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November 25th, 2009

Time Warner Cable ready to fight high program costs

Posted by: Yinka Adegoke

Time Warner Cable, the normally placid No.2 U.S. cable operator, is getting ready for a fight with its programming partners at the cable networks and broadcasters over rising affiliate fees. In truth, TWC has always been ready for a fight with the programmers. This time, it wants to make the first move and get its 14 million subscribers behind it.

The New York cable operator is launching an ad campaign “on behalf of its customers” to target what it sees as unfair price demands by programmers. It argues that these price demands, which usually come around this time of year at the end of programming contracts, can sometimes be as much as 300 percent increases. TWC says programmers make the demands “secure in the knowledge that video distributors are the ones who have to pass those costs along to customers and take the blame.”

So what’s Time Warner Cable going to do about it? They’re going to launch a website — yes, a website with the catchy URL: www.rolloverorgettough.com. News Corp, Sinclair Broadcasting and cable networks must be quaking in their collective fee-hiking boots.

(For the uninitiated: One way for companies to make money from their shows is to charge cable operators for the privilege of distributing them. Programmers like to raise those fees every so often. When cable operators resist, shows you like have a way of being held for ransom and sometimes disappearing for a while.)

Time Warner Cable’s website will allow customers to give their feedback and will be supported by ads in newspapers, TV and the Web.

“We want them to know why we fight so hard on these issues - if we Roll Over, they pay the price. If we Get Tough, they may lose their favorite shows until we reach a reasonable agreement.” said TWC CEO Glenn Britt in the press release.

It’s not the first time Time Warner Cable has tried to be principled about not overpaying for content. You might remember the great “Why is SpongeBob crying?” campaign of Dec 2008 when Viacom and TWC fell out over rising carriage fees.

Britt’s easiest solution to avoid revisiting this issue every year might not be to build websites, but to buy content companies like its larger counterpart Comcast is trying to do with NBC Universal. If nothing else it will give TWC more leverage in negotiations with some content makers — and they’d have to play nice.

November 24th, 2009

Rupert Murdoch, the smartest man in newspapers?

Posted by: Robert MacMillan

I wrote an analysis on Monday about the possibility that News Corp might take its news search results away from Google and list them on Microsoft’s Bing search engine instead. My conclusion: This one isn’t such a hot idea. Then I read John Gapper’s Financial Times item about how it *could* be a hot idea.

To recap, here’s how it would work.

  • Microsoft would pay News Corp for the privilege of being the only search engine to carry results from papers including the New York Post, Wall Street Journal and Times of London.
  • Microsoft thinks it can get more people to use its search engine, drawing them away from Google.
  • News Corp could punish Google, in essence, for making tons of money from the ads it serves alongside news search results. Why, the thinking goes, should Google make a bunch of money off the news that we produce and our newsrooms go starving and our ad sales tank?
  • Other newspaper publishers, if they see Murdoch making it work, might think the same thing and abandon Google en masse.

I and many others wrote that it would be a gamble at best. What if people don’t care that much about news? If the 70 percent of the search market that uses Google discovers  the news is absent, will they switch search engines? Scientists of misanthropy like me say it’s unlikely. If they don’t find it, they won’t seek it.

Gapper at the FT has another way of looking at it:

In effect, (Murdoch) would be swapping his revenue stream from online advertising with a payment from Microsoft for drawing visitors to Bing. That suggests one of two things: either, as a lot of digital evangelists have suggested, he is getting old and does not “get” the internet, or he has looked at the figures and decided that Google traffic is not worth very much. Personally, I think the latter is more plausible. …

Mr Murdoch appears to have decided he will not lose very much by ditching Google traffic and even a fairly small payment from Microsoft would compensate. He is attempting to get distributors to pay for content in the way that US cable operators pay cable networks for programming. …  If the revenue from search traffic is low, why not swap it for something else?

In other words: You, Mr. or Ms. Newspaper Publisher, hate Google because you’re in a co-dependent relationship. You need Google, but Google hurts you too, so you want to escape from Google, but you can’t… But think about it this way: How much worse can it be? You’re shedding hundreds, if not thousands of jobs, and you call 25 percent ad revenue declines an improvement over how they were a few months ago. What’s NOT to lose? And if someone’s paying you more than you’re making now?

Not to add too many question marks to one blog post, but does this make Rupert Murdoch the smartest man in newspapers?

November 16th, 2009

Top Rupert Murdoch adviser learns meaning of ‘deadline’

Posted by: Robert MacMillan

Top Rupert Murdoch adviser Gary Ginsberg is leaving News Corp after 11 years, the company said on Monday.

It must have hit New York Times reporter Tim Arango’s e-mail inbox first (his writeup appeared about five minutes before I got the press release).

Here is what he wrote about Ginsberg, 47, the second senior executive to leave News Corp in recent months, following Chief Operating Officer Peter Chernin:

Mr. Ginsberg, a former lawyer in the Clinton White House, was hired in 1999 to be News Corporation’s director of communications. He was hired partly to refurbish the company’s image after a controversy in which Mr. Murdoch was said to have stopped publication of a book by Chris Patten, the former governor of Hong Kong, to curry favor with the Chinese government. Mr. Ginsberg’s portfolio within News Corporation expanded well beyond public relations. He gradually gained control over investor relations, marketing and corporate social responsibility. He also became an important bridge between Mr. Murdoch and Democratic politicians, particularly Bill and Hillary Clinