
So when all the hot money has left, who will make a success of Local News? I think it will be the same sorts of people who made a business out of Local Newspapers originally, hardscrabble entrepreneurs who are deeply committed to the area they live in and who love reporting the news. You can see the shape of this in the Authentically Local movement. This is tiny today. It is like the Homebrew Computer Club in the 1970s. You need passion to be in the Authentically Local publishing business; you are certainly not doing it for the quick bucks or the financial security. As the founders of Authentically Local say right on their cover – Local Doesn’t Scale. But it may do something more important which is create a sustainable model for news in local communities.
Is The Article Like The Song Or The Album? Deconstructing The News #futureofnews #wjchat June 9, 2011Posted by bernardlunn in Journalism.
add a comment
Painters create paintings, musicians create songs, authors write books, developers create systems, entrepreneurs create companies and…journalists write articles. Well, maybe not. Some people are questioning this assumption.
When a disruptive technology comes along it always changes the legacy medium. For example, the invention of the camera forced painters to rethink how they could add value and that led to impressionism, abstract art and other wonderful forms of creative experimentation.
When digital music arrived, it destroyed the concept of an album which started with the 33rpm vinyl format and carried on into CD.
But digital music did not deconstruct further, the song remains the unit that is produced & consumed.
In the news business, the album is the newspaper or the TV/Radio channel. Apart from a few loyalists among the older crowd, online news consumers are not brand loyal, they click around to get what they want. But the article is still the dominant unit.
Blogging did not change that. Bloggers may write shorter articles, because they have to churn out 4 posts per day. Bloggers may call them posts rather than articles. Bloggers may have found the Publish key a huge liberation from the Publisher’s rejection letter. But, call it what you like, Bloggers still produce articles.
But Twitter may have changed things. Twitter is so fundamentally new as a medium that it challenges older assumptions. A Tweet is emphatically not an article. You can derisively dismiss Tweets as “brain farts” and a lot of them fit that bill. But in the news business, Tweets are one type of “news fragment”. I don’t know what else to call them. Some of these news fragments can become the constituent pieces of an article. That is what all the curation tools are trying to do, assemble Tweets into stories (which are built into the article form factor).
Compare this to other media that deliver creative work:
- the fragments in a song are things like the bass line, vocals etc.
- the fragments in a painting are things like paint and canvas
- the fragments in a book are things like paragraphs and chapters
In those media, would you be interested in consuming the fragments on their own? If you are a creator, maybe. If you play the bass, you might want to isolate Jacob Pastorious’s bass lines from Weather Report to learn from them.
That is the problem we have in the news business. Millions of people love writing. That is what made blogging such a phenomenon. I get it, I love writing. The act of creation is a pleasure. The act of consumption is OK, but not as much fun as creation. So when we see those news fragments, we become fascinated.
When people who are not involved in media and technology ask me why I am fascinated by Twitter, I usually talk about following the early days of a massive story. I was totally glued to Twitter #jan25 when the revolution was happening in Egypt. I have always been fascinated by revolutions, I have lived in the Lebanon and I am fascinated by the news business. So this was exciting to me on many levels.
But as soon as Nick Kristof got to Cairo, I was happy to just read his articles as well as anything by other journalists who really understand the Middle East like Thomas Friedman.
I can also envisage that somebody who is obsessively interested in all things Apple related, they want to drill down to the fragment/source. But how many subjects can we be obsessive about? How many subjects do we want to be “news prosumers” in?
I think the article will remain, like the song and the painting, the primary unit of production and consumption. Journalists, bloggers and what we might call “news prosumers” or “news fanatics” might want to delve deeper into the individual fragments, to go direct to the sources.
That use case, the news prosumer, needs to be catered to. It is really a filter/check box indicated whether you consider yourself an expert on that subject. The expert will get all the latest stuff in reverse chronological order, getting the fragments direct from sources (using their own insights and knowledge to filter out the junk). But methinks that is a minor use case. Those of us in the news business might think it is a big use case as we fall into that use case category, but that is a classic mistake. Also, I think that most mainstream media attempts at doing this will be rejected by the news prosumer fanatics, who will always want to delve direct into the fragments direct from the sources.
The article like the song remains the same, even while the container (newspaper/channel/CD) is threatened.
add a comment
Reporter used to be synonymous with journalist. Recently, people have started to refer to reporter as a “citizen journalist”. The implication is that journalists are not “on the ground” reporting on what they see and hear at first hand, they are sitting at a desk curating flows from reporters who are unpaid. Calling unpaid reporters citizen journalists makes little sense, the term is overdue for retirement.
But the implication is that the journalist has actually become an editor, deciding what to publish from a team of reporters. Actually the journalist is also the publisher. When I am finished writing I simply hit my WordPress Publish button. It is free and I can have advertising networks sell some ads. I don’t need to manage a sales team and the accounting is simply checking into Paypal. I am oversimplifying a tad to make a point. But all the “media companies formerly known as bloggers” started a single individual who was journalist, editor and publisher at the same time.
This empowerment is the wonderful legacy of the social media age.
