Searching for Revenue in Free Journalism

The state of journalism. It is bigger than the Internet, the fall of classified advertising, funding for investigative journalism, search aggregators and the link economy. To briefly take a broad 30,000 foot view, if not the foundation, journalism is a pillar of a democratic society. It is the check on the check and balance governmental system designed by and for the people to ensure justice as well as truth.

Journalism continues its predicted and precarious state of crisis. There is no one entity to directly blame, but the problem seems clear. Free. The very first thing taught in every economics class is that nothing is free. Everything has a cost. Clearly objects, food and even land has a value, a monetary cost. Cost can be subjective, but one of the few truths of this world is that all things have a cost established through a price derived by demand. The cost to produce a thing must also be factored into price and perhaps this is specifically where journalism stumbled. Providing content for free that holds high demand and cost of production to the nascent communication medium known as the Internet in the ’90s is the jagged root befalling journalism.

Priced to Sell. It is an educated, well researched address by Malcolm Gladwell in the New Yorker about the longevity of the online business model of free that has been propped up by the Internet. The article in part reviews the book “Free: The Future of a Radical Price” by James Moroney read Chris Anderson as well as the premise of free as a business strategy at large. It is clear Gladwell questions the blogosphere’s war cry that “Information wants to be free,” but does not go all the way in completely debunking the theory by closing with:

“The only iron law here is the one too obvious to write a book about, which is that the digital age has so transformed the ways in which things are made and sold that there are no iron laws.”

I will take this final step. Information absolutely, positively does not want to be free. Moreover, ideas and information are the most valuable product of man. Unfortunately, the Internet and the link economy has driven down the cost of access to ideas expressed through words and video so far that ideas and information have become free in the minds of most consumers. Sure, in most cases there is a cost to access the Internet, but the idea creators do not receive compensation. Understand that there is a difference in this discussion between ideas and communication. The varied platforms known loosely as social networks that advance societies ability to communicate is a great positive built on the back of the Internet. It has allowed the dispersion of knowledge such as natural disasters and human rights violations to a global audience at a speed never seen before. Free communication is good. Free ideas is not.

The Associated Press announced yet another plan to try and ensure compensation for its content – its ideas that have very real value both to society and in cost to produce. As expected, the blogoshere berated the AP and denounced the organization as decaying old media institution that we would be better off without. Shortsighted in my opinion. More and more media companies are beginning to awake to the strategy that the one thriving newspaper in America has stuck by throughout the Internet age. The Wall Street Journal is not free and I expect by the close of 2010 most other news organizations online will not be free either. Ideas and information has value. This year free has eliminated news papers such as the Rocky Mountain News. From its ashes rises the RockyMountainIndependent that will include memberships as source of revenue. True, for now, most of its content will be free, however it is developing separate content for paying members that I expect will expand to a larger portion of the site. Ideas and Information are not free. They have value and should be paid accordingly to ensure a sustainable future for journalism.

The 19th Hole – 7/19/09

July has the unfortunate distinction of being the month right before football starts back up, but that does not mean we are without news for the U.S.’s top sport. America’s past time hits its midpoint of the season this week, but of course no one cares any more. Baseball could be on the verge of becoming America’s fourth sport. Sacrilegious you say – perhaps – but there is a rising tide that is undeniable.

A new champion in this rising sport helped provide more publicity in a week’s time than perhaps the last five years, again proving that all publicity is good, even if your champion is giving the bird directed straight at the fans that paid top dollar to see the sport’s Championship.

Not all is new. We nearly witnessed the crowning of the oldest Major champion in golf history. To bad 71 holes does not make for a tournament. Hole 72 is unforgivingly decisive. We also had incredible, albeit in a sport that will never take hold in America. For the staunch football fan, July continues to impress.

