A new study, based on analysis of private financial data from 38 newspapers and in-depth interviews with senior executives from 13 companies, found that the papers studied are losing seven dollars in print advertising for every one dollar they are gaining in new digital revenue — a ratio that shows the pace at which newspapers are shrinking. Executives were candid about the obstacles they faced in making the digital transition, including changing corporate culture and attracting digital sales people to newspapers.

But the 38 case studies also reveal enormous differences among newspapers, which suggest different management approaches can make a significant difference in performance. Some papers were growing both print and digital revenue and others had nearly matched print losses with digital dollars. At the other end of the spectrum, several papers were suffering losses in digital year to year, meaning those papers were falling further and further behind.

Read the full report for these findings:

• Trends in revenues for digital and traditional print advertising
• The use of coupons and daily deals as a revenue source
• The potential of advertising on mobile devices
• Development of nontraditional revenue sources
• Obstacles to change

Who are these new players in journalism? Are these sites delivering, as they generally purport to be, independent and disinterested news reporting? Or are some of them more political and ideological in their reporting? How can audiences assess this for themselves? In short, what role are these operations playing in the changing ecosystem of news?

A new study by the Pew Research Center’s Project for Excellence in Journalism offers a detailed look at a portion of this new cohort of news providers-sites that cover state and national news. The study examines some four dozen sites across the country, all of them launched in 2005 or later, that offer coverage beyond the local level to state and national news. That group includes national news sites such as Pulitzer Prize-winning ProPublica, which receives money from more than a dozen foundations and has a staff of more than 30.¹ It also includes lesser-known news sites such as Missouri News Horizon, whose funding is less clear and covers Missouri state government with a staff of three journalists. The study analyzes the funding, transparency and organizational structure of these sites, and also the nature of their news coverage.²

(There is a larger universe of community-level non-profit news operations perhaps even more diverse in nature. That group is beyond the scope of this analysis, but does bear further study.)

The 46 national and state-level news sites examined — a group that included seven new commercial sites with similar missions — offered a wide range of styles and approaches, but roughly half, the study found, produced news coverage that was clearly ideological in nature.

In general, the more ideological sites tended to be funded mostly or entirely by one parent organization — though that parent group may have various contributors. They tended to be less transparent about who they are and where their funding comes from. And they tended to produce less content — in some cases generating one or two stories per week produced by a single staffer.

Sites that offered a mixed or balanced political perspective, on the other hand, tended to have multiple funders, more revenue streams, more transparency and more content with a deeper bench of reporters. The six most transparent sites studied, for instance, were among the most balanced in the news they produced.

In terms of reach, the most popular site in the study, The Daily Caller, is a commercial enterprise with a clear ideological orientation. Of the non-profit sites, it is harder to generalize. One of the most popular sites in the study was the Washington Independent, a liberal site, but it has since ceased publication.³ In many other cases, sites with more balanced coverage, such as ProPublica and the Texas Tribune, are among the most trafficked in the sample.

These are among the findings of the study, which examined 46 news websites and an additional 68 institutions and individuals that provide the primary financial support for those sites. Researchers analyzed a total of 1,203 stories sampled from the month of September 2010 and conducted an audit of the sites and their chief supporters between the months of May 2010 and September 2010.

Read the full study and view special online features of the report at journalism.org

1. Among ProPublica’s funders is The Pew Charitable Trusts, which provided the group with a two-year grant of $1 million in June 2010. The Pew Charitable Trusts is also the primary funder of the Pew Research Center and the Project for Excellence in Journalism.

2. Sites formed around a single issue, like the Hechinger Report, or those comprised primarily of opinion or aggregation, such as Arkansas News, were excluded from this study. So were sites that were fundamentally local in nature, covering one community, such as Voice of San Diego, the St. Louis Beacon, or the Bay Citizen. Also excluded were sites that produce on average less than one original story per week. See About the Study for more on the parameters of the sample.

3. In a November 2010 note to readers, editor Aaron Wiener explained that as foundation support began to dry up in the midst of economic recession, The Washington Independent’s expenses were unsustainable, and its parent, the American Independent News Network, ended publication.

By several measures, the state of the American news media improved in 2010.

After two dreadful years, most sectors of the industry saw revenue begin to recover. With some notable exceptions, cutbacks in newsrooms eased. And while still more talk than action, some experiments with new revenue models began to show signs of blossoming.

Among the major sectors, only newspapers suffered continued revenue declines last year — an unmistakable sign that the structural economic problems facing newspapers are more severe than those of other media. When the final tallies are in, we estimate 1,000 to 1,500 more newsroom jobs will have been lost — meaning newspaper newsrooms are 30% smaller than in 2000.

Beneath all this, however, a more fundamental challenge to journalism became clearer in the last year. The biggest issue ahead may not be lack of audience or even lack of new revenue experiments. It may be that in the digital realm the news industry is no longer in control of its own future.

News organizations — old and new — still produce most of the content audiences consume. But each technological advance has added a new layer of complexity — and a new set of players — in connecting that content to consumers and advertisers.

In the digital space, the organizations that produce the news increasingly rely on independent networks to sell their ads. They depend on aggregators (such as Google) and social networks (such as Facebook) to bring them a substantial portion of their audience. And now, as news consumption becomes more mobile, news companies must follow the rules of device makers (such as Apple) and software developers (Google again) to deliver their content. Each new platform often requires a new software program. And the new players take a share of the revenue and in many cases also control the audience data.

Those data may be the most important commodity of all. In a media world where consumers decide what news they want to get and how they want to get it, the future will belong to those who understand the public’s changing behavior and can target content and advertising to snugly fit the interests of each user. That knowledge — and the expertise in gathering it — increasingly resides with technology companies outside journalism.

In the 20th century, the news media thrived by being the intermediary others needed to reach customers. In the 21st, increasingly there is a new intermediary: Software programmers, content aggregators and device makers control access to the public. The news industry, late to adapt and culturally more tied to content creation than engineering, finds itself more a follower than a leader in shaping its business.

Meanwhile, the pace of change continues to accelerate. Mobile has already become an important factor in news. A new survey released with this year’s report, produced with the Pew Internet & American Life Project, in association with the Knight Foundation, finds that nearly half of all Americans (47%) now get some form of local news on a mobile device. What they turn to most there is news that serves immediate needs — weather, information about restaurants and other local businesses, and traffic. And the move to mobile is only likely to grow. By January 2011, 7% of Americans reported owning some kind of electronic tablet. That was nearly double the number just four months earlier.

The migration to the web also continued to gather speed. In 2010, every news platform saw audiences either stall or decline — except for the internet. Cable news, one of the growth sectors of the last decade, is now shrinking, too. For the first time in at least a dozen years, the median audience declined at all three cable news channels.

For the first time, too, more people said they got news from the web than newspapers. The internet now trails only television among American adults as a destination for news, and the trend line shows the gap closing. Financially the tipping point also has come. When the final tally is in, online ad revenue in 2010 is projected to surpass print newspaper ad revenue for the first time. The problem for news is that by far the largest share of that online ad revenue goes to non-news sources, particularly to aggregators.

In the past, much of the experimentation in new journalism occurred locally, often financed by charitable grants, usually at small scale. Larger national online-only news organizations focused more on aggregation than original reporting. In 2010, however, some of the biggest new media institutions began to develop original newsgathering in a significant way. Yahoo! added several dozen reporters across news, sports and finance. AOL had 900 journalists, 500 of them at its local Patch news operation. By the end of 2011, Bloomberg expects to have 150 journalists and analysts for its new Washington operation, Bloomberg Government. News Corp. has hired from 100 to 150, depending on the press reports, for its new tablet newspaper, The Daily, though not all may be journalists. Together these hires come close to matching the jobs that we estimate were lost in newspapers in 2010, the first time we have seen this kind of substitution.

A report in this year’s study also finds that new community media sites are beginning to put as much energy into securing new revenue streams — and refining audiences to do so — as creating content. Many also say they are doing more to curate user content.

Traditional newsrooms, meanwhile, are different places than they were before the recession. They are smaller, their aspirations have narrowed and their journalists are stretched thinner. But their leaders also say they are more adaptive, younger and more engaged in multimedia presentation, aggregation, blogging and user content. In some ways, new media and old, slowly and sometimes grudgingly, are coming to resemble each other.

The result is a news ecology full of experimentation and excitement, but also one that is uneven, has uncertain financial underpinning and some clear holes in coverage. Even in Seattle, one of the most vibrant places for new media, “some vitally important stories are less likely to be covered,” said Diane Douglas who runs a local civic group and considers the decentralization of media voices a healthy change. “It’s very frightening to think of those gaps and all the more insidious because you don’t know what you don’t know.” Some also worry that with lower pay, more demands for speed, less training, and more volunteer work, there is a general devaluing and even what scholar Robert Picard has called a “de-skilling” of the profession.

Among the features in this, the eighth edition of the State of the News Media produced by the Pew Research Center’s Project for Excellence in Journalism, is a report on how American newspapers fare relative to those in other countries, two reports on the status of community media, a survey on mobile and paid content in local news, and a report on African American media. The chapters this year have also been reorganized and streamlined: each is made up now of a Summary Essay and a longer, separate Data Section where all the statistical information is more easily searchable and interactive.

