To Be Efficient, Start From Zero

Posted on 27. Oct, 2008 by in Business Summit, Revenue, What's Next?, Where Are They Now?

From John Hassell – Star-Ledger, rapporteur for the News Efficiencies group.

We were the fun group — the cost-cutters.

Charged with finding new efficiencies for newsrooms, we struggled a bit to come up with a model that would produce useful lessons. Ultimately, we decided to focus on a market like Philadelphia or Dallas and, rather than tweaking the existing daily newspaper model, to start fresh with an online-only news organization.

Andrew Heyward of Marketspace LLC led the discussion, and we began with traffic and revenue assumptions, then worked backward to create a newsroom that fit within those limits. With Neil Budde of DailyMe doing the math on his iPhone, we projected a website with 800 million page views/year at $5 rpm, for total revenue of $4 million. We set aside $2.1 million of that revenue to pay an editorial staff of 35 FTEs $60,000/year.

Here’s how the staffing broke down:

-
Content creators who do blogging/photography/video/curation of beats: 20
-Community managers who do outreach, mediation, social media evangelism: 3
-Programmers/developers: 2
-Designers/graphics artists: 2
-Producers who do site management, etc.: 5
-
Editors: 3

There was a spirited debate about whether there should be a newsroom at all; in the end there was general consensus that staff members should be out in the community reporting as much as possible, but that a scaled-back newsroom provided a valuable space for collaboration.

Easier to agree on was a list of things our staff would not do:

-National entertainment
-National sports
-National/international news
-Editorial page

In the areas of primary focus — local government, education, high school sports, etc. — we envisioned beat reporters working with networks of local bloggers to expand the reach of the staff.

We left questions about how to monetize all of this to the revenue group, but as Michael Rosenblum of Rosenblum Associates put it, “We’ve created a digital aquisition machine, and we find creative revenue opportunities based on that content.”

16 Responses to “To Be Efficient, Start From Zero”

  1. xxnapoleonsolo

    04. Nov, 2008

    Your work is fascinating, but seems to assume that everyone is tech-savvy and uses the internet regularly.

    I am sure that the people coming up with the model are, but within a community, there will be loads of people who are not.

    How would the model reach and include them if it is online only?

    Reply to this comment
  2. mel taylor

    10. Nov, 2008

    Michael Rosenblum of Rosenblum Associates says: “We’ve created a digital aquisition machine, and we find creative revenue opportunities based on that content.”

    my 2 cents: the tactics and rationale for content aquisition(especially video)that mr rosenblum recommends are spot on. I am in full agreement with the MOJO strategy, etc.

    yet, i respectfully disagree with the thought that once the content is acquired, the sales force then comes up with ways to monetize. “build it and they will come” does not work as well as it used to.

    instead, the news industry needs to put additional time and focus on their ‘other’ customer, the advertiser.

    once we understand what the advertiser needs, and the environment they want their brands to be embedded within, we can then spend more time building content and platforms that serve the needs of both reader AND the advertiser.

    i realize this is a total 180 with the way it’s always been done. but unless news organizations come to grips with that fact that business & revenue models need to come first, the traditional news/media industry will continue to contract.

    Reply to this comment
  3. jeff mignon

    14. Nov, 2008

    I was part of the workshop. I think a key element is missing. Not only we proposed to help the newsroom with bloggers but ALSO with a network of paid “citizen journalists”. I proposed, with Benoît Raphaël the editor of Lepost.fr (Le Monde Multimedia Group), to follow the French model of local newspaper. Model where there are 10 paid “citizen journalists” (called: correspondents) for 1 pro-journalist. Local newspapers, in France, have been functioning this way for the past 50 years. 70 to 80% of the content of a local newspaper is produced by those paid correspondents. It gives them the possibility to report on a very hyper local level. To be clear: correspondents are not free-lances and they are not very well paid.

    Reply to this comment
  4. Edward Vielmetti

    17. Nov, 2008

    $5 CPM for page views? not bloody likely. maybe $0.50, maybe $0.05.

    also, 800m page views/year is 65m page views/mo. given that a successful topical blog aims for 1m page views/mo, and writes 30-40 stories a day to get that, you’re looking nominally at an output of about 2000 news stories a day. are there 2000 stories a day about Baltimore?

    i really don’t think the numbers add up.

    Reply to this comment
  5. Michael Higdon

    18. Nov, 2008

    xxnapoleonsolo:

    To answer your question, we’re not building the future of news for people who are not tech savvy. My 14 year old sister reads online after school all day and we are building news for her, not for you and not even for me (I’m 22).

    John: Check out FixJournalism.com, we are talking about how to create your newsroom and we are talking almost the same set up. But we don’t have editors. ;)

    Reply to this comment

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