Sounds like the local newspapers in Maine are doing something right.
From Talking Points Memo:
“Maine Gov. Paul LePage (R) on Friday warned students at an elementary school that newspapers represent a menace to the state, the Bangor Daily News reported.
“My greatest fear in the state of Maine: newspapers,” LePage told students at St. John Catholic School in Winslow, Maine. “I’m not a fan of newspapers.”
The Daily News noted that it’s the third time that LePage has publicly spoken ill of newspapers, and the second time he’s done so in a school.
LePage, who was not endorsed by any major Maine daily newspaper during his run for governor, has frequently made headlines for some of his remarks. Previously, LePage twice publicly warned audiences that Maine’s newspapers are full of lies — first at a fisherman’s forum in Rockport and again to schoolchildren a year later in Waterville.
This week, Hamilton Nolan at Gawker published an essay entitled “Journalism Is Not Narcissism”. He takes to task professors and writers who encourage others to write about their lives as the story.
From the essay:
“It is tempting to stop here and dismiss Shapiro, the author of nine(!) ‘first-person books’ including three(!) memoirs, as a run-of-the-mill narcissist whose unfortunate students are being molded in her own misguided image. (Quoth the professor, ‘You have to grab the reader by the throat immediately, which is why I launched my second memoir with the line “In December my husband stopped screwing me.”‘) But let us more generously interpret Shapiro’s attitude as not a cause, but a symptom—her own honest reading of the state of the professional writing market today. In a way, she is not wrong, although she is also part of the problem.”
“The demoralizing truth is that there is a huge appetite for first-person essays of this sort. The pages of Salon, and Slate, and Thought Catalog, and XO Jane, and women’s magazines, and lowbrow-masquerading-as-highbrow publications like parts of the New York Times, and Gawker Media are absolutely overflowing with them. At their very best, they offer some amount of insight learned through experience. Mostly, they offer run of the mill voyeurism tinged with the desperation of attention addiction. For those who own the publications, they’re great—they bring in the clickety-clicks.”
Nolan’s lament over the state of young journalism is balanced by Ann Friedman who used to be the executive editor of GOOD. She compares this personal form of journalism with Andrew Sullivan’s foray into entrepreneurship by charging for his blog (which raised at least $240,000 in two days… a very promising sign for a small team).
“Whether or not the phrase “personal brand” grosses you out, it’s something any journalist who wants to be employed in another 10 years should be thinking about. Having a direct, dedicated following—a readership invested in you, not just the publication you’re primarily associated with—is like a career insurance policy. While there are many fine journalists who never bring even the lightest detail about their personal lives into their professional narrative—no tweets about their kids, no first-person anecdotal ledes, no opinion-tinged asides in reported features—they are an increasingly small group. I cringe every time I read a New York Times story in which the reporter awkwardly refers to herself as ‘a visitor.’ Really? You can’t just say “provided me with directions to her Craftsman bungalow”? Please.”
Sarah Lacy who runs PandoDaily (we share Lerer Ventures as an investor) and Paul Carr who runs NSFW Corp both started out as reporters working at newspapers. They both worked at TechCrunch and today they both run their own content companies.
While the video is overlong with a number of digressions, it’s worth listening to people who are trying to figure out how to make a small-team publication work. There are some significant nuggets of wisdom in here.
Warning: Lots of salty language.
Jeff Jarvis sums up our own thoughts quite succinctly:
“Larry Kramer, publisher of the much-larger USA Today, just said with admirable candor that he can’t put up a pay wall online because his product “isn’t unique enough.” Ditto The Daily.
Next, The Daily started as an iPad-only offering. Eventually, it branched out to the iPhone and to Android tablets (but only for Verizon telephone customers) and the Kindle. I hope that other publishers learn from this misguided “mobile” strategy. Too many have dreamed that the tablet would return to them the control over brand, experience, and business model that the web and its links took from them. Too many think they need to create new products just for so-called mobile devices (though we actually often use them when stationary, at desk or on couch).
No, a news organization should have a strategy built around relationships with individuals, serving them wherever, whenever, and on whatever platform they like. My needs don’t change just because the device in my hands does.”
This dovetails nicely with Vibhu Norby’s post entitled “Why We’re Pivoting from Mobile-first to Web-first” and Fred Wilson’s response, “Rethinking Mobile First”. Both are worth diving into.
