Category publishing

eBay founder Pierre Omidyar dropping Twitter project for local news service

Image representing Pierre Omidyar as depicted ...
Pierre Omidyar, Image via CrunchBase

Billionaire eBay founder Pierre Omidyar has announced that he’s abandoning Ginx, his Twitter client project, in favour of developing a new online local news service in Hawaii where he lives.

Peer News, founded by Omidyar and fellow eBay stalwart Randy Ching in 2008, has advertised via Twitter for an editor and in a blog posting Omidyar said a lot of effort was now going into building the new service.

We have a lot of work to do before our public launch in early 2010. We’re focused on building a really talented team here in Honolulu. For our Ginx users, we’re sorry to let you know that we’ll be shutting down the service at the end of 2009. We learned a lot and greatly appreciate all the interaction and feedback from you over the past year. We’re huge fans of Twitter, so you will still see us online, but we want our developers focused on the new organization and news service.

Omidyar (@pierre on Twitter) said he had been interested in news for some time and that Peer News was founded with the goal of:

empowering citizens and encouraging greater civic participation through media. We believe that a strong democracy requires an engaged society supported by effective news reporting and analysis. And, we believe that this can be done in a profitable, sustainable way.

FireShot capture #055 - 'Pierre Omidyar (pierre) on Twitter' - twitter_com_pierreSo if you fancy applying to be the editor based in Honolulu, the details can be found here. Prospective candidates need to offer answers to two key questions impacting news today.

  1. In 100 words or less, when did you first realise that the Web was going to change journalism forever?
  2. In 100 words or less, what advice would you give the news industry?

News veteran Howard Weaver has been advising the Peer News team, and in a blog posting entitled “Looking toward one future for local civic journalism” he said:

The new venture intends to demonstrate that a digitally native, technologically fluent web organisation can profitably serve targeted readers who want sophisticated journalism focused on local civic affairs.

Local and regional newspapers have been hugely impacted in the crisis affecting journalism and changing reader and advertiser habits. Local publications have been closing in their scores as revenues and circulations plummet. The loss of a local newspaper closes a prime avenue for local accountability and democracy. It is a subject of heated debate, and stressed out newspaper executives will be watching Omidyar very closely to see if he can generate profits from online local news.

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Associated Press job losses update — AP layoff list

AP Associated Press LogoFurther to my posting earlier on job losses at US wire agency the Associated Press, Gawker has been keeping a running total of job losses in both the United States and in news bureaux elsewhere in the world.

The list is being constantly updated as more information and tip offs become available.

The full AP layoff list can be found here.

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Associated Press lays off news staff as cost cutting hits home

The Associated Press Building in New York City...
Image via Wikipedia

The Associated Press has laid off “dozens” of news staff as part of the agency‘s bid to reduce staffing costs by 10% this year.

The moves come as the 163-year-old cooperative wire agency has grappled with falling revenues, mutiny from its members and well-publicised battles against search engines and aggregators that it accuses of making money off the back of its services.

While US news media was buzzing yesterday as first word of the cuts began to filter out, the AP — which prides itself on fast breaking news — was itself uncharacteristically slow in reporting what was happening.

When it eventually came, the AP story didn’t say how many staff were being laid off, but the News Media Guild, which represents around 1,300 employees in the US, said as of Tuesday evening 38 Guild-covered reporters, editors and photographers had been told they were no longer required. It dubbed the day “Black Tuesday”.

AP said its cost cutting goal was set late last year as it prepared to lower fees for newspapers and broadcasters that had been hit by recession and the shift of advertising to the Internet.

The AP story said:

AP’s revenue is expected to fall about 6 percent this year to roughly $700 million.

Hoping to minimize layoffs, the AP imposed a hiring freeze late last year and offered early retirement packages to longtime employees over the summer. About 100 opted for those packages.

It’s been a tough year for the news business in the United States. Newspaper circulation across the country plunged by an average 10.6% in the six months to 30 September, while earlier this month the struggling Chicago Tribune, Los Angeles Times and other Tribune Co newspapers planned to do an AP cold turkey for a week as part of a test to see if all ties with the news agency can be severed next year.