Read the full report at journalism.org.

At the moment our surveys find only a tiny proportion of internet users — 7% — express any willingness to pay for news. That’s not because internet users are uninterested in news: fully 71% of all those online say they get news from the internet. Within that group, however, just 35% say they have a favorite news website and, among those with a favorite site, only 5% say they pay for news content now. Moreover, just 19% say they would be willing to pay if that favorite site started charging for access to its content.

In other words, when we asked people who have a favorite website if they would pay for access to that site if it erected a pay wall, 82% said they would not return to the site and would go elsewhere for their news. And those are the people who like that website enough to call it a favorite. This reluctance poses huge challenges to news sites that want to erect a pay wall and add subscription fees for access to their online offerings.

Lee Rainie, Director, Internet & American Life Project

Many news executives, however, sense change for the better in their newsrooms despite cutbacks and declining revenue. Editors at newspaper-related companies praise the cultural shifts in their organizations, the younger, tech-savvy staff, and a growing sense of experimentation. Many broadcast executives see so-called one-person crews — in which the same individual reports, produces and shoots video — as improving their journalism by getting more people on the street.

But the leaders of America’s newsrooms are nonetheless worried about the future. Fewer than half of all those surveyed are confident their operations will survive another 10 years — absent significant new sources of revenue. Nearly a third believe their operations are at risk in just five years or less. And many blame the problems not on the inevitable effect of technology but on their industry’s missed opportunities.

“Our mantra this year is experiment and fail quickly,” one newspaper news executive volunteered. “Don’t be afraid of change and don’t stick with something too long if it doesn’t work.”

“Outside funding options are a bad idea overall,” another broadcast news executive offered. “They are being used to ‘save’ old models of journalism that are no longer economically viable and will die out over time no matter what.”

The survey found some significant differences between the attitudes of leaders of newspaper-based newsrooms and those of broadcast. Among them was their view of journalism’s future. Broadcast news executives were strikingly more pessimistic, with those who see journalism headed in the wrong direction outnumbering those who think it is headed in the right direction by almost two-to-one. Leaders of newspaper newsrooms, by contrast, are split, with a slight tilt toward optimism.

These are some of the findings of a non-random online sample of 353 journalism executives from the ASNE or RTDNA membership lists, recruited via e-mail invitation from December 2009 through January 2010. In all, 353 news executives responded, representing 36% of those surveyed from ASNE and 24% from RTDNA.

Among the findings:

• Many of the new revenue options being debated today receive only limited or divided support from news executives. When it comes to the often-discussed option of pay walls for online content, for instance, only 10% say they are working on them, though that could change. Another 32% are considering them while 11% have written off the idea. More than a third (35%) have not considered them at all. Still, as they look ahead, only 15% of news executives believe pay walls will be a significant source of revenue in three years.
• There is significant resistance, however, to other discussed revenue streams, particularly from the government or from groups that engage in advocacy. Fully 75% of news executives have serious reservations about receiving government subsidies, and 78% have significant reluctance to accept financing from interest groups. Roughly half have significant worries about funds from government tax credits and more than a third have significant doubts about private donations.
• Most of the effort online is focused instead on more conventional revenue sources. Display and banner online advertising, for all that it has failed to grow, is still the No. 1 area of effort and the one that news executives pin their greatest hopes on. But second is revenue from products outside of news.
• Broadcast news executives are noticeably more pessimistic about journalism’s future than editors at newspaper-based operations. Broadcasters think their profession is headed in the wrong direction by a margin of nearly two-to-one (64% vs. 35%). By contrast, editors working at newspapers were split (49% wrong direction vs. 51% right direction). A year ago, journalists who were members of the Online News Association surveyed by PEJ fell in between these two: 54% wrong direction, 45% right direction.
• And most news executives think the internet is changing the fundamental values of journalism. Six out of ten feel this way — though executives from broadcast operations (62%) do so more than executives from newspapers (53%). Their biggest concern is loosening standards of accuracy and verification, much of it tied to the immediacy of the Web.
• Mobile applications are becoming increasingly important. Three-quarters say mobile applications are essential or very important while just 35% say that of YouTube postings or other video websites.

Continue reading the full report at journalism.org.

Moderator: Frank Sesno, Director, GWU School of Media and Public Affairs:
Opening Presentation: Tom Rosenstiel, Director, Project for Excellence in Journalism, Pew Research Center
Panelists:
Jim Brady, President, Digital Strategies, Allbritton Communications
Tina Brown, Founder and Editor-in-Chief, The Daily Beast
Susan Page, Washington Bureau Chief, USA Today
Charlie Sennott, Executive Editor, GlobalPost
Antoine Sanfuentes, Deputy Washington D.C. Bureau Chief, NBC News

In the following edited transcript, ellipses have been omitted to facilitate reading. Find the full transcript and a video of the event at the SMPA website.

Frank Sesno: I’d like to welcome you to the School of Media and Public Affairs. [W]e are proud to offer an interdisciplinary program where we specialize in both political communication and in journalism mass communication. We like to say that we are at the intersection of media journalism and politics. It’s a busy sometimes dangerous intersection but we enjoy it.

 Frank Sesno

It’s a special pleasure to be hosting this event in association with the Pew Research Center’s Project for Excellence in Journalism and the Newseum. It is a timely conversation, one that will not [be], I promise you, yet another hand wringing, cry in your soup, my newspaper is history, where are the jobs, bring back the money, bring back the classifieds yak fest. Not that we intend to gloss over the problems of course but today we are very, very fortunate to have an incredible group of innovators, decision makers and new research as sort of the wind at our back and inspiration. Still as we know this is a time of breathtaking challenge and breathtaking opportunity. Alex Jones warns that the iron core of journalism is melting. Robert McChesney talks about the death and life of American journalism. And Clay Sharkey looks around at the empowering democratizing world of media and concludes here comes everybody. And they are all right.

But I think we should keep one single razor sharp, defining reality at the front of our minds. Never before in human history has so much information been available to so many people, so quickly. People crave information, our democracy requires it, it is human nature. But it’s fair to ask what kind of information. What role will media play in its dissemination? Can legacy media adapt [so that] legacy doesn’t come to mean extinct?

Tom Rosenstiel: In the next few minutes what I’m going to try and do is summarize the 700 plus pages that are in the State of the News Media report but hopefully advance it a little bit and tee up the conversation that’s going to follow. So I’m going to start with what’s happening but hopefully pivot into where things are going.

 Tom Rosenstiel

The first thing to recognize is that the problem in old media for the most part is more of a revenue problem than an audience problem. Look at these numbers: 26% down in revenue in 2009 for newspapers, 24% for local TV, 19% in ad revenue from magazines. Now look at the audience numbers: there are drops but they are not nearly as severe. And in some of them I mean online revenue was down but online audiences are up. So the notion that people are abandoning traditional media outlets and that audience fragmentation is at the heart of this is not really it. What it is, more simply, is that the audience is migrating online, often to traditional outlets, but advertisers are not following them. We could spend a lot of time telling about why online advertising isn’t working but we’ll gloss over that now.

The scale of the losses in old media are enormous — we estimate $1.6 billion lost [to] newspapers in annual capacity. Now there is enormous excitement in new media and new media experiments in community media, in the efforts that are being funded by on community media but in scale they don’t come anywhere close to what we’re seeing in the market collapse on the revenue side in traditionally media.

Now the other [incorrect] notion [is] that all of these revenue drops amount to a collapse in our media. They don’t. They amount to a transition in our media at the moment. The media aren’t shrinking. The commentary and discussion aspect of our media culture is becoming more robust. I think of this often as the sort of after-action element of our media culture — after people have consumed the news and find out what happens they want to talk about it. Now this is an obviously a critical dimension of what media is supposed to do. In the original, news began in coffee houses and public houses, public house is a fancy name for a bar, where people would come — often these coffee houses were near shipping docks — and talk about what was going on in the town or they would talk to people who came off the ships and find out what was going on far away in Europe or elsewhere. In the United States or in the colonies they would have a little log at the end of the bar and people would get off stages, carriages and write down things they’d seen in other towns. [Y]ou could go read the log and it was a kind of early newspaper.

So the idea that discussion is not an essential fundamental part of journalism is wrong, it is. But as that discussion element of our media is growing, the reportorial dimension of media is shrinking. In a sense we have a narrowing of focus because you have fewer reporters congregated around fewer stories. In some cases you actually have more reporters [around a single story] — a paradox in which you actually have more outlets covering news, [but] each of them is smaller and they all cover the big story of the day. So we have more people congregated at the White House and fewer people at the Agricultural Department. We still have somebody at the big city metro mayor’s office but there are fewer reporters congregated at the zoning commissions of the suburban communities.

At the same time we have new news competitors coming in to fill the space, the void that they see created by the decline in traditional reportorial media. Just in the last year we’ve seen a host of partisan groups — watchdog.org is a group that’s in a number of states that’s funded by a libertarian anti-government group. It’s very hard to find that out when you go to their websites. They are quite clear that they don’t think that they need to be clear about where the financing comes from; they’ve hired trained journalists to do the work but it’s very hard to know what’s behind that work.

