Session Title: Newspapers: Sleeping Giants or Just Asleep?
Session Date: April 20, 2005
Session Time: 9:00 am – 10:00 am
Newspapers have powerful local brands and unique local content. But, as widely reported, their local revenues and subscriber base is under siege from Internet players on all sides. Though there are some notable exceptions, newspapers as an industry have yet to really mount a spirited defense of their turf online—although that could be changing. Will more newspapers and newspaper networks aggressively compete online for local users and SME revenues, including competing for directory advertisers? Or is the inertia of internal organizational and cultural issues too great to overcome against the accelerated pace of online development?
Bob Armour, VP, Business Development, CrossMedia Services/ShopLocal
Mike Markson, VP, Business Development, Topix.net
Terry Millard, President, Planet Discover
Tom Mohr, President, Knight Ridder Digital
Jeff Moriarty, VP, Product & Technology, Boston.com
Leif Welch, VP, Business Development, IPIX
Related Posts: buzzhit!’s Drilling Down on Local Search 2005 Index Page
Q: Has there been a change in Newspaper aggressiveness in the last couple of months, year?
Welch: The giants aren’t asleep, certainly not over the last year. More like being in a daze. We’re seeing small changes, not aggressive. Very fragmented, different behaviors from different players
Mohr: Newspapers vary in terms of their degree of sophistication. No question, it’s been a learning curve since the mid-90s, lots of mistakes made. The commitment is there. I think we’re gaining increasing competence in being a long-term successful player in the local space. We look at assets like CareerBuilder, Cars.com, etc along with our local sites as being powerful players.
Kelsey comment: You said we’ve made some mistakes. In my opinion, the only mistakes newspapers make is when they do nothing.
Mariarty: I think we’ve been asleep on classifieds, local search. We have a long way to go.
Millard: What we’ve seen over the past 12 months… 2004 was a lot of thinking about what local search is, since Jan 2005, we’ve started to see some action… proof of concepts, get in the market right or wrong, see how consumers and advertisers react. It’s moved from thought to action.
Markson: I think newspapers are starting to realize that great brands aren’t enough; you’ve got to have great technology. You’re seeing Boston.com working with Feedster. The Three Bears investing in us.
Q: In an industry that has a lot of legacy systems, how does integration happen. How long will it take for newspapers to have the technology.
Markson: We’re a 10 person shop in Palo Alto, mostly dev. But I’d say this is a Mohr question
Mohr: We’re delighted with the relationship. We need to make sure we don’t get too involved and integrated into what they’re doing; we want them to have the freedom to do what they do. Long Tail play. Will integrate some Topix abilities into our site
Armour: [Ed: Back to first question] Acquired in May 2004, launched the destination site [ShopLocal] in 3 months. Pace is definitely accelerating from some key newspaper companies that are driving this
Q: The Three Bears are doing a lot of the driving. Tom, how do the Three Bears work together?
Mohr: It works very well, but it’s a bit mystical. It’s a collaborative relationship. The principles involved in the Boards are consistent across most of the holdings. Close, trusting relationship. Very little market overlap, so not competitive. Share a common vision for where things need to go.
Q: Could there be 2-3 newspaper brands in 5-10 years that serve the whole country, all largely drawing content from RSS Feeds?
Mohr: Clearly there will be national brands like the NY Times. But there’s definitely a local play. Local traffic up 89% this year. Not all content is equal. Consumers are interested in what people write or rant about… but also want content from a trusted source with editorial they can rely on.
Markson: There’s commoditization in national news; but not in local. Quality is definitely an issue in the blogosphere. There are only 500-1000 blogs in our crawl. Lots of meta-analysis.
Armour: In most small local markets, the newspaper is the dominant source
Mohr: Using HitBox to track reactions to stories in real-time. Newsrooms asking for live presentation in the newsroom, so that the assignment desk knows what the readers want.
Q: What are the innovative things that are going on in the newspaper space, and how are people responding to it? What’s working?
Armour: We’ve been live for 6 months. Feedback is positive; we like the trusted brands. But we want more. We’ve got the big box players, but people want the local shops too. Newspapers are in the perfect position to do this. Then, how do we get into the YP market; some self-serve, some awareness
Q: How are the local retailers taking this opportunity
Mohr: We intend to aggressively leverage our existing relationships to populate ShopLocal with robust content
Welch: We see two consumer experience trends. We’re seeing unique initiatives to compete against eBay and Craigslist; cheap and free classified listings. The point is to bring the consumers back; getting the readers to become advertisers. Second trend; great content, but not findable or dynamic… working on exposing this.
