Friday, April 11, 2008

ACES Post Time

Blogging at the ACES conference can be found here from my colleagues Jim Thomsen, Gerri Berendzen, Neil Holdway, Daniel Hunt and others.

A followup to Doug Fisher from yesterday's meeting: You said that the economic value of what we do is miminal, as in no one would pay much for "news" because it is so transitory. That what we sold was the package. My question is, does that apply just to "breaking news"? If one is talking about, oh, Sue Shellenbarger's columns on balancing work and family in the WSJ, things one might clip, would that be of a higher economic value? What sort of editorial content is worth more money than just stuff you might find on A1 or B1? Hope you can reply.

Doug Ward, Sara Hendricks and Kathy Schenck moderated a session this morning based on comments in the opening session, about what can raise the profile of copy editors and what can raise the value of ACES. One thing that keeps coming up is that ACES, which was founded to raise the profile of newspaper copy editors as a result of the early 1990s American Society of Newspaper Editors study, is still seen by many who come for the first time as being too much of a newspaper organization. Yet at the same time, the number of potential newspaper employees who have never heard of ACES is still huge.

ACES would seem to have a bright future as a broad-based organization for copy editors whether they are in newspapers, books, magazines, PR departments, organizational Web sites, online journalism, or whatever. On the other hand, given the efficiency with which the scythe reaps its harvest in newsrooms and what it cuts down first, does ACES still have its major work to do as a news-organization advocacy group based around newspapers and news magazines? Because time, resources and energy are limited.


Doug said...


You'll find a lengthy discussion on my blog, most recently at The Land of Free. Then click on the "economics" label for more.

The gist of it is this -- almost everything, even individual news articles or columns, has some intrinsic value as long as there is a willing seller and a willing buyer. But is that economic value enough to provide "worth" -- in other words to cover the costs involved in producing that product? That also involves things such as whether an item is fungible.

Now, let's take that column you speak of. Certainly, for some devoted readers, there will be economic value? But what are they really willing to pay for the privilege of reading that column?

Now, disaggregate all the expenses associated with producing that column: The fraction of the writer's salary; the portion of the heat, light and salaries of others; the paper and ink; delivery; etc.

Silly? No, because that's what the Internet is doing - disaggregating everything in your paper. Damn hard to figure out? Yes. But sophisticated businesses come close.

So simple question: Do you think those readers will pony up enough to offset the disaggregated costs? If not, then the thing may have some value, but it has no worth.

And that's my point, that for most of what we do, the worth is so small as to be inconsequential. Even those things with potentially high value have, by the nature of the business, a fleeting life, which makes extracting the economic worth from them prohibitively cost.

The value has tended to come from the wrapper - the newspaper and the additional services it provided (especially when there was a monopoly or oligarch): Aggregation, filtering/indexing, serendipity. To some extent, also, credibility, although on the Web, credibility is primarily transactional, not institutional.

But those can all in one way or another be duplicated online -- for free. (Why? Because the marginal cost of adding capacity is almost nothing.)

This is one of the reasons all those hopes for "miocropayments" never really materialized. Another is that the barrier from free to 0.1 cent, say, is physically small but psychologically huge.

(Now,there may be other unquantifiable benefits to the general good. But that makes this a social good and raises the question of whether that can and even should be attempted through the unregulated private marketplace.)

Was I being a bit provocative and shocking - yes, because journalists have got to come to grips with this. Many of them may face it directly if they are laid off and try to establish new news sites online.

We have a two-part problem: The content and the wrapper, and both require different strategies. Content requires us to think hard about what really will carry economic worth. The wrapper, which is what really most of the handwringing is about, is a completely different problem -- how do we invent new wrappers that have such compelling convenience or features peopel are wiling to pay for?

tom said...

I've come to Doug's conclusion intuitively based on building a niche web site for hikers.

Any content that stands as a bridge between buyers and sellers can theoretically be self-supporting online with search engine optimization, targeted ads and affiliate marketing.

Any content that has no transactional component faces far rougher sledding. Which is to say, *all* the local news we put in the paper.

A transactional site becomes viable with 5,000 to 10,000 users. Any site that tells people how to make money has potential, and any site focusing on "what people want to see" -- celebrities especially -- has a shot, but the field is very crowded and the competition is brutal.

An "audience of eyeballs" can't hurt, but an individual blogger needs an audience of about 10,000 to 20,000 to make a full-time business out of it. That's 10 employees for a paper with a circulation of 100,000.