The AP has promised members rate reductions averaging around 20%, but with its content perceived to be increasingly less relevant and the costs for the service harder to sustain, many question what the future holds for the news agency.

AP supremeo Tom Curley has been aggressively fighting (alongside Rupert Murdoch) giant news search services such as Google and Microsoft saying they should be made to pay for AP content. Curley says sites such as Google have reaped a fortune off AP articles, photos and video without paying fair compensation.

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Rock’n'roller Josh Tyrangiel to leave Time.com, pogo over to lead BusinessWeek

Josh Tyrangiel
Rock’n'roller Tyrangiel to head BusinessWeek

Michael Bloomberg’s new play thing, the top (but loss-making) BusinessWeek magazine will have 37-year-old Josh Tyrangiel as its new editor, once the acquisition from McGraw-Hill completes in December.

In his “On Media” blog within the BusinessWeek site, Tom Lowry wrote today:

By selecting the 37-year-old Tyrangiel who is not a business journalist per se, Bloomberg clearly wants a leader for BusinessWeek who is not only a highly-regarded editor but someone who has demonstrated he knows how to reach a wider array of readers in both print and online.

Tyrangiel, a deputy managing editor at Time magazine and the editor of Time.com, is actually a bit of a rock’n'roller. Prior to taking the reins at Time.com he was the magazine’s music critic and also wrote for publications such as Vibe and Rolling Stone. While he may never have interviewed Bernard Madoff or Warren Buffet, he can count Bruce Springsteen, George Clooney and the Dixie Chicks among his interviewees.

Bloomberg’s chief content officer and former Time Inc. editor in chief Norman Pearlstine, was reported by Lowry as saying:

“I saw Josh in a number of leadership positions as he took on increasing responsibilities at TIME.”

He continued:

“Working closely with him …. I came to appreciate his intelligence, curiosity, energy, and integrity. Josh is recognized within Time Inc. and its parent, Time Warner Inc., as an ‘editor’s editor’ and a natural leader. His understanding of the ways in which print and online publications can work together will serve Bloomberg well as we expand our consumer media offerings.”

Changes have been sweeping through BusinessWeek since the sale to Bloomberg was announced last month. Jobs have gone and staff fear the venerable old magazine will become a promotional tool for Bloomberg, with the real business being done online. With his strong online credentials, Tyrangiel, who will replace Stephen Adler, may well help confirm those fears. His tenure at Time.com saw web traffic soar from 400 million page views in 2006 to what could be an estimated 1.8 billion page views this year, Lowry wrote.

Top Time Editor To Become BusinessWeek’s New Editor

Posted by: Tom Lowry on November 17

Josh Tyrangiel .jpg
Josh Tyrangiel, a deputy managing editor at Time magazine and the top editor of its online operations, will become the first editor of a Bloomberg-owned BusinessWeek. The acquisition, announced Oct. 13, is expected to close in early December.

By selecting the 37-year-old Tyrangiel who is not a business journalist per se, Bloomberg clearly wants a leader for BusinessWeek who is not only a highly-regarded editor but someone who has demonstrated he knows how to reach a wider array of readers in both print and online. A major reason Bloomberg LP executives pursued BusinessWeek was to reach a broader audience beyond Wall Street and the professional investor communities.

“I saw Josh in a number of leadership positions as he took on increasing responsibilities at TIME,” says Norman Pearlstine, Bloomberg’s chief content officer and a former editor-in-chief of Time Inc., Time’s parent. “Working closely with him …. I came to appreciate his intelligence, curiosity, energy, and integrity. Josh is recognized within Time Inc. and its parent, Time Warner Inc., as an ‘editor’s editor’ and a natural leader. His understanding of the ways in which print and online publications can work together will serve Bloomberg well as we expand our consumer media offerings.”