Moriarty: Blogging experiments; photo submissions. The question is how to get readers to think about us for more than just reading an article; getting them to transact (search, etc)… getting them to read a travel story, then book a trip.
Markson: Our focus is on making ads part of the content [ed: not literally] by making them highly contextually relevant; insulin pump ads with a diabetes article.
Q: What’s the likelihood of NP and YP working together? What would make it likely
Markson: We view the search engines as the yellow pages. Through technology, they’ve turned YP ads into content [contextual] ads.
Welch: It makes so much sense on paper; lots of complimentary assets, salesforce, etc. In the NP side, we’re still trying to get print and digital to work together. We’ve talked with YPs who would love to partner with NP; but in the end, there’s zero action. Likely not something that’ll happen in the next 5 years.
Millard: It’ll only happen through acquisition
Mohr: Business case driven. The question is how do you leverage the synergies that creates incremental revenue. Agnostic, but open; skeptical.
Armour: Low, unless there’s an acquisition. No JV, no partnership
Q: The fact that your competitors don’t have these cultural barriers, that they can bring product sellers and service providers together creates a hole? What about that?
NO PANEL RESPONSE [Ed: So very telling… and so unfortunate]
Audience Q: AFP believes they are being exploited for $16.5M Are news aggregators exploiting creators, or are creators getting more than they give
Markson: If you’re in the business of monetizing page views, more traffic is better. Most publishers see that. We have an opt-out policy; maybe 3-4 folks have done that. Unsolicited, we’ve had about 2K pubs ask to be part of the crawl. We distribute news to CitySearch, Ask Jeeves, etc.
Mohr: We’re definitely in the distributed net side of this; some parties still want to be a walled garden. We want to be where consumers are.
Moriarty: We see 20% of our traffic from search engines; About.com is about 50%. We’re looking for more traffic from the aggregators, not less
Audience Q: Newspapers have failed to bring their advertising franchise online; where do you see advertising revnue coming from
Mohr: We’ve been very focused in building an online classified offering. Free listing below $250, modest fees above. Launching print+online this summer. Craigslist has really opened up a new marketplace. We’re focused on making sure that we provide the marketplace in most of our markets. CareerBuilder is increasing prices… and volumes! Overall take-rate is approaching 100%
Audience Q: What changes beyond hyperlinks will we see in the ways people interact with content
Moriarty: We’re working with Feedster to link Red Sox player names with blogs. We’re seeing a huge growth in video plays; 1.5-2MM plays per month. Lots of potential
Welch asks Q: You don’t see many local advertisers in banner advertisers, contextual. Why not build your own Google Adsense?
Moriarty: In the process of implementing InDecka [sp?!]. Now we’re looking to provide opportunities within a search environment
Audience Q: Please comment on the vertical players like Edmunds, FindLaw. Are they two small to be a threat, are the acquisition targets
Moriarty: We have a partnership with Edmunds; great distribution partnership. Lots of qualified leads.
Mohr: We’re impressed by Edmunds. Our asset, Cars.com, is strongest in used. Homegain is interesting; lead gen is very interesting. We’re learning from this; not just in potential partnerships, but in building our own offerings
Audience Q: Tom mentioned 80% growth: where is it happening
Mohr: That’s local traffic growth. Overall traffic was up 25% last year
Millard: We’re seeing 20% gains MOM in sites that are running our search
Audience Q: Buffett believe print advertising trends are slidding and will continue; they’ll lbe irrelevant in 20 years
Welch: The demise of newspapers has been predicted for a long time, but they’re still making money… which might be why they are changing so quickly. It’s really about missed opportunities; they could have been eBay, Google, etc.
Millard: I’d agree with Buffett. Think of newspapers as local information sources; great ways to market online. That’s where the play is.
Armour: No question that Buffett is right. The question is can they be just as effective online
* These are raw, unproofed notes taken in real-time. Nothing attributed to any speaker should be assumed to be an exact quote. Rather, my goal was to capture and communicate the essence of what was said. If there is a significant mistake, please post a comment or email me; I will make a correction at my earliest opportunity.