On why these posts are still here.

I began this blog eight years ago, in March 2016.

It petered out a year later, after a man named Donald Trump moved into the White House.

His ascension wasn’t this blog’s death knell — a job offer from a New England daily was.

I was only too happy to help keep one newspaper alive, rather than blog about the entire industry’s survival.

I don’t have any excuse for not resuming my work here after I left that newsroom, moved and took a support position at a university.  Mea culpa.  I laid down my sword while the fight was still going on.

But I have been watching, with alarm and awe. 

I’ve been alarmed by the continuing decline of daily newspapers. 

I’ve been awed by the reporters, editors and local publishers at existing dailies who continue to fight, as well as by those who have stepped forward with new business models, putting their careers and fortunes on the line.

The fight IS NOT over. There’s lots of work to be done.  I’m not sure picking this blog up again is the best contribution I can make.

But I’m not going to take these pages down.  I think the high performance bar of the traditional newspaper business model — the list of its benefits as archived here — should remain in public view. 

Why?  Well, speaking of another challenge (conserving the world’s oceans), Jacques Cousteau expressed my feelings very well.

“In the end we will conserve only what we love; we will love only what we understand; and we will understand only what we are taught.”

This blog was my little attempt to remind the world about the benefits of the traditional newspaper model.  Those lessons remain germane, because that model worked very well.  It produced a steady diet of local, national and international news that was consumed, in common, by the readers of the local dailies that published it.

As we all know, when people are allowed to make their own decisions about what to buy and who to vote for, the success of their civilization will depend on the quality of those choices. 

And that depends on the quality of the information used to make them.

Another presidential election looms ahead.  The newspaper industry is weaker than it’s been in my lifetime.  In fact, the worldwide circulation system of legitimate news is weaker.

We are awash in information that doesn’t matter.

As for relevant, legitimate information, the link between its originator and its eventual reader is increasingly obfuscated by online algorithms and, heck, by people just posting stuff.

Far too many of us don’t know where the important information — the details we use to make those important decisions — is coming from.

If you are a reader, please don’t just read, please verify the source.

If it’s a working daily that you can verify exists, its information is more likely to be dependable.  Because the people producing that information are held to higher standards — legally and ethically — than bloggers and online content providers like me.

Please keep caring about those original creators and do what you can to support them.  A digital subscription to your local newspaper may only cost $10 a month.  Buy one.  It matters.

If you are a news provider, you already know how important your work is.  You have my profound respect and thanks.

Good luck to us all. Keep fighting.

Your humble host.

Push me, pull you

Cost. It’s more than just the price paid. We also pay in time and effort. Money, time and effort — we weigh all of them when we’re deciding what to buy and how.

In this series of posts, we’re noodling our way through  Thales Teixeira’s findings, as presented at the 2017 New England Newspaper Convention. The title of his talk was “Responding to Digital Disruption.” In it, he introduced a new lexicon to describe strategies that have caused the rise and fall of business models.

“Cost” is an old word we need to think of in a new way. Two new concepts we also need to learn are “integration force” and “specialization force.”

In their paper, “The Decoupling Effect of Digital Disruptors,” Teixeira and Peter Jamieson define the integration force as “the sum of all the benefits received and effort avoided through ‘one-stop shopping.’” Integration forces strengthen the link between two consumer activities.

Specialization forces act in the opposite way, weakening the links. “Specialization forces tend to arise from opposing benefits, such as a retailer that offers a wide variety of goods and in-store service, important at the searching/sampling stage versus those that offer low prices and product availability, important at the purchase stage.”

Here’s the key quote from Teixeira and Jamieson’s paper: “Whether consumers couple or decouple adjacent stages depends on the net effect of the integration and specialization forces.”

Lost yet? Hang in there. Let’s put it all together with an example. His name is Joe.

Joe is not computer literate. He has a smartphone, but uses it only to make and take calls.

Joe wants a new TV. He drives to Best Buy, talks to a salesperson, looks at various models, compares their prices and makes his choice. Could he get it cheaper elsewhere? Maybe. But the time and effort costs associated with leaving Best Buy, driving to another store, parking, walking in and finding the model he wants aren’t worth the $20 he might save. So he buys his TV at Best Buy.

In Teixeira’s lingo, the integration forces exerted on the link between Joe’s browse — buy activities was strong, so the link held. Best Buy made the sale.

Let’s add a wrinkle. Joe’s daughter teaches him how to use an Amazon app on his smartphone before he goes to Best Buy. He drives there, talks to a salesperson, evaluates various models (showrooming) — and then he uses the Amazon app to compare prices, make his choice and buy from Amazon.com.