 Transforming Journalism

You are going to see more and more of this occurring in the next couple of years because these are groups that have a political interest in covering the news and controlling the discussion about the news in the areas they are interested in. And making money at it isn’t their goal. Shaping the discussion is. So those are not only going to grow but their goal is to get [their] content into the mainstream press that has a larger audience. We’re already seeing that. The old media don’t really know how to react to that. Frequently they way that this is going to work is they are going to hire journalists that the old media folks know and say well this is Al, you know Al, he’s a trustworthy guy — nothing to worry about.

The other thing that we are seeing clearly is that the power is shifting to news makers and one of the things that’s making this happen is the tendency towards immediately. Things are posted very quickly. Old media are making rapid use of new media technology and while the new technology could offer us a potential for infinite depth it also offers the potential for instant speed. And what we’ve seen in some of our studies is that the press release that’s authored by the news-making agency, the government agency or whoever, is often adapted very briefly, or very hastily and reposted by a news organization as a kind of quick story. And that moves and sort of establishes a baseline of what people understand about that event. But it’s much closer to a press release than what was published in the newspaper a few years ago.

And that along with the ability of news makers to sort of play off an expanding group of outlets against each other, speed and proliferation are ceding more power to those who would make the news. We’re also seeing more partisanship in certain elements because if you have a small organization and you want to create an affinity with an audience — certainly we see this in prime time cable — building your audience around your perspective in the news [is] a tried and true way of establishing a loyal audience. All of these things combined I think are creating the sense for people that the news is more of an argument and less of an authoritative finished product.

And certainly, after some years of stability in trust levels relating to the media, just in the last couple years we’ve seen a rise in distrust again. Much of it actually is from liberals who think that the [media have] become more biased than they were. Earlier levels of distrust rising a decade ago tended to be more among conservatives. Now both sides are angry at us.

Another critical issue is what you might call the unbundling of news. The old economic equation that created the news was that you take money from car ads and real estate ads and you’d use that money to go cover zoning commissions or whatever editors thought was important. There was no connection between a given piece of content and revenue. You didn’t sell specific stories or specific topics. [P]opular stories helped build the audience that subsidized the unpopular stories, the stories that were significant. Now increasingly people are seeking out the news story by story. And the news organization as a brand is somewhat less important [while] the brand of an individual story, even an individual reporter, is more important. So as news people, what’s the incentive for us to go out and cover news that is simply important but is never going to generate much of an audience? This is an increasingly significant issue that news people are going to have to grapple with.

One of the other conclusions we come to in the report is that. after all is said and done, we think that the fortunes of this [new] media and the old media are going to be much more tied together than they ever anticipated. And the reason is that unless they can find a revenue model online to monetize news in a digital space, they are both going to have very limited reportorial capacity. So ultimately they are going to become business partners in the search for new revenue models and there are more stuck together than they ever thought they were going to be.

We are already beginning to see pro-am collaborations. How can news organizations use non-news people to help them gather the news, how can they have formal collaborations, how can they help each other. Are there economies of scale? [W]hat are the revenue prospects at this point? Well in the surveys that we’ve done they look difficult. 79% of people tell us that they hardly ever or never clicked on an online ad from a news organization. We asked people about pay walls and first we asked how many people have a site that they would call a favorite website: Only 35% did.

Then we asked that group — the group we would think most likely to be loyal — whether they would pay for their favorite site; only 15% said they would. If you add in the ones who already do pay, which is a very small number who go the Wall Street Journal and Bloomberg, that number goes up to 19% but it’s still not a very big number and it’s certainly well below the 10% that many news organizations estimate would pay. Now I don’t know that this means that it can’t happen. It just means that right at the moment people are not accustomed to paying and they are going to be initially resistant to it.

So what are the models then for news? Well this is hardly a definitive list but one would be different kinds of display advertising than news organizations use now. If you talk to people at Google they scoff at the kind of display advertising that is in news organizations on news sites because they say it’s too crude. It’s not targeted enough. [O]ne Google executive told us: we’re in our 10th generation of online ads — you are still on your first.

Another is non-news revenue. Newspaper executives [are] in the home delivery business and [they are] making new revenue from delivering things to people’s houses. If the post office stops Saturday delivery that’s good for [newspapers]. Pay walls are clearly another. Transaction fees — you create a retail mall on your website and people buy things and you are in the retail business. Knowledge, services, premium websites, micro sites within news organizations. Mixed audience products where you are basically selling information about your audience; targeted ads are part of that. Amortizing across platforms. There is a host of other things even if you believe as some do that the news business missed scores of opportunities in the last decade.

The key to all of this is going to be understanding the new news consumer. How do people get news? What is brand? What’s the difference between commodity news and franchise news — commodity news being news you can find in a lot of places, franchise news being news you can only find at that one news organization?

 Tom Rosenstiel

[I]n the work we’ve done we’ve found that the notion of primary news source is obsolete. People today graze across many news sources. Even the way the surveys generally are asked — where do you get most of your news? — may be an obsolete question now. People no longer rely on a single or even a handful of gatekeepers. Only 7% of people get news from one platform — say just TV — [while] 46% get their news from four to six platforms every day. And 60% go online and offline in a typical day. Where do they get their news? Across a wide swath: 50% of people still get the news every day from a local newspaper. Local TV news, although it is suffering, is still the most popular. Online numbers are clearly going up, but the idea that these old technologies vanish is probably not the case at least not anywhere near yet.

[People] also acquire news throughout the day — 30% now get news several times a day, just online. And how far do they range online? Not that far. They graze but they graze to a handful of places. Only 3% of people online get news from more than 10 websites on a regular basis. Most [have] two to five favorite — well not favorite sites, but trusted sites. And where [do] they graze online? Interesting: 60% to aggregators. Certainly in the traffic data the aggregators are the most popular. But there is a wide range of places — 30% of people get news from people or institutions that are not news-related that they follow on social media. And what do people do online? A lot of things. Including email stuff to each other.

One big question is whether people now are going to just the subjects and the things they are interested in, sort of migrating to fragmented specialized areas and places that they agree with. The answer appears to be — both in traffic data and in survey data — that that’s not what’s happening. That the idea of accidentally coming across things that you didn’t know you were interested in still lives. It’s a smaller part of our media consumption, but 34% of people say that describes them best and actually the traffic data would suggest those numbers may be even higher.

Partisan news is clearly not where everybody wants to get their news: 31% say they prefer news sources that share their point of view and in the Pew Research Center [People & the Press survey] data the those numbers have not changed in decades. About two-thirds of people say they prefer to get news that have multiple points of view or that have no point of view. And online the top sites dominate, the old media presentation still has market appeal. [Among] the 4,600 sites that Nielson tracks that do news and information, the top 7% get 80% of the traffic. Of the top 200 news sites, 67% are from legacy media, another 13% are aggregators who aggregate old media. Only 14% are online-only content creators. So there is still a market for what these people produce, for that kind of reportorial journalism, if there is a way to monetize it.

Chris Sterling: Now it’s time to turn to the panel that will be moderated by Frank Sesno who is SMPA’s director.

Tina Brown: I think [in] today’s world, whatever you are editing, you have to be much more of an impresario. You have to regard yourself as putting on a show and firing on all cylinders at all times, to recognize that the major enemy that we all have is “time famine”. [I]t’s all about making them pay attention and I’ve always taken that view as an editor. When I was at the New Yorker I used to feel deeply insulted when people said I have a wonderful pile of magazines by the bed and I’d say oh no you know I failed. Because we have to make them read them in the taxi or on the way to the bathroom, and if they didn’t I knew that we’d failed. So it’s the same thing very much today — but on steroids, because there is so much competition.

 Tina Brown

We launched the Daily Beast a year and a bit ago and created the site very, very quickly but we actually were pretty counterintuitive about it. We decided to have absolutely no hype ahead of time because, in some ways, I think today hype is even more suspicion-building than it ever was. It really is almost a kind of anti-hype cultural while actually requir[ing] a lot of exposure — so that’s a tricky thing to navigate. We kept very low and very quiet at the beginning and then we kind of crashed over the top with a site that was created in eight weeks to come out before the election fever was over. [O]ur whole sort of policy was that we had to constantly provoke to have a point of view, to always go against the grain.

So the whole philosophy of The Daily Beast really is first of all we give you 10 stories at any one time that we feel you ought to read. [W]e don’t give you, say, 20 links about the Taliban, we’ll give you one piece on the Taliban, a piece that we’ve decided is the only piece worth reading. The rest of it, 70%, is now original content and that original content is generated really about running against the news all the time. It’s like taking the counterpoint of view. Finding writers who don’t just want to say something but want to say something different from what other people have out there. And we don’t just post anything. [W]e’re old fashioned that way. We feel that we can only get quality by saying no to quite a lot of stuff that gets offered so that we’re always looking for that piece, that writer, that point of view that’s going to go against the grain.

