Category Archives: General Strategies

PEPC WorldWide Becomes Satellite Newspapers

PEPCWorldwide, whose satellite-connected vending boxes can on-demand print any of 119 daily newspapers from 48 countries, is rebranding itself as Satellite Newspapers. Steve Mannen, CEO of the Dutch company, explains, “This new easy-to-remember name reflects our company’s focus on the seamless distribution of digital newspaper editions through multicast satellite transmission. To secure a uniform and consistent market approach we decided to simultaneously link the name of the newspaper-vending machine directly to the company.”

Whizzing About On The Subject of Paid Content

There’s an interesting article in American Journalism Review about whether or not newspapers should implement user registration and/or charge for online content. Registration makes sense (hello, did anyone remember why NYtimes.com announced in 1995 why it implementing registration?). But charging for all acesss is proving to be the latest online newspaper industry’s latest childish pursuit of bright shiny objects.

Another Example of Media Disintermediation

David Astor, syndication columnist for Editor & Publisher Magazine, has written a column [which unfortunately might by now be hidden behind VNU’s paid archive wall] about how My Comics Page gained 10,000 new paid subscribers this spring. MCP now serves 25,000 paid subscribers. This is yet an example of (a) daily and Sunday newspapers unwittingly having their contents disintermediated and (b) how the contents of newspapers are worth more apart than when packaged together as a whole.

London Times and FT to Launch Digital Editions

The Times of London and the Daily Telegraph, competitors, are the latest UK dailies to begin publishing digital editions.

What’s notable about these large (weekday print circulations ranging from 500,000 to 2 million) dailies publishing digital editions is that the Audit Bureau of Circulation in the UK & Ireland doesn’t yet audit or certify digital edition circulation. These large dailies nonetheless see positive business cases for launching digital editions.

The UK Journalism says that The Guardian and the FT plan to begin retailing digital editions later this year. (Actually, those two newspapers have been wholesaling digital editions for several years via PressPoint and NewspaperDirect, to newsstands, hotels, cruise ships, and kiosks. But now The Guardian and the FT will now be offering digital editions directly downloadable to consumers.)

News in Any Format from Sdysvenska Daglbadet

Covering the IFRA Online Trend conference earlier this month in Amsterdam, our friend Rafat Ali notes the interesting ‘Instant News’ project by Sweden’s Sdysvenska Daglbadet newspaper. It involves instant delivery of news through whatever electronic media the user wants at any pre-designated time:

“A user decides, when I’m online, send me breaking news through IM. Between 4 pm and 10 pm (after office and before I go to sleep), send me news on my mobile through SMS, and after that till I am online again in the morning, send the news through e-mail. The service is subscription based, and easy to integrate with payment systems and with the universal ID/logon system, if you have one for your site….”

Delivery & Registration

Today’s Newspaper Sites Move to Registration Model story at Editor & Publisher magazine’s Web site. Focusing on newspaper sites that are requiring registration prior to access, it states, “these site are already seeing new revenue as a result of registration.”

I think the story has that cause-and-effect backwards. Of the three examples (Belo Interactive, NYT, Chicago Tribune) the story gives of sites that have increased revenues, all the executives quoted say those increased revenues arise from e-mailing content, not from forcing registrations.

Those increased revenues are primarily due to advertisers being willing to to pay for guaranteed daily delivery of their ads, not due to consumer registration. That’s why the the newspapers mentioned that are forcing registration but not delivery content by e-mail aren’t getting those increased revenues.

Why do paid subscription newspapers in the U.S. that deliver editions directly to homes & offices generate far greater advertising revenues than either free newspapers or newspapers that are available only by purchase at the newspapers’ offices? The answer is that advertisers are more willing to pay for ads placed in something that readers have requested to receive daily, even paid to receive daily.

That might be obvious to newspaper publishers, but their New Media staffs have failed to see it during the past seven years of shoveling their newspapers’ content online. Instead, they’ve made their newspaper’s content available online to consumers only via retrieval at the newspaper’s own site.

The results have been they’ve had trouble knowing how many consumers really see their content and how frequently. With those unknowns, advertisers haven’t been particularly attracted or motivated to pay large amounts or high advertisings CPMs. And because the only way for consumers to read that content regularly has been to visit the newspaper’s site — which few consumers daily remember and take time to do — those sites have received woefully infrequent use; although their content changes daily, the sites’ average user visit only 2 to 5 times per month!

Those newspaper sites that invoice their advertisers for the number of banner ads exposed thus have exposed ads to their average user only on about 2 to 5 days, not 30 days, per month, thus generating only 1/15th or 1/6th the ad revenues they could. Those newspaper sites that invoice advertisers for monthly sponsorships of Web pages, rather than the number of banner ad exposures, likewise have found that Web pages seen only about 2 to 5 per month by the average user are proportionately less attractive to advertisers than pages seen daily.