  • Michael Vick. His federal dogfighting sentence to end July 18, there is wide speculation regarding what team may pick him up, when or perhaps if the NFL commisioner will  allow him to play in the league again and thus if we will resort to playing in the fledgling UFL this upcoming season. The July 13 Sports Illustrated had an interesting piece title, “What’s Next For Michael Vick?” The article looks at past and current legal transgressions by other athletes and the punishment received, both through the courts and their respective leagues. What Vick did was wrong. He went to prison for 23 months. Should it not be obvious to all that he has served a very harsh concurrent punishment both legally and to his career. It is not any teams responsibility to sign him, but NFL would be in the wrong to extend his sentence. Perhaps the most interesting quote from the article came from esteemed writer Malcolm Gladwell: “Let’s see, Leonard Little got drunk and killed another human in a car accident. He served 90 days in jail and got suspended for eight games. Vick was cruel to some dogs. He went to jail for a year and a half. And we’re wondering if Vick can play in the NFL? Please.
  • MLB. This past week the league celebrated its All Star game and I do not know anyone who watched. Similar to the strike in 2004, the steroid inquisition via the George Mitchell report has destroyed fan interest. The past decade has completely altered the validity and accuracy of statistics. In a large sense, Manny Ramirez may have been the final straw, cleverly told in this fictional epic by Bill Simmons. Perhaps the greatest tragedy was uncovered in the July 13 Sports Illustrated-what can I say it was a good issue. The article looks at how Albert Pujols may be the most perfect player to ever play the game and this year has a chance to win the first batting triple crown since 1967. I fear it may fall on deaf ears, despite Pujols  strong, affirmative denial of ever taking performance enhancing drugs.
  • UFC 100. Brock Lesnar became the undisputed heavyweight champion and moments later attempted to restart a fight with the opponent he just pummeled, verbally assaulted his opponents wife, criticized the organizations biggest sponsor and flipped off the entire crowd. Sounds a little like a weekly WWE show at first glance, but MMA is now mainstream. This is not the Kimbo Slice circus from last October, instead this was the event and perhaps the champion that will push MMA to the third most popular sport in the U.S. Media attention was off the charts before and especially after the event and possibly more telling, UFC 100 had more than 1.3 million pay-per-view purchases. The most in its history.
  • The British Open(apparently now referred to as simply the Open Championship). Tom Watson at 59 was one shot away from becoming the oldest major champion in PGA history. It was not to be, mirroring the excitement and then honorable defeat by Greg Norman from the 2008 Open Championship. To bad. Maybe Jack still has one left in him. Wouldn’t that be a thrill. If the media comes away with one learning from this year’s Open Championship, please let it be that we no longer discuss taking Tiger or the field. This is just a plain dumb story angle and with Tiger missing the cut, perhaps it will never be brought up again. One could hope.
  • Indoor Brazilian soccer. Yep you read that correctly. This may not be the greatest soccer goal of all time, but it has to be the best of 2009:

The 19th Hole – 7/3/09

What a difference a year makes. The U.S. may now matter in two global sports that in years recent, we were an afterthought. Favre Gate of ’08 is now mere nuisance and the NBA is filled with Conference altering changes. I also no longer loath the month of July as its significance in the sports landscape is quite plentiful.

I have been quiet on this site for exactly two months. This is to long for something meaningful not to result from my absence. Today is a very important date. It is the day I made steps to seriously pursue a passion, a direction. Today I began developing a site, and similar to GDGT it will be a least a few months before it is fully unveiled. July is an exciting month. Happy Birthday America.

  • GOOAAALLLL! That is right. Its summer so it is time to discuss elite soccer again. For 45 minutes, a full half, U.S. soccer was on top of the world. The Confederations Cup saw the U.S. leading Brazil 2-o, unfortunately the game ended 3-2 in favor of the South American power house. Brazil winning the Confederations Cup was not unexpected. The U.S. playing in the final and competing drew comparisons for many to the Miracle on Ice. While in no way does the Confederations Cup have similar importance to the Olympics, this would have been an unprecedented milestone in American soccer. Even with the loss, it represents the first time the U.S. competed in the final  for a significant global soccer championship. World Cup ’10, yeah U.S. soccer, you have piqued my interest.
  • The NBA Draft. Where to begin. Blake Griffin was selected first in the Draft. The Timberwolves selected three point guards while still having Sebastian Telfair under contract. There is a reason some teams stay in the gutter. You heard it here- some where between first and last – Ricky Rubio will never play for Minnesota. Perhaps because some have suggested comparisons to Iverson, I am hoping for great things from Milwaukee’s Brandon Jennings. Here is a great counter criticism post regarding his recent trials. Oh yeah, inexplicably, the Spurs some how landed DeJuan Blair at pick 37. There is a reason some teams always compete for a Championship.
  • Wimbledon. In Ladies singles, as anticipated, the Williams sisters will compete head to head yet again for Grand Slam title. The title game is on the 4th of July no less. Its America’s little way of reminding the British about a document we like to call the Declaration of Independence. The Gentlemen’s Singles final is a bit of a different story. American born Andy Roddick will face off against Roger Federer, winner of 14 Grand Slam titles. This is not the match the tennis world was expecting or possibly hoping for. Today Roddick took down Britain’s Andy Murray. I will not lie – a piece of me was rooting for Murray after watching the Hope of Dunblane, but I have moved on. Hopefully Roddick can bring relevance again to U.S. Men’s tennis this weekend.

