Author: Mark Fletcher

lostremote.com carries an excellent interview with CNN President Jonathan Klein on citizen journalism and related topics. Check out this quote:

“I think citizen journalism is a huge force that’s going to get greater and greater. There’s no stopping it,” Klein said. “As long as we’re clear what the audience created and what CNN created, there’s room for both in this universe.”

The ourmedia.org website carries audio of the interview. It’s important listening to anyone involved in the news and information business.

Look at this folks – here’s a big story with a respected name and you have access to the source thanks to the tools we’ve been talking about here. Ourmedia is a perfect example of how the world is changing. They have had 14,000 people join their community in the last 4 weeks. Listen to this interview with Klein. You’re there. You can make your own assessment based on reliable facts from those making the news.

In the interview Klein forecasts greater fragmentation of the media and the role CNN will play in that. He explains that young people get it and that’s why they are embracing it.

Having built the highway and got people onto it with a warm fuzzy pitch about the nature of thir business Google is taking to covers off gigantic billboards all along the highway to increase advserising according to this story in the New York Times yesterday. They’ll move from context related advertising to more push advertising.

The challenge for Google is to not become a me too and have the advertising and the whims of the advertisers drive the business.

In a vlog (video blog) presentation to the Radio-Television News Directors Association conference in Las Vegas last week Jeff Jarvis (former TV critic for TV Guide and People, creator of Entertainment Weekly, Sunday Editor of the NY Daily News, and a columnist on the San Francisco Examiner) warned broadcasters to watch out for video bloggers.

Like podcasting, vlogging sets stories free from their physical world aggregation – newspapers, TV programs and radio stations. They facilitate consumer access by story rather than by aggregator. This will increase consumer access but frustrate the hell out of those who make money out of aggregation.

Now anyone with a $100 camera and a PC can create content and make it available. Vlog reporters will take us to stories ahead of more traditional news sources – as we saw recently with some tsunami coverage.

Those in the supply chain between content makers and consumers watch out!

Respected US weekly Newsweek (published in Australia inside The Bulletin) is adapting to growth in realtime news and information access through an initiative called “Every Day, Every Week,” according to this report from MediaPost.

This is the action of a smart company protecting its brand as opposed to one product carrying the brand. It’s how they will attract new readers. The challenge is to build the relevance of the Newsweek web presence while not cannibilising their print product while it is profitable. It will be interesting to watch advertiser behavior.

The MediPost story quotes Senior Editor Deidre Depke. “We want the site to be part of people’s regular routine, whether they read the magazine or not,” said Depke. “We know what we’re not–we’re not going to be regularly breaking news stories–but we can deliver the thought-out, analytic take that Newsweek is known for every day.”

The message for Australian newsagents: newspaper and magazine publishers have strategies for finding new readers in the online world. These strategies don’t require a traditional supply chain.

Okay so we’re concerned about the impact blogging, citizen journalism, podcasting, other technology developments and disaggregation of media titles.

We’re also facing the arrival of electronic portable newspapers. Not today or tomorrow but very soon. The first sample was demonstrated a few weeks ago in Japan. Now Intel has invested in the company at the heart of the technology.

Electronic newspapers have been a holy grail for many years. Now, E Ink is close. Their “e paper” panels are paper thin, light and low in power consumption. Already publishers are lining up to embrace the technology.

Seiko has signed on to commercialise the world’s first paper display watch.

In March at the Expo 2005 electronics trade show in Tokyo, Toppan Printing and NEC used E Ink’s technology to create a 2.4 metre by 2.4 metre newspaper displaying updated feeds of Japan’s Yomiuri Shimbun broadsheet newspaper. The screen was wafer thin.

The goal is a light weight portable wireless enabled device which receives updates to your live newspaper – with video as well as still images.

Look at the horizon and then look beyond for technology changes which will impact our businesses and then remind yourself that change is inevitable and good.