But something has been lost. We have lost the reporter. Maybe it is simply a budget issue. Unless it is a massive global story, like a revolution or Tsunami, nobody is paying for the reporter to fly to the spot. So our typical image of a blogger is somebody sitting in their home office on a laptop, reading news feeds and press releases. There are more PR people than journalists. Everybody is recycling the same old stuff. The tech blogosphere is canary in the coal mine. Any news release from a tech bigco has 10 or more news stories that are almost all the same, competing only on speed of release and link bait cleverness of the headline.
The only exceptions in the tech blogosphere are Arrington and Scoble. The Arrington story is not repeatable. He basically creates news by starting a controversy. He is so wired in the Valley that he can do this. This is either horribly conflicted or the return of Gonzo journalist; Arrington as a reincarnation of Hunter S. Thompson is a pretty funny thought. But that idea won’t scale as the VCs say.
But what Scoble does, travel the world interviewing entrepreneurs, is scalable. This is original content, proprietary, the essence of what we used to call reporting. He can do this because Rackspace pays his salary and expenses. That is a scary thought for media organizations; the future of journalism is coming from a company that is byepassing media companies to establish their own direct access to the market.
But whether the future creators of original content are media companies or “the companies formerly known as advertisers and now called content marketers”, the Scoble-like reporter needs better tools for the whole lifecycle from original reporting to publishing and monetization.
Disclosure: that is the focus of ReportingLiveFrom and this has not been launched yet. For more background, see these earlier posts:
See earlier post on Investigative Journalism Needs More Than Curation Tools for context.
1. The reporter must be able to control the URL and the monetization. News that goes to closed social networks that monetize the free contributions cannot be sustainable. Journalism has to be paid for. We can use social media to listen (Twitter Lists are just the old “little black book” of sources) and to promote stories and get incoming links. But journalists who want to make a living cannot simply make the social media founders/investors rich.
2. The reporter must be able to contribute news using the lowest common denominator tools: mobile phones and email. Expensive, proprietary tools will be a barrier. Even a free app that has to be downloaded before one can contribute, will be a barrier. The person who happens to be “on the spot” where the news is breaking must be able to report what is happening.
3. The reporter must be be able to publish automatically on real time without asking anybody’s permission. This is the gift of the social media age. Yes, this same tool can be used by spammers, scammers and hacks paid directly by special interests. That is the price of openness and the reason why the next point is so important; but the alternative (control by a few media moguls) is worse.
4. The reporter must be able to proactively choose sources and ask them for specific contributions. Relying on curating existing flows on social networks is reactive and not the essence of journalism. This capability must be available to the single individual (the “person formerly known as blogger” and occasionally called citizen journalist) as well as media organizations large and small.
5. The reporter must be able to request payment in various forms. This won’t apply to salaried reporters working for large media organizations. But all forms of free agent reporter are likely to create the majority of news content in the future and they should be able to request payment in whatever means makes sense to them – non-monetary recognition, stringer type retainers, per item fees. For example, the person who records a key moment of history should be able to get paid by the highest bidder, unless they have contracted with another news organization before the event.
6. Text is not enough, we need millions of TV stations. Mobile video is a reality and consumers want the old lean back TV experience with an interactive twist. Everyman can be a TV anchor replaces the earlier blogging dream of everybody can be a published writer.
Investigative journalism is important to society, somebody needs to “speak truth to power”.
Historically the newspaper business was so profitable that it could fund long investigations. They could also take the risk of lawsuits that often resulted when the rich and powerful did not like the truth that was being reported. But today, those budgets are being cut to the bone and newspaper owners are too scared for their own survival to consider investigative projects.
Nor can the pure play online only blog-based businesses pick up the slack. They have to pander to page views and keep costs within the boundaries marked by ever-falling CPM and CTR ad rates. “Reporters” have to create 4 posts per day, usually around 500 words. Their best attempts at adding value to press releases are clearly no substitute for investigative journalism.
For a while, I thought that “citizen journalism” would be the answer. The idea was that any citizen can hit enter on their blog and the truth is revealed, they have no gatekeeper (who might be conflicted by their relationship with a special interest) who can say no.
The problem is that, for every honest citizen trying to do their best, there are way more spammers, scammers and paid hacks of the rich and powerful. So the consumer of news has to filter out the nuggets of truth from the mountains of rubbish. To do that they need well-trained and motivated journalists and editors. So we get back to square one.
Many techies dream of an automated answer, the perfect social curation filtering tool that will automagically assess every source’s credibility and only deliver the good stuff to your personalized online news service. Yep, and the high school student will find the cure for cancer in class and invent something that goes faster than the speed of sound.
I love how Andy Carvin at NPR is curating the news from the Arab revolutions using Twitter lists and other tools. The best tech bloggers, such as Marshall Kirkpatrick, have used these tools for a while, now we are seeing these tools used to report on matters that really matter to humanity. That is all great.
The danger is that we fall back into a naive view that technology will replace the need for people like Andy Carvin. Or that it is easy to get mainstream journalists to work the way he works. It maybe that this is something that is perfect for early adopters but won’t scale.