In some media circles, Tyrangiel was considered a leading candidate to succeed Time managing editor Richard Stengel. According to sources, Time Warner CEO Jeff Bewkes was so impressed with Tyrangiel that he tried to recruit him to be come the editor of CNN.com, the online arm of the 24-hour cable news channel, but Time Inc.’s current editor-in-chief John Huey intervened and convinced Tyrangiel to stay at Time with the promise that he might one day succeed Stengel.

During his tenure at Time.com, Tyrangiel boosted the Web site’s traffic from 400 million page views in 2006 to what could be an estimated 1.8 billion page views this year. Previous to Time, Tyrangiel worked at Rolling Stone and Vibe magazines and served as a news producer at MTV.

“Josh Tyrangiel will be a tremendous asset as we build the market presence of BusinessWeek backed by Bloomberg’s global multimedia news organization, to create the most compelling business news for the most sought-after readers.,” said Bloomberg L.P. President Daniel Doctoroff.

Tyrangiel will report to Pearlstine, who in turn will report on editorial matters to Matthew Winkler, Bloomberg’s editor-in-chief. “Norm and Josh are the ideal team to deliver a terrific business magazine that brings the most trusted, most influential and most important news to a global audience of thought leaders,” said Winkler.

Tyrangiel will work alongside BusinessWeek executive editors Ellen Pollock and John Byrne and managing editor Ciro Scotti. Pearlstine announced earlier that they would continue in their roles at the magazine. Tyrangiel succeeds Stephen J. Adler, who announced his resignation as editor-in-chief on Oct. 20.

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VIDEO – Old and new media lock horns to generate fascinating discussion on the future of news

Keynote discussion of the week where the future of news media was chewed over at the Monaco Media Forum 2009 by Mathias Dopfner, CEO of Axel Springer, and Arianna Huffington of Huffington Post fame. Conversation is hosted by Christine Ockrent, CEO of France 24.

The resulting video is a fantastic exploration of the tensions between the old and new schools of journalism, commercial pressures and just what the future may (or may not) hold.

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Murdoch’s News Corp cooking up a storm over plans to ban Google

Paywallman flies to newspaper rescue
Paywallman flies to newspaper rescue

And the drum keeps playing. It’s almost as if Rupert Murdoch believes that if the News Corp digital tribe keeps chanting the mantra that Google will be blocked from indexing their sites, the future of publishing and the wealth of publishers will be preserved.

On Friday, the Telegraph reported that Jon Miller, former AOL head and now News Corp’s chief digital officer, told the Monaco Media Forum that the News Corp door would soon be slammed shut on Google and his company would lead the media industry in a new direction.

“There is real tension surrounding the free versus pay debate,” Miller was quoted as saying. “It will play out in the next two years. We believe that the value of high quality content is not recognised online (by giving its away for free) so something needs to happen.”

Now, like him or loathe him, Murdoch is one of the greatest media moguls the world has seen. Over the years he has proved the naysayers wrong time after time. And what about now as the news publishing industry lurches ever deeper into crisis? Can pay barriers be thrown up with the expectation readers will remain loyal to brands and hand over cash to secure the privilege of continuing to consume News Corp content?

Not on your Nellie!

As I’ve mentioned previously, the actions of News Corp and other news publishers ignore the plain simple fact that reader behaviour is radically changing. Brand loyalty is fading, and having got used to free content online people are simply not prepared to pay for news and general information. Beyond refusals to pay lie the new worlds of social networks, aggregator services, citizen journalists and ordinary people just using technology to communicate in ways that only a few years ago were purely in the realms of science fiction.

At the heart of the online world sits the link economy. Links are what drag eyeballs from place to place. People increasingly follow through on recommendations from trusted sources including search engines, people they know, aggregators, or Twitter (which is becoming hugly important in setting readership consumption agendas). What people are doing less and less, is deliberately seeking out the view espoused by the old media brand.

The days of “Dear boy, don’t you know it was in The Times?” as a means of communicated worth, trust and accuracy are gone. Today, readers will look across a number of sources depending on what is served up to them. Increasingly, the reader also doesn’t want just a single view but a panorama of views across different credible or even biased sources.