Once Joe knew how to use Amazon’s app, specialization forces weakened the browse—buy link. The forces arose from the opposing benefits offered by Best Buy and Amazon. In Teixeira’s words, Best Buy offered “a wide variety of goods and in-store service, important at the searching/sampling stage.” Amazon offered “low prices and product availability, important at the purchase stage.”

In our next post, we’ll talk about what Best Buy did to counter Amazon. Stay tuned.

This is the fifth in a series of posts reviewing a presentation given by Thales S. Teixeira, Harvard Business School professor, at the 2017 New England Newspaper Convention. If you’d rather read Teixeira straight, visit his working knowledge papers. To read this series in order, please view:

1. Time for a new recipe — Why do digital disruptors succeed?
2. Breaking apart the product — Disaster by another name: unbundling
3. Attacking the weak links — Decoupling the stages of consumption
4. Newspapers aren’t the only target — Decoupling disrupts all kinds of business models

Newspapers aren’t the only target

Where were we?

Oh yes. We were talking about the research findings of Thales Teixeira, as presented at the 2017 New England Newspaper Convention. Which is to say, we were talking about digital disruptors, how they wreak havoc, and what can be done to fend them off — or become one of them.

In this post, we’re going to review examples of decoupling. That’s Teixeira’s term for breaking a link between consumer activities that have traditionally been done together. It’s how the disruptor succeeds.

As we run through Teixeira’s examples, we’re also going to characterize each consumer activity. Does it create value for the consumer? If not, does it capture value for the producer? Or does it just erode value for the consumer, without capturing value for the producer?

Example 1, TV

The traditional chain of consumer activity for watching TV is: watch a program (creates value), watch a few ads (captures value), watch a program (creates value).

In their paper, “The Decoupling Effect of Digital Disruptors,” Teixeira and Peter Jamieson explain that TiVo, a maker of digital video recorders, enables viewers to skip the ads, “in effect separating the consumption of these two sequential activities.”

Why did TiVo succeed? Because it decoupled the activity that added no value for the consumer from the activity that did, and offered that one to consumers separately.

Example 2, radio

The traditional chain of consumer activity for listening to radio is:

1. listen to a song you like (creates value for you)
2. listen to an ad (captures value for the station from you)
3. listen to a song you don’t like (erodes value for you; doesn’t capture value for station)
4. listen to promoted value, a song the station was paid to play but one you don’t like (captures value for the station from you)

Pandora decouples steps 1-2 from steps 3-4. You can listen to only those songs you like, or are likely to like. So valued is this personalized music service that consumers are willing to listen to ads (step 2), or, for a small monthly fee, listen without ads (which completely decouples step 1 from the other steps).

Example 3, car ownership and use

The traditional chain of consumer activity for someone who  wants to drive a car is to conduct research, choose a vehicle, buy it, use it, and maintain it.

Turo, an online matching service, has decoupled the activity that creates value, driving the car, from the rest of the steps in the chain. Turo will help you find and rent the car of your dreams, one that’s owned by another person.

The sharing economy, notes Teixeira, decouples the value-creating activity of using from the value-eroding activity of owning.

The bottom line

“Viewed at a broad level,” writes Teixeira and Jamieson, “it is clear that decoupling is pervasive and poses a major threat to incumbent players in many industries. The media and entertainment industries are the most obvious targets for decoupling (as they were for unbundling) because the digital nature of their products allows for piecemeal delivery of content and because they have long relied on unnecessary value-capturing activities to generate profit.”

This is the fourth in a series of posts reviewing a presentation given by Thales S. Teixeira, Harvard Business School professor, at the 2017 New England Newspaper Convention. If you’d rather read Teixeira straight, visit his working knowledge papers. To read this series in order, please view:

1. Time for a new recipe — Why do digital disruptors succeed?
2. Breaking apart the product — Disaster by another name: unbundling
3. Attacking the weak links — Decoupling the stages of consumption

 

 

Building a news bridge

We’re going to take a break in our discussion of Thales Teixeira’s findings on digital disruptors to talk about a new idea. Here it is:

What if every American in a blue state who has a digital subscription to their daily newspaper were given a digital subscription to a daily newspaper from a red state?

What if every American in a red state who bought a digital subscription were given a digital subscription from a blue state?

What if American newspapers, weeklies and dailies, took it upon themselves to bridge the gap between Republicans and Democrats?

Why don’t we lead?

Digital subscriptions make it possible. Why not build the knowledge of people who, by subscribing, have demonstrated they care enough to read about their own communities? Why not build their knowledge about another community, on the other side of the gap?