Despite Econalypse – Internet Still Innovating

Approaching the midpoint of 2009, the worldwide econalypse is in full effect. The close of April ushered in an 8.9 percent jobless rate in the U.S., which is believed to be at a 25 year high and now articles highlighting the worst hit cities are beginning to appear. This post is not about what is failing, but instead the new ideas, innovations and interesting developments rising out of the econalypse. It is not exhaustive, but it hopefully will unearth exciting and different ideas that could lead to a thriving 2010.

 The genesis of this topic came from Po Bronson’s What Should I Do with My Life, Now? article and the Editor’s Letter in the February 2009 Fast Company. The final motivational push came from the 2009 Fast Cities special section that focuses on cities with an eye to a better more efficient and socially beneficial future.

Infamously, “The Video” from October ’08 is now considered the marker for the end of Web 2.0. A staple of the era was the RSS Reader, however this past week Slate discussed how the advancements in browsers have surpassed the once celebrated efficiency of RSS Readers that perhaps have now arrived at their extinction. The ability to load multiple sites in their native design through tabbed browsing is subtly groundbreaking. Browsers are rendering sites faster and it eliminates the “other inbox” that could grow unwieldy in only a few hours depending on the number of subscribed feeds. The browser is quickly graduating from a tool to access the Internet to the program that runs every computing activity. Pundits have suggested it is the new Operating System, while this shows a misunderstanding of the functions of an OS it does highlight the direction we are heading.

Online Search is an emphasis of Connected and like a slow rising tide, the landscape, expectations and definition of Search is gradually and most assuredly changing. For several years Google has dominated search through its superior keyword search algorithm. Semantic search is the holy grail of search, and similarly to the cup of life, we have yet to uncover and unleash its power. In the place of semantic search we have seen an explosion in social search. Mahalo had been the leader with its human-powered search engine that displayed results based on user input, but Web 2.0 social search was a clear second to Google. What if people could ask questions and search for information in real time with a global network? This is precisely where microblogging technologies like Twitter excel, however Aardvark may prove to be the technology that takes social search beyond the limitations of keyword search. Unable to improve upon what former colleague Fernando Rizo has already written on the topic, check out this analysis on what Aardvark and similar technologies will do to the world of search.

WebTV and online distribution of video has been a primary recent focus of Connected. Through excellent journalism and activism, Time Warner Cable abandoned its test of broadband data caps. Continued reporting that unearthed the economic fallacy that ISPs have attempted to use to rationalize data caps and metered billing will hopefully maintain net neutrality. This is a necessity for WebTV as big name players such as Amazon and Hulu continue to make legal, high quality content available to consumers. Original Webseries also continue to find a place in the growing WebTV space. A few recent top examples include:

Finally, the process of creating video is now a full fledged passion and recently I learned about tilt-shifting photography and video. This is an amazing example of Creative innovation:

March Mayhem

This post is not necessarily about the NCAA Men’s basketball tournament or sports in general. It is about how the internet and webtv is impacting sports and the U.S. culture. March Madness has been a major event for a while now, but the internet has taken it to a completely new level of intrigue and accessibility. It is officially a mid March national  institution.

A few years ago, options at the office for following the start of the tournament were limited. You could check score updates online, listen to games on the radio (broadcast or streaming) or take a long lunch. Last year CBSSports.com and NCAASports.com changed everything by providing good quality live streaming video for free. A quote this past week from the USA Today article helps highlight the magnitude:

Last March, 92% of the viewers that watched games at NCAASports.com did so through work computers, according to Nielsen Online. It’s tough to tell how “March Madness” affects workplace productivity. Employment consulting firm Challenger Gray & Christmas has made varying estimates since 2002. Last year, it said that NCAA-watching could cost employers as much as $1.7 billion in wasted time. – USA Today

Through the first three days of the tournament CBSSports.com received 4.8 million unique visitors, which represents a 65 percent increase compared to 2008. Another interesting statistic is the nearly half of the video streams are through the high-quality HD option provided through Microsoft’s Silverlight player. Silverlight was also used by NBC for the 2008 Summer Olympics, a relationship that has been extended to the 2010 Winter Olympics.

