Robert Paterson's Weblog

Future of News - Lessons from Giant Pool of Money and Planet Money

Last week, the Giant Pool of Money, won a Peabody award. This was a breakthrough program on many fronts. First of all it was a collaboration between two rivals - This American Life and NPR. Secondly it was web based. Thirdly it was long form. Lastly it took the POV of mystery - not only for journalists but for ALL concerned - including the regulators and the Treasury.

The show shed light for the first time on the complex crisis that confronts us. It gave birth to an entirely new kind of news show, Planet Money, that is extending all the lessons learned by the initiating show.

Here is a video of one of the co hosts - Adam Davidson (The other was Alex Blumberg of This American Life) Where Adam does his best to explain how making this show is changing his perspective on how journalists cover complex stories.

I think that in these few minutes, Adam explains the real revolution that has to take place in news.

He tells of his problem with space and time in conventional journalism. How can you talk about say a problem in mortgage backed securities in just 3 minutes when most know nothing abut them. But this is what people have to do in the time constraints of a audio or Video news program or in the space constraints available in a newspaper. Conventional news simply does not offer the time or the space to cope with complex things.

Linear news cannot inform us about complexity and complexity is our world now.

He talks about the problem of the "Authoritative Voice" the voice of God that is used. As a correspondent in Iraq, he and his wife could always tell the newbies - they were the ones who knew what was going on! It is now quite clear that even Henry Paulson did not know what was going on. So why should any journalist pretend that they did? Adam is saying that the right place for a journalist is to be a seeker on behalf of the public.

Top down voices of authority cannot illuminate complexity either. Only an invitation for conversation can unpack complexity's meaning.

Update - I have added this part on Complexity a day later:

This deceptively simple diagram, made by Dave Snowden, I think explains for the the core idea.

 

The ever increasing number of links and connections in the world has taken us to a "Phase Shift". We have broken out of a Simple and Complicated World into a Chaotic and Complex world.

Chaotic and Complex events CANNOT be understood by using a linear thought process. Only an emergent process has any chance of establishing understanding. This is why our current Linear News process actually makes us MORE confused.

Only an interactive multi-player conversation can offer "Emergence". So only an online process for news has any chance.

In the first few weeks of Planet Money, I talked with Adam and Laura about their plans and how they might be able to use a web based show. Here in summary is what he told me. In essence they were going to prepare a a big all you can eat buffet. It would suit every taste and would be open 24/7. (BPP was a diner)

• Daily the team would offer up nuggets, small dishes, of current and topical news that they found or that an ever expanding circle of "fans" as per BPP, would send in

• 3 - 4 times a week they would offer up a podcast, a longer form piece - a small audio magazine - this could be and is sliced and diced and added into the main magazines such as All Things Considered, News Broadcasts, Local shows, Morning Edition - what they learned with BPP is that it is better to add great new content into the blockbuster items rather than try and compete with your self. This way PM builds a wide audience by using the network effect. Adam also is a regular guest on the New Hour - thus PBS and NPR are getting closer as well

• Every 6 weeks or so - a long form show such as Giant Money in collaboration with TAL.

• The POV was always going to be - EXPLAIN! The presenters of the show would be representing us. They would start from a position of NOT KNOWING and not understanding the jargon. The irony is that even the so called experts have told Adam that they too have learned from the show. The problem being that they often know a lot about a little but also cannot see the larger whole. So the "VOICE" that we hear is a questioning, uncertain voice. When I say "Voice" I mean literally the timbre of what you hear. The deep profundo voice of God is not allowed on the show. I think key to this voice are Laura and Caitlin who sound like your favorite sisters and not your mother or some Amazonian know it all with power hair. The guys are quizzical and sound a bit like your bright university guy friend who is helping you understand calculus or statistics.

Of course everything is online so it is all available at any time. Hence the "banquet" metaphor.

I find all the hand wringing of conventional journalism a bit lame. 3 minute sound bites, 8 inches of text and the VOICE from the burning bush is actually making the world harder to comprehend.

Don't all the problems that confront us fit this new kind of treatment? For do you really know what do do in Iraq and Afghanistan? Do you really have the answers to health or to energy? Do you know anyone that really has the answer to our education system?

Is not part of our problem that conventi0nal journalism makes it all but impossible to get to the root of these issues?

I think that the limits of "space" and "time" on conventional media do make it worse. These limits reduce all to bits and bites and give a stage and power to rabble rowsers - look at the cheerleaders in the financial sector!