“All in all, mobile service apps turn out to be a horrible place to close viral loops and win at the retention game. Only a handful of apps have succeeded mobile-first: Instagram, Tango, Shazam, maybe 2 or 3 others (Games drive short-term revenue but don’t get me started on that topic – sell a billion $0.99 games with 30% taken off the top by Apple/Google and you now have the equivalent revenue of a Call Of Duty opening weekend). Take Path, one of the most promising mobile-first startups. I don’t want to rag on them because I love the app, but it’s just a good example. Color would also work well. With 5-10 million downloads, Path has retained less than 200,000/users a day according to AppData. You can also check their download rank in the Social category and see that it has dropped from 5 to 94. That’s anywhere between 2 and 4% retention and a couple hundred downloads a day. Even if that’s wrong by 5x or 20x, it still doesn’t make sense as a business for many years. A boutique social network user is not exactly the type of person to click on an ad.”
Fred Wilson says:
“What I want to focus on is the paradox that mobile is where the growth is right now and that mobile is very very hard to build a large user base on. Everything that Vibhu says in his post is right. Building an audience on mobile is a bitch.”
It’s good food for thought.
It appears that News Corp.”s “The Daily”, an iPad news publication will be shutting down on December 15th.
You can read more here.
While we”re seeing more and more forays into content experiments (especially surrounding mobile devices), “The Daily” always looked much more like a traditional publication. Big staffing, big best online casino publicity, and hefty expenses.
Of particular note:
“Jesse Angelo, the Daily’s editor-in-chief, will become publisher of the Post; Daily publisher Greg Clayman will get a job heading up digital at the new publishing company.”
Several great discussions have been started this week around the web concerning small publications, the creation newsstand software, and the Washington Post’s rejection of a paywall:
My favorite part:
“What was your vision for it?
I’ve always been very enamored of European newsmagazines—the Spiegel kind of magazine, which has an energetic, high-low approach to news. But those magazines also need a lot of pages—there’s something about the way a magazine looks and feels when it doesn’t have advertising that is unbelievably disappointing, both as an editor and as a writer. Pages are not meant to be adjacent to one another. They need the advertising to give it body and fullness. There was always that sense of Newsweek being not the full-bodied thing that it ought to be.
It seemed wan.
Yes, it always seemed wan, and that affects the way you read it. That was one of the big problems.”
I encourage you to read the whole thing.
You can read more here.
I’m going to have to write a more full-featured piece, but it’s clear that building a generalized weekly print publication for mainstream consumption is hard and certainly harder now than ever.
Now, now, Billy Gallagher may be a little harsh here, but based on my daily subway rides, he’s not wrong:
“EXCLUSIVE: Area Woman Reads Newspaper
This morning, I saw a woman reading words on printed paper.”
Read the whole thing. It’s funny… then pour yourself a drink.
During a discussion about the very best format for reading a newspaper on a subway (Tablet vs. Paper where the relative merits of using a tablet as an umbrella came up), I came across this treasure. It’s a 1914 Op-Ed in The New York Times sharing a novel way of reading the newspaper on the Subway without disturbing your neighbors. I thought you would all enjoy:
Interestingly, the 8 column layout he refers to in the article certainly would lend itself to reading the way he recommends. This paper from July 29th, 1914 announcing Austria’s invasion of Serbia (and the beginning of World War I) illustrates the 8 column layout.
The full text:
Should Learn the Art of Folding Newspapers Lengthwise.
To the Editor of The New York Times:
Referring to the letter signed “S.S.” and headed “Inconsiderate Subway Readers.” the complaint he makes is quite true. Great inconvenience is caused by the men standing up, especially when making frantic efforts in a crowded car to turn the pages of a newspaper which they are reading. In their endeavor to fold or turn the paper over they often shove a corner of the paper into the face of the person sitting in front, which particularly to ladies is annoying.
May I suggest a very simple expedient to prevent and forestall these unnecessary worries and troubles. I always cut the paper open where it is folded. I then fold the paper down the middle of the page where the rule divides it in two even sections, four columns on each side. The leaves can now be turned over easily along the centre fold and it becomes quite a comfort to read the paper in this manner. It takes up little room and the leaves can be turned even in a crowded car quite readily within a narrow compass and without causing inconvenience to self or others.
New York, March 6, 1914
All rights belong to The New York Times.
…for just $500,000. That’s all well and good. I’m sure there were reasons for it and it may have been the best option. Kevin Rose hasn’t been there for more than a year and he’s now VC at Google Ventures (not to mention being a very successful angel investor). Digg is still one of the top 200 sites on the Internet and did more than 7 million uniques last month.
The real lesson, however, is to never let anyone run a cover of you like this*:
You can only ever regret it.