Okay so everyone agrees that newspaper sales are challenged thanks to falling consumer interest among the 18-34 year olds and thanks to many more access points to news and information such as websites, blogs, mobile phones and other hand held devices.

The newspaper and magazine publishers and distributors are responding to this by wanting to get their product into every location possible. They are turning what were once destination products into impulse purchases. They are educating the consumer and devaluing their mastheads along the way. They are starving the channel which could actually grow their business.

Whereas for more than 100 years newsagents were the prime retail outlets for newspapers and magazines in Australia, they now achieve between 45% and 50% of sales. Petrol and Convenience, Supermarkets and other retail account for the rest. But in making this shift to more outlets, the publishers and distributors have only taken care of the top 50 to top 100 titles. The other 1,500 to 2,000 titles retailed in Australia have been left in newsagencies – with fewer eyeballs to find them.

No wonder newsagents are struggling more than ever.

A smart publisher or distributor would focus exclusively on the newsagent channel. Why? For some simple reasons:

A smart publisher or distributor would not encourage competition against newsagents out of fear of missing an impulse sale. No, they would nurture this 4,600 strong retail channel which is unique to Australia and find a way to create the classic win win.

It is easier to advertise an issue of a magazine being at a newsagency than at the range of stores publishers are pursuing today. Think about this. A TV ad for a magazine sold in five different retail channels and 10,000 stores if harder to advertise than a magazine sold in 1 channel and 4,600 stores. This is the value of the newsagency channel and it’s being lost on our suppliers. They will be like the banks and realise when it is almost too late that they turned their back on the golden channel.

In September 2004 the ANZ Bank announced that they were reversing their branch rationalisation program. They started opening branches. They got it wrong and responded with what consumers wanted.

Consumers were happy with newsagencies. There was no consumer push to get product into other outlets. No, that was coming from newsagent competitors. It was a campaign not dissimilar to the one being waged by Woolworths today against pharmacists.

Publishers and distributors have acted like lemmings and chased other retail channels and, I’d suggest, NOT found the sales they wanted.

The answer is for one publisher or distributor to ignore the lure of the me too business strategy and focus exclusively on the newsagency channel. The right engagement will generate results which will make others reconsider their pursuit of petrol and convenience and other outlets.

For their part, newsagents need to be clear in their message to consumers, make it obvious that you are the retail destination for news and information. Embrace range as your point of difference and prove to the publishers that even in this time of significant change our channel is a channel which can boost business.

The two weeks since the Rupert Murdoch speech to the American Society of Newspaper Editors have seen a scramble on the pages of mainstream media to connect with his comments. Few in mainstream media have commented that News Corporation has joining the conversation about the impact of blogging, citizen journalism and newspaper readership late in the day.

The Murdoch speech and the coverage since in many newspapers, Business Week, economist.com and less mainstream forums like the Wilson Quarterly has collectively become a tipping point.

Many in mainstream media now get it that the world has fundamentally changed. It is as if we needed a figurehead to bless the change before we accepted it. Okay, so the conversation about the future has been blessed.

Consumers want greater participation in reporting news. Younger consumers have redefined what are acceptable sources of news are and how they access them. Journalists are breaking out of homogenized news organizations and seeking out independent and cost effective means of reporting what they want to report. Stories are breaking free of aggregated media forms and finding places more suited to their telling. Advertisers are embracing a world where the fees they pay are controlled more by real success than an impression of success. Consumers are embracing choice and individuality over the one size fits all model of the 1980s and 1990s.

Mainstream media can respond to these changes by ensuring that their brand is attached to new mediums of access to content and thereby find a place to retain and even grow advertising revenue. Such pursuit is appropriate for their businesses. They will get closer to consumers and rely less on the supply chain. Look at how radio broadcasters have embraced podcasting in its short lifetime. They get the impact of this new medium and many have invested quickly to get into the space and sell advertising into their podcasts and thereby protect their revenue streams. Newspapers and magazines will need to do the same.