Planet Money will look like the Model T Ford in 30 years time. But it will I think be seen as the Model T, as the expression of an entirely new and appropriate way of approaching the world that we now inhabit. A world that is made so complex by its vast array of interconnections.

As with all things on the web - the real shift is in relationship and hence POV.  The time and space contraints of traditional media drive the top down expert/god POV. This fitted a less interconnected and hence less complex world. But with a hyper linked world, we live in much more complex times. Only a hyper linked way of gathering and offering the news will fit.

That is the revolution.

Hats off to Adam and Alex - to Ira Glass and to Ellen Weiss

What would you do?

Unlike Canadian Banks, Canadian Media was allowed to concentrate and is now in dire trouble. CanWest, CTV and CBC are are hemorrhaging. It is clear that many of their stations, titles and programs will fold.

I read that CTV offered its station in Brandon to the CBC for $1.0 and that the CBC passed.

This has got me thinking. If I was offered our local paper or say the local CBC station (The Guardian is our paper owned by the sickening Transcontinental Group and may well be on the block soon - If CBC was to cut back - surely CBC Charlottetown would be first to go?)

What would I do?

I have been thinking about this all day and so far I have no answer other than I would not take them on as they are - even for only $1.0

So with no other thought than that - what do you think we could do - for while this is a thought experiment today - it has every chance of being a real question before the end of 2009.

How could a community such as PEI or your place take back its media power from the wreckage of the dying system?

How a newspaper dies - The staff tell the story of Rocky Mountain News

Final Edition from Matthew Roberts on Vimeo. Will this happen to your paper? Might happen here on PEI with the Guardian.

Canwest - The Cancer facing Media Organizations

With $3 billion in debt, the holding company, Canwest, is dying. It will take down the titles too. So will the Tribune group with $13 billion in borrowings.

Is this not the affliction that many papers face? Being owned by people that have borrowed too much is a cancer that makes their local problems of declining advertising and readership into a crisis.

How papers have been owned is surely part of the systemic problem? If they are ever to be revived, how they are owned will surely be a factor?

To Pay or not to Pay - News and other media - The Business Model

More than 40 million read the New York Times online versus a million in print. Millions stream new movies and don't pay. It may be that by the end of 2009, most newspapers in North America may be gone or just about to go. As torrenting gets simpler more and more mainstream people will download movies too.

So what to do?

I think people would pay for a new deal. I would pay for the Times. I did before. I now rent and download movies on iTunes. I pay for a lot of music on iTunes.

My bet is that if the best papers went the whole way online - they would find a paying readership. But going the whole way means that they have to get rid of ALL the costs that are part of the old model. Not just the printing and distribution but all the bureaucratic costs as well.

A local paper could do the same. Here is the Beacon - a local St Louis Online "paper"

Even single journalists can even freelance like this - I supported Michael Yon for a year.

I have room for maybe 2 Global papers, a local one and several free lancers - provided the price was reasonable. That means their costs have to be reasonable too. That surely means an intense focus on the story and the online experience and not on the institution.

Studios could do the same - make it easier to get the movie online - make the online experience THE EXPERIENCE. That means an intense focus on the online experience: on the interaction and the sharing. Build on the archive. Support aggregators and commentators. Set the price accordingly

The irony is that so many papers are owned by larger financial structures that have trapped themselves by the costs of buying the papers. The need to pay off the loans strips the cash flow from the papers - which in turn strips the talent from the newsroom. They have to preserve the printing and the support overhead. So the heart of the paper is torn out and the limbs remain.

Maybe the paper has to die to free up the staff. Maybe each part of this world has to wait until death itself to make the changes or maybe parts resurrect themselves after death. This is what is happening in St Louis where the best talent now works for the Beacon - an online only "paper". The Post Dispatch is a Zombie Paper - hollowed out by owners who have got themselves into a financial bind. The Beacon is the "Resurrection Paper" staffed by journalists who have to be journalists and who know and care for their city.

It's all going to come down to the business model. If you operate in the old and the new at the same time - you are doomed. You now have to choose online as the primary route.

For news papers - that means that the "Paper" and all that is connected to the "paper" has to go. It also means that titles that have been bought by financial aggregators will go. The PEI paper the Guardian is one of those. It demands a focus on the complete online experience that includes bringing content and support into the paper.

It is the same for Public TV and Radio. All I see is a weak blend of mainly the traditional and a very limited online. There are some trends and observation that are now visible that may make it clear what NPR, CPB, PBS and the stations can do. A new business model is appearing here too.

