Ite-post-experiment

Washington Post experiment with regional dailies raises intriguing questions about intent, value and opportunity

This is a sidebar to a longer piece found at the Reynolds Journalism Institute website.

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• • RELATED STORY in der Spiegel

BY BILL DENSMORE
This story was reported in October, 2014)

Since U.S. newspapers began in the mid-1990s to market news on the World Wide Web, they have searched for new revenues to support the practice, initially focusing on advertising. By 2012 many papers began seeking online subscription revenues as well. Efforts at collaboration have been spotty.

But a possible breakthrough occurred on March 18, 2014 when The Washington Post announced it would begin providing selected online news products as a free premium for subscribers of selected regional newspapers. The move marked experimentation by a key U.S. publisher with the concept of a shared-user network. By September, news-industry analyst Ken Doctor wrote the program involved 120 U.S. dailies and 200,000 print newspaper subscribers. In October, Poynter Online said it was 165 papers.

"This program is a way for us to work with newspapers and other print and digital partners around the country to both add value to their subscriptions and expose The Post to a wider audience than ever before,” Stephen Hills, president and general manager of The Post, said in a March statement.

For The Post, the “Newspaper Partner Program” is an opportunity to get hundreds of thousands of news-interested digital readers, at a minimal acquisition cost. The relationship is unlubricated by cash: “No money changes hands,” said in one account. “What we’re doing it for is to get the promotion and increase the national exposure of The Washington Post.” Hills told Poynter it has “opened the possibility of talking about lots of different ways we could partner” with other outlets.

Ordinarily The Post charges at least $100 a year for digital access after 20 free online articles per month; for the partner papers’ print-only subscribers, it’s free for at least a year.

The move fit The Post strategy under new owner (and Amazon founder) Jeff Bezos to increase its national and world footprint of influence, where in recent years it has lagged behind The New York Times. The Post has had almost no digital subscribers as it pursued an open-web policy and only non-paying registered users until 2013. In launching this experiment, therefore, "The Post didn’t have anything to risk,” observes Mark Contreras, CEO of Calkins Media and a former chairman of the American Press Institute. “The Times would have $250 million in digital circulation revenue at risk.”

In October, Post made public via a set of slides results of a survey of 1,299 of its free regional subscribers solicited via the emails the Post collected under the new program. The survey showed strongly favorable reactions from the subscribers who responded, who said the free added feature increased their opinion of their local paper and their desire to remain subscribers.

“I thought it was a great added bonus for our readers and so far has been really successful,” says Martin Kaiser, editor and senior VP-digital content at the Milwaukee Journal Sentinel, which joined the Post experiment from the start.

“It’s the smartest thing Bezos has done so far,” says John Temple, president of First Look Media and a former top editor at The Post. “He’s finding high-value customers all over the country and world.”

In August, more than 12,000 of the Minneapolis Star Tribune’s 40,000 paid digital-only subscribers had opted to include access to The Post at no extra charge, said Steve Yaeger, vp-marketing and public relations at the paper. “We have simply emailed our qualified digital subscribers a very simple email. It simply describes the benefit and click here to activate, it takes it to a clean landing page where they create their Washington Post credentials and away they go.”

“The Post is just a win for everyone,” says Michael Deep, editor of NetNewsCheck.com, who has followed and written at least twice about The Post experiment. “The Post gets the unique visitors it needs and everyone else gets to offer another layer of benefit for their subscribers.”

Some concerns: What will the Post do with user info?

A feature of The Washington Post experiment concerned some of the RJI interviewees – the fact The Post is gaining email addresses and names of users of the regional newspaper partners. Analyst Ken Doctor explained the possibilities for The Post in a Sept. 4 post on the Nieman Lab website:

“ . . . [Y]ou must “authenticate” your subscription with The Washington Post. Once you do, you become a known, and trackable, customer of both The Post and the local paper. While the program’s first priority is simply building reach, The Post will be able to monetize all those new readers via digital advertising. Down the road, we can expect the exploitation of e-commerce opportunities, likely connected to Amazon, which The Post apparently experimented with in August. Regional publishers aren’t worried about Post incursions into their audiences; the deal seems like a fair balance to them — for now.”

“If people just added The Washington Post. If that is all it is -- no new subs -- I would consider it a failure,” said Andy Waters, general manager and president of the Columbia [Mo.] Tribune. “If you pick up no new subscribers and you've just given away all your customer data, what have you gained? The Post gets access to all the newspaper customers for all kinds of subscriptions or whatever else.”

