Marc Andreessen – Twitter Observations on the Future of MediaFollow
Such a fascinating change in the traditional journalistic press over the last several years...
Used to be: Corrections to printed news stories were a really big deal, high bar to get accepted. Story as printed = permanent record.
Now: Even top print newspapers frequently revise stories online, sometimes dozens of times, often w/no change tracking or acknowledgement.
Glass 1/2 full view: Stories get better and better in place over time, vector closer to truth. Accuracy over time goes up. All good.
Glass 1/2 empty view: Quality bar for initial post can be lower, original work sloppier, since can correct in place as much/often as needed.
Deterministic "truth" vs probabilistic "truth" -- here it is/take it or leave it, vs here it is/subject to arbitrary ongoing revision.
Print journalism converging in technique (?) and quality (?) towards blogs, Wikipedia -- for better or worse (or both).
Ed Bott fully decoded this with original NSA PRISM news stories.
So I am very interested to see how capital-J Journalism can maintain reputation for truth, accuracy vs blogs, Wikipedia. Stakes very high.
Or, we may be entering new golden age of journalism, just not recognized yet -- best of all worlds, accuracy rising, closer to truth?
Enthusiastic response to last series of tweets on evolution in the news business, so here are a bunch more thoughts.
Starting point: I am more optimistic/bullish about future of news industry over next 20 years than almost anyone I know. Will grow 10x-100x.
Part 1/5: The news business is a business like any business, and can and should be analyzed and run like a business.
Thinking of news as a business is not only not bad for quality objective journailsm, but is pro quality objective journalism.
A healthy business is the foundation for being able to build high quality products, and to do so sustainably. Including journalism.
Analyzed as a business, the news industry is going through a fundamental restructuring and transformation, for worse AND for better.
The main change is that news businesses 1946-2005 were mostly monopolies and oligopolies, and now they're not. Wrenching change for anyone.
Doesn't mean that great news businesses can't get built in highly competitive markets, just that they get built differently than before.
In particular, monopoly/oligopoly structure of newspapers, magazines, broadcast TV news pre-'05 meant restricted choice, overly high prices.
In other words, the key to the old businesses was control of distribution way more than anyone ever wanted to admit. Wonderful while lasts.
Now, with everyone on Internet, three things are happening simultaneously:
(1) Distribution going from locked down to completely open, anyone can create & distribute, no $ premium for control of distribution.
(2) Formerly separate industries colliding on Internet. Newspaper vs magazine vs broadcast TV vs cable TV vs wire service, now all compete.
(3) Market size dramatically expanding--many more people consume news now vs 10-20 yrs ago, many more still in 10-20 yrs. Big, big deal.
1 & 2 drive prices down. 3 drives volume up. Right now everyone obsessed with 1 and 2. Ultimately most important is 3. Market size=destiny.
Big opportunity for news industry in next 5-10 yrs is to increase market size 100x, drop prices 10x. Become larger & much more important.
Part 2/5: Construction and reconstruction of business models -- how to make $.
Picking up from Part 1: Best news about news business is gigantic expansion of addressable market -- rise of developing world + Internet.
Total addressable market for news by 2020: ~5 billion people worldwide; straight extrapolate from # of cell phones -> smartphones globally.
However, we all have to get more sophisticated about defining and segmenting markets. Critical to really understand who, where, when, why.
Many evolving markets seeing "death of middle": broadest breadth winning; deepest depth winning; neither broadest nor deepest in trouble.
So logical to expect big winners in news business to either be the broadest or the deepest: to max mass or go max specific.
With that as backdrop, here are most obvious 8 business models for news now & in the future; each business should mix & match as relevant:
(1) Advertising. Still central for many news businesses. But need to get out of "race to bottom" of bad content, bad advertisers, bad ads.
Quality journalism businesses need to either take responsibility for own high-quality advertisers & ads, or work with partners who do.
There is no excuse for crappy network-served teeth whitening and "one weird trick" ads served against high quality content. Disastrous.
(2) Subscriptions. Many consumers pay $ for things they value much of the time. If they're unwilling to pay, ask Q, are they really valuing?
(3) Premium content. Paid tier on top of free ad-supported. High end e.g.: Bloomberg & Reuters. Will work for more & more. Again, value = $.
(4) Conferences & events. Bits becoming abundant; human presence becoming scarce. Charge for scarcity. Bits drive demand for presence.
(5) Cross-media. I think Tina Brown was right but too early w/Talk. News key source of material for books, TV, film--also growth businesses.
(6) Crowdfunding. GIGANTIC opportunity esp for investigative journalism. Match people with interest in topic to reporting. Click = vote = $.
(Helpful hint: Start today with @Crowdtilt -- easy as pie, no brainer.)
(7) Bitcoin for micropayments. Easy to get started now (@coinbase); as consumer use scales up, easy to ask for small $ w/low or no fees.
(8) Philanthropy. Today @ProPublica & @FirstLookMedia, tomorrow could get much larger. ~$300B/yr philanthropy in US alone. Underutilized.
In addition, as my friend Jim Barksdale says, "Two ways to make money in business: you can unbundle, or you can bundle." Or, rebundle.
We already see the rise of new kinds of aggregators in the wake of the great unbundling of newspapers & magazines. Another thread to pull.
One frequent critique of brave new world is, "Won't oceans of crap drive out quality content?" I don't think so, in fact the opposite.
On Internet, no limitation to # of outlets, voices; therefore quality can easily coexist with crap. All can thrive in respective markets.
And, the more noise, confusion, and crap -- corresponding increase in need for trusted guides, respected experts, quality brands.
Finally, the "investigative journalism problem" -- how to fund investigative journalism, believed to be least commercially viable type.
Answer #1: Total global expense budget of all investigative journalism is tiny -- ~$10s of millions only. Small $ problems easier to solve.
Answer #2: Crowdfunding + philanthropy + subsidization by otherwise healthy news businesses should easily cover invst journ & even increase.
Same answer to "Baghdad bureau problem"--conflict zone reporting super-important; expensive vs other reporting; but not that much $ total.
Remember: Most great businesses are not big businesses. This market plenty big enough for thousands of high-margin small-medium businesses.
(... to be continued ...)
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