We also felt strongly that in today’s world design matters hugely. That visually we’re at another iteration of the internet where it’s not enough now to simply have links and a basic tech-ridden sort of site that is created by geeks who haven’t really got an editorial point of view. We spent a lot of time on the design of the data base. I’ve always been an editor who sat with our directors and wrestled with them for hours about the tension between form and content and visuals and I did that with The Daily Beast. I went down to the design studio and sort of totally freaked out these tech guys because they weren’t used to having the client show up and sit there and at first they were like, whoa, doesn’t she understand that we don’t want her in our studio. But after time they understood that actually we could give a lot to each other. We became very, very good collaborators because I was totally fascinated to what the design is and they were very fascinated to sort of discover that content actually was important.

[W]hen I started the Tattler magazine in London, when I was 25, I sort of learned that if you don’t have budget you better have a point of view. Because if you can’t afford to go out there and send reporters crawling around the world, at least you’ve got to have an idea about what you want to say that’s different. And that actually has been very much what we have at the Beast and it seems to have got traction. We now have over 4 million monthly unique [visitors]. [B]ut it’s not enough to simply have content that is arresting, you do have to very, very aggressively promote what you are doing at all times. [W]e booked 49 appearances a month on average with our writers. We have a couple of kids who basically spend all day long pitching and booking and calling news outlets and tweeting and it’s all about sort of every platform all at ones.

We just did a major conference called Women in the World where we tried to shine a light on our foreign coverage. [I]t is tough to get traffic for subjects that are foreign news, that are stories about Africa, Al Qaeda etc., which we do a lot on The Daily Beast. And one way is to make that content come alive with discussions and panels and occasions, such as this, where you can really dramatize and make a noise about what you are doing. Because we can’t simply give up on that kind of subject matter because it’s not instantly sort of traffic candy.

[M]any websites today sort of feel that they have to have politics together and media together and foreign news together we take the opposite view. I actually think that subject matter has energy by its collision with other kinds of subject matter. And so in our highlight section we’ll have a piece about a foot fetishist right next to a piece about Al Qaeda and somehow both [give] each other traction in a strange way. Because I think the people in their lives like that mix between high and low, between risqué and serious, between funny and smart and you know all of that stuff goes on at once.

Sesno: Charlie let me turn to you. [T]alk a minute about building a site and global reporting on the back essentially of a team of freelancers. One of the great things about GlobalPost is you are all over the world. You’ve got lots of young people and accomplished journalists both. One of the raps at least if you read some of the popular press is that there is not enough money for a journalist to live on here. How do you build this on the back of a freelance model?

Charlie Sennott: Well we launched GlobalPost about 15 months ago and when we launched I really share a lot of the same stories that Tina just told about what it was like to build this thing from the ground. [W]e wanted to make it have a bold design, really highlight our writers, highlight photography, make it feel different, make it feel exciting and build a team.

 Charlie Sennott

Now in building a team of foreign correspondents these days we no longer have those traditional models of correspondent’s having full positions where they can come into a newsroom and know that when you get assigned overseas everything is taken care of. That you will be a foreign correspondent for the Boston Globe, which will pay for your son’s schools in my case, they will take good care of you. I feel very fortunate to have experienced that kind of foreign reporting. But it’s largely over. So what we’re left with are fantastic foreign correspondents who are out in the world looking for work and we’ve tried to become is a network of outstanding freelancers.

So we’ve tried to build a team of some of the best foreign correspondents who are out there in the world. Jean McKinsey, who is our Kolbe correspondent, is a great example of the kind of correspondent we have. Jean is also with the Institute for War and Peace Reporting and she has a full time contract with them. So she spends a lot of her time in Afghanistan teaching young Afghans how to be reporters. She gets paid for that and then she writes for us on a regular basis as well.

We have correspondents like Michael Goldfarb, longtime National Public Radio correspondent in London who is also writing books. We’ve tried to become an outlet that recognizes that the future of being a foreign reporter is going to be you are an entrepreneur. You are going to have to recognize that you need to think entrepreneurially and consider GlobalPost the base of what you do — a grounding, a steady gig where we give people a retainer to write four stories a month. And then we have a budget for special projects and for enterprise reporting where we can really step it up if you have a great idea and you need more resources. So right now we have 70 correspondents in 50 countries.

[B]riefly, we have three revenue streams because we are for profit. [A]dvertising is one of the revenue streams. Syndication [is another]. [W]e’ve had 30 newspapers with whom we now syndicate. They range from the New York Daily News to the Pittsburgh Post Gazette to the Times of India — with circulation of three million, one of the largest English language newspapers in the world — CBS News, the “Newshour.” [T]hat syndication model has really been good for us. The third one is membership, which is an invitation to say to people: look great journalism costs money. We want to invite you to be part of GlobalPost. Become a member. There are added services that you get with that.

[W]e’re very excited about our traffic. We’ve had very steady traffic growth of approximately 30% month-on-month, which really suggests that maybe people do care about international news. I think people want to know about the issues we face, so many of which are global in nature. [D]o you want to know about climate change because we can have our correspondents look at that issue from 50 different countries, 70 different writers? So our traffic is now closing in on a million unique per month, which far exceeds the goals we had for our first year and we’re very excited about where we are headed.

Sesno: Jim Brady. Politico… How can one cover a major metropolitan area of 4 million people with 35 or 40 people? What are you building? What will you cover?

Jim Brady: I think we are starting with the concept that you can’t be all things to all people anymore. Landscape is so fragmented now that you have to assume that the days of winner-take-all competition in cities is pretty much over. And so, going out and hiring hundreds of reporters and suggesting we’re going to compete with the Post or with other local television stations, [is] just unrealistic financially. [I]f you look at the news organizations that cover Washington DC as a city where people live, pretty much everyone of them is attached to another property that really gets the lion share of the attention at the company whether it’s local newspapers, local TV, local radio. [S]o if you could start anew from scratch basically on the website and build from there, what could you build that would be extremely different from what you could build if you were trying to do it at one of those organizations?

 Jim Brady

[H]aving been at Washingtonpost.com for four or five years you see the struggle every day between trying desperately to figure out how to preserve the lion’s share of the business while trying to grow this emerging part of the business. And so, after having left there, I thought, boy, there just seems like there is such opportunity for a website operating on web time; something that we like[d to] say back at Washingtonpost.com, is not just on the web but of the web. [S]o what that means is we’re going to go aggressively after a limited number of beats where we think there is opportunity where something is either not being covered particularly well or can be covered differently. [S]o we are not going to be at every zoning board meeting in the region; we are not going to be at every high school football game.

We are going to pick our spots but we are also going to not act as if we are sort of alone in this eco system. There are hundreds of really good local websites and local news sites in this region, bloggers like you said, other news sites that we are going to work closely with and in fact partner with because most of you who live here in neighborhoods have local sites that you go to get really useful very targeted information about your communities. We’re not going to be able to provide really targeted information about Great Falls, Virginia and Oxenhill, Maryland and Woodbridge, Virginia. [W]e’re going to have to depend on sites that are already [doing] really good work there.
So we’re going to partner with local bloggers. We’re going to aggregate very aggressively, to do what was once considered sort of outrageous in the news space which is actually point to competitors.

[I]f the Washington Post [publishes] a great story about something going on in DC government, it would be letting our readers down to not point to that. We’ll be very aggressive on mobile. And we push really hard at throwing away one of the wrongheaded terms that’s been thrown around a lot the last couple years, which is “platform agnostic” journalism. It’s not platform agnostic. You have a different experience on a mobile phone than on a web browser and on an iPhone and on television and we are going to try to provide journalism that fits the platform and not just say one size fits all. So we’re going to try to cover things very differently. So I think there is plenty of room and you’ll see hopefully in a couple of months how we are going to try to create this what I hope would be a very different thing.

One of the questions that comes up a lot is, is this extendable to other markets? And I think it clearly is. Allbritton has a significant advantage locally because it owns Channel 7 and Channel 8 and thus comes with a lot of three really important things: journalistic resources, good long relationships with local advertisers and an amazing promotional platform to help people get to this new site. That’s not the case in every but I suspect — in fact I am sure — in five years most major markets in the country will have a site just like this. Because, in the end, having been front and center in the struggle to really converge at the Post the last five years, [I know] it’s really hard to do both things the web and print require. They require different mindsets but also significant amounts of mind share and trying to put those two together is really a difficult task. So we can sort of say we’re starting anew and I think that alone is the biggest advantage we have.

Sesno: And the purpose is to make money.

Brady: I think the idea was to be for profit. I think what’s happened to journalism from the creative standpoint in the last 10 years has been the most exciting time in the history of the craft in terms of the tools we have — the way we can reach audiences 24/7 in any corner of the world. We haven’t figured out the business side yet and I wanted to be part of that.

Sesno: Susan Page. Newspapers as the study points out saw revenue fall 26% in 2009. 43% over three years. What can of traditional newspapers do to reverse the decline? Are there different ways to report the news and get more news more efficiently?

Susan Page: I don’t think anyone thinks of themselves as a traditional newspaper anymore and that would be the case with USA Today. If wanted to read USA Today this morning you could have bought it on a newsstand, you could have gone to USAToday.com. You could have subscribed to our e-edition, which takes the paper copy and sends it to you in digital form. I am not entirely sure who that is for but we’re selling that.

