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Recently I was invited to give a lecture at the University of Malaga --"The audiences are in charge: Are publishers listening?" The audience had students in their doctoral, master's and bachelor's programs, as well as a number of faculty. Below is a summary of the presentation. 1. The marriage of convenience between advertising and journalism is over. For proof, look no further than the graphic below, which shows that newspapers in Spain have lost more than 500 million euros in ad revenue since 2009, and that includes the revenue they get from digital. (The U.S. is very similar.) In the future, news media will need to develop a deep relationship with their users. The important thing will be not the quantity of eyeballs reached, as measured by page views and unique users, but the quality of the relationship with the users. Versi�n en espa�ol Read more �

For those who could not attend the annual convention of the Spanish Journalism Society (SEP, Sociedad Espa�ola de Period�stica , in Malaga, Spain, May 24-25, below is a summary of my keynote address. (Here are slides of the English version , presented Sept. 22 at the Creima Conference in Oporto, Portugal.) The talk focused on two major trends in digital journalism that are taking place in many places around the world. The slides highlight examples of media from France, Holland, Mexico, the U.S., Germany, Peru, England, Colombia, Argentina, and Brazil, among others. Photo by Jos� Mar�a Legorburu 1. Publishers are pivoting toward users and away from advertisers and investors as their main source of financial support . The business model that depended on advertising to support journalism is moribund and nearly dead. The automated buying and selling of advertising is controlled by the duopoly of Google and Facebook, which have more and better data about news publishers' users than th...

Editor's note: an earlier version of this post had typeface issues; my apologies. An organization I work with that promotes development of independent media in Latin America, SembraMedia.org , recently asked me to make some predictions for 2018. ??I really had just one: Credibility will be the new currency of journalism in 2018 and the years to come. ?But to explain, here are that prediction's corollaries:?? 1. Independent media--those based on serving the public rather than turning a profit---will grow in importance through revealing corruption and holding authorities accountable. There are many examples. In the U.S., organizations such as ProPublica and Texas Tribune ; in Spain, eldiario.es ; in Peru, OjoP�blico ; in Colombia, Connectas and La Silla Vac�a ; in Mexico, Aristegui Noticias and Animal Pol�tico ; in Argentina, Chequeado ; and hundreds of others around the world. ?2. These independent media that serve the public first rather than political or economic intere...

Email has an intimacy that TheSkimm has used to build a loyal base of 7 million subscribers. Digiday has a weekly podcast about the business of digital media, and two recent interviews with founders of startups had nuggets of wisdom applicable to any media startup. Digiday's editor-in-chief, Brian Morrissey , interviewed The Business of Fashion 's Imran Amed about its move to a subscription model , and the founders of TheSkimm , Carly Zakin and Danielle Weisberg , about how they used email to build a loyal community. Elements of their success formulas 1. Passion for a topic that you can develop in a way that no one else is doing . a) Amed, then a consultant for McKinsey &. Co., began writing a blog in 2007 that talked about fashion as a business. He felt that no one was exploring the meaning of the numbers behind the leading fashion businesses. Over time, he developed a loyal audience who began suggesting ways he could monetize that audience. b) Zakin and Weisberg were...

Alfredo Trivi�o has worked largely behind the scenes on some of the biggest digital media projects for some of the biggest brands in the world. But you might not have heard of him. Alfredo Trivi�o: users will own the media, in every sense He spent seven years in senior management roles at News Corp., ultimately as director of innovation, where he worked on development of a pay model for digital journalism and on long-term editorial and commercial growth strategies. (He is a 1999 graduate of the University of Navarra School of Communication, where I teach.) He was invited to give the closing keynote address last week to the annual conference of the Spanish Journalism Society (SEP, Sociedad Espa�ola de Period�stica). He ruminated casually about trends he sees in the worlds of digital journalism and digital commerce, mixing some English terminology into his Spanish presentation. Among the shifts he sees: A shift from journalism and commerce to journalism vs. commerce. That is, the...

Now that Facebook has made clear that it will not be promoting journalism to its users, all of the publishers who were getting much of their traffic there should look elsewhere. ( Frederic Filloux of Monday Note has one of the best analyses of the company's announcement .) What now? Well, there are several tactics and strategies that publishers can take to replace what they have lost (and will lose) from Facebook's pivot away from news. (I have also written about such strategies in Spanish.) 1. A tactic: start an email newsletter with links to your content. Think of it as a walled garden that protects you from Facebook. Daily, weekly, or monthly newsletters create a more intimate relationship with users. Some publications have several on different topics, such as technology, business, public safety, or politics that users can select from. Local news sites in particular can benefit from daily newsletters. The links to your content send users directly to your site, and any ad ...