Indeed, I’ve read recent stories in which Belo executives say that the availability of e-mailed content has been the major driver of registrations at their sites (anybody from Belo please correct me if I’m wrong about that). E-mail delivery of content is the best way to drive registrations and increased revenues, not the other way around.

Continue reading Delivery & Registration

Some Resources on Privacy Issues

While researching international online privacy issues for a client today, I happened across the Center for Democracy & Technology‘s fairly comprehensive Guide to Online Privacy. I initially came across it while looking for any updates to the U.S. Commerce Department’s ‘Safe Harbor’ consumer privacy agreement with the European Union. The CDT site had no such updates but contains a wealth of hyperlinks to information about the ‘Safe Harbor’ treaty, about P3P, wireless device location privacy, and other online privacy issues.

Many of my conservative friends in the publishing industry might carp at the CDT’s liberal tone, but I believe that online businesses have to be actively pro-privacy to profit. For example, eMarketer today reports that concerns about online privacy was the reason why 82% of US consumers online refused to give information to a Web site

Sledgehammer Superstitials Hit Online Users

The behavioral psychologist Abraham Maslow once noted, “When your only tool is a hammer, everything starts to look like a nail.” Unicast ? a New York online advertising technology firm whose name infers anything but interactivity ? today unveiled what might be the banner ad version of the sledgehammer.

Their Superstitial banner is a 300-kilobyte ad that rises to cover approximately two-thirds (550 x 480 pixels) of the computer screen with up to 20 seconds of ‘rich media’ advertising. Despite the Interactive Advertising Bureau‘s recommended 100-kilobyte maximum size for interstitial and pop-up ads, Universal Pictures and ADiamondisForever.com have agreed to advertise with Superstitials, DoubleClick has announced its support of Superstitials, and among the networks and publications that have announced they will Superstitials are About.com, Business.com, BusinessWeek Online, ESPN.com, Excite, FastCompany.com, Fodors.com, Inc.com, Kiplinger.com, Maxim.com Sportsline.com, Office.com, PCWorld.com, Reel.com, Terra Lycos, uBid.com, Weather.com, and Zagat.com.

Does anyone other than me remember when the majority of what a person saw a computer screen was the Web content that he’d gone to see?

What are the New Media?

In 1998, we formulated a Philosophy of New Media. This past week, we took time out from this Web log (and other things) to reformat its pages.

Not only does this Philosophy point out the misnomers and misperceptions that currently plague most news publishers and broadcasters who are attempting to operate online, but other events also keep proving the Philosophy true. It is as apt today as it was four years ago, and we’re proud of that.

Woe is the Newspaper Industry

Perhaps no story portrays the newspaper industry’s current woes as well as this:

On Monday, Kmart Corporation was named the Best Overall in the Newspaper Association of America’s third annual Retailer of the Year awards competition. The following day, Kmart filed for bankruptcy, the largest such filing ever made by a retailer.

The NAA Retailer of the Year awards were established to acknowledge those retailers that execute highly effective partnerships with newspapers in their markets. Kmart was nominated by the San Diego Union-Tribune and Gannett Co., for newspaper initiatives that resulted in a 24 percent increase in daily sales at Kmart stores and a 44 percent hike for Sunday editions.

Kmart, the third-largest discount retailer in the U.S., continues to operate all 2,114 of its stores, but analysts say that several hundred stores will be closed after a corporate review is completed at the end of April, which could mean layoffs for thousands of the company’s 240,000 workers. There is no estimate yet of how much newspaper advertising revenues could be lost.

Have Online Ad Networks 'Screwed the Pooch'

According to Tom Wolfe‘s book, The Right Stuffto screw the pooch was a slang phrase that test pilots in the California desert used during the 1950s to describe a pilot who died in the wreckage of his plane.

News last week that DoubleClick is discontinuing its Intelligent Targeting product makes us wonder if DoubleClick and similar online advertising networks have themselves driven crashed the promise of online advertising into the ground.

The dual promise of online advertising was that the consumer would see ads only for things that he wants and that the marketer would be able to buy ads seen only by consumers who want his product. That benefits both consumers and marketers.

However, the key was to know what what each consumer wants. To gain that knowledge, DoubleClick and other online ad networks surveiled online consumers, generally without their knowledge, tracking where they Web surfed and for what. DoubleClick’s Intelligent Targeting product then allowed marketers to sell focused ads based upon Web surfing consumers’ own individual ‘profiles’ — those ‘profiles’ based upon DoubleClick’s surveillance.

