Wednesday, May 11, 2011

Journalists need to better understand the business of digital journalism, study says

The Columbia University Graduate School of Journalism has published a new report on digital news economics, which highlighted how the relationship between content and advertising is changing, and what this means for the news business. The report comes just after the Pew Research Center's report on how people navigate the digital news environment
The main aim of Columbia's research was to find out what kinds of digitally based journalism the US commercial market is likely to support, and how.
The definition of digital journalism is broad: it includes online phenomenon (the Internet and computers) as well as mobile devices like phones and tablets.
Amongst much interesting analysis - the report is 146 pages long and is divided in 9 chapters - one part is devoted to the relationship between the news industry and the advertising market.
Felix Salmon pointed this out on his Reuters' blog. He quotes a passage of the report saying:
"For decades, there has been a connection between the journalism that news organizations provide and the advertisements that generate most of their revenue. Whether it's a glossy spread that runs before the table of contents in a fashion magazine, or the anchor-man's "more after this message" assurance on the local Eyewitness News, ads and content have always been closely linked in the stream that appears before the consumer."
"That linkage is breaking down, and news organizations are scrambling to re- place it with something else. That may mean selling ads on sites they don't own or control."
Salmon argued that during his career he came across people with fantastic ideas for a website, relying as a business model on banner ads and of course, as a statistical inevitability, some of them will make money. But the ad-adjacency model can't be the business model to rely on. News organizations - he suggested referring to the report - should find ways to monetize the credibility they build within their communities.
One way could be to sell ad space not just on their own site but to use their brand for other ventures. Just to cite some examples: Wired has pop-up stores, New York Magazine has a bridal show, the Atlantic has a big events business which already brings in $6 million a year and which is growing fast.
The relationship between digital journalism and advertisers must be re-thinked, the New York Times summarized.
"That does not mean yielding editorial control to sponsors, but it might mean coming up with alternatives to impression-based pricing, creating higher-value content for the Web by tapping into page view data, and helping to ensure that Web ads have value on their own", the article wrote.
The article also quoted Bill Grueskin, the academic dean for the journalism school and a co-author of the report, who said: "We're not suggesting that journalists get marching orders from advertisers. We are suggesting that journalists get a much better understanding of why so many advertising dollars have left the traditional news media business."
The report ends with these considerations:
"We believe the public needs independent journalists who seek out facts, explain complex issues and present their work in compelling ways. We also believe that while philanthropic or government support can help, it is ultimately up to the commercial market to provide the economic basis for journalism. The industry has realized many of the losses from the digital era. It is time to start reaping some of the benefits."

Source: CJR, Felix Salmon's blog, New York Times

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