Imagine the conversations one might hear in town, not just about the latest school board meeting here, but also the school board meeting there. Imagine the conversations you might have in the newsroom, about how your sister paper covered an issue or event.

The initiative, to reach scale, should be led by national newspaper organizations. It should be branded and marketed (house ads, at least). It should be exceedingly easy for subscribers. We want them to read both publications.

Big chains might find it relatively easy to set up sister relationships within the chain. Small, independently owned papers might need help finding a sister paper — maybe, could ask their own readers to help identify one.

Why don’t we lead?

Attacking the weak links

Oh, they’re crafty, those digital startups. They look at business in a new way, and they find the weak links.

That’s what we’re trying to do — see the newspaper business in a new way, find those weak links. We’re reviewing the findings of Thales Teixeira, a Harvard Business School professor, as presented at the 2017 New England Newspaper Convention.

As discussed in our last post, Teixeira attributes the first wave of digital disruption to the strategy of “unbundling.” Digital start-ups unbundled newspaper content, separating it out and offering it up, piecemeal.

Teixeira attributes the second wave of digital disruption to the strategy of “decoupling.” He defines it as “the breaking of links between consumer activities that have traditionally been done together.”

Consider the evaluate — choose — purchase — consume steps that often occur under one retailer’s roof. Once upon a time, to buy a TV, you’d go to Best Buy, and:

• talk to a salesperson and look at different models (evaluate)
• make your selection (choose)
• buy it (purchase), and
• take it home and begin using it (consume).

Now, Amazon and Pricegrabber apps have broken the evaluate — choose link. Using an app, you can compare prices online and make an online purchase while you’re still standing in the Best Buy store. (That customer behavior, by the way is called “showrooming.”)

I don’t know about you, but I need to run through more examples of decoupling until I can easily see the stages, the links between them, and how and why they broke. First, though, we need to add one more concept, the valuation of each activity, or stage.

Decoupling separates the stages of a buyer’s decision-making process, some of which create value for the customer and some of which do not. According to Teixeira’s findings, each stage or activity, either:

• creates value for the consumer,
• captures value for the producer, or
• erodes value for the consumer without capturing value for the producer.

This is an important concept to grasp, because Teixeira has found that decoupling disruptors that decouple and offer value-creating activities seem to be highly valued in the marketplace; those that decouple and offer value-eroding activities earn a relatively low valuation; and those that decouple and offer value-capturing activities seem to be valued in the middle.

It’s also an important concept because, once you get it, you can more easily see why a decoupling strategy worked, disrupting the target business model.

Think about it, and stay tuned.

This is the third in a series of posts reviewing a presentation given by Thales S. Teixeira, Harvard Business School professor, at the 2017 New England Newspaper Convention. If you’d rather read Teixeira straight, visit his working knowledge papers. To read this series in order, please view:

1. Time for a new recipe — Why do digital disruptors succeed?
2. Breaking apart the product — Disaster by another name: unbundling

Breaking apart the product

Think of the traditional newspaper operation as a production pipeline. At the end of the pipe, the product pops out each day, the newspaper. A reader buys it and gets a whole bunch of information, all at once.

Startups first cracked the newspaper business model by using digital technology to offer pieces of that information at lower cost to readers. Shopping for a secondhand table? Look on craigslist. Buying a house? Realtor.com. Restaurant review? Check out yelp. Latest news? Google.

That business strategy has been dubbed “unbundling.”

“New digital players grabbed the opportunity to distribute news, music, movies, etc., online and deliver only what people wanted to consume, even if that meant just a portion of the full content,” explains Thales S. Teixeira and Peter Jamieson in “The Decoupling Effect of Digital Disruptors.” “This unbundling of content was the hallmark of the first wave of digital disruption.”

Unbundling doesn’t just happen to newspapers, the authors point out. “Apple’s iTunes unbundled songs from albums. Amazon’s Kindle unbundled chapters from books.”

Small comfort. Well, we’re not looking for comfort. We’re looking for answers. And one lies in the pattern discerned by Teixeira, this strategy called unbundling.

To understand it better, let’s revisit two more ideas introduced in our first post on Teixeira’s findings.

First, the concept of consumption as a series of separate stages, or activities: evaluate — choose — purchase — consume. Someone buying a TV, for example, might:

• go to Best Buy, talk to a salesperson and look at models (evaluate),
• make their pick (choose),
• buy it (purchase), and then
• use it (consume).

Key point: unbundling occurs at the consumption stage.

Second concept: Each activity in the consumption process can be of one, and only one, kind. The activity either:

• creates value for the consumer,
• captures value for the producer, or
• erodes value for the consumer without capturing value for the producer.