 Susan Page

You could follow us on Facebook or Twitter. You can get into some building and see teases to our stories on a video screen in an elevator. And if you thought USA Today stories were short when we started out, you should read some of the copy on the elevator screens. But the old divisions that we’ve talked about for the last couple years between what my fellow panelists are doing and what we are doing are really getting blurred. Because we think of ourselves not as a traditional newspaper, we think of ourselves as maybe a traditional news operation where our agenda, our mission is to hold powerful people to account, to offer information not opinion. We offer some opinion in parts of the paper as well, but basically we want people to feel like this [is] a major news source covering the big stories of the day and that whether you are liberal or conservative you can read it and feel confident that information you are getting does not have a partisan slant and it’s about things that are significant.

Now it’s true that this is expensive and the decline in revenue sources has been a huge challenge. We’ve seen our newsroom shrink some although not as much as regional and local newspapers have seen. We have a smaller staff that works harder and works in more diverse ways. We’ve forged new partnerships with the 90 or so Gannet owned newspapers across the country. So now you’ll see we’ll sometimes run stories that ran in the Arizona Republic or the Des Moines Register, or we’ll use those reporters to pursue stories that we want, especially breaking stories that happened in their part of the country. [S]o those are ways in which we have tried to adapt. But I think one thing we’ve learned from Tom’s study and others is that it is still legacy media that is driving the conversation in this country. And it is still legacy media that is driving traffic on the web. Tom’s study, which I was reading last night, says that 80% of the links in social media sites and on blogs are to legacy media. Or to newspapers who break stories.

So how do we know that Gov. Sanford was not walking along the Appalachian Trail? We know that because the newspaper the South Carolina State told us that. Or why do we know that Gov. Patterson in New York was intervening inappropriately in a domestic violence case involving a close aide? We know that because the New York Times figured it out and told us. So the idea that traditional newspapers or the traditional mission of newspapers is becoming archaic I think is incorrect.

You know we are trying to figure out how to finance the journalism that we want to do. And I think none of us think that there is going to be some silver bullet — some revolution in classified advertising will suddenly come back and be the financial backbone of newspapers across the country. I think almost all of us think that it’s going to be a mix of things. It’s going to be advertising on the web. It’s going to be getting some revenue from the web from readers. And while the few studies show that people are not now willing to pay on the web for news, you know there was a time when people were not willing to pay money for TV reception but now it’s customary. There was a time when my mother would have slapped me if I’d said I was going to pay a dollar for a bottle of water. Who here has not yet done that?

[A]ttitudes change so I do not find these poll findings descriptive for the future. Getting support from nonprofits. One of the things we started to do is work with and run stories by Kaiser Health News and Pro Publica. And we only do this with nonprofit news organizations that meet our standards and are willing to work by our rules — our sourcing rules, our rules on transparency. But that’s been successful. We’ve also been flexible about packaging the content we deliver so increasingly we do these onetime magazines — [the one] about Obama’s inauguration was a big seller. We’re really taking content that we’re developing for ourselves and repacking and then getting some more revenue for it by selling to people who want a kind of commemorative edition. We’ve done that last month about Mohammad Ali’s 50 years in boxing.

It’s incumbent on all of us to show the kind of energy and entrepreneurial spirit that start-up sites have shown. We have just one more thing we’ve started to do: communities on our website. [I]f you are a fantasy football fan or if you like American Idol or if you are trying to build a green home there are now communities on the USA Today website. That’s really a response to some the news organizations we’ve seen come up and be powerful and we want that to be part of our agenda too.

I would just say one last thing, which goes to something that Jim said. {T]he last couple of years have been really tough to work for newspapers because there have been such serious layoffs and a shrinking news hole, but in some ways good things have happened. You know we are much more transparent now with readers than we ever were. When we were when I started in this business. There is much more accountability. The entire world is your fact checker if you make an error in a story and it gets posted on the web. There is a stronger connection with readers, which goes to some of these communities that we’ve started up on our website. I think the story telling is more powerful because you are not just using words and photos but you are able to use audio and video. And you have, I think, sharper writing for people and less thumb sucking and that’s all to the good too.

Sesno: Antoine, to television for a moment. You straddle an interesting world because NBC is a traditional network. We still have nightly news. You have a variety of cable channels, which is seen as a strength and one of the reasons that the cable news business is one of the few bright spots in terms of revenue as you look across an otherwise bleak landscape certainly in the last year. But I’m curious if you would address this issue of argument versus news and where you think television is going. And this issue of is there news left in cable news, because it appears to have gone, at least in most cases, to the mat.

Antoine Sanfuentes: Let’s look at the hours and hours of news programming that we provide starting [on] the NBC platform. [T]hrough the bulk of the day we deal with news and it’s NBC News. You have Andrea Mitchell, you have Pete Williams, you have Jim Miklaszewski, you have all our talented NBC correspondents making a contribution all day long. [I]t starts in the morning on The Today Show [and continues] throughout the day on MSNBC. You can also go to the internet. [Y]ou have the internet, you have cable, you have broadcast and they all work very closely together. After [the] nightly news wrap, after Today Show, if there is a piece that you missed, you can go to the internet and you can watch it instantly.

 Antoine Sanfuentes

[W]hen we talk about traditional journalism and you look at the NBC model, I think not only are we keeping up but I think we’ve been ahead of the game for several years now. We’ve been working within these three platforms but we’ve also adapted. I think technology will get us there. And when we talk about digital journalism, it is a real plus that a correspondent now can go into the field — usually two people — with the DVcam, the laptop, very small technology that can allow you to broadcast and send your images back. In my view that will transform the industry. [W]e’ve had a tough time but it’s really it’s a realignment that’s in line with the technology that is now available. And I think that you’ll find that within our ranks you are seeing a lot more of NBC news on these various platforms. You are seeing our producers who are writing great pieces, our correspondents — they’ve got quite a challenge to get all done in one day but they’re keeping up. And I look forward to the future, frankly, where we talk about how do you report and cover at the same time. I think the technology will get us there. You know when we look at iPhones and the streaming of materials it’s astounding to me.

Sesno: Let’s open this up then for some discussion now. [L]et’s go to the issue of what people are willing to pay for. Tina why don’t you get us started with this.

Brown: Well I think that ultimately it will be like the network television cable model. People never thought that anybody would ever pay for television but in fact cable began and they are paying cable. So the question of bundling like-minded things together and making them into a package and buying them I think it will happen for certain premium sites. But I do think we are going to remain in this multiplatform world without question where you are going to have to have five or six things going on to make the revenues [sufficient].

Sesno: How about paying for Daily Beast?

Brown: [I]t could become a paid site with paid elements in it. But we’re not proceeding along that basis as a revenue model. [We] are getting advertising now more and more, but at the same time getting sponsorships, we’re producing Beast books now, which we’ve gone into and published two books already in the last year. We’re looking at TV. [W]e are lucky because we have IAC [Chairman and CEO] Barry Diller, a partner who [has] always taken the long view, that this is going to be a three or four year wait to get to profitability — which we are lucky to be able to have because obviously there are some sites which can’t, which kept getting refinanced.

Sesno: We didn’t make money at CNN for five years.

Brown: And nor have any magazines of any size but today’s world is about who is going to wait. And you need a partner that can. Or you have to keep refinancing, which is very stressful.

Sesno: Charlie, you are charging something now. What do you get if you pay and how many people are actually paying?

Sennott: Our site is free. GlobalPost.com still embraces this idea that information wants to be free on the web. But it also recognizes the fact that journalism has great value and it costs money. So we do have a paid membership where we invite people to pay an annual fee of $50.00 a year to become a member of GlobalPost and what you get when you become a member of passport as we call it in GlobalPost is an opportunity to talk to foreign correspondents in the field in a conference call. We invite crowd sourcing but we invite it through membership.

Sesno: How many people are doing this?

Sennott: So we have less than 2,000 right now. I don’t know the exact number. It’s probably closer to 1,000. It’s very much in beta. This is not been done, from what we know, anywhere else — to say what if you did a sort of almost NPR style membership and you said look we think this is an organization that’s out there in the world trying to do old fashioned journalism with some really basic ideas like you have to live in the country about which you report. You need to speak the language or at least be trying to learn it. And I think that sort of old school, that old shoe leather journalism that has great value, as Susan pointed out. If we’re going to do that we need to invite you to support it. That’s our model.
Sesno: And then people pay? Think they’d do it?
Brady: No. I don’t. I’m sort of the mind that the best thing news organizations could do is sort of surrender [to] the fact that they are never going to make a ton of non-ad revenue on the web and go straight to mobile. Because to me I think we’re, there is a lot of money to be made on mobile and I think mobile may be the web’s version of satellite radio and cable television.

Sesno: How do you make money on mobile?

Brady: I think [people will] pay for different things on mobile than they would pay for on a browser. They’ll pay for timeliness; they’ll pay for geographic relevance. They’ll pay to be the guy in the audience who finds out that their boss just had something written about [him] before the guy [in] the next seat [does].

Sesno: Is this like an ITunes world? [I]s this micro payments, 29 cents and you get the story about your boss?