Murdoch accuses news aggregators of being parasites and search engines of stealing premium content beyond what would be governed by fair use. It’s not just that he is concerned with the revenue value of their content being diminished, but there is a parallel discussion centred on the cost of gathering top notch news. It is a very expensive business to have foreign correspondents scattered around the world. The days of the bottomless expense accounts and bespoke Savile Row safari suits are long gone. As an ex-foreign correspondent myself with a great love of news, the argument over who will pay is one I grapple with.

But, as with the newspapers, we have to let the past be the past. If we accept that traditional publishers face declining revenues for the legacy business the challenge becomes how to open new revenue streams while looking to prioritise expenditure on generating premium content.

Nick Gregg, CEO of StrategyEye, succinctly captures the key issues in his paper “The Next Two Years of Publishing — Where it Needs to Move”.

“Large editorial journalist bases are expensive and out of tune with [the] new world,” he says. “A shift to a blend of ‘investigative’ writers and ‘curator’ writers is needed to reduce costs and deliver wider information in the succinct manner modern users expect.”
Editorial models need to be reinvented and technology needs to be harnessed to exploit new content opportunities. He fires a loud warning shot over the bows of RMS (Rupert Murdoch Ship) News Corp.
“…knee-jerk reactions are not the way forward. The current vogue for some publishers to say ‘let’s shift to paid subscription walls’ is potentially highly damaging except in certain niche content areas. Imposing subscription walls may generate some revenue from a small percentage of loyal readers. But it could kill a brand in the long run if the next generation of target audience simply never engages with its content.”

Back over at News Corp, Miller reckoned newspapers in the UK could survive after Google cold turkey.

“The traffic which comes in from Google brings a consumer who more often than not read one article and then leaves the site. That is the least valuable of traffic to us… the economic impact [of not having content indexed by Google] is not as great as you might think. You can survive without it,” the Telegraph quoted him as saying.

I have a feeling I will be frequently coming back to this topic . It would be lovely (from a newspaper viewpoint) if news stand sales could simply be replaced with online subscriptions or even micro sales. But considering where we are in the freemium world, this is about as likely as Murdoch being asked to turn out for England on the wing.

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NewsNow aggregator says newspapers threaten injunction to stop linking

FireShot capture #038 - 'NewsNow_ The UK's #1 News Portal' - newsnow_co_uk_hNewsNow, the UK-based news aggregator service, now says several major newspaper publishers are threatening to seek a court  injunction to stop it posting links to their content.

In an “Free Linking Q&A”, the news aggregator says News International, publisher of The Sun, The Times and the News of the World, wants all linking to its content to be stopped. Others including The Guardian, Daily Mail, Daily Mirror, The Daily Telegraph, The Independent, Daily Express plus regionals such as Johnston Press and Northcliffe Media are:

demanding money and intrusive control over how we conduct our business.

NewsNow, established in 1997, is the largest UK news aggregator with around 20% of the market, second only to Google.

Graphic: Hitwise

Graphic: Hitwise

It is unclear whether anything has changed since NewsNow first published its open letter last week, (NewsNow aggregator comes out fighting against newspaper threats) but what is clear is the service is beginning to feel the pinch.

And it is the pinch that the newspaper publishers are also feeling. Revenues for traditional print newspapers are tumbling. In the US, the latest newspaper ABCs showed that on average circulations fell more than 10% in the six months to 30 September. With publishers desperate to shore up revenue streams classic mistakes are being made.

Rather than embrace the opportunity of the new eyeballs the aggregators provide, they are seeking to monetise the links themselves. Now, there is no value in the links per se. There is value in the traffic they carry. It’s a bit like a train full of passengers. While the people are on the train they can be monetised — they buy tickets, drinks and food. But take away the rails and the train can’t move. If the train doesn’t move there will be no passengers, and no revenues. Come on publishers, think about this.

