Amid the hubbub of this week’s mass layoffs throughout the Postmedia network, its finances were noted mostly for revealing how much each of its executives earns every year. Less noted (though mentioned) was the part of its quarterly report, released a few days prior, that touched on digital ad revenue.
“Digital revenue was $30.2 million for the three months ended November 30, 2015, representing 12.0% of total revenue,” the report said. Compared to the same period last year, digital revenues had increased $5.9 million, “as a result of the Sun Acquisition”. However, it went on to say, if Postmedia’s acquisition of the Sun newspaper chain were to be excluded from the tally, digital revenues actually decreased by $1.4 million, or 5.7% during those three months, compared to last year. The reason given for this decline is familiar by now to those in the media, or who simply pay attention to the media: decreases in local digital advertising and digital classified revenue.
We could, at this juncture, have an equally familiar, somewhat historical, discussion about all that. About how Craigslist and its ilk cut the knees out from newspapers just as the shift to free online platforms was beginning, thus undercutting a key revenue generator. Or about how giving news away for free from the get-go was the media industry’s original digital sin for which there will be no fiduciary forgiveness.
Rather than talk again about how we got here, it might be time to accept the current state of affairs and look ahead. We could ask: Where will we all work next? But that might not be the correct question in this case – or at least not the one we should ask immediately. Before we can figure out where we’ll work, we need to think about what sort of work we might do, and for whom, and which models might work best. So, maybe in this journalism future-casting, we might better ask: What’s happening to advertising?
For one, advertising is driving a platform shift – advertisers are moving to your mobile device. Companies like Facebook, which eats up a large chunk of online ad revenues because it knows so much about its users, are realizing that the most valuable future is on your phone, rather than your desktop, because that’s where our eyeballs spend time. It’s for this reason (in part, anyway), they’re making sure you stay within the Facebook universe even longer, shifting its design so that its mobile app operates more like a browser than merely a website. We'll get back to that in a minute.
Also interesting to consider is Instagram’s advertising – not just the promoted pictures users see in their feed, but the embedded ads within posts. For the moment, it seems celebrities are the only people afforded the chance to pose with products as if they were using them in their daily life and subsequently charge those brands thousands of dollars for doing so. Still, it’s not altogether unlikely that the practice will spread – not to mention become more and more localized. Why wouldn’t, for instance, a Toronto brewery or restaurant find a popular local Intagrammer to help promote their latest beer or newest menu item? Again, more on that below.
For the moment, what we can take from this is that there are three things that are (probably!) going to happen to advertising, if they aren’t already: it will become more localized (or, at least, highly targeted), it will be mobile-oriented, and it will be embedded. The first of those is largely unsurprising – we’ve known for a while that hyper-local ads are effective, and that done in the right way, can generate revenue (classified ads, for example). But what about the other two? And what might they mean for journalism, or media more generally?
How we consume
People aren't just spending more time on their phones looking at random stuff; they're using them to read. And a mobile read does not necessarily equate to a short read. As the Atlantic highlighted in a 2014 piece, long-form pieces are still holding attention for mobile readers. It specifically references a 6,000-word Buzzfeed piece that garnered more than a million pageviews, 47% of which were from mobile devices. And that those who read the piece on their phone spent an average of 25 minutes doing so, versus those who read it on a tablet, who only spent 12 minutes with it. Similarly, Instapaper (and Tumblr) creator, Marco Arment, told Poynter that for longer stories, a phone is better than a laptop. “The modern computer is packed with distractions. Your hands are always on the controls, waiting to click around and find the next bit of information… Long-form content requires attentive reading, and attentive reading requires a distraction-free environment. You need to pull people away from their computers.”
But how are people finding these pieces, long-form or otherwise? The answer, unsurprisingly, is increasingly through Facebook, which as of last summer sends more traffic to news sites than Google. This is perhaps partly why some news organizations have decided to follow Facebook into the new mobile era by signing on to its Instant Articles – which load instantaneously within Facebook.
When Facebook launched Instant Articles, CEO Mark Zuckerberg held a Townhall Q&A on the site and explained the new feature. “One of the biggest issues today is just that reading the news is slow. If you’re using your mobile app and you tap on a photo, it typically loads immediately. But if you tap on a news link, since that content isn’t stored on Facebook and you have to download it from elsewhere, it can take 10+ seconds to load,” he wrote. “People don’t want to wait that long, so a lot of people abandon news before it has loaded or just don’t even bother tapping on things in the first place, even if they wanted to read them.”
This was pitched as a win for news outlets (and democracy). “When news is as fast as everything else on Facebook, people will naturally read a lot more news,” Zuckerberg continued. “That will be good for helping people be more informed about the world, and it will be good for the news ecosystem because it will deliver more traffic.” That last point is obviously important, and we might want to put an asterisk on it.
