Backfence.com goes live today and already it’s looking good. The site covers the local issues we plan to cover in our LocalNews Daily online community. They go beyond and into advertising, yellow pages and the like – areas not on our radar at present. The site is very clean and easy to use.

Stories on Backfence have been posted by local residents. Many say this is the way of local news in the future. Who wants to read a homogenised local paper stuffed in your letterbox as a conduit for advertising when you can have something like this which is more about the news than anything else?

Here is an interview with the founder, Mark Potts which sheds more light on backfence.

Backfence sets a new benchmark in hyper local citizen journalism.

We start tomorrow engaging with potential contributors by handing out flyers to invite content submission. We’ll do this first across the counter in our newsagency where we see between 10,000 and 12,000 customers a week. We need to walk before we run and thought this very local contributor invitation was a good starting point. While we could have stuffed letterboxes with flyers we figured that sort of defeats one purpose of our mission.

At boston.com is an article by Mark Jurkowitz about the Examiner newspapers being home delivered free to homes in affluent areas in Washington and San Francisco. Here’s a good description by Jurkowitz:

The paper has developed a unique formula. It is a graphically snappy tabloid with a focus on local news and conservative-leaning opinion pages produced by a small staff. It is distributed free to households with incomes of more than $75,000. Examiner executives say the goal is not to knock out their more powerful rivals, The Washington Post, (700,000 daily circulation) and the San Francisco Chronicle (480,000). Rather, the goal is to appeal to readers looking for an easier-reading alternative to the big metro daily and to attract advertisers who can efficiently target dollars to reach high-income consumers.

This is a story US newspaper publishers are watching very closely. Will the Examiner model of bypassing the costs of customer acquisition and careful socio-economic targeting work? Will advertisers support the model long term? Teething problems aside, this story at boston.com and others in recent times suggest that the Examiner model has legs in major cities in the US.

In Australia, 4,600 newsagents play a key role in the home delivery of newspapers. We do so for a share of cover price and a per item delivery fee. An Examiner model here would flip the current home delivery model upside down with immediate economic impact on newsagents.

Being a cog in the supply chain, in any industry, at the moment is challenging.

Thanks to an item at poynter.org, I found this world first: a general classified site allowing advertisers to upload video clips. More than 600 ads have been loaded at Speurders.nl already. We’ve seen it before in specialist sites but not a general site such as this.

While some clips are of doubtful value, others make you wonder why it’s taken so long for general online classifieds to offer this innovation. Maybe that’s because newspapaer publishers control the online advertising space.

Some advertisers have created interesting video productions with good commercial qualities – and that opens a whole new opportunity.

Interesting to read the report today at washingtonpost.com on comments by Berkshire Hathaway Inc. chief executive Warren Buffett made at a three hour news conference following their annual meeting.

“The economics for newspapers are worse now than they used to, and the prospects are worse,” said Buffett, a long-time director and large shareholder of The Washington Post Co.

Buffett said declines in circulation result from readers turning to alternative sources , such as free Web sites and television. And he said owning the dominant news Web site in a region is not enough to guarantee sustained profitability for newspaper firms.

Comments from Buffett cause whole industries to react. He has been lauded as an investment guru and visionary for decades. It will be interesting to see how others report his comments. The Washington Post article does not report answer to what would have been the most obvious question: if newspapers are declining, what’s next? He did discuss his investment in Buffalo where he has investment in a newspaper and a website and said “We’ve got the best position, but it isn’t remotely like owning the paper 30 years ago.”

Dan Milmo from The Guardian reported a few weeks ago:

Emap has created a separate radio division in a shake-up that will see more of its top-selling magazines move from sales racks to multichannel TV, mobile phones and online.

This serves as further evidence that the brand is the thing. Not the product you currently associate with the brand.

Publishers are right to position mastheads in multiple mediums. The challenge is for those businesses (like Australian newsagents) with models rooted in just one medium (print) to ensure relevance in the future.

Wikinews is a news portal created and run by volunteers. It’s citizen journalism on an international scale and is somwwhat of a model for all of us interested in the space.

One key challenge they are yet to overcome is the time taken to review stories submitted. If the delay remains of the current length, Wikinews will be more of a place of analysis and in depth pieces than what we know as traditional news stories.