Brady: I think you may sign up for alerts to get that. But again if you are looking at like traffic alerts and weather alerts, if the phone will tell you that you about to approach a huge traffic jam maybe you ought to make a left. I mean if I got saved twice a year by those alerts, I’d pay a pretty good chunk of change for it. So I think [in] the portable world [there] is much more of an opportunity to eventually charge. I just think it’s a supply and demand on the web unless you are producing something that is really unique someone can go find it somewhere else. And even [if] you claim it’s of slightly higher quality at a site that charges, most people just aren’t going to take that leap. I think one of the things that everybody up here recognizes and I am sure everyone in the audience recognizes is right now we are in the middle ages. We are in this time of ferment change, revolution, it’s really exciting.

Sesno: Unless you’ve lost your job.

Sennott: Well I think it’s really hard when people are losing those great jobs from traditional legacy media — those are great jobs. I had one. I took the buyout at the Boston Globe and really went forward with this. [But], especially for the students out there, this is the most exciting time to be getting into journalism in my life time because the models are going to be created by you. There is going to be a lot of thinking that’s going to go into this. You don’t need huge amounts of capital anymore to go out and try to start something. You know at GlobalPost we were lucky to have very grounded solid investors. And I really understand this is a long slow build.

Brown: I do agree with Charlie on that. [I]t is true that we all mourn the bureaus, etc. but actually you can get vibrant foreign reporting without bureaus. You really can. I’ve collected so many amazing Indian writers and I was so happy I did when the Mumbai massacre happened because we had fabulous really current brilliant reporting. From the likes of Aravind Adiga, who wrote “White Tiger,” and tremendously good journalists over there who were finding such original fantastic stuff and I think more eclectic and more interesting than anything that I could have got from a one guy on the spot who was ours.

Sennott: You know I think that’s true. I think the new model is about building a community that’s going to go out and try and cover a certain segment of what used to be in your newspaper. And that could be sports and that could be in our case international news.

Sesno: Let me place a skunk in the garden party here for just a minute. Because we are all patting ourselves on the back about how wonderful all this is going to be, but [what happens when] there is real serious long term digging. [T]ake an investigative piece — you talked about accountability journalism, you want to get into the mayor or the governor or whatever. {A] team of reporters who at least traditionally would spend weeks, maybe months digging, maybe come back with nothing. They’ve actually got freedom of information requests they are filing, they know how to do it, they know what to make of sensitive documents, and sensitive material; you are going to have that at what is your new adventure called?

Brady: Doesn’t have a name yet.

Page: [Y]ou know people who worked in these traditional foreign correspondent jobs didn’t just get a lot of perks, they came with an agenda that was very clear and with accountability to a news organization. And they weren’t working for multiple bosses. I understand why we’ve gone that direction, but there is a value to the more traditional model as well. Just to pick up on something else that Charlie said since we are at a university here — we’ve seen like a generation of senior journalists kind of get washed away including some really talented people who didn’t deserve to be laid off. But it has really cleared the decks for the people who are coming out of school now who have different expectations about what the job is going to be like. You know I have a son who wants to be a reporter and he has every expectation that he’ll shoot video and record and audio and not that the expectations are just different although the values are the same.

Sennott: I think this is another thing that at GlobalPost we’re really grappling with all the time. And that is we actually are looking for something pretty basic in that you find in the best reporters in the world, which is story telling. What we really in the core want to be about is just telling a great story. And we don’t want to try to create these reporters who think they have to do that through video and photography and audio and writing because then they are going to lose the essence of what it is to tell a story. So when we are dealing with younger reporters and mid career and veteran reporters we always tell them to go to your strength. I mean if you are a writer, write. Tell us the story that way. If you can pick up a digital camera and you feel comfortable with it and you can help document an angle, that’s added value. But what we don’t want to do is sort of blur the lines because I think you end up with great mediocrity that way.

Look when you have a network of 50 people, and you have a story like the global economic crisis and all of them are talented, we can actually take that team and with one email copy to all of them say, we want a snapshot right now from the field of the most devastating antidote you can find of the impact in your country of the global economic crisis. And you can begin to work together and creates this sort of quantum effect. So that our reporting, I’m very proud, won a Saber award and beat out some much larger news sites because we were able to look at it in an integrated way that was very interactive.

Brown: I also think we have to look at new ways of telling stories or getting at subjects. At the Beast, when a story first breaks and we’re still assembling that material, we’ve created something called the “big fat story”. And the big fat story is four or five different pieces from different places or whatever the place which we put in different boxes and then summarize. [I]f it’s a murder, here’s what the crime was, here is what the suspicion is, here is what people are saying about it. And then it gives you a way of telling a story in a completely different way. I’m actually kind of fascinated to figure out new ways to do narrative journalism because, having come from magazines where narrative journalism was what I did all day, I do miss narrative journalism online. I think it’s still not the place to do the long, accreted detail story. You are not going to get the same attention span for a piece that’s over really about 1,200-1,300 words.

Sesno: I remember hearing you on NPR citing Michael Kinsley’s long piece about how we have to have fewer long pieces.

Brown: [W]hen people talk about not having good writing online I totally disagree. I mean I think we blow out bad writers so fast on the Beast because you know anybody who spends five paragraphs clearing their throat and blowharding around, you just want to cut to the chase.

Sesno: And that’s different than it used to be?

Brown: Well I think it makes you much more ruthless as an editor, which is what you need to be.

Sesno: Antoine once upon a time NBC had documentary unit, the other networks had documentary units, CNN had documentary those documentary units have gone away. The only institutional documentary unit anymore really is Frontline on PPS.

Sanfuentes: I think given that we saturate the airwaves with news, we look for the right opportunity to do it. I’d point you to “Inside the Obama White House”, which is something that is unique to NBC. [I]f you look at the various platforms we used on that particular day from lights on to lights off, we were tweeting, I was taking still pictures, we created a slide show that was viewed by millions of people on MSNBC.com. We had a network primetime special. We had pieces on nightly news, the Today Show, MSNBC; we had live shots to talk about the experience. So there are ways for us to do this, maybe not as often as we used to but it’s a different model.

Brown: And let’s face it unless Brad Pitt’s involved no one is going to go to Africa. Right?

Sanfuentes: Well I’ll point to my very good friend Ann Curry. We took several trips to Darfur together and Congo and it was really great to see that our leadership at NBC supported us. We went in with great technologies, small; we were able to transmit from there both at the border in Chad and from Congo. Something that would have been unheard of I think.

Sesno: Tom Rosenstiel, from what you’ve heard so far what most encourages you and what most concerns you given the conversation and the research?

Rosenstiel: The first thing that I think is encouraging is that what we think of as journalism is breaking up into many different elements that serve the way that consumers get information. [I]t’s good that they are doing different things — that GlobalPost is focused on the narrative, that NBC has got these multi platforms. Because that’s the way, as citizens, we consume news. We don’t need the same thing for every kind of story.

Sesno: We don’t need the one big homerun place.

Rosenstiel: No. There is essentially a more complex news ecosystem that is now forming. I’ll never look to the Daily Beast to be the New York Times nor should I want to. There already is a New York Times. And the other thing that I think is encouraging is that when you recognize that you begin to start to say wait a second — news is not just the long narrative or the inverted pyramid. I am intrigued too by the idea of new ways of writing stories. The idea of a Wikipedia page for a long running story or a Wikipedia like page where I could go in and find out what happened today and then sort of get all the other background there. The idea of the story that you start over every day is really an artifact of the 19th century. So I think that’s very encouraging.

Sesno: What worries you?

Rosenstiel: What worries me is that thinking doesn’t go far enough. Ultimately my guess is that if the news institutions are going to monetize the web it’s going to be by moving away from narrative. That they are going to have to recognize that they’re in the knowledge and information business. And that there are many businesses embedded in that. And that simply trying to put ads against narrative is a very narrow slice of the knowledge business.

I also suspect that a lot of the innovation is going to occur outside of these old institutions. And that for all that groups are trying to innovate you’ve got to have the DNA of engineers. I agree with you wholeheartedly, Jim, that the idea of platform agnosticism is a foolish term. That the people who are going to win online are going to be platform orthodox. They are going to exploit the technology. And it’s only when you do that that I think you are going to end up with revenue models. To me all of this is great. [T]he news side has opened up the possibilities, but without monetization it’s just good intentions.

Find the full transcript and a video of the event at the SMPA website.

What now?

Inside news companies, the most immediate concern is how much revenue lost in the recession the industry will regain as the economy improves.

Whatever the answers, the future of news ultimately rests on more long-term concerns: What are the prospects for alternative journalism organizations that are forming around the country? Will traditional media adapt and innovate amid continuing pressures to thin their ranks?

And with growing evidence that conventional advertising online will never sustain the industry, what progress is being made to find new revenue for financing the gathering and reporting of news?

The numbers for 2009 reveal just how urgent these questions are becoming. Newspapers, including online, saw ad revenue fall 26% during the year, which brings the total loss over the last three years to 43%.

Local television ad revenue fell 22% in 2009; triple the decline the year before. Radio also was off 22%. Magazine ad revenue dropped 17%, network TV 8% (and news alone probably more). Online ad revenue overall fell about 5%, and revenue to news sites most likely also fared much worse.

Only cable news among the commercial news sectors did not suffer declining revenue last year.