* I know Jessi Hempel and Sarah Lacy (Pando Daily is backed by some of our investors) and they’re both absolute pros who both thought the cover was ridiculous at the time.
Spotify recently released a few numbers (via TechCrunch). It’s illuminating. It’s also a crystal clear demonstration of why so many music startups have gone big and ultimately been wrecked by the industry they’re making money for. Only Pandora was able to hit escape velocity so far and go public (with $75 million in quarterly revenue and $74.25 million in quarterly expenses!). But the last ten years are littered with really good streaming services that have been forced out of existence by oppressive licensing agreements or onerous charges.
Down to the numbers:
- Spotify has 13 million active users.
- 3 million are paying about $10 per month.
- 10 million are listening for free with ads (mostly ads for upgrading Spotify near as I can tell).
- Spotify is on track to do $889 million in revenue this year.
- They’ll do about $360 million on paid users ($120 per user).
- They’ll do about $529 million on unpaid users ($53 per user which actually seems impossible based on their frequency of ads and that they’re mostly house from my experience).
That last number sounds really impressive, and while it is, it’s not quite what it seems. Spotify is still losing money every quarter. For every song played, Spotify needs to pay the music labels and artists about 70% of revenue before they cover their own operational and marketing costs. The bigger they get, the bigger their losses have become. In the meantime, music labels are going to get paid $662 million and pass very little of that onto the artists.
The music labels, despite much concern over their future welfare, have created an industry baked around letting very talented teams build software that catches on only to face certain annihilation (or a quick fire sale like Imeem).
Netflix, despite their size, is in the same position. It just took the movie studios a little longer to come around to the same position as the music companies.
The pattern is repeated over and over again:
Build something great. Make it awesome. Engage users. And when contract negotiations come back around, raise the price of content to a level that sabotages the service and claws back as much of the profits as possible.
We’re left with large zombie technology platforms doing significant amounts of revenue, making almost no money, and without the means to continue to innovate.
Great entrepreneurs become sharecroppers.
No one disputes that artists and labels deserve to make money on music streaming services. But this situation can’t go on forever.
The music companies get to take their short-term profits. But make no mistake. It’s only setting them up for the day when someone really will destroy them.
Stephen Morse, Journalism Fellow at CUNY (and dead ringer for Amir Blumenfeld) debates Felix Salmon about the efficacy of Kickstarter funded science publication, “Matter”, and inadvertently makes a really important point: “Anything could be sustainable if it’s small.”
Morse is concerned that small publications won’t scale and that this doesn’t really present any sort of path for the industry as a whole. After all, it’s hard to imagine a Hearst or Gannett reinventing themselves with a product that makes $20,000 per week.
Here’s why it’s necessary.
When everyone is trying to consolidate and look for organizational efficiencies, you end up crushing the teams who create innovation. Letting small units create sustainable products and brands begins to look like a stellar way to reinvent yourself.
Over the years, we’ve seen publications aim to control costs rather than attempt to build products people really want to pay for. But small teams already have low costs. And they can have different goals. Matter’s aim is to write one awesome science article each week and sell it for a dollar. Lots of people think this is a great idea and have said they’ll pay for it.
Morse’s point is that the total potential market is small and may only be 20,000 people (I think they can be very profitable with less than 10,000 if they pay themselves the salaries a typical reporter makes).
At 20,000 though that’s a nearly $1 million revenue business. With five employees, they’ll have a better profit margin than most news enterprises today.
In this case, less equals more. You can always figure out a path for a sustainable business to expand. Right now, the news business is trying to figure out how to take an unsustainable business and contract it into a sustainable business that can expand again. The first one is easier.
If your business can only work on huge opportunities, swing for the fences initiatives, and invest in $100 million opportunities, there’s no doubt you’re absolutely going to miss out on the next big thing.
It’s the next small thing that’s going to grow up to kick your ass again and again and again.
I took this picture nearby the Marriott Wardman Park Hotel in Washington, DC. That’s where they held this year’s NAA conference. Filled with antiques, flower gardens, and terrific landscaping, it has been home to Presidents Herbert Hoover, Dwight D Eisenhower, and Lyndon Johnson, Vice Presidents Spiro Agnew, Charles Curtis, Henry Wallace, and Chief Justices Vinson and Warren. Pretty posh, right?
While people were eating fancy meals, watching President Obama and Governor Romney speak, staying in $400/night rooms, and having a party each night in the hotel bar, this was around the corner.
While it’s good to see everyone, hear what people are working on, and meet some really great people, this picture should bring us back to reality.