This blog post started out as an explanation to my friends and family in Cleveland and Columbus, Ohio, why their local newspapers had become shadows of their former selves . Why their newspapers were so thin. Why news coverage was so shallow. Why they felt like they weren't getting their money's worth. From trust to distrust in one decade. Pew . And we will get there in a minute, but first, some good news. It was heartening to see the Knight Foundation's recent announcement that it was committing $300 million over five years to strengthen journalism, from the ground up, by focusing on local news and on encouraging collaboration. �We�re not funding one-offs. We�re helping to rebuild a local news ecosystem , reliable and sustainable, and we�re doing it in a way that anyone who cares can participate,� said Alberto Ibarg�en, Knight Foundation president. Gradually, civic minded individuals and organizations have realized that the loss of local news coverage threatens...

Money talks. Put your money where your mouth is. Show me the money. We have lots of expressions that equate money with crebility and trust. How people get and spend their money is often the most credible expression of what they value and who they are. We attribute so much value to money and to the way it expresses our true beliefs that historian Yuval Noah Harari declared in his bestseller Sapiens: A Brief History of Humankind : "Money is accordingly a system of mutual trust, and not just any system of mutual trust: money is the most universal and most efficient system of mutual trust ever devised." By extension, this belief in money as the best measure of value of everything in modern society -- the loss of a loved one (insurance payouts), the salary of a teacher or a CEO, a barrel of oil -- has led us to trust markets too much . In fact, many studies have shown that the media marketplace puts great value in misinformation , disinformation, sensationalism, gossip, and en...

The network effects that destroyed traditional news organizations are benefiting digital startups, which can grow virally and generate outsized impact in their communities. From Unimedliving My teaching colleagues are experts on the economics of the media industry, and we recently had a lively debate on how to reverse the financial crisis of journalism . The collapse of the industry's business model is endangering the institution of journalism-the Fourth Estate, a counterweight to power--by eliminating journalists and media coverage, especially for local media. It's a question that was explored recently by Ken Doctor at Nieman Lab in his report, "Newspapers are shells of their former selves. So who�s going to build what comes next in local?" Doctor details a number of initiatives by non-profit and for-profit organizations aimed at filling the gaps in local news coverage involving hundreds of media outlets. But using the standard industry metrics, it doesn't a app...

Predicting the future has always been a dangerous business in the creative industries . As any economist will tell you, products like books, movies, TV shows, and music are "experience goods", which can only be evaluated after they are purchased or experienced. Making predictions or recommending strategies is especially difficult now with rapid technological change disrupting every creative industry. This theme appeared in several of the presentations at the Creative Industries and Media Management Conference held at the University of Porto, Portugal, Sept. 19-21. The conference was organized by Paulo Faustino of Porto and Nova universities. -- Michal Glowacki , professor of journalism at the University of Warsaw, presented preliminary findings from a study of the dynamics of organizational culture in public media that identified success factors in what he calls creative media clusters . Read more �

The following text is a translation from the Spanish version of a lecture I gave at the University of La Sabana in Bogot�, Colombia, on Aug. 22. My lecture, in Spanish, starts at the 6-minute mark of the video. Journalists today have the opportunity to create the future of the industry. But to do so, we have to change some of our long-held beliefs and attitudes. We have to create new business models (O, those awful words!) and learn to say some words without blushing. This need to change comes about because of the nature of our profession, which for most is a vocation. As journalists we have to keep our distance from political and business interests to maintain our credibility. Still, as a group we can be arrogant, self-righteous and holier-than-thou (I include myself in this criticism). We tend to view ourselves as high priests of an exclusive profession and bearers of a special ethical standard that few others can live up to. We see ourselves as purer, more objective, less affecte...

Readers now supply more than half the site's revenue. Josh Marshall started out as a political blogger in 2000, made a business of it in 2003, won a George Polk Award, and has managed to stay independent through all the wild swings of the digital pendulum. So his reflections on how to transition from an advertising business model to paid subscriptions have a certain authority. He talked about the evolving business model of his site, Talking Points Memo , in a 47-minute podcast with Digiday Editor Brian Morrissey. Among Marshall's observations that are relevant to other would-be news entrepreneurs: Small, independent news sites cannot rely on scale to drive revenue. They need a strong relationship with their users. Many digital media organizations that have massive audiences will not be able to make the transition to paid subscriptions because they don't have that relationship, he believes. Many of the 26,000 paid subscribers to TPM, which are now supplying just over hal...

Forget about the big numbers of total page views per month or unique users per month. Fans are engaged and willing to give their time and money. Those numbers are misleading and meaningless. They had meaning only in the days when the media business depended on mass media , massive audiences , and products aimed at the masses . That was when the news media depended on advertising. Today the business of media is all about touching potential customers with personalized, customized messages. It's about identifying the small number of people who are truly fans of your publication or the stars on your team. It's about strengthening the emotional attachment people have to your brand and its mission. How the big numbers mislead us In their very successful campaign to reach 1 million paid subscriptions for their digital-only edition, the Washington Post learned that the users most likely to subscribe came to their site three times a month . Read more �

Some observations by media economics expert Robert Picard's observations about the challenges of media today, from an interview done by the University of Navarra Faculty of Communication : Media companies need to develop revenue from many more sources than they did in the past. Media companies are diluting the quality of their product by chasing reader clicks with light or frivolous digital content. "This is not bringing in money, and it's not bringing in audience." Versi�n en espa�ol Maybe 15 to 25 percent of the reading public will pay for serious news, Picard says. These are the people who really want news. Journalists think their work is really important, and for the journalists, it is. But for most people, they just want to get on with their lives . If something important happens, then they will go online and read it somewhere, but most of the time they won't pay for it. Newspapers have to stop thinking of themselves as a product for a general audience. T...