The trouble is that DoubleClick and most other online ad networks never learned that:

    (1) Most online surveillance ‘profiles’ are faulty because they track not real people but user of their computers. If I use my personal computer to visit four Web sites, then there is fair probability that I’m interested in those Web sites’ and profiling me on that basis might be true. But if instead my girlfriend, my dog, and myself each were to use my personal computer to visit four Web sites, a profile based upon surveilling which sites were visited would probably yield a profile of a woman who loves Formula One racing and eats dog food.

    (2) In New Media, control lies in a different position than in Mass Media. The Internet has shifed control of its media more into the hands of the consumers and a bit furher out of the hands of publishers or marketers. So, secretly (because that’s how most Web ‘cookies’ work) surveilling online consumers tends to aggravate consumers who discover it. Hence, the consumer privacy uproar about such online surveillance. Consumers also fear that this ‘profile’ information about is being sold and re-used by marketers in ways they no knowledge about or control over.

What was instead needed to fulfill the promise of online advertising was not secret online surveillance of online consumers to create ‘profiles’ about them, but a mutual safe and secure mechanism for consumers to inform the intermediator and marketer about their needs & wants. Its legislative and technological guarantees would provide consumers with assurances that it was safe to disclose their needs & desires to marketers, who would use that information correctly and according to permissions set by the consumers themselves.

However, DoubleClick and similar companies took a spy flight over consumers’ borders and got themselves shot down. They screwed the pooch.

Postrel on Products

We’ve long been a fan of REASON Magazine Editor Virginia Postrel, who also is one of four experts who takes turns writing the Economic Scene column in The New York Times Business Section. Here are two reasons why we like her:

In today’s Economic Scene column, she writes about how how publishers don’t think cutting the price of books will sell more books, “People who love their products tend to underestimate how many tepid or wavering customers there are at a given price. They lose sales by thinking everybody will be as enthusiastic about the product as they are themselves and the potential customer will be therefore oblivious to a high price.”

We think that also able describe e-book manufacturers and book publishers, both of whom unsuccessfully sold devices and e-books at high price.

We also think that a speech Postrel gave in 1999 inadvertently but ably describes what newspaper and magazines publishers fear about the Internet:

“It is the argument that markets are disruptive and chaotic, that they make the future unpredictable, and that they serve too many diverse values rather than ‘one best way.’ The most important challenge to markets today is not the ideology of socialism but the ideology of stasis, the notion that the good society is one of stability, predictability, and control. The role of the state, in this view, therefore, is not so much to reallocate wealth as it is to curb, direct, or end unpredictable market evolution.”

Does NY Times Web Site Blur Editorial-Advertising Lines?

“To borrow from the tagline of the new blockbuster film Lord of the Rings, it may be the one Web page that binds them all. But did it united them in darkness?

That’s is how CBS MarketWatch leads a story claiming that The New York Times Web site’s ‘sponsored content’ for that film is the latest example of “how the modern world of Internet journalism is colliding with the age-old struggle of keeping news and advertising apart.”

Earlier this year at the Content Summit in Zurich, we watched New York Times Digital General Manager Scott Meyer explain his company’s ‘sponsored content’ concept: The advertiser gets to create a promotional Web page pick that features the advertiser’s choice of previously published Times articles about whatever is being promoted.

Because the articles were written by the newspaper’s critics and staff and were objective, the Times claims use of those articles by the advertiser doesn’t blur the line between editorial and advertising content.

But we maintain that New York Times Digital has clearly blurred that line because:

  • The advertiser chooses which Times stories will be published on the Web page — it is unlikely that negative stories about will be published.
  • From the consumer’s perspective, the Web page clearly looks like a Times editorial news page, not an advertiser’s page.
  • Letting an advertiser pick which stories get published on a page would clearly violate the Times print edition’s ethical practices. The Web might be a new medium, but we believe that ethics transcent media.
  • If the Times is to maintain itself as the paragon of American (and perhaps all English-language) journalism, it must be held to a paragon’s journalistic ethics standards. That’s why we’ve criticized the frequent ethical lapses by its Web subsidiary. And we assert that the root cause of these lapses was New York Times Chairman Arthur O. Sulzberger Jr. installing former advertising executive Martin Nisenholtz — an ad executive without any journalistic experience who is in change of a paragon journalistic Web site.

    Frank and Pessimistic Forecast from NAA

    Last month, the UBS Warburg Pincus Media Conference saw a rather frank and bleak slide presentation (9.5-megabytes in size) from the Newspaper Association of America’s Vice President of Market Analysis Jim Conaghan with forecasts for 2002. Online publishers can incidentally take some comfort in Conaghan’s analysis: Web sites modestly increased print circulation and bolstered print readership.