The newspaper business is still broken and upside down.
After a few days of feel-good panels, we all need to get back to work fixing it.
Every team that has ever gone through Y Combinator (and just about everywhere else) has been encouraged to launch as soon as they have a minimal viable product, get users, and then iterate based on user feedback. It’s the cycle that drives innovation for most companies.
“Oh, it would be really cool if this integrated with X.”
“Oh, it turns out that most of our users are coming from industry Y and the thing that would make this really killer for them would be feature Z.”
The key insights that you couldn’t have had otherwise.
I know launching late. In my first company, Paul Graham once exclaimed that “we were the 40 year old virgin of startups”. Y Combinator funded us anyway but ouch, right?
At OwnLocal, we launched pretty fast, partially as a result of PG’s voice forever ringing in our heads. Partially, because our customers demand innovation in an industry where no one has stepped up to the plate in a really long time.
But more importantly, the reason almost every startup you know launched too late is because you don’t have a good idea what your true minimum viable product is until you launch. You’ve made an educated guess and it’s wrong. While there are many companies that die from launching too late and suffer the consequences of putting too much time and money into their products, are too optimized for one industry or path, or a competitor releases the right product faster, startups don’t usually die from launching too early.
That’s okay because you may have more money and time to figure out what you should really be doing. Many times this looks like an iterative process and it turns out that a failed MVP puts you on the track to launching faster trying to find your audience.
But for those startups that are successful, you probably don’t know the exact MVP line. If you’ve built something of value, you’ve likely built that MVP+1 feature that turns out not to have been important at all. It’s a hard problem trying to optimize for the exact quantum of a useful initial product that also catches on with users. That will be wrong too. You probably didn’t need something you thought you did. But, really, who cares?
Focus as hard as you can on building something awesome and launching early. If it turns out you’ve built something people want, you’ll probably look back and realize you launched too late with some features your users didn’t really need. That’s the power of hindsight.
Seriously, it’s okay. Stop all the handwringing. You’re not a bad lean startup entrepreneur. Besides, you need to get back to work.
There are users to take care of, features to iterate on, and dreams to code into existence.
I had to laugh out loud the first time I saw Pew’s Report that unfriending on Facebook was on the rise. I laughed even more when it was accompanied by typical media prognostications that if this trend continues, it would dramatically hurt Facebook’s ability to monetize their audience. I’ve seen it mentioned several times now.
Are people really this bad at math?
The number everyone was so getting bent out of shape over: 500 million unfriendings occurred in 2011 up from just 138 million unfriendings in 2009.
It’s a crisis. It’s an epidemic. Oh, wait, that’s less than one unfriending per active Facebook user per year (.6 unfriendings per active user, actually). In the same year, each Facebook user is on average adding way more than a single friend.
Is there an unfriending trend? Nope. Not one that matters anyway.
I’m reminded of the scene in Citizen Kane where upon being told he’s losing a million dollars a year running his newspaper:
“You’re right, I did lose a million dollars last year. I expect to lose a million dollars this year. I expect to lose a million dollars next year. You know, Mr. Thatcher, at the rate of a million dollars a year, I’ll have to close this place in… 60 years.”
Except imagine Mark Zuckerberg saying “the average user (if he or she never friended anyone else) would run out of friends in… 200 years.”
He’d probably have the same giant smirk Orson Wells had.
We hear a lot of publications fretting over their social media strategy. But I never hear anyone talking about e-mail.
E-mail is way bigger than social networking, demands people’s attention multiple times every day, and is a default installed application on every phone and computer.
So what’s your e-mail strategy?
Tomorrow happens to be the most exciting day in Silicon Valley. Yep, Y Combinator Demo Day.
While founders are preparing last minute tweaks to Keynote decks (It seems rare to find YC Founders without a Mac), adding that last piece of polish to the demo they’ve spent three months hacking together, you just can’t help but feel proud to have gone through it all.
When I look back at my Y Combinator Demo Day in 2008 (!), I remember meeting an amazing group of people who came to watch a bunch of young guys show off their stuff. We were the last batch in Boston and the investors probably hadn’t been that cramped into cheap plastic Ikea chairs for ten hours since they were in grade school.
It was a miraculous, nerve-racking kind of feeling. I don’t remember much except that hundreds of VC’s were excitedly talking to us.
It was all an awesome blur. It’s a hell of a thing to be a part of.
Feel proud, YC Founders… for the thirty minutes between when you’ve finished and when you need to get back to work.
Good luck tomorrow! You’ll be great.