On a side note, the changes in the news and information marketplace will not impact in a linear way. Podcasting, for example, will impact newspapers and magazines even though much of the discussion to this point has been about radio. Disaggregating stories and providing them in other mediums will set the stories free and consumers will find the content they want using the mediums they want. We are in an era where the story is the thing as opposed to the delivery mechanism. Previously you might have had a TV show and a magazine of the same name and quite similar content. Now, with all this wonderful technology you might see less of this.

The current news and information supply chain is where the biggest impact will be felt. Through the changes and after. Through the changes because of the almost chaotic situation where costs will be driven down in a retreating marketplace by people who have not fully considered how to respond to this thing they do not understand. This is where small business will be hit the hardest. After the changes because what will or will not be the role of the supply chain.

The newspaper supply chain – distribution, home delivery and retail – has been a servant of the publishers in Australia since the mid 1880s. For the supply chain – Australia’s 4.600 newsagents – to have a bright future, they need to move from this servant relationship and into a business model which affords more control. The options are considerable yet few are considering them. Now is the time for a conversation about the future, a conversation which pursues understanding in advance of a plan to maintain and grow these small businesses upon which more than 50,000 employees depend for a weekly paycheck. While publisher relationships will be important to newsagents for some years to come, we need to be developing other relationships which suit our business needs and where we have more control in the price of what we sell and the remuneration we can achieve for our services.

The current model where we do not control selling price or service fees puts us at a significant disadvantage as the cost blow out for the distribution of newspapers has shown over the last three years.

With advertising growth at almost exponential rates from their online business while readership of their newspaper falls, how long will it take a publishing company to dramatically alter their physical product distribution model. This is what newsagents need to be thinking about? There is a domino game playing here. Newsagents will feel that a smaller piece of a shrinking pie is better than no pie at all whereas an alternative view might be that the sooner the end game is played the sooner we can see a road forward for our businesses.

While we will hear the thud of a newspaper on the lawn for a while yet, it will happen less and less as predicted by almost every researcher in this field. How quickly is anyone’s guess.

Those in the newspaper and magazine supply chain need to be part of the conversation publishers are engaged in today about their future. We also need to be having our own conversations about our future. And while all that is happening, we need to continue build our businesses for the consumers who are yet to know that anything is changing around them.

When Business Week speaks people listen. This week, Business Week has a cover story about blogs, the information phenomenon which is sweeping the world. Here’s a wake up call quote from one of the excellent articles:

Go ahead and bellyache about blogs. But you cannot afford to close your eyes to them, because they’re simply the most explosive outbreak in the information world since the Internet itself. And they’re going to shake up just about every business — including yours. It doesn’t matter whether you’re shipping paper clips, pork bellies, or videos of Britney in a bikini, blogs are a phenomenon that you cannot ignore, postpone, or delegate. Given the changes barreling down upon us, blogs are not a business elective. They’re a prerequisite. (And yes, that goes for us, too.)

Everyone in business should read the Blogs Will Change Your Business article and the other articles and commentaries in the magazine. Those involved in the news and information supply chain MUST read the coverage. Business Week’s attention is that the world has changed.

Newsagents, those 4,600 independently owned and uniquely Australian businesses are a key part of the supply chain in this country and every newsagent ought to read Business Week and then engage in a conversation about the future direction of their business.

Manufacturers (publishers) are getting closer to consumers. This will impact the supply chain (newsagents included). Maybe not tomorrow. Maybe not next year. However, we are seeing the impact of the expected future in decisions being made today. Our suppliers have to make the decisions which are best for them. Likewise we need to make decisions which are best for us. The specialist retailer of news and information is no longer. We need other specialisation. Many newsagents are doing this already with excellent success. Too many, though, are not and face starvation.

We (newsagents) need to engage in an informed, intelligent and intellectual discussion about blogs and the disaggregation of media and create models which provide for our customers, our employees and our families in the future.