The new bosses
As it turns out, by late last year, news organizations that had committed to Instant Articles were finding that their ad revenue was tough to come by, given some of Facebook’s restrictions, like on the size (no big ones) or type (no rich media ones) of ads that could run with pieces. Facebook acquiesced to demands, and loosened its rules. But here's the important bit: if news outlets place their own ads in Instant Articles, they receive 100% of the revenue, but if they let Facebook do it for them, they receive only 70%. Facebook, in other words, can, under the right circumstances, make money from news content without having paid anything for it, aside from allowing views to count toward the publisher’s website totals. As Michael Wolff pointed out at the MIT Technology Review last year, publishers like the New York Times, which uses Instant Articles on Facebook, “effectively give up their own channels and become suppliers of content to more efficient distribution channels. There is no New York Times, there are just New York Times articles.” Taken to its logical end point, it effectively means journalists might all one day be feeding news to Facebook by default, no matter where they are accredited.
Of course, that’s assuming media outlets are still the ones handing out accreditation – which they might not be. So who will?
Another bit of news popped up this week that might give us part of the answer to that. It was an announcement, actually – that a former CBC radio executive director has signed on to work for Pacific Content, a company that makes podcasts. More specifically, they make podcasts for companies – “branded podcasts” – which are, in their words, “an innovative marketing solution for bold and imaginative companies who want to build their own audience.” One of those companies is Slack, the messenger system offices use now internally to eliminate the need for chain email discussions. The Slack podcast is funded by Slack, and while the content is not necessarily about Slack, specifically, it is about “work, life, and everything in between”. A recent edition, for instance, featured stories about “staying limber and fit,” and “how outdoor camaraderie helps with in-office software development” – in other words, things that Slack would like people to associate with its brand. This means Slack becomes more than just an office tool; it’s an identity to which you associate. Forget Instagram embedded advertising – call this embedded branding.
It’s an interesting step to what feels like the inevitable future, where the middleman is cut out completely, and where the technology company owns the creative content, essentially becoming the news organization. That is to say, we don’t all work for the New York Times and have our stuff posted to Facebook as if it were a wire service bulletin system; instead, we just all work for Facebook.
Isn’t working for giant, broad-reaching, profit-focused corporations partly what got us all here in the first place? Yes. Except for one key difference: Facebook’s ability to sell micro-targeted ads – the very thing that at one time allowed newspapers to at least survive, if not thrive.
What this might mean is that we end up with Facebook “channels”, for lack of a better term – news and radio stories hosted within Facebook’s mobile app that are aimed at niche audiences (much in the way podcasts or Apple Music are now) that show up in what’s already called a “news feed”. But rather than “liking” the New York Times or the Toronto Star on Facebook and seeing a range of their stories, some of which may not interest you, you will instead “like” or even pay for a Facebook news channel, and receive much more precise content, written by Facebook reporters on much more precise topics – not just Facebook Culture, for instance, but Facebook TV or Facebook Walking Dead; not just Facebook Politics, but Facebook House Committees or Facebook Environment Policy. There could be branded channels, too, of course. The Louis Vuitton Facebook Fashion channel. Or whatever.
The style of content wouldn’t necessarily change (even now, Facebook asserts that Instant Articles are good for all “types” of articles), so journalists might still write as they always have, in short- or long-form. Subscribers to each channel would receive a push notification on their phone when a new story is posted, as they do now for the Times or other news outlets. Highly-targeted advertising would help keep it viable. Journalism would, technically, still be journalism. Right?
Until, of course, the content didn’t reflect well on Facebook’s brand. Then… well, who knows?
Alternatively, we could head things off at the pass. Maybe. There are options, including working models for non-profit journalism like ProPublica, and crowd-funded projects like Canadaland that demonstrate that the future predicted above is not a given, nor must be the totality of things, and that journalism can still work as a business. Yet, to get the latter two kinds of endeavours off the ground, there often has to be either seed money or a known audience ahead of time, or both. And even if those are both present, it might not work out.
Is there a place where bold, even strange, ideas could be tested for a potential audience, and afforded the necessary time to develop, and cushioned to some degree in the formative stages against the immediate demands of the free market? Is there somewhere that might offer a laboratory in which we could build something new before it gets built for us?
One of the growing annoyances with CBC News is that its online division has begun to drift toward what’s usually referred to, inaccurately, as more of a Buzzfeed-style site – that is, click-bait stories designed to garner traffic, but that perhaps offer little true news value. “You think private media are going to chase these kinds of stories? Not a chance!” Andrew Coyne tweeted sarcastically the other day, accompanying a link to a CBC story about a cat that looks like actor Adam Driver. Point taken: why should the CBC be covering that?
