Another view on Newspapers’ “Original Sin,” from Howard Owens

Howard Owens has weighed in with his view on what the newspaper industry’s “Original Sin” was in the early days of the Internet:

Alan Mutter says we screwed up by failing to charge for content. I say not only was that not a mistake, but many newspapers did try to charge for content. I have written that the Original Sin was that we “did next to nothing to explore how we might use this new technology to help businesses connect with customers.”

Howard, publisher of the digital startup The Batavian, contends that a greater error was keeping our online units “tethered to the mother ship.” Howard, one of the most insightful people working in digital journalism, makes an excellent case in his blog that we would have done a better job in moving into the digital age by spinning our web sites off into standalone companies.

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What if advertising doesn’t recover with the economy?

What if the cyclical part of the advertising collapse does not come back after the end of the cycle?

Lad Paul, an old friend and colleague from the Des Moines Register who recently retired as executive editor of the New York Times News Service and is now consulting, asked that question recently on my Facebook page.  I asked Lad if I could share his question and my answer on the blog (with some minor editing, mostly to remove personal remarks we exchanged, and with some elaboration because I’ve thought more about it as I’m writing this) and he agreed. He had been making his way through my Blueprint for the Complete Community Connection and these questions kept nagging him:

What if advertisers have discovered that they don’t need middle men like our newspapers to find their customers? What is to stop them from taking the money that in the old world would have been their advertising budgets and spending it instead on developing fancy Web storefronts, and then letting the customers find them and their products via search?

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Attributor’s plan is a tourniquet on newspapers’ hemorrhage of ad revenue

Here’s how little hope executives of newspapers see for our industry: The idea that reportedly excited them most at last week’s secret meeting could make up about 3 percent of last year’s decline in advertising revenue.

Zachary Seward of Nieman Journalism Lab, who is doing an outstanding job of reporting on the meeting, tells in his latest report about the Fair Syndicate Consortium‘s plan to track down splogs (spam blogs) that reprint news web site content in its entirety and get advertising revenue from third-party vendors such as Google and Yahoo!

The report is interesting and I don’t fault newspaper executives for protecting their copyrights and their rights to advertising revenue from content they produce. But here’s what I found discouraging in Seward’s report:

• Jim Pitkow of Attributor, who made the “Fair Syndication Consortium” pitch, estimates that pirated content is costing newspapers $250 million a year.
• Seward reports: “Nearly everyone I’ve spoken to with knowledge of the Chicago meeting, where newspaper companies were pitched on a variety of online business plans, says that Pitkow’s presentation of the Fair Syndication Consortium was by far the most popular.”

OK, let’s do some math on that. As Alan Mutter reportedin his Newsosaur blog, advertising revenues plummeted by $7.5 billion last year (and that pace accelerated in the first quarter of 2009). So the $250 million that newspaper executives got excited about was a mere 3 percent of last year’s decline in revenue, less of what we appear headed for this year.

Sure, save that $250 million if you can. But that’s a tourniquet, not a plan for a healthy future. 

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ViewPass has potential for data, revenue

I don’t want to belabor my opposition to paid content or to the secrecy of last week’s meeting of newspaper executives.

But the secrecy and the resulting attention to the heavy paid-content focus of the meeting kept us from learning until a week later about Alan Mutter’s interesting presentation about ViewPass, a plan for a system that would allow easy payment by consumers across multiple platforms and extensive collection of data that would allow publishers to target advertising based on that visitor’s interests.

Mutter proposes ViewPass as a way to “access valuable content on the websites and mobile platforms of all participating publishers.” While I have concerns about all paid-content approaches (I made the Freudian typo “pain-content” in a tweet last night), and about the industry’s unhealthy focus on such a misguided approach, I concede that charging for high-value content might work in some niches.

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