We need to make business decisions today with the knowledge of what is happening and with an eye to protecting our key asset of our relationship with our customers. We need to stop suppliers leaning more on us and abusing our disunity to their advantage as these changes filter through.

The changes we are seeing mean that our space in the supply chain is more valuable and this ought to be reflected in the fees we charge.

Reading this issue of Business Week is the start or arming yourself for consideration of the future. Business Week have done the research and responded by creating a blog themselves. blogspotting is a welcome and interesting addition to the conversation.

In my own newsagency business we are responding with the launch very soon of an online local newspaper. LocalNews Daily combines blogging, citizen journalism and an environmentally friendly online presence for news local to the community we serve. This will provide us with practical experience which we hope will guide a way forward through the changes.

There are several citizen journalism models similar to what we are creating with LocalNews Daily. One such is Urban Vancouver. A walk through the site demonstrates what a local community based news site can look like and the feedback areas document the gratitude of the community for such a place.

Talking about blogging and other phenomenons circling mainstream media…

It is tempting, but wrong, for the traditional mainstream media (which includes The Economist) to belittle this sort of thing. It is true, for instance, that the vast majority of blogs are not worth reading and, in fact, are not read (although the same is true of much in traditional newspapers). On the other hand, bloggers play an increasingly prominent part in the wider media drama—witness their role in America’s presidential election last year.

So says The Economist in a thoughtful article at economist.com.

The article was prompted by the widely reported speech by Rupert Murdoch to the American Society of Newspaper Editors last week.

Newsagents, as part of the news and information supply chain, need to enagge in discussion on these issues. While we worry about issues of today (cover price, delivery fees, late papers, over supply, under supply and greater competition) it is the news and information products we don’t sell, the new media, which we need to be building our business models in response to.

Australia’s 4,600 newsagents can play a role in this new world if we act quickly. We have to establish a better connect with our local community; we have to make each product we carry pay its own way (no more piggy backing in pursuit of profitability); we need to consider creating our own content; we need to urgently pursue recharge business; we need to pursue value add products; we need to find a way for our 4,600 sgtrong network to be part of the digital supply chain and to own that.

Our response cannot begin until we accept that the world is changing in a way which requires a response from us.

OhmyNews is five year old website with 37,000 citizen journalists and receives between 150 and 200 stories a day which are then processed by an editorial staff of 12. OhmyNews operates on a bigger stage than we plan for our small venture but it is worth learning from.

OhmyNews is generating considerable interest from a range of quarters as this story at CNN.COM reports.

It’s started in Seattle and will spread faster than a wildfire. iDine from the SeattleWeekly. This weekly newspaper is being creative in getting their content to consumers and in this instance the iPod from Apple is the device. This is perfect use of technology to set information free.

Rather than observe the news and information supply chain change around us we have decided to become participants. LocalNews Daily is an online only citizen driven newspaper which will initially focus on the eastern suburbs of Melbourne. Our news site is in the final stages of construction and should be in beta release within the next few days.

LocalNews Daily will focus, as the masthead says, on local news. By and for the people. We will not be burdened with advertising our operation as has happened with traditional local newspapers. We’re tired of letterboxes being stuffed with advertising material bulging inside a local newspaper with few stories of genuine local interest.

Access to LocalNews Daily will be free as will be access to submitting stories. Stories submitted will be published immediately. The publishing process will be very simple. In addition to news we will offer free blogs and a free photo gallery to all.

LocalNews Daily will only work if those who read the site and live in our target area actively participate and help us reclaim the local news channel.

Our newsagency is in a shopping mall in Forest Hill (in the middle of our target audience). More than half of our sales come from news and information product. LocalNews Daily takes our consumer connect deeper than these products and into the local space. Until now we have not had involvement with what we would call local news. That’s about to change.

This development places our bricks and mortar business in a new playing field while continuing to provide exceptional service within the traditional supply chain. The experience will better prepare us for bigger changes which will affect our traditional business.

