A year later, the lousy pennies of last year added up to €1bn in the 2009 financial year, according to the Burda chief executive, Paul-Bernhard Kallen.
The wind has clearly changed. At the DLD conference, news organisations were eager to show how open they are to the internet, and hungry to learn from successful startups.
“If you define your business by the technology of your era you won’t outlive that technology,” the Thomson Reuters chief executive, Tom Glocer, said. “We have to be playfully innovating to get from one technology paradigm to the next. If you don’t play with new tools and gadgets, you can’t build the big dreams.”
And there are still dreams out there. ‘The New York Times’ is about to move behind a paywall. “But the blogs will still be free,” says Nick Bilton of the NY Times’s research and development department.
Bilton isn’t too concerned about the paywall; in any case, he is more concerned with the future than the future. And the future for him is shaped by a deeper integration of social media. “What you are going to see happening is the delivering of stories based on your location. And you will start to get content based on who your friends are.”
Coping with changes
‘The New York Times’ actually puts a lot of effort into the understanding how technological changes affect its core business. For example, the NYT research team is investigating the future of reading habits. “We made an experiment and put an RFID chip into the phone, the computer and the television.”
The chip was there to track the user’s reading. When a user stopped reading a story on the phone, it opened it again on the desktop. When the user entered the living room, videos related to the story were presented on the television screen.
Burda is also thinking about the future. “We try to develop ideas, we try to make them happen,” said Kallen.
“Burda is well anchored in both worlds, the traditional and the digital world,” he added. “We have to find new income, and we have to find formulas to operate on lower cost base.”
However, Kallen criticised Google. Sitting on the strategy panel next to its senior vice-president, David Drummond, Kallen read out the business terms of AdSense and accused Google of not being transparent enough about how it calculates its revenue. Drummond responded that the vast majority of the revenue is to handed over to the partners, and that news queries don’t generate any revenue on Google.
Advantage
In contrast, the Telegraph Media Group digital editor, Edward Roussel, had a relaxed view of the search giant. “If you can’t beat them, join them,” he says. For the ‘Telegraph’, Google is a way of optimising its ad revenue. “And they’ve been really good in developing products. Conventional media have problems with new digital tools.”
Roussel added that he didn’t see ad revenues as the most important revenue stream. “We plan to develop clubs — this idea is important to us,” he said.
“And you are big in sports betting,” said panel host Jeff Jarvis. Picking up Burda’s statement that the online version of the ‘Focus’ magazine is profitable not through adverts, but through ecommerce, he asked: “Are news organisations becoming retailers?”
Jeff Jarvis hosted a panel on content, and spent the second part of it walking through the audience looking for a revenue model for journalism. He didn’t find one. However, in a fragmented media world, the revenue stream might be fragmented, too. Apple isn’t just a computer manufacturer any more. Microsoft is trying to be bigger in search. Perhaps news organisations have to have the same distributed approach. And retailing might be part of it. Why not?
The Guardian
