Saturday, March 1, 2014

Marc Andreessen's inspired post about the future of news

The future of news is fragmented, and that's a good thing, says Marc Andreessen.
"The news business is going to "grow 10X to 100X from where it is today. That is my starting point for any discussion about the future of journalism."
If that's his starting point, it can be ours too. The news business is booming, and hugely successful investor Marc Andreessen thinks that's a good thing. It certainly is if you're at the front of that wave, but anyone lagging behind should be very afraid, because it may already be too late.
"The main change is that news businesses from 1946-2005 were mostly monopolies and oligopolies. Now they aren’t."
The implications of the democratizing nature of the Internet and low-cost digital publishing available to anyone Andreessen summarizes in three points:

  1. Anyone can create and distribute content
  2. Formerly separate industries now compete directly online (think TV vs. newspaper vs. radio vs. wire service), which drives prices down.
  3. Many more people consume news today than did 10 years ago, and in 10 years the volume of consumption will be vastly higher than it is now.

Obviously, after talking about lower barriers to entry and the increasing volume of news content we see as a result, Andreessen moves on to financing. He offers eight different sources of funding, though the takeaway is that a news organization must blend all of these to be successful at paying for itself.

  1. Advertising: No tooth-whitening crap.
  2. Subscription: They will pay if it isn't crap.
  3. Premium content: Again, they will pay if it isn't crap.
  4. Conferences: Human presence is a premium you can charge for.
  5. Cross-media: Think books, TV, movies produced along with news.
  6. Crowdfunding: This is a big one. People will pay to support a specific project they believe in. [See the Planet Money T-shirt].
  7. Bitcoin for micropayments: Andreessen believes in Bitcoin.
  8. Philanthropy: "There is around $300 billion per year in philanthropic activity in the U.S. alone. It’s WAY underutilized in the news business."

Andreessen is a believer, and counters the argument that lower barriers to entry means more crap with the fact that crap and quality can coexist, and the more crap there is, the more demand for quality and trusted sources.

He lists 10 organizations that are getting it right [follow them all on Twitter with this list]:
  1. AnandTech: Don't know it, but a quick perusal does seem to show a fresh look at tech reviews.
  2. The Atlantic: Big digital push with properties like the Atlantic Wire and Quartz.
  3. BuzzFeed: Leveraging listicles to do "amazing in-depth long-form journalism".
  4. The Guardian: Expanding its reach online with great reporting.
  5. Politico: Must-read thanks to insider knowledge and aggressive online focus.
  6. Search Engine Land: News about search, leveraged into lead generation. Brilliant.
  7. The Verge: Tech news that is now a must-read, very good growth prospects.
  8. Vice: Made a decision to go into video and into online, exploded.
  9. Wirecutter: Innovative in its simplicity, takes reviews one step further with recommendations.
  10. Wired: Example of blending print and digital content with great success.

I am happy to say that I'm a regular consumer of 80% of these sites (I've bought based on Wirecutter recommendations, I read Politico every day and Vice every weekend, and Wired's iPad app is probably the best in the business), and am looking forward to visiting Search Engine Land a lot more starting today.

But one thing that ties most of these sites together that goes unmentioned is DESIGN. The online audience is very sophisticated now, and expects a level of visual quality that they didn't before. I would argue that design is a huge part of the success of every organization on this list, especially The Atlantic, Vice, The Verge, Wired, Guardian.

Design matters, and if it's not up to the standard you think your content is up to, then you are doing a disservice to the reader, and readers are not as ready to forgive uninspired design as they used to be.

Finally, Andreessen really starts looking to the future.

What's holding the industry back? For Andreessen, it's fixed capital. Fancy headquarters, expensive machines, unions and their restrictive contracts. Oh, that and objectivity.
"But the objective approach is only one way to tell stories and get at truth. Many stories don’t have “two sides.” Indeed, presenting an event or an issue with a point of view can have even more impact, and reach an audience otherwise left out of the conversation."
To be successful, Andreessen thinks, news organizations should be more narrowly focused ("The U.S. alone has 15 full-scale national news organizations, plus more from international markets and all the online news organizations cropping up, That’s too many general news outfits."), leaders should be more courageous, and an organization's culture should include eight specific qualities:

  1. Vision (not hallucination)
  2. Scrappiness (not complacency)
  3. Experimentation (try things and listen to your audience)
  4. Adaptability (not inertia)
  5. Focus (a small number of clear goals)
  6. Deferral of gratification (it takes time for quality content to build a quality audience)
  7. Entrepreneurial mindset (rules are still being written, so anyone can write them)
Here, I suppose, is the most important part of Andreessen's inspired post: These are all human characteristics, and it will be people who change the news business, not the huge companies that used to control things. 

Ken Lerer observes the state of media, in 8 Tweets

As an avid consumer of journalism, I am always on the lookout for news about the business of journalism. New ventures are starting all over the place, led by big names or big ideas, and there is money in journalism again.

One of the people behind some of that money is Ken Lerer, known primarily for his role in the controversial origins of the Huffington Post but with a track record of supporting innovative success stories like BuzzFeed, MakerBot and Warby Parker that prove he has an eye for products people want to consume.

Lerer took to Twitter last week, inspired by investor buddy Marc Andreessen of Andreessen Horowitz, to share what are (so far) 8 observations about the state of the news business and its future. Let's pick them apart a little.
The first in the series comes after a Tweet pointing to an inspired post by Andreessen on why he is bullish on the news business. Among some choice quotes:
"Maybe we are entering into a new golden age of journalism, and we just haven’t recognized it yet.  We can have the best of all worlds, with both accuracy rising, and stories that hew closer to truth." 

Lerer starts by comparing the digital news business today to the early stages of cable television. The pipes are laid, the bandwidth is there, now we need content - quality content - to fill it. For Lerer, the future is in social media, the direct line to your audience's pocket, and one of the best ways a news organization can listen to its audience.

It used to be about what people were reading (NY Daily News vs. NY Post). Then it was about what they were clicking on (Huffington Post summary of the New York Times article), and now it's about what people are sharing, what they are talking about. And that conversation is happening on social media.

Now the audience just needs content worth talking about.
Favorite this tweet now because you don't want to forget this one: "Content without tech is a waste of time and money."

Implicit in this idea is the increasing sophistication of the information consumer today: they expect quality content and they expect a seamless user experience no matter what device they are using. The right publishing platform must be quick, responsive and integrated with the rest of the Internet, because the reader is.
He then turns to how to finance this quality tech and quality content:
Intelligent ads, yep. Sounds great and I can't wait to see them. I'm assuming this is something beyond just targeted ads.
Here we have a plug for Thrillist, an e-newsletter and men's interest site that combines clean design, good photography, and editorial content that you can buy. Oh and this company that is way ahead of the curve and the only ones "doing commerce and content the right way"? It's owned by his son. Does it matter? I haven't spent enough time with Thrillist to say, but it bears mentioning for transparency's sake, right?
Lerer brings it back to journalism (what Andreessen calls "Capital-J Journalism") to reiterate that a sophisticated audience demands sophisticated content. Not whatever trending crack like BuzzFeed quizzes happens to be ricocheting around the social Web this week, but quality content.

I could not agree more, and wish more organizations had the courage to invest time into projects that need many iterations to get right. Any organization that does is and will be rewarded.

For my final words, I'll turn to Andreessen's original post that launched Lerer's 8-point burst of inspiration, in which he describes the future of news in what sounds like a bubble but just means a new economic reality that will see many failures for every successful new organization to get in the game.
"The big opportunity for the news industry in the next five to 10 years is to increase its market size 100x AND drop prices 10X. Become larger and much more important in the process."