I will write more about this over the next week before the IMA conference

PS UPDATE - How Dr Horrible made money by starting with a web mindset

Soon no Paper for the NYT

For all those in pub radio and TV who think that somehow muddling through is enough - have a look at this article on the future of the New York Times

The Atlantic - Michael Hirschorn - Via Jeff Jarvis

Diane Mermigas looks ahead to 2009 for media

I know that many think I am an alarmist. I admit I tend to use strong language.

Diane Mermigas is very considered. Here are her thoughts about Media and 2009.

It's not the news I want to lose - its the "paper"

There is a well argued piece by James Surowiecki in the New Yorker that makes the point that today we get it all - all the news for free. But at some point content will have to be paid for.

The peculiar fact about the current crisis is that even as big papers have become less profitable they’ve arguably become more popular. The blogosphere, much of which piggybacks on traditional journalism’s content, has magnified the reach of newspapers, and although papers now face far more scrutiny, this is a kind of backhanded compliment to their continued relevance. Usually, when an industry runs into the kind of trouble that Levitt was talking about, it’s because people are abandoning its products.

But people don’t use the Times less than they did a decade ago. They use it more.

The difference is that today they don’t have to pay for it. The real problem for newspapers, in other words, isn’t the Internet; it’s us. We want access to everything, we want it now, and we want it for free. That’s a consumer’s dream, but eventually it’s going to collide with reality: if newspapers’ profits vanish, so will their product.

I will pay. I did pay for the walled Times because I love the editorial writers. I will not pay for the paper because 95% of it I don't want.

I do pay for songs on iTunes. I don't by CD's because I don't want 95% of what is on them.

I hardly ever watch TV because 99% of what is there I don't want. I do pay to rent DVD's and movies form iTunes because I then get what I want.

So from a sample of 1, here is a premise.

Most of us will pay for content that we want. But we want it "Our Way" - no padding and online.

At some point, as local papers die, the NYT will have a huge readership - I read it every morning here on PEI. But it is the paper that kills the margins. I don't want the paper - I want Tom Friedman!

As local papers die - there will be a gap. NPR and the local radio stations can fill that. But they have to be smart about how they use the web to do that.

Commercial Local TV will die. There is a huge opportunity for PBS Stations to fill the gap. They too have to be decisive - the web is their main platform now for the classic PBS Content. So I keep coming back to the PBS inventory. Thousand of timeless shows - all on DVD - where I have to send money and get a thing and wait weeks.

All the rules for the new web reality are known now.  What we are waiting for is leadership.

NPR, PBS, CPB and a few pathfinder stations have to get together and plan to be the winner. They have the content - all they need is to act.

They can do more.

What would a real network be like? How would using a real network also enahnce Public Media's margins in this tough time. More later this week on that.

"News" and Canada's Constitutional Crisis - Pouring Gasoline on Fires

An ongoing theme going on beneath the surface is the tension between "Social Media" and the "Official Media". The Official Media claim that you can't trust Social Media because - well it's just opinion that is never fact checked. Official Media insists that it checks its facts better and hence can and should be trusted.

The current Constitutional Crisis in Canada exposes this Fact Focus as being bogus.

What the News Rooms of the Official Media miss is that what people need are not "facts" but context. We are faced with a number of complex problems - the political leadership of our country, the failure of our economy, war and conflict that we cannot win and an emerging environmental crisis to name a few. Our News system is reducing our ability to understand and cope with these complex problems.

This is so clear right now as we are in the middle of a political crisis.

It is clear from the many comments on what is going on that many, maybe most, Canadians do not understand how Canada's Parliamentary system works. In effect, many believe that they have elected a President. In reality we elect a Parliament.

BUT nearly all the "Official Media" goes immediately to VOX POP. So we have on the one hand Albertans angry on talk shows and we have on the other (the wonder of "balance") people in the street in the East saying that this is all wonderful. It is all about the leaders and not about how our political system works.

The result is polarization and helplessness.

What the Official Media is failing to do is to provide people with the context for what is going on.

This jump to opinion and "balanced Vox POP" is applied to all topics. The financial crisis is another example. The market's up - the market's down. It will be ok soon. It is the end of the world. No attempt to get what what has really happened. So we all all excused from taking action our selves.

This leads to anxiety and the desire for God (AKA the great leader) to make it all better.

Gas prices. Now they are up - get rid of your SUV. Now they are down - buy an SUV. No discussion about what is really going on. Again we are all taken out of anything that we might do ourselves.

I suspect that one of the root problems is the "Balance" concept. Every opinion has to be balanced. So there is Global warming and there is not Global Warming. So we should stay in Afghanistan or we should leave. These are complex questions not seen easily on the surface. They have to be discussed not debated. The answers to complex questions emerge, they are not the result of one opinion winning over another.