The struggle here is in creating innovative revenue replacement strategies and in delivering services that appeal to a new generation of customers that want to engage with their content in ways that print newspapers can never deliver. It is certain that in the future traditional print newspapers and their legacy business models will not be the key driver of cash. In order to generate revenue, newspapers will need to ensure they have online traffic, and for that they should be looking to seek ways of exploiting the free services offered by the link aggregators or search engines.

NewsNow says the key question here is not how much publishers want to be paid for the “right” to link to their content.

It’s about what deserves compensation. It’s the principle of publishers restricting and levying fees on link aggregation and link circulation we’re bothered about, and the long-term consequences for the web, freedom to link, freedom of expression and access to news, and our right to go about our lawful business without being threatened.

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Black days for US newspapers as circulation plunges

'Europe Edition - Wall Street Journal - Latest News, Breaking Stories, Top Headlines - WSJ_com' - europe_wsj_com_home-page

The only US newspaper to show circulation increase

If there is still anyone that doubts there is a crisis in the newspaper publishing industry they must be very well hidden. It seems that as every day passes more bad news emerges. Today, it was the turn of the US Audit Bureau of Circulations (ABC) to hammer in new coffin nails and paint a picture of massively accelerating decline.

Consider this — across the 379 newspapers in the mix, daily circulation fell by an average 10.6% to 30.39 million copies for the six months to 30 September 2009 compared to 34 million copies in the same period last year. For the sake of comparison, the decline this time round was more than double that in the previous period. I’m not a betting man, but unless there is radical change it is becoming a question of when not if major newspapers go under.

But there is more to this than just the market telling newspapers it is no longer as interested in their products as it once was. Unlike other recessions, this time round responses to the grim economics from publishers is fuelling a vicious cycle of accelerating decline. As readership shrinks and ad revenue fades, publishers are left with little choice other to reduce costs in every way possible. Huge staff cuts means the underlying quality proposition of the title is eroded, while cuts in the numbers of copies distributed free or heavily discounted means the reach of the publication is adversely impacted. Result — circulation falls further and ad revenue declines faster as the ABCs are a key indicator for businesses deciding where to place their advertising spend. Ow. That really hurts.

Only one of the top 25 newspapers was credited with circulation growth. The News Corp-owned Wall Street Journal’s circulation rose 0.6% to 2.02 million.

Top 25 US newspapers by circulation (source: ABC)

1 Wall Street Journal 2,024,269 +0.61%
2 USA Today 1,900,116 -17.15%
3 New York Times 927,851 -7.28%
4 Los Angeles Times 657,851 -11.05%
5 The Washington Post 582,844 -6.4%
6 New York Daily News 544,167 -13.98%
7 New York Post 508,042 -18.77%
8 Chicago Tribune 465,892 -9.72%
9 Houston Chronicle 384,892 -9.72%
10 Philadelphia Inquirer 361,480 n/a
11 Newsday 357,124 -5.40%
12 The Denver Post 340,949 -14.24
13 The Arizona Republic 316,874 -12.30%
14 Star Tribune, Minneapolis 304,543 -5.53%
15 Chicago Sun-Times 275,641 -11.98%
16 The Plain Dealer, Cleveland 271,180 -11.24%
17 Detroit Free Press 269,729 -9.56%
18 The Boston Globe 264,105 -18.48%
19 The Dallas Morning News 263,810 -22.16%
20 The Seattle Times 263,588 n/a
21 San Francisco Chronicle 251,782 -25.82%
22 The Oregonian 249,163 -12.06%
23 The Star-Ledger, Newark 246,006 -22.22%
24 San Diego Union-Tribune 242,705 -10.05%
25 St Petersberg (Fla) Times 240,147 -10.70%
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Time Inc seen heading for more cuts, NYT reports more losses

'Time Inc_' - www_timeinc_com_homeBad news and more bad (but not so bad) news remain the flavours of the day for US publishing giants Time Inc and the New York Times. A report in this morning’s Financial Times says Time is preparing for a another major fresh round of job cuts to follow on from last year’s massive loss of 600 jobs, or 6% of its staff.