More soon.

The greeting card marketplace is awash with technology based solutions which will compete with the traditional greeting card. An offrering from astonishingcards.com is bound to appeal to the mobile generation. They claim: Astonishingcards.com lets you create, print and mail Greeting Card style postcards and Photo Postcards.

At US$1.39 a card and with the convenience of sending the greeting from your desk or phone it’s an offering which will have an appeal. Astoinishingcards are one of many in the space, they’re getting attention because of the clever mobile connection.

Here’s a card manufacturer with a business model which does not rely on a supply chain between them and the consumer.

MAKE magazine, a US publication devoted to digital projects, hardware hacks, and D.I.Y. inspiration has commenced podcasting stories. So, another magazine joins Newsweek and a few others in being early adopters of bringing traditionally print based stories to a mobile audio audience.

Here’s what their first show covers: In this show- Woody Norris wins the “Nobel prize” of invention, using the iPod Shuffle without iTunes, camera phone panoramas, hacking for GIs, answered some reader email/IMs, Bill Nye is back, Macromedia and Adobe merge, getting around the XP Admin password and everything that’ll be in issue 02 of MAKE!

I keep saying it so what the heck: the supply chain between manufacturers (publishers) and consumers is shrinking fast. The world is changing and we in the supply chain need to adapt. We will look back on these times as when an earthquake hit the supply chain and the ground fell away from underneath us. By adapting we can find support elsewhere.

ABC radio stations Triple J and dig have commenced podcast trials in Australia. Radion National starts in May 2005.

The connection podcasting and Australia’s 4,600 retail newsagents is that it represents significant change to or possibley the breakdown of an aggregated (controlled) system for distribution of news and information. So much of our channel relies on similar aggregation products.

A study by Forrester Research is a wake up call for radio executives. It details the challenges ahead which new technology and new media bring to their turf. It forecasts a podcast ready audience for the US of over 12 million within six years. Some in the one year old podcast worl are predicting that this number will be reached in half the time.

Podcasting, which is the newest entrant into the digital audio mix, will see significant growth by 2010 –reaching 12.3 million households — as MP3 adoption climbs and broadband reaches 62 percent of households.

As we have seen with Newsweek already as well as the BBC, National Public Radio and others, podcasting has credibility as well as content. Releasing content so it is free as and when consumers want opens a whole new market.

I’ve been commenting here for a while about new sources of news and information. Taquitos.net is a perfect example of citizen comment, maybe even citizen journalism of a form, where consumers review snackfoods. There are over 2,400 products reviewed. There are plety of sites like this – putting consumers in charge. Who needs Choice magazine or any similar consumer association review when consumers are speaking directly – if the reviews are from real consumers that is.

The more consumers directly engage in creating content the greater the challenge for aggregators (news and information product) in some sectors.

Newsweek.com has launched a podcast called Road Test, which covers car reviews. They also have another podcast called Newsweek On Air.

This is serious innovation and anyone involved in the magazine business will be watching with interest. The Podcasting space was for radio and here’s a magazine publisher invading already.

If you’re not aware of what Podcasting is, here’s a good definition.

The supply chain between content creators and consumers is getting shorter every day.

The 18-34 generation which is shunning newspapers is embracing podcasting as a source of news and ninformation in addition to music. Reading this article from The Globe and Mail explains the thrill of content creation and publication. While newspapers and magazines would consider podcasting to be a technology to threaten radio and possibly television, it’s broader than that. It’s a technology which speaks to the 18-34s and will make newspaper and magazine content accessible to them.

UK newsagents will find out this week is the Office of Fair Trading will maintain current distribution arrangements for distribution of magazines or replace it with a system with less restrictions. Read this well written report Becky Barrow of the Telegraph. Here’s an excerpt:

The problem is that newspapers and magazines rely upon each other, using the same wholesaler and the same vans to deliver to the same shops in each exclusive territory. If the two are separated, the system could collapse as costs become prohibitively high. The supermarket chains would be able to negotiate good deals with big discounts and the wholesalers would do battle with each other to win the contracts.