We need tools that empower trained journalists and editors, that help them to identify more credible sources and to efficiently get those sources to contribute. Those same tools can be used by citizen journalists. The tools must be very simple and very cheap, so that they are accessible to citizen journalists and local news operations. Exposing a $50,000 corruption at your local town hall matters just as much as the $500 million corruption at a national level when that $50,000 determines whether the school budget passes and your kids get art class.
I was initially sceptical about non-profit institutions getting involved. I thought that the answer had to come from the market. But I have been impressed by what ProPublica is doing and their model may be sustainable, as they get revenue from commercial news organizations. But we need more ProPublicas as well as purely commercial versions of ProPublica. For that to happen, we need a revolution in efficiency.
There needs to be something like a Moore’s Law of investigative journalism where the cost drops significantly every year.
Disclosure: this is the focus of ReportingLiveFrom, a new venture that I am co-founding. We are not yet ready to go live with our tools, I am writing about the issues to get our thinking clear and engage with other interested parties.
Why I Am Returning To My WordPress Blog May 4, 2011Posted by bernardlunn in B2B Media, Blogging, Journalism.
I was late to blogging, around 2007, but had written a lot in other media. I started with WordPress, then wrote for Read Write Web, SemanticWeb and SmallBizTrends.
I have no intention of monetizing via advertising, so I don’t care about page views (that is only a vanity stat). Nor do I have any single business objective, so I don’t feel the need to be disciplined about writing every day. I really do write for fun, I enjoy writing. It is a way to organize my thoughts. But it is also, hopefully, a conversation. I want to engage in a dialogue with people who are “thinking along the same lines”, even if they tell me I have got it totally wrong (I love changing my point of view).
So, the question is not whether I should blog. It is whether I should blog here, or on some high traffic site. A few years ago, it was different. Then it was obvious that you should blog as a guest author on a high traffic site. Four things have changed my mind on this:
- Google is indexing my blog posts within less than a minute. Yep, this no-name blog is being indexed almost in real time! I tested this myself. I assume this is because WordPress adopted RSSCloud.
- I tested on a blog network that lets guest authors post freely (SeekingAlpha) and on this blog and the number of page views was almost the same.
- I asked some blogs that have a restricted guest author policy and found that I had to write in a way that fit within their editorial guidelines. If I wanted to be a professional writer, that would have been a useful exercise. But I am determined to remain amateur in my writing and want the freedom to write what I want, when I want.
- New style aggregators such as Hacker News and Techmeme have a way to submit posts, so you can alert a specialized audience on a post by post basis. Hacker News found me about a year ago when my post on “punk manufacturing” was discovered and yesterday I submitted something that got a great conversation going. Methinks Techmeme is more news-driven and that’s not my game, but lets see.
This tells me that it might be possible to get the blogging magic quadrant – freedom on one axis and engaged audience on the other.
Curated List Of Curation Resources March 2, 2011Posted by bernardlunn in Blogging, Journalism.
add a comment
How nerdily recursive is that? Its a hot topic, so here is my index to the interesting stuff on curation (one man’s view of what is interesting is all, but that is what curation is all about, so no more apologies):
http://twitter.com/#!/saved-search/Curation Follow that search term and you have curation stuff in all it’s raw, noisy glory
http://www.youtube.com/watch?v=nUDPFtOCQVA&feature=player_embedded The way Andy Carvin curated the news flow from Middle East revolutions. This rang very true to me, I was doing the same – in a very haphazard way - as an amateur who was obsessed with what was happening.
http://curationchronicles.magnify.net/ Steven Rosenbaum wrote the book on curation – literally
http://vodpod.com/watch/1172451-clay-shirky-its-not-information-overload-its-filter-failure-web-2-0-expo-ny Shirky at his brilliantly incisive best
http://scobleizer.posterous.com/the-new-billion-dollar-opportunity-real-time Scoble gets a lot more people thinking about curation by mentioning a $ billion.
http://scobleizer.com/2010/03/27/the-seven-needs-of-real-time-curators/ Scoble gets a bit more specific
A great bit of business journalism December 14, 2007Posted by bernardlunn in B2B Media, Journalism.
add a comment
“Internet II: Rebooting America
Michael S. Malone, 09.10.01
Getting real and getting it right.
The biggest economic boom in history is bearing down on us. “
Big deal, you might think. But check out the date (what happened the next day?). In late 2001 this was really far-sighted, clear thinking.
Now look at his concluding remarks:
“But with this announcement also comes a warning: We are not prepared for this impending boom. We have no way to support it, to nourish it, even to reap its benefits. What will happen to Internet II, the fulfillment of the technological revolution, when our order sits on a runway behind 60 other planes awaiting takeoff, or on a stalled interstate? And how many batteries will we need to surf the Grid in the dark?
Internet II is coming, but we aren’t ready. If we aren’t ready soon, we may have to wait until 2015 or 2020, and perhaps visit Frankfurt or Shanghai to see what we missed. “
Blogs, shmogs, great journalism still lives and makes a difference.