This topic is of interest to us as we contemplate our approach we will take with our own LocalNews daily citizen journalism project. We’re of the conclusion that if we’re serious about this we need to have the right tools to check facts and present the stories professionally.

In his op ed piece, Alas, Poor Newspapers! We Knew Them, Rupert, Richard Brookhiser writing in The New York Observer presents his analysis of the future of newspapers following the recent speech by Rupert Murdoch to the American Society of Newspaper Editors.

“As I read it, Rupert Murdoch was being polite. What he was telling his colleagues was: Newspapers are dead.”

The piece is a lament about what was and what might replace it.

Interesting that a newspaper person pronounces death of their medium of choice while many playing in the new world of digital media are writing about a new role for newspapers, providing analysis and depth not suited to the faster online delivery mechanisms.

Newspapers better engaging with readers, providing flexible access and embracing the digital world will have a future. Whether this will be enough (probably not) will be anyone’s guess. The key message from Rupert Murdoch was that the world has changed and it’s time for newspapers to react and participate.

The Media Centre hosted a two day event (Apr. 28/29) on mobile media. At their website you can access many of the presentations including these gems:

A video interview with Lucy Hood, Senior Vice President of News Corp. about challenges with their new mobisodes – one minute content clips sold for mobile phone access.

Strategic consultant challenged attendees to think outside the sequare when it comes to digital media content access – apparently suggesting connected Coke vending machines as news access points. “Imagine these machines as point of delivery for all kinds of digital media, especially if they are connected to the Internet like network storage devices. One bit of wisdom he shared was, “Design your future, try not to predict it.””

The Media Centre website is worth a trawl for more content from the event.

The op ep piece, Web putting readers in editor’s chair, on page 27 of the Australian Financial Review today (Apr. 30) is a half hearted catch up on the issues of blogging, citizen journalism, pressure from advertisers and disaggregation in mainstream media.

I’d provide a link to the story but as with pretty much everything on the AFR website you have to pay to access it. That alone says something about their connect with media changes.

“Now Google, whose name has become synonymous with internet searching, plans to build a database that will compare the track record and credibility of all news sources around the world, and adjust the ranking of any search results accordingly.”

A quote from an interesting article April 30 from New Scientist about Google’s proprietary plans to analyse news sources in a move which is bound to infuriate many.

Now if it could be applied to the promises of politicians prior to an election we could let Google choose the government for us. Yeah, I like the idea of a company deciding what I can and cannot trust. I know not to trust some newspapers based on the views of the proprietors or the writer of an op. ed. piece.

The Internet has been a place of less influence over such things and while the Google patent is more about an automated analysis of content and history one has to wonder whether to trust it.

The LA Times ran an opinion piece on April 27 wondering what Google and Yahoo will do next in their news and information play. It wondered, tongue in cheek, how long it would before we saw the Google Street Journal. It’s good to see newspapers wondering about their future and how the more cashed up search engines which have become such successful competitors will deal with the more traditional media companies.

It’s only a matter of time before a Yahoo or a Google decides to buy an old media company in order to differentiate itself by offering high-quality, proprietary news. Or a company like Amazon could buy a prestigious newspaper publisher and reinvent itself as a portal, leapfrogging over those that treat news updates as a commodity.

Business schools would tell us that such takeovers are to be expected. At the Board table it will be buy buy buy. Why? Because they have the cash and will see mastheads as valuable additions o their already respected brands.

Newspapers have the newsgathering and analysis expertise. Google buying a news organisation would enable them to take those assets and the masthead and release the content from the confines of the physical product as we know it today.

Refer to my posting a week ago on E-Paper. Google in the direct news publishing business and the commercialisation of E-Paper … now that’s a giant leap forward. But not so far forward from where we are today.

News stories want to be set free from the restrictions of newspapers where the needs of advertisers come first.

Amid the flurry of cheque writing for such take-overs there will continue to be plenty of small players focusing on news from their backyard in the belief that an era of local focus in the news and information business has started.