The estimates for what happens after the economy rebounds vary and even then are only guesses. The market research and investment banking firm Veronis Suhler Stevenson projects that by 2013, after the economic recovery, three elements of old media — newspapers, radio and magazines — will take in 41% less in ad revenues than they did in 2006.

(Who owns the news media? View an interactive database of companies that own news properties in the United States at journalism.org.)

For newspapers, which still provide the largest share of reportorial journalism in the United States, the metaphor that comes to mind is sand in an hourglass. The shrinking money left in print, which still provides 90% of the industry’s funds, is the amount of time left to invent new revenue models online. The industry must find a new model before that money runs out.

The losses are already enormous. To quantify the impact, with colleague Rick Edmonds of the Poynter Institute, we estimate that the newspaper industry has lost $1.6 billion in annual reporting and editing capacity since 2000, or roughly 30%. That leaves an estimated $4.4 billion remaining. Even if the economy improves we predict more cuts in 2010.

Network news division resources are likely down from their peak in the late 1980s by more than half — which amounts to hundreds of millions of dollars — and new rounds of cuts came in the last 12 months. Local television is harder to gauge, but one estimate puts the losses in the last two years at over 1,600 jobs, or roughly 6%. Staffing at the news magazines Time and Newsweek since 1983 is down by 47%.²

So what about the new media experiments growing around the country? There are certainly exciting things happening, from former journalists creating specialty news sites and community sites, to citizens covering neighborhoods, local blogs and social media.

In 2009, Twitter and other social media emerged as powerful tools for disseminating information and mobilizing citizens for purposes such as evading the censors in Iran and communicating from the earthquake disaster zone in Haiti. The majority of internet users (59%) now use some kind of social media, including Twitter, blogging and networking sites, according to a new PEJ/Pew Internet & American Life survey.

Citizen journalism at the local level is expanding rapidly and brimming with innovation. This year’s report includes a new study of 60 of the most highly regarded sites. The prospects for assembling sufficient economies of scale, audience and authority may be most promising at specialized national and international sites — efforts like ProPublica, Kaiser Health News and Global Post.

For all the invention and energy, however, the scale of these new efforts still amounts to a small fraction of what has been lost. While not all of the blogs and citizen efforts can be quantified, J-Lab, a project led by Jan Schaffer that studies new media, estimates that roughly $141 million of nonprofit money has flowed into new media efforts over the last four years (not including public broadcasting). That is less than one-tenth of the losses in newspaper resources alone.

Michael Schudson, the sociologist of journalism at Columbia University, sees the promise of “a better array of public informational resources emerging.” This new ecosystem will include different “styles” of journalism, a mix of professional and amateur approaches and different economic models — commercial, nonprofit, public and “university-fueled.”

Clay Shirky of New York University has suggested that the loss of news people is a predictable and perhaps temporary gap in the process of creative destruction. “The old stuff gets broken faster than the new stuff is put in its place,” he has written.

There is something important in these notions. As Schudson notes, the news industry became more professional, skeptical and ethical beginning in the 1960s. Many journalists think that sense of public good has been overtaken by a focus on efficiency and profit since the 1990s. However, some of the new initiatives have re-invigorated the journalism mission of public interest and have helped to connect people within the community more.

(Explore and answer questions about media coverage in 2009 with PEJ’s News Interactive at journalism.org. The data are based on more than 68,700 stories analyzed in PEJ’s News Coverage Index for the year.)

Yet the energy and promise here cannot escape the question of resources. Unless some system of financing the production of content is developed, it is difficult to see how reportorial journalism will not continue to shrink, regardless of the potential tools offered by technology.

And as we enter 2010 there is little evidence that journalism online has found a sustaining revenue model. A new survey on online economics, released in this report for the first time, finds that 79% of online news consumers say they rarely if ever have clicked on an online ad.

There was certainly more talk of alternative approaches to advertising in the last year. Entrepreneur Steve Brill and others launched JournalismOnline.com, which offers news sites a mechanism for charging, but at this point it is more a possibility than a business reality. Rupert Murdoch announced discussions with Microsoft about higher payments for searching his content and insisted that everything his company produces would go behind pay walls. Columbia University produced a report that explored nonprofit and public funding sourcing and assessed the state of start up new media. The New York Times announced it was giving itself a year to figure out a way to charge for content to “get it really really right.” And more new media startups were planned, a growing sign that as old media continues to shrink, the ecosystem is changing and some things are growing.

But if a new model is to be found it is hardly clear what it will be. Our survey, produced with the Pew Internet & American Life Project, finds that only about a third of Americans (35%) have a news destination online they would call a “favorite,” and even among these users only 19% said they would continue to visit if that site put up a pay-wall.

In the meantime, perhaps one concept identifies most clearly what is going on in journalism: Most news organizations — new or old — are becoming niche operations, more specific in focus, brand and appeal and narrower, necessarily, in ambition.

Old media are trying to imagine the new smaller newsroom of the future in the relic of their old ones. New media are imagining the new newsroom from a blank slate and news ecosystem.

Among the critical questions all this will pose: Is there some collaborative model that would allow citizens and journalists to have the best of both worlds and add more capacity here? What ethical values about news will settle in at these sites? Will legacy and new media continue to cooperate more, sharing stories and pooling resources, and if they do, how can one operation vouch for the fairness and accuracy of something they did not produce?

The year ahead will not settle any of these. But the urgency of these questions will become more pronounced. And ultimately the players may be quite different.

“I think the answer may come from places staffed by young people who understand the new technology and its potential and who have a passion for journalism,” said Larry Jinks, the highly regarded former editor and publisher who transformed the San Jose Mercury News a generation ago and who still sits on the board of the McClatchy Company.

Major Trends

In past years we have tried to identify major trends emerging in the coming year, and many of those still apply now. For 2010, we want to emphasize six points.

As we learn more about both Web economics and consumer behavior, the unbundling of news seems increasingly central to journalism’s future. The old model of journalism involved news organizations taking revenue from one social transaction — the selling of real estate, cars and groceries or job hunting, for example — and using it to monitor civic life — covering city councils and zoning commissions and conducting watchdog investigations. Editors assembled a wide range of news, but the popularity of each story was subordinate to the value, and the aggregate audience, of the whole. And the value of the story might be found in its consequence rather than its popularity. That model is breaking down. Online, it is becoming increasingly clear, consumers are not seeking out news organizations for their full news agenda. They are hunting the news by topic and by event and grazing across multiple outlets. This is changing both the finances and the culture of newsrooms. When revenue is more closely tied to each story, what is the rationale for covering civic news that is consequential but has only limited interest? The data also are beginning to show a shift away from interest in local news toward more national and international topics as people have more access to such information, which may have other effects on local dynamics.

The future of new and old media are more tied together than some may think. A new multi-university study released in this report finds that even the best new-media sites in the country still have limited ability to produce content. No doubt they will evolve. Yet their reportorial capacity ultimately will still depend on finding a revenue model far larger than what exists today or is projected to come from conventional online advertising. While there are some competing values and different reportorial cultures, in the end new and old media face the same dilemma and may be much more aligned in their search for revenue than many have thought. In some cases, there will be formal alliances or networks of new and old media. One concept that will get more attention is collaborations of old media and citizens in what some call a “pro-am” (professional and amateur) model for news. Yet how traditional news organizations cope with such partnerships, the rules for what is acceptable and what is not, remain largely uncharted.

The notion that the news media are shrinking is mistaken. Reportorial journalism is getting smaller, but the commentary and discussion aspect of media, which adds analysis, passion and agenda shaping, is growing — in cable, radio, social media, blogs and elsewhere. For all the robust activity there, however, the numbers still suggest that these new media are largely filled with debate dependent on the shrinking base of reporting that began in the old media. Our ongoing analysis of more than a million blogs and social media sites, for instance, finds that 80% of the links are to U.S. legacy media. The only old media sector with growing audience numbers is cable, a place where the lion’s share of resources are spent on opinionated hosts. One result may be the rising numbers in polling data that show 71% of Americans now feel most news sources are biased in their coverage and 70% feel overwhelmed rather than informed by the amount of news and information they see. Quantitatively, argument rather than expanding information makes up the growing share of media people are exposed to today.

Technology is further shifting power to newsmakers, and the newest way is through their ability to control the initial account of events. For now at least, digital technology is shifting more emphasis and resources toward breaking news. Shrinking newsrooms are asking their remaining ranks to produce first accounts more quickly and feed multiple platforms. This is focusing more time on disseminating information and somewhat less on gathering it, making news people more reactive and less pro-active. It is also leading to a phenomenon in which the first accounts from newsmakers — their press conferences and press releases — make their way to the public often in a less vetted form, sometimes close to verbatim. Those first accounts, sculpted by official sources, then can spread more rapidly and widely now through the power of the Web to disseminate, gaining a velocity they once lacked. That is followed quickly by commentary. What is squeezed is the supplemental reporting that would unearth more facts and context about events. We saw this clearly in our study of news in Baltimore, but it is reinforced in discussions with news people. While technology makes it easier for citizens to participate, it is also making giving newsmakers more influence over the first impression the public receives.