Sourcing the article to “a person familiar with the plans”, the FT said the cuts were expected within the next few weeks.

The nearby New York Times Company reported a loss of $35.6 million in the third quarter as newspaper advertising revenue plummeted nearly 30%. But it still managed to beat expectations on deep cost-cutting and through pushing up its cover price and even saw its stock spike. Tellingly, internet revenue was also down 7.2%, to $78.9 million which was driven by an 18.5% fall in digital advertising revenue at the News Media Group.

Other uncomfortable reading for print publishers would wrap in:

Anyone got any good news out there?

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Survey gives massive thumbs down to paid news & sports content

Oh dear, another week and another piece of research delivering much the same grim message. No surprises then when a sample of 2,ooo UK respondents overwhelming gave a thumbs down to paying for nearly all forms of online content including news and sports coverage.

Who will pay for news & views? Not the readers, it would appear
Who will pay for news & views? Not the readers, it would appear (via MediaWeek)

The study, by Lightspeed Research and commissioned by Global Web Index, gives traditional media executives yet more food for thought.

Aside from the 91% saying they would never pay for news the survey also hammered a nail into the coffin of those that thought deeper, richer content would have people reaching for their wallets with 90% saying “forget it” to paid-for analysis.

The findings will only serve to up the pressure on traditional publishers looking to redefine business models for the online world.

The issues here are controversial. Murdoch is looking to charge for access to some of his newspapers and TV channels, while other British newspapers are believed to have been putting pressure on news aggregators in a bid to grab revenues via the third economy — those that simply point the way to content provided by others.

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NewsNow aggregator comes out fighting against newspaper threats

'NewsNow_ Journalism' - newsnow_co_uk_h_Current+Affairs_Journalism

In a move slammed by commentators as being akin to a herd of donkey’s suing the inventor of the wheel, a number of national UK newspapers have apparently been making legal threats to content aggregator service NewsNow.

What on earth is going on here? While details of the threats have yet to emerge, we know newspapers have been seeing their commercial prospects head south and we know that the key to ensuring future survival is to elusive generate online revenue streams. But what these newspapers seem to be doing is shooting a messenger and not addressing the roots of their problems.

NewsNow is a basic linking service. It is not stealing any content, purely enabling users to search on key words for links that then take people through to the source article. Links are at the heart of the web. They are what make things tick. They generate traffic while building relevancy for SEO purposes. As I was building the online premium subscription breaking news service ICIS news, I wanted to ensure we were on NewsNow. For me there is a clear correlation between free traffic, which in turn generates leads and which then can be converted into REVENUE.

In an open letter to UK national, regional and local newspapers, NewsNow chief Struan Bartlett said his company and other aggregators had received legal threats over the possible imposition of new controls on how aggregators can link to external websites.

Bartlett’s letter specifically named The Times, The Sun, The Guardian, Daily Mirror, The Daily Telegraph, The Independent and the Daily Express and said that publishers were misguided in thinking that aggregators could undermine newspapers.

We can’t speak for all aggregators but for our part at NewsNow, we don’t do anything that detracts from the value of your content. We don’t redistribute your web pages to anyone. We operate within the law, and we don’t do you any harm.

Far from it. We deliver you traffic and drive you revenues you otherwise wouldn’t have received. The idea that we are undermining your businesses is incorrect. It is fanciful to imagine that, if it weren’t for link aggregators, you would have more traffic or revenues. We provide a service that you do not: a means for readers to find your content more readily, via continuously updating links to a diversity of websites.

If newspapers persist in placing themselves in a firmly sealed box they will see traffic decline. People will not type in individual URLs. The reader today needs to have relevant content pushed to them. People are increasing less inclined to go out and pull content in the hope it is what they may want to see.

The problem here goes to the core of the paid versus free debate. News Corp’s Rupert Murdoch and Tom Curley, head of the Associated Press, have laid down the gauntlet to the major players like Google and Microsoft as part of their bids to ensure either the readers or the aggregators pay for the content they disseminate.