This opinion piece by Robert Gottliebsen in The Australian newspaper today reports comments made by ACCC Chair, Graeme Samuel, about the future media landscape. Check out this quote:

“It is pretty clear that the internet will be a key driver of the next wave of competition to the current media players, and the markets we have traditionally defined as ‘media’ will change. And the possibility is there for not one but hundreds of new competitors to today’s broadcasters,”

Then there is this from the ACCC website:

We are in the midst of a technological revolution which threatens to make the introduction of television look like a mere blip in the evolution of distribution of news, information and entertainment. The question for regulators and government alike is do these technological developments make many of our existing concerns about media regulation irrelevant?

Read the Samuel speech in full here.

The bandwagon of voices on this topic gets bigger every day.

Our very local citizen journalism model, LocalNews Daily is getting closer to our planned launch. The test site is located here for folks who want to help test the site by registering and submitting stories.

We are creating a model here which we plan to make available at no cost to other newsagents (retailers of newspapers and magazines) who want to better connect with their local communities and take a more active role in the news distribution business.

Our plan is for a network of LocalNews Daily editions across the country, loosly linked to create a proactive citizen journalism model. We want to create healthy local news by reducing the supply chain between those reporting local news and those consuming it.

The key is content, worthwhile content. To attract this we are casting a wide net across our target area and inviting submission of news content. We’re also pursuing obvious channels such as universities which offer journalism schools. We’re also making contact with professional journalists in the area who may have left the newsroom for one reason or another.

In our retail business we see between 10,000 and 12,000 customers a week. We’re providing flyers to them as they represent our grass roots readers and contributors.

1550 KYCY-AM in San Francisco has announced in this press release that from May 16 it will replace all current programming with podcast programming – listener generated programming. Read more of what they have to say on their website here.

Talk about being early adopters. This is mainstream media (they’re owned by the giant Viacom group) endorsing and embracing citizen created content. Read our earlier posts about ABC Radio and the BBC in the Podcast space.

It’s old news in music and will soon be old news in radio. It’s about to hit in print (newspapers and magazines).

It’s part about citizen journalism, part about ease and mobility of access and part about the success of new media players refusing to be bound by past formats.

It’s about how younger people want to consumer content.

It’s about the stories and their desire to be told as opposed to accepting second place to advertising.

Disaggregation is what we are seeing in so many places.

Thanks to iTunes and like type online stores I can buy the songs I like as opposed to whole albums.

Thanks to Podcasting I can listen to reports which interest me from a range of sources rather than having to listen to a whole radio show.

With new devices hitting the market to make accessing content easier and more mobile, disaggregation will only increase. This will make mainstream media focus more on content and setting it free than on their aggregator products of newspapers, magazines, tv shows and radio broadcasts. If one is interested in stories about Golf for example I can see a world where you’d set a budget per day and that would give you stories about the topic to that value on the device of your choice. You’d also get up sell options on other related stories. Plus you’d be advised of the stories others reading the story you are reading liked.

The key part of this scenario is that you would be buying content by the story. Micro purchases. To help fund newsgathering and their need to maintain and grow profit levels the creators of the content would imbed new forms of advertising. In fact, smart content providers will find this more successful than the less scientific approach in today’s mainstream media.

We do this today in a free world using Google News or Yahoo News or RSS readers and the like. In the world I envisage the content changes, much of what we see today ceases to be free and we could access it while mobile, at home and from news centres (from where we can download).

If you think it’s a stretch that we will move from the world of free content we have today to one of paid content in the news and information category, think Napster. The music industry fixed the problem of free content. Newspaper and magazine publishers will fix this. They must if they are to retain their role and give mainstream media a future on the other side of what in becoming known as Generation C – the content generation.

Content providers will be sorted out by the quality and trustworthiness of their work by thinking consumers while at the other end gossip type content providers will win sales based on the promise of luscious details. The key in this world is that the story is what sells. Not the package. It’s the story. And the brand the story is sold under is what will earn consumer repeat interest, as always.

My interest in this is the impact on those in the aggregated product supply chain. Like Australia’s 4,600 newsagents. More than 50% of our businesses rely on aggregated product (newspapers and magazines). What can we expect in such a marketplace? Not much, yet. Disaggregation of the level I envisage is a way off. But in this world what may seem a few years off today could be months away. This is why bricks and mortar businesses in the news and information supply chain need to be considering their place in the new world. This is why we need to lift our heads and look part the horizon and pursue opportunities which ensure our future and focus building our relevance in a changing world.

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.