This would sound familiar to Australian newsagents still dealing with the flow on from the decision by ACP to supply many petrol and convenience outlets direct rather than through the newsagent.

Newspaper and magazine publishers and distributors need to understand that isolating individual products in this makes a previously viable distribution system less so. The losers are small business.

Speaking at the Magazine Publishers of America conference last month about the Barnes and Noble magazine strategy, Peter Kreisky Chairman, The Kreisky Media Consultancy, Inc. said:

Here are the key elements of their magazine strategy – as I see them. First, B&N has designed its magazine section as a major in-store destination to enhance customers’ in-store experience. The section is always to the right of the front door, close to the café, where it will encourage browsing and lingering. It has proprietary, high quality, fixtures. B&N offers a broad and deep selection tailored to each store (between 1700 and 3,000 titles per store chosen from a base of 5000). It also aggressively cross-merchandises: computer magazines next to computer books; cooking magazines next to cookbooks, and so on. It also uses highly visible promotion fixtures.

Kreisky is an expert in his field. The complete text of his speech can be found here and is a must read for newsagents and indeed anyone in the magazine retail space. His company does excellent work in the magazine space and it would be wonderful to be able to draw on that expertise here. I am certain he would have research data and opinions which would help us boost our magazine sales.

Here is another quote from his speech to those attening the MPA conference.

We must make sure that we choose the high road and – with your support – transform magazines from just another Display Category to high value Department, overflowing with vitality and customer connections.

The transparency order issued by the ACCC in relation to Australia Post does not adequately address concerns of newsagents, not this newsagent at least.

Australia Post, 100% Australian Government owned, has a massive advantage over independently owned newsagencies. Research would reveal significant leasing advantages, operational advantages, cross subsidies from the postal service to retail, lower customer acquisition costs (thanks to exclusive mail services) for general retail sales and the might of the brand. The executives at Post have morphed the public service post office into a retail giant and it is businesses like newsagencies which are now suffering as a result.

Australia Post, with its current focus on retail growth and competition against newsagents, poses a huge threat to the viability of the newsagent channel. They continue to encroach of product categories which used to be the deomain of newsagents. Yet they refuse to make postal products available to newsagents on an equitable basis.

A government concerned about small business would establish an enquiry into the viability of the newsagency channel in the face of the competition from Australia Post in the non postal retail products and service categories.

What business does the government have owning such a commercial enterprise?

Yesterday, like every other Saturday, Australia Post outlets closed at or just after lunch in shopping malls across Australia. While other retailersd remain open, because that’s what customers want, Australia Post displays its disdain for customers by closing their doors.

Today, Sunday, their corporate stores are closed all day. The rules which apply to independent retailers don’t apply to Australia Post. The needs of customers don’t seem to be heard by Australia Post.

That’s their business of course. However, my business, directly opposite Australia Post, is open today and we cannot get postage product on economic terms so customers in our shopping mall miss out as they do across the country on a Sunday. We have no choice about opening either.

The Federal Government owes it to newsagents to sort out the inequities and provide a fair playing field. Australia Post corporate stores are too protected and the government benefits while independent businesses like mine suffer.

This story on the ABC online website is frustrating. It names newsagencies as being bad guys in the paper or plastic debate. Planet Ark says we’re slow on the uptake. They say we are not aware of the targets of reducing plastic bag usage by 50% by the end of this year.

We’re aware in my newsagency and we have a range of initiatives in play including an active laser toner recycle policy. We have arranged this through Planet Ark. I know of other newsagencies working with them as well.

Given the size of newspapers and the lack of a viable non plastic alternative we prefer to not provide a bag unless a customer asks. It works most of the time and our own plastic bag consumption is down as a result.

This story by the ABC is another example of reporting by press release. I’ve emailed Planet Ark and let them know my frustration.