“You are talking about a business model for The Washington Post,” says Elizabeth Osder, principal of the Osder Group of Los Angeles, Calif., and a former digital media executive at Yahoo! Inc., The New York Times and Advance Media. “They want to gather an email address that they can monetize . . . The folly is getting access to content -- what else is it that is going on there?”

Drummond Reed, founder of Respect Network, provides user identity management and trusted data sharing services. He has a strong background in privacy research and helped developed the OASIS XDI data-exchange protocol supported by more than 75 companies. He saw The Post initiative as a “particularly interesting experiment" and wonders if next step couldn't be networked subscriptions.

“We are not exchanging any lists,” explains Guy Tasaka, chief digital officer for Calkins Media, which is a regional participant in The Post experiment. “They just give our subscribers login information to create an account.”

At the Toledo [Ohio] Blade, managers were well aware that The Washington Post was going to get the email addresses of their customers when they signed up at The Post, said Tom Zeller, audience-development manager. “We discussed and decided we were OK with it,” he said. “They become The Post's customers, too." About 2,000 Blade digital subscribers had signed up by early August. It means The Post can market to those 2,000 Blade customers. Said Zeller: “At that point they now own the data because they are The Post’s customer as well . . . the content doesn't interfere with what our strengths are which is strong local reporting. So we didn't see it as a conflict but rather as a complement.”

Zeller says The Post is now talking to its regional partners about an email newsletter The Post would create which would include links to regional-partner stories “which would link directly through to the partner’s content,” said Zeller.

“Where is Bezos going?” asks Bill Schubart, founder of the Vermont Journalism Trust and public-media funder and entrepreneur. “Is he going to want to create a journalistic Amazon?”

Bezos’ motivation for the regional collaboration is to increase the chances of The Washington Post selling and showing national digital advertising to premium customers of the regional papers, observes Penelope Muse Abernathy of the University of North Carolina. She has just a completed a book and companion interactive teaching site, "Saving Community Journalism: The Path to Profitability.” She is UNC’s Knight Chair in Journalism and Digital Media Economics. She sees no direct revenue benefit for the regional partners. “The only thing they can hope is increased engagement with their own readers on their content,” she says. “Because once they’ve gone to that Washington Post website they are gone.”

Could local ‘authentication’ be accepted by Washington Post?

In the current experiment, local-paper subscribers in effect create a second user account at The Post, therefore identifying themselves to The Post. But what if an account at, say, the Milwaukee paper, was ‘accepted’ by The Post as a valid login to The Post?

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(See also: “Academic is ahead of business, news media in establishing one account that works at many websites -- and the government is trying to get there too.”)

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“It would be a lot better if when you went to The Washington Post you were already logged in through your local paper,” says Matt (Sokoloff) Broffman, a former RJI fellow and daily newspaper digital-media editor who now runs the local news blog Bungalower.com in Orlando, Fla. “How can we set up a way so that newspapers can make deals with each other that work in real time? So let's describe how we do authentication and if you want to do a deal you can. As an example: Is this your user, and what subscription rights do I want to offer?”

To take it a step further, Sokoloff suggests what he calls a “one-stop shop for information content, not just news content” similar to the Netflix approach as an central source for moves from most all studios and filmmakers. “Even if you don’t own the user, you are getting paid,” he says.

The Alliance of Audited Media has been involved and consulting with The Post since it began its regional news-sharing experiment, says Tom Drouillard, president, CEO and managing director of the trade group that includes publishers, advertisers and ad agencies. “They want to make sure they can monetize it appropriately -- either change the established rules or fit within the established rules. I get that, that's a business opportunity.”

In-depth content value -- for public broadcasters, too?

“They are trying to make their play quickly to be the national alternative to The New York Times,” says Chuck Peters, CEO of Source Media and The Gazette Co. in Cedar Rapids, Iowa and a member of the Inland Press Association board. Peters -- whose small daily was not part of the first round of participants -- thinks few of his readers would be strongly attracted to additional national and world news. He believes in the concept of offering access to deeper topics, such as in-depth farm news beyond what the paper can develop itself.

The idea of one news organization adding value for its users by giving them convenient access to other quality content would make sense among public broadcasters too, according to Mark Fuerst, a former public radio general manager who has consulted for years to NPR, PBS, CPB and ran an industry trade group. “I think public broadcasting is going to have to do the same. Now, are they there mentally?”