This idea of balance also misses the fact that Truth does not need to be balanced. But Truth can be eroded if this balance is part of the process. Truth can be made to seem in question. So nothing is left to stand upon and more feelings of being helpless grow.

A focus on facts versus meaning results in of course data overload and confusion. For instance, what do all the facts about the terror attack in Mumbai mean? On their own, nothing except that affect our emotions and again make us feel helpless. The deeper meaning of Mumbai would be to discuss the motives of the attack and how the attack drives the response. But we don't get this, we just get the facts and the emotion.

Another is time. A major time allocation in a 20 minute newscast would be a minute. 3 minutes is like War and Peace. A major space allocation in a paper is 500 words. Headlines roll into headlines. And now....  And Now... And now. We jump cut from one item to another. Just getting over scenes from Mumbai, and we jump to scenes of angry Albertans, then we jump to a murder scene, then we jump to something warm and fuzzy (for balance). The result is chaotic. The impact is more feelings of being disconnected and helpless.

The result of these practices by Official Media is social and political dysfunction. All that is left to the citizen is helpless emotion. The very nature of Official News today is undermining our ability as a society to cope.

It's up to many of us bloggers to do our best to offer a more contextual alternative. For while we are on the fringes today - we may become the Official News sooner than we think!

The economics of the Official Media are eating away at its foundations. Will even the New York Times exist in 3 years time? I give the Aspers a year at most in Canada. The major networks in the US have maybe 18 months before they run out of cash flow sufficient to pay for their leverage.

Traditional Media on the edge

Diane Mermigas is the media analyst that I follow closely - her post today about how the financial crisis is affecting the media giants is critically important and foreshadows a kind of death of the dinosaurs.

The loan covenant issues threatening Viacom and CBS underscore the unexpected, devastating impact the credit crisis and the recession will have on even the biggest media concerns, some of whose repayment and cash flow issues have not yet come to light. The resulting realignment of media players could alter the competitive landscape on the upside of the economic recovery 18 months from now.

Speculation that controlling chairman Sumner Redstone may be forced to sell CBS or Viacom to satisfy the requirements of a $1.6 billion loan demonstrates how broad and deep the adverse effects of the credit crunch can be.

The loan was made to National Amusements, the private Boston-based holding company through which Redstone owns his Viacom and CBS shares, which were used as collateral. NA owns a string of national movie theaters and an 87% stake in Midway Games. NA is also managed by daughter Shari Redstone, who is feuding with her father. They are working with banks to renegotiate terms of the loan, about half of which is due in by mid-December.

The precipitous drop in CBS and Viacom shares made it impossible for National Amusements to meet a covenant requiring that it maintain a certain debt-to-asset ratio. This year, CBS stock has declined 53%, and Viacom stock has declined 57%, with half that value lost just in October. Redstone last week sold $233 million of non-voting stock in the companies, and will have to sell more non-voting and even voting stock if he cannot access debt markets to refinance the bank debt.

I doubt that these over-leveraged organizations can hold it together.

News Corp. chairman Rupert Murdoch, whose empire was threatened by debt and repayment issues more than a decade ago, is so far steering clear of the current malaise. Although Murdoch told shareholders last week that the company has manageable debt and $5 billion in deal reserves, it has a huge economic risk in its newspaper and television advertising exposure.

Clearly, the entire media landscape stands to be changed by the adverse impact of advertising revenues, economically demanded changes in operating structure, ownership change, falling stock prices and company values, loan covenants and other financial requirements.

General Electric, the quintessential global conglomerate and owner of NBC Universal, has been under siege for a month dealing with the negative credit crunch hit on GE Capital. It has prompted a scramble to raise $15 billion in cash, sell assets and cut costs everywhere, including at least $500 million in NBCU’s 2009 budget. GE also leveraged against bull markets by lending to customers of its subsidiaries which are hard-pressed to make payments in a recession.

Like Redstone, other corporate chiefs are being forced to sell their holdings to avoid breaching loan covenants or to meet margin calls in response to plummeting stock sales. Liberty Media controlling chairman John Malone recently sold $49.5 million of stock back to the company at a deep discount. However, Liberty Media executives working closely with Malone recently indicated that he may opportunistically acquire the debt of some media companies and possibly make a run at others trading at record low levels. If so, that could present an interesting dilemma for companies like Viacom and CBS.

There is a huge opportunity for the networked local community based alternative to fill the gap. This is what my clients in pub media are working on.