The ranks of self-interested information providers are now growing rapidly and news organizations must define their relationship to them. As newsrooms get smaller, the range of non-journalistic players entering the information and news field is growing rapidly. The ranks include companies, think tanks, activists, government and partisan activists. Some are institutions frustrated by the shrinking space in conventional media and the absence of knowledgeable specialists to cover their subjects. Others are partisans and political interests trying to exploit a perceived opportunity in journalism’s contraction. There are varying degrees of transparency about the financing and intentions of these efforts. Some are quite clear. Others present themselves as purely journalistic and independent when in fact they are funded by political activists, yet only by digging and cross-referencing websites can the agenda and financing be divined. In an age where linking and aggregation are part of journalism, news organizations must decide how they want to interact with this growing cohort of self-interested information players. Will they pick up this material and disseminate it? Can they possibly police it? Can they afford to ignore it? The only certainty is that these new players are increasingly vying for the public’s and the media’s attention, and their resources, in contrast to that of traditional independent journalism, are growing.

When it comes to audience numbers online, traditional media content still prevails, which means the cutbacks in old media heavily impact what the public is learning through the new. An analysis in this year’s report of online audience behavior, extrapolated from Nielsen Net Ratings data, finds that 80% of the traffic to news and information sites is concentrated at the top 7% of sites. The vast majority of the top news sites (67%), moreover, are still tied to legacy media financed largely by their shrinking end of the business.³ New media are growing, but their ranks among the most trafficked sites are still small. Another 13% of these news sites are aggregators, whose content is derived from legacy media. Only 14% of these sites are online-only operations that produce mostly original reportorial content rather than commentary. In short, the cutbacks in old media are not only drastically affecting traditional media but significantly impact online content as well.

SECTOR HIGHLIGHTS

NEWSPAPERS

Newspapers are not disappearing in droves. Only half a dozen of any size went out of business or cut back print publication last year and most of those were second papers in their market. But newspapers have seen ad revenues fall by nearly half in three years, staff cutbacks are dramatic, if not quite as large, and a coming issue now is that papers are at risk of becoming insubstantial, lacking the heft to be tossed up on the front porch or to satisfy those readers still willing to pay for a good print newspaper.

ONLINE

The state of online news heading into 2010 may best be described as a moving target. Digital delivery is now well established as a part of most Americans’ daily news consumption. Six-in-ten Americans get some news online in a typical day — and most of these also get news from other media platforms as well.

NETWORK TV

As 2009 began, viewership of the evening newscasts actually rose for three months straight, but more declines quickly followed. What is occurring in network evening news is erosion, not a collapse. And there are new worries about the networks’ morning news programs. For years after evening numbers began to fall, morning shows were a bright spot. That is now changed. In 2009 morning news audiences fell for the fifth straight year. We estimate that network news staffs had already been cut by roughly half from their peak in the 1980s.

CABLE TV

Cable news in 2009, in nearly every indicator, was more robust than the previous year. Much of this growth was on the back of Fox News Channel, which offset some struggles at CNN and MSNBC. Ideology and opinion, now a centerpiece of the medium, was a key factor in that growth equation.

LOCAL TV

Almost all the indicators for local TV are pointing down. Audiences continue to fall for newscasts across all timeslots. Revenue, too, was in a free fall. Looking ahead, most market analysts project revenues to grow only slightly, but that is hardly taken as good news given that it is a year that includes both the midterm elections and winter Olympic Games. Stations may be nearing a point where they can no longer add new newscasts or new revenue opportunities, such as sponsored segments, to their old ones.

MAGAZINES

In a tough year for magazines, news magazines were especially hard hit despite efforts by some to re-invent themselves. Newsweek announced it would focus on analysis, rather than news, and U.S. News & World Report converted to a subject-specific monthly. Both lost readers in droves. The biggest winners were British: The Economist gained circulation, again, and The Week gained in ad pages.

AUDIO

The dynamics impacting audio’s future are clearer with each year. Most people still listen to news, talk and music for at least a little while every week, and they do most of this listening through traditional broadcast, or “terrestrial” radio. This is where the audience is largest. Yet this is where the profit and revenue are under the most pressure. Many stations have left the air and some owners of multiple stations have entered bankruptcy.

ETHNIC

In a year that saw the inauguration of the country’s first black president and the arrival on the Supreme Court of the first Hispanic justice, the ethnic news media managed to stay in relatively good health, despite the worst recession since the Great Depression. Some segments fared noticeably better than their mainstream counterparts, but there were areas of trouble. Perhaps more than anything else, 2009 spoke to both the unique appeal and particular fragility of media outlets that appeal to specific ethnic groups.

Find detailed analysis of audience trends, economics and news investment for each sector by reading the full report at journalism.org.

<sub>1. Cable figures are based on estimated combined ad revenues for CNN/HLN, Fox News Channel and MSNBC for 2008 and 2009, provided by SNL Kagan, a division of SNL Financial LLC. Online figures are total online display ad revenues, from January to September 2009, compared with the same period in 2008, provided by eMarketer. Network figures are based on revenue estimates for network television ads from January to September 2009, compared with the same period in 2008, provided by the Television Bureau of Advertising. Radio figures are based on AM/FM advertising revenues from January 2009 to January 2010, compared with the same period in 2008-2009, provided by the Radio Advertising Bureau. Magazine figures are based on ad pages sold – not revenue – provided by the Publishers Information Bureau for six news magazines: Time, Newsweek, The Economist, The Atlantic, The Week, and The New Yorker. Newspaper estimates are derived by Rick Edmonds of the Poynter Institute based on data provided by the National Newspaper Association. Local TV figures are based on revenue estimates for local and national spot advertising on local TV from January to September 2009, compared with the same period in 2008, provided by the Television Bureau of Advertising.
2. These figures, derived from analysis of staff boxes, show staffing at the two magazines of 710 in 1983 down to 373 in 2009.
3. The top news sites among Nielsen’s list of 4,600 are those sites with 500,000 unique visitors monthly, or the top 199 sites after government, consulting and database sites that do not produce news are culled from the list. The first reference includes all 4,600 sites on Nielsen’s list, which includes some government, consulting and databases that are not news.</sub>

The following is excerpted from the author’s opening statement before the Joint Economic Committee hearing on “The Future of Newspapers: The Impact on the Economy and Democracy,” September 24, 2009

There are a lot of misconceptions about where we get our news. Only about 54% of Americans say they regularly read print newspapers. But that number, drawn from surveys, does not tell us much about where news comes from.

In every community in America I have studied in 26 years as a press critic, the newspaper in town has more boots on the ground–more reporters and editors–than anyone else–usually than all others combined. A good deal of what is carried on radio, television, cable and wire services comes from newspaper newsrooms. These media then disseminate it to broader audiences.

When we imagine the news ecosystem in the 21st century, the newspaper is still the largest originating, gathering source.

The second misconception about newspapers is that their crisis stems from loss of audience. Not so. Weekday print circulation last year fell by 4.6%, but the number of unique visitors to newspaper websites grew by 15.8% to 65 million. When you combine print and online audiences of newspapers, the industry overall is faring better than other legacy media-and many newspapers are seeing their audience grow. One study, by Scarborough, suggests audience gains of 8.4% from online readership. What’s more, the internet offers the potential of a more compelling, more dynamic, more interactive journalism-a better journalism than print-coming from these newsrooms.

The crisis facing newspapers is a revenue problem. Advertising, the economic foundation of journalism for the last century, is collapsing, particularly classified advertising. Print newspaper ad revenue fell by roughly 25% in the last two years, and 2009 will likely be worse. Meanwhile, online display advertising for newspapers is now declining, too.

Last year, the traffic to the top 50 news websites grew by 27%. But the price of an online ad fell by 48%.

The consequence is that the amount of our civic life that occurs in the sunlight of observation by journalists is shrinking. The number of city councils and zoning commissions, utility boards and state houses, governor’s mansions and world capitals being covered on a regular basis, even by a lone journalist, is diminishing. One out of every five people working in newspaper newsrooms in 2000 was gone at the beginning of 2009, and the number is doubtless higher now. My old newspaper, the Los Angeles Times, has half the reporters it did a decade ago.

The problem is more acute at bigger papers than at smaller ones, but no one is immune–and I venture metropolitan suburban areas may be most vulnerable.

Alternative news sites such as Voice of San Diego and MinnPost are exciting innovations, but the number of people working there does not yet come close to the lost numbers-and none of these sites has so far found a sustaining business model.

More of American life now occurs in shadow. And we cannot know what we do not know.

Newspapers are more than partly to blame. Like other legacy industries before them, newspapers let a generation of opportunities slip through their fingers-from E-Bay to Google, to Realtor.com to Monster.com. The industry is running out of options, though I believe some remain. Those include charging for content, getting tough with aggregators, creating online retail malls, and more. No one knows which will prevail. I am an analyst, not an advocate. The only thing close to a consensus is that most likely no one revenue source will be sufficient.
So should we care whether newspapers survive? Perhaps not. Typewriters have come and gone. But I believe we do have a stake as citizens in having reporters who are independent, who work full time, and who go out and gather news, not just talk about it, and who try to get the facts and the context right.

And it’s not just the high-flying investigative reporters I have in mind, but perhaps even more so the reporters who simply show up week after week, sit in the front row, and bears witness, and who, simply by their presence, say to those in power on behalf of all the rest of us, you are being watched.