Putting aside network congestion, it is of little consequence how many individuals watched HD video on their office computer this past week. The significance is that there is scalable, reliable technology that allows for HD live streaming of sports games. By connecting a computer with internet access to a HD TV, March Madness fans can watch any live game in its entirety instead of being limited to the feed from their local CBS station. CBS does a fantastic job staggering games and ensuring viewers see the most exciting action, however giving viewers the ability to choose the game they want to watch or more importantly to flip between games showed exactly what is possible with webtv. The picture quality through Silverlight was impressive and the experience was well beyond my expectations. The only limiting factor is the ISPs. I unfortunately experienced buffering issues near the end of the day today that I can only assume I have Time Warner Cable’s throttling policies to thank.

How huge would it be if this could be done for the NFL or NCAA football? I know there are On Demand options through cable and satellite providers, but what if the middle man was cut out and consumers could buy HD On Demand packages that stream over the web directly from leagues? This is where it could all get very interesting because live sports is the final frontier for webtv. Once reliable options become available, there truly will not be a need for cable.

Regulators…Mount Up

It is hard to imagine a worse start for the new administration. With direction from President Obama, Congress in its infinite wisdom has chosen to completely unravel more than a year’s worth of work to transition the U.S. from analog to an all digital TV broadcast. Their excuse is that consumers were unprepared and confused, however the new solution is so wrought with problems that confusion will be the least or our worries.

On Feb. 17, some full-power broadcast television stations in the United States may stop broadcasting on analog airwaves and begin broadcasting only in digital. The remaining stations may stop broadcasting analog sometime between March 14 and June 12.From DTV.gov

Thanks government, this definitely fixes the problem. The FCC has the unenviable job of determining, which stations are allowed to change over before June 12. This means instead of all stations transitioning at one time, some stations in a region will be in analog while others could be broadcasting only in digital. One wonders if this could be “confusing” for consumers.

The decision also ties into the bloated “Stimulus Bill” with $650 million allocated to the digital-converter box coupon program. This is more than half a billion to fund more coupons and marketing for the new date. For a short time last year I had a hand in the millions spent on marketing to educate the public about the transition. By moving the date back, all that taxpayer money for marketing was essentially wasted. Moreover there are significant negative economic consequences for broadcasters and other tech companies that had been preparing for the February transition. Many broadcasters will now be required to support analog for an additional four months and companies who were preparing to utilize the the newly available spectrum for new technologies will need to stand idle while the recession continues in full force. Moving the date is a colossal mistake.

Perhaps the new administration should look at technology directives that actually benefit consumers instead of fouling up a program that was in place long before it came to power. One example is the growing trend of ISPs implementing data caps and metered pricing. A recent GigaOM post describes how Time Warner, Comcast, AT&T, Charter and Frontier Communications are all either beginning to test or have rolled out capped internet access to some or all of their customers. As I have written in the past, this will hinder innovation, raise prices and place a barrier for wide adoption of webTV. President Obama has the ability to eradicate this business practice, it remains to be seen whether he will have the foresight to take on this issue or whether network neutrality’s double edged sword will be realized. Some weeks back I stated my desire to put past feelings aside and become part of the solution for change. I am still waiting for action by my government to earn my commitment to it.

Broken Circuit

After declaring bankruptcy in November, Circuit City announced that it is officially closing its doors and going out of business. Only a couple years ago companies could not grow fast enough, but now most real estate projects have been canceled, stores are closing everywhere and many retailers are in danger of succumbing to the same collapse as Circuit City. The Washington Post reports that the current economy has made restructuring company debt more difficult and that this could merely be the first wave of many U.S. business closures in 2009.

It is true that poor debt related decisions by companies several years back compounded by the current economy is the driving factor for corporate failures such as Circuit City, but I believe there is another subtle shift occurring that touches all companies regardless of their industry or their current financial standing. Bill Clinton’s 1992 campaign can be summed up in one phrase, “It’s the economy, stupid.”  It was simple, direct and highlighted the country’s shift in focus from foreign policy to the recession. The economy is bad, real bad, but while to some it may sound unbelievable, many companies will fall this year because they were four years late in developing a viable online business model. Predictably, “It’s the internet, stupid.”

Consumers’ desire to shop and more importantly buy at brick and mortar retailers is fading. Online retail spending dipped three percent this past holiday season, but more and more people are growing comfortable with online shopping and the superior prices found there. Specifically, electronics are a popular online purchase through sites like Amazon.com and NewEgg.com. While this is not surprising news, it is arguably the reason why Circuit City failed and why companies like Blockbuster who were slow to adapt and implement an online strategy may be on borrowed time.

It is a shame to see Circuit City go. It was where I bought my first computer, but unfortunately is where I previewed my new computer and TV before purchasing them at Newegg. For nostalgia sake, here is a memorable commercial that was probably my first exposure to “The Circuit”