Bartlett said:

Links market your content to readers. Abolish them, and readers won’t all type in your homepage address. They will go elsewhere. We don’t believe we are alone in this view. Many website traffic managers, journalists and editors within your own organisations clearly share this view. We know, because they’ve told us directly that they strongly value our linking to your websites.

There can only be one loser in the Battle of the Links — the newspapers. Aggregators will simply look elsewhere for the content, and eyeballs will be dragged away with them. Brand loyalty is increasingly a thing of the past, especially when it comes to consuming news online. Nico Flores makes some good arguments in favour of the link economy on his blog On Demand Media.

We’ve seen what’s happened to the music industry as it utterly failed to innovate and drive new business models in the face of escalating free or illegal downloads, and now, it appears, newspapers and other news sources may be about to make the same mistakes. It is impossible for anyone to maintain monopoly over general information, and that is where the majority of “news” sits.

What is important is ensuring the traffic is driven down a preferred road and that the content provider is then able to engage directly with the reader to seek ways to monetise content that is carefully targetted and highly relevant to a specific user. The key here is all about embracing the future, not fighting it. Bows and arrows are no good against nuclear weapons.

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Fears BusinessWeek to become Bloomberg promotional tool?

So now staff at the Bloomberg-acquired weekly BusinessWeek may have a slightly better view of their future. As reported on this blog on Wednesday senior executives from Bloomberg and McGraw-Hill addressed several hundred employees in their New York HQ yesterday to outline the future for the 80-year old title that has been losing up to $1 million a week.

In an article on his The Num3rati blog, veteran BusinessWeek tech reporter Stephen Baker appears to question the Bloomberg business approach to selling terminals at $20,000 a pop and how the magazine will fit.

How much can this market grow? To listen to Bloomberg execs, they make money from the boxes and invest that money in more news-gathering power, which makes the boxes even more attractive. It’s a virtuous cycle which presumably leads to continuous growth. With BusinessWeek, Bloomberg hopes to extend its brand into the wider business audience, including c-suite executives, and open up further markets for their boxes.

I don’t see it. In my experience, every continuous growth projection encounters some force that disrupts it.

And of the future of BusinessWeek, Baker said:

Yet despite the ambitions expressed at yesterday’s meeting, I’d bet that the magazine will end up serving largely as a promotional tool for the company. The real business will be online. That’s where Bloomberg 2.0 will take shape.

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Bloomberg snaps up BusinessWeek, cuts seen likely to follow

businessweek-logoSo Bloomberg is to acquire McGraw-Hill’s venerable but struggling magazine BusinessWeek for a cash offer of between $2 million to $5 million. Not very precise, but it appears the terms of the deal, which is expected to complete by 1 December, have not been formally announced.

Founded in the Great Depression, but will BusinessWeek be able to take care of its own?

Founded in the Great Depression, but will BusinessWeek be able to take care of its own?

BusinessWeek, founded in 1929 at the time of the Great Depression, was put up for sale in July, and the process has followed a tortuous path over the last few months. PaidContent.org has a useful timeline of its coverage following the twists and turns of the deal here.

The weekly, which competes with fortnightly publications Forbes and Fortune, is thought to have lost around $20 million last yar and was projected to see that figure more than double in 2009. According to a blog posting by BusinessWeek’s senior editor Robin Ajello, Bloomberg will take on all existing liabilities including potential severance payments.

The magazine employs around 400 staff, and Ajello said editor-in-chief Steve Adler has sought to allay fears of a “scorched earth policy” and told his staff  the deal guaranteed that McGraw-Hill benefits would be extended to employees for one year after the deal closes.

The acquisition marks a significant change of direction for Bloomberg that since being established in 1981 has sought to build rather than buy market share.

The full team of top Bloomberg executives, along with McGraw-Hill CEO Terry McGraw, will speak to BusinessWeek staff first thing today.

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