Second key point: unbundling separates value-creating products.

Clear as mud? We’re trying to understand the challenges the traditional newspaper faces using a new vocabulary. Stick with us. It will be worth the work. More tomorrow. …

This is the second in a series of posts reviewing a presentation given by Thales Teixeira, a Harvard Business School professor, at the 2017 New England Newspaper Convention. To read the series in order, please view:

1. Time for a new recipe — Why do digital disruptors succeed?

Time for a new recipe

This post begins a series that will chew on a plateful of powerful ideas. They were presented by Thales Teixeira, a Harvard Business School professor, at the opening session of the 2017 New England Newspaper Convention.

The title of Teixeira’s talk was “Responding to Digital Disruption.” It held your humble host rapt. For the thought quickly occurred — by applying Teixeira’s ideas to our discussion about news models, we might actually get somewhere.

So here we go. We’ll start where Teixeira ended up. He concluded that:

• customers disrupt markets, not start-ups;
• the disruptive ingredient is business model innovation, not technology; and
• there is a common approach to disruption — it is not idiosyncratic.
  

In other words, there’s a pattern there.

In case after case, no matter what sort of business was targeted — from newspapers to big box retailers to service providers — Teixeira has found that digital disruptors succeed in the same way, for the same reasons.

Disruptors succeed because they find a way to:

• unbundle content that is traditionally offered together, or
• decouple the stages of consumption,

offering consumers, in both cases, something for less, in money, time or effort.

Just what the heck are the stages of consumption, you ask? You already know them: evaluate and compare, choose, purchase and consume. Each involves activities than can be only one of three types:

• an activity that creates value for the consumer,
• an activity that captures value for the producer, or
• an activity that erodes value for the consumer without capturing value for the producer.

Decoupling separates one activity from another.

It’s rich food that Teixeira dishes up. In the next posts here, we’ll review his lingo, explore his ideas and findings, and then apply it all to the business with which we are concerned: news.  If you’d rather read Teixeira straight, visit his website and his working knowledge papers. But please return here to add to the conversation. Thanks!

Connecting in rural America

It had a familiar ring — a frustrated advocate decrying the lack of:

• a hyper-local, comprehensive strategy, including
• attention to issues such as local health care and the condition of roads and bridges, conveyed through
• in-person contact with the community, to “talk to people about these things.”

It sounded like a prescription for solid daily news coverage, the kind that might help a local newspaper thrive.

But the man urging that those needs be addressed is not a newspaper publisher. His name is Matt Barron. He’s a resident of Williamsburg, Mass., who has left the Democratic Party after 41 years of active membership because, he says, party leadership refuses to hear and act on the obvious — that it has lost and will continue to lose rural voters if it doesn’t mend its ways.

I read about Barron this morning in the online edition of the Daily Hampshire Gazette of Northampton, Mass. And as I did, I wondered whether the newspaper industry ought to pay him heed. Many have wondered whether the press has lost its audience, particularly in red state America.

“Barron noted that when politicians say ‘go to my website for information or assistance,’ it does two things. First, it prevents many rural voters from getting that information as they have no internet access. Secondly, it reveals a complete lack of understanding of one of the biggest issues in rural areas today — the unavailability of broadband.”   —“Democratic Party leader Matt Barron leaves party over neglect of rural areas”

Hmm. We talk about news business models on this blog. All good business models begin with an assessment of who one’s customers are. In the case of a newspaper, that assessment needs to include how easily they can access whatever platforms the newspaper is using — print, website, mobile phone.

Barron touts the use of rural radio and newspaper ads as an inexpensive and effective method of reaching constituents. Perhaps if more candidates would buy display ads, local newspapers would be healthier. But one wonders, too, whether they would be healthier if they devoted more cash to basic, local news coverage.

A redesign for you

Gadzukes, a lot is happening out there. Here, too.

The SaveMyDaily site has been reorganized. With the post count approaching 50, it was time to make the blog easier to read. Please check out the “Pick a Topic” list in the site margin. If your time or interest is limited, click on a subject to see just the pertinent posts. Your humble host hopes the feature will help focus our efforts toward a successful end.

As for doings elsewhere, here are updates to posts previously published.

Fish or Foul? (Newspaper publishers care about what they print — and pay a price for it.): In a Dec. 15, 2017, post on Facebook, Mark Zuckerberg acknowledged that the company’s network is more than an elaborate maze of digital plumbing:

“Facebook is a new kind of platform different from anything before it. I think of Facebook as a technology company, but I recognize we have a greater responsibility than just building technology that information flows through. While we don’t write the news stories you read and share, we also recognize we’re more than just a distributor of news. We’re a new kind of platform for public discourse — and that means we have a new kind of responsibility to enable people to have the most meaningful conversations, and to build a space where people can be informed.