Robert Picard speaking to class at University of Navarra. Robert G. Picard is one of the founding fathers of the academic discipline known as media economics. The field has attracted more attention lately as news outlets, ravaged by digital competitors, have gutted their reporting staffs and slashed public-service coverage. Policy makers, media executives, investors, and journalists themselves look to experts like Picard for answers about how to deal with the industry's financial crisis and the diminishing supply of news. Picard admits that he is unsure of exactly what the future holds for the industry. What he does know is that the people who are running media organizations--TV, radio, newspapers, magazines, and even digital outlets--know far too little about their readers, viewers, listeners, and users. Publishers need to invite these consumers into the processes of creating and distributing content, he said. They need to think about how to create value that will satisfy the need...

A deal with the devil. A new study by the World Association of Newspapers and News Publishers (WAN-IFRA) confirms what I have suspected for a long time: when publishers rely on Facebook for distribution, they are making a deal with the devil. "Reality Check: Making Money with Facebook" was based on a survey of an "expert group" of 150 publishers. On average, Facebook was contributing only 7% of their revenues in spite of the fact that much of the publishers' content was being consumed on that platform. And Facebook is stingy when it comes to sharing revenue with publishers, compared with Google, Spotify, Twitter, and others. It "seems to share proportionally less revenue with content creators than other platforms do." Loss of branding power The WAN-IFRA findings are also troubling because studies by Pew Research (see paragraph 4 of the study) and the Reuters Institute for the Study of Journalism (see p. 16 of the study) have shown that users think F...

A new study of 100 digital news startups in Latin America by SembraMedia in partnership with Omidyar Network -- Inflection Point -- offers many clues to achieving the elusive goal of sustainability. Extensive interviews with the founders -- 25 each from Argentina, Brazil, Colombia, and Mexico -- produced data that clarified the elements of successful business models and showed the best places to invest resources and training. Janine Warner , co-founder of SembraMedia and an ICFJ Knight Fellow, directed the study, which was managed by her co-founder, Mijal Iastebner. (Disclosure: I participated in the study as an editor.) Among the insights: You don't need a lot of money to get started. 71% of the media in this study had startup capital of less than $10,000, but a tenth of those now generate at least $500,000 in revenues (p. 8). Those that focus on business development do best. Those with at least one sales person reported median annual revenues of $117,000; those with no sales ...

Richard Fletcher of the Reuters Institute has produced an in-depth analysis of the top reasons people around the world gave for paying for news online. The Digital News Report 2017 included interviews of more than 70,000 adults in 36 countries. Fletcher observed that the most common reasons people gave for paying were they wanted access on their mobile devices (30%), they like to consume news from a range of sources (29%), or they were offered a good deal or package (23%). My take on Fletcher's data: The message to digital news publishers should be clear: they need to make sure their content displays rapidly and adapts well to the small screen--responsive design. Also, they should be testing various prices and packages for online content to see which ones produce the best returns. Read more �

Alfonso Vara-Miguel A new study of internet users in Spain shows that those who trust "the media" less are more willing to pay for news online. The explanation for this counterintuitive behavior is that those distrustful folks "are willing to pay for those specific media that they trust", according to the researchers, Alfonso Vara-Miguel of the Universidad de Navarra and Manuel Goyanes of the Universidad Carlos III of Madrid. ( The full text of their article is in Spanish: "The probability of paying for digital news in Spain," in El Profesional de la Informaci�n .) In other words, trust and confidence have an economic value that media organizations can monetize . Manuel Goyanes Getting people to pay Media economists like to say that the Spanish are legendary cheapskates when it comes to paying for any form of media. But the researchers believe they have identified some of the market segments most likely to pay for news . They base their conclusions o...

Home page of Dennik N Contrary to all the predictions about the public's unwillingness to pay for news when it is freely available online, more publishers of high-quality, in-depth reporting are making money. The latest example comes from Slovakia, as recounted by Rob Sharp in Nieman Lab . The editors of a popular national newspaper there discovered that a news organization tainted by corruption accusations was about to buy a significant stake in their paper. Versi�n en espa�ol Anticipating restrictions on their work, the editor, Matus Kostolny, and a team of his lieutenants decided to start an independent online news publication, Dennik N . As Sharp describes: The outlet attracted �1 million of private investment and advanced subscriptions of around �300,000. They launched their daily website in January 2015, and a printed paper shortly afterward. Now, just over two years later, they are among the top five quality newspaper websites in Slovakia. In a country of 5.4 million people,...