The issue of the CBC is a unique one, and discussing it inevitably leads to arguments about funding. Its funding is a thing to discuss, and I won’t get into it here, really, except to say that those arguments generally tend to fold back to content – usually whether all that money is being used correctly.
The reason CBC online might have started to bait for clicks is out of a – misguided, though understandable – compulsion to compete with other news organizations that, for all the reasons described above, appear fundamentally to be on a different path. And the more it competes, the more it puts undue pressure on its private competition. After all, who can really compete with the public broadcaster? Ultimately, in our scenario here, what this could mean is that very soon, the CBC’s competition won’t be the Star, but much bigger, tech players who know quite a lot about their audience.
Accepting all the inevitable counterarguments to this, I humbly offer that currently in Canada the CBC’s online division offers the best chance at producing more new, niche-oriented media, given that it continues to receive federal funding – and if the current government has anything to do with it, apparently will receive more. This is not to say that all out-of-work journalists could work for the CBC, but rather that it may be there where experimentation could work, as it bears fewer (though still some) of the pressures of private media.
More specifically, this might mean launching an iPlayer-style TV app, and commissioning programming for it that otherwise might not make it to the main network simply because it appeals only to a small sub-section of viewers. Similarly, expanding its battery of podcasts beyond merely recordings of its radio shows, to include specific – or even random – topics (Video games? TV recaps? Vacations in continental Europe? WHL team coverage? The Aboriginal music scene?) would be inexpensive and, more importantly, allow advertisers more specific audiences to target. Likewise with its journalism: why not open sub-sites? Why not, for example, a data-journalism site akin to FiveThirtyEight? Any of these ventures that proves successful at the CBC might strike out on its own, starting another series of similar shows or podcasts, complete with a website garnered toward those viewers or listeners. Who knows?
There are problems with this idea – I can name a few already. For one, it would take a major shift in the way we conceive of a public broadcaster (as part start-up incubator). But if a varied, engaged, and thoughtful media sphere is indeed a public policy concern, then it might be incumbent of us to at least spitball some ideas about what we can do with the media corporation we all still own.
One of the stranger aspects of the (continuing) recent struggles of the New Republic is that its latest owner, Chris Hughes, made his fortune as the co-founder of Facebook, yet never seemed to implement the kind of targeted model to media that the social media giant suggests could be successful.
Hughes became majority owner and editor-in-chief of TNR in 2012. The magazine to that point had had its ups and downs, but for a time was known in the U.S. as the “in-flight magazine of Air Force One” – a policy magazine designed for policy wonks. Within two years of Hughes’s takeover, the magazine had dropped from 20 editions per year to ten, and the new CEO Hughes hired, Guy Vidra, a former Yahoo! News head, was describing it as a “vertically integrated digital media company”. In a meeting detailed by the New Yorker, Hughes “insisted that a radical transformation into a digital-media company with a greater emphasis on profits did not mean that [TNR]…would devolve into a clickbait factory.”
This week came the news that Hughes is now selling the magazine. As Ezra Klein wrote at Vox, the New Republic has “stood for less and less in recent years… the TNR that stood for so much routinely saw subscriber numbers of 100,000 or less. It would never fulfill its publisher’s hopes of acquiring tens of millions of monthly digital readers.”
“The pressure for convergence is strong. We feel it at Vox, and sometimes give into it. It’s easy to see which stories are resonating with readers.” Klein wrote. “Right now, almost all successful digital publications are partially built on internet best practices and partially built on that publication’s particular obsessions, ideas, and attitude. Digital publications need to be smart about their mix of what everyone else does and what no one else does.”
Easier said than done, surely, but there is a lesson here perhaps, if we needed another, about how news organizations have thought to react to the internet: not digging down into narrower and narrower content cracks, but paving as wide a path as possible, hoping that the total clicks will pay off in the long run, as well as the short.
We’ve seen the result, both in revenues and in content. After departing TNR in a massive post-Vidra shakeup, its former literary editor, Leon Wieseltier reflected on the so-called disruption of the media landscape: “Journalistic institutions slowly transform themselves into silent sweatshops in which words cannot wait for thoughts, and first responses are promoted into best responses, and patience is a professional liability. As the frequency of expression grows, the force of expression diminishes.”
Oh, but who knows? It’s not as if nobody’s trying to keep their heads above water. A few major publications are making interesting strides on their own into new advertising initiatives with sponsored content. The Times, the Guardian, the Economist, and Slate have all designed visually compelling ways to tell sponsored stories. Maybe that’s all that’s needed to keep things going. Everyone is looking at ways to better target their readers, both with content and advertising. We’re all trying, here. There is no single solution, at the moment, to journalism’s online woes. But we tried going big, and it hasn’t quite worked out, so it seems we might as well try going the other way, now. Maybe that’ll work.