“With any changes we make, we must fight to give all people a voice and resist the path of becoming arbiters of truth ourselves. I believe we can build a more informed community and uphold these principles.” —Mark Zuckerberg

For more on the steps Facebook is taking to do that, take a look at the company’s “News Feed FYI: Addressing Hoaxes and Fake News.”

Making it clear (Better online news design might regain reader trust.): In “So, is it news, opinion or advertising?,” Michelle Morgante, managing editor of The Merced Sun-Star, points out that readers often don’t know the difference between the three. If online news sites do label every piece with a descriptive design element (NEWS, OPINION, etc.), it might be wise to include a link that explains the difference between them — or a link to Morgante’s column.

Discriminating distribution (Should the distribution method dictate the news content?): The Nieman Lab reports that The New Haven Independent, a nonprofit online-only news outlet, has tailored its cop shop policy in recognition of the reach and persistence of internet news. Paul Bass, the paper’s editor and founder is quoted as saying, “With the advent of the Internet, what’s online becomes people’s main or only source of news. People’s reputations are at stake, and often the arrest itself and not the outcome is what is known about them.” (“No mugshot exploitation here: The New Haven Independent aims to respect the reputations of those arrested in the community it covers” —Neiman Lab)

Fish or Foul?

Thus far in our discussion of newspaper business models, we’ve posited that being the gatekeeper and owning one’s distribution system is desirable, for two reasons.

1) It guarantees that the publisher has control over the news product and can ensure it’s of sufficient quality to fulfill its public service role.

2) It enables the publisher to wring every cent of profit from the distribution of the news product and the sale of ad space, which subsidizes the cost center that is the newsroom.

What would happen if news publishers no longer cared about the first reason, and didn’t have to subsidize any newsroom at all? Certainly seems like a lucrative model.

Are we watching it happen? Not by traditional newspaper publishers, but by new companies playing a mutated form of the traditional role?

Which brings us to the recounting of a robust discussion your host recently had with a dear friend, a former ad director of a daily newspaper, now retired.

In the comfort of his living room, over glasses of wine shared with him and his wife (who remained tactfully quiet and admirably pleasant), the question of whether or not Facebook and Google are publishers boiled over.

I argued that they are; my friend contended that they are not.

The companies are a new form of business, my friend said, a glorified pipe through which content generated by others passes, with a certain amount of revenue, of course, staying behind to build more pipe and fatten the wallets of its owners.

I countered that, since their algorithms dictate which ads and content their servers send out, Google and Facebook are exercising discretion and are therefore acting as publishers, not just pipes.

It’s nary impossible to build a sustainable business model if you don’t understand the marketplace and the nature of your potential competitors. So let’s noodle on here.

A newspaper printing press and its circulation department are akin to the internet service providers (ISPs) that computers use to communicate around the world. Both the press and circulation system and an ISP act as a conduit, a smooth-bore pipe.

The staff of the newspaper, though, determines every bit of news and advertising that does, or does not, go through that pipe. Newspaper publishers exercise discretion.

Google and Facebook do, too — your news feed doesn’t just happen, you know — algorithms (which are just coded forms of human logic) create your feed.

Newspaper publishers accept responsibility for what they publish. Google and Facebook don’t even describe themselves using that term.  They are neither fish nor fowl, neither a smooth-bore conduit nor a publisher wholly responsible for the content their servers send out.

We may cry  “Foul!” but theirs is a business model with which we must now compete — or use to our advantage.

UPDATE (02/16/2017)

In a Dec. 15, 2017, post on Facebook, Mark Zuckerberg acknowledged that the company’s network is more than an elaborate maze of digital plumbing:

“Facebook is a new kind of platform different from anything before it. I think of Facebook as a technology company, but I recognize we have a greater responsibility than just building technology that information flows through. While we don’t write the news stories you read and share, we also recognize we’re more than just a distributor of news. We’re a new kind of platform for public discourse — and that means we have a new kind of responsibility to enable people to have the most meaningful conversations, and to build a space where people can be informed.

“With any changes we make, we must fight to give all people a voice and resist the path of becoming arbiters of truth ourselves. I believe we can build a more informed community and uphold these principles.” —Mark Zuckerberg

For more on the steps Facebook is taking to do that, take a look at the company’s “News Feed FYI: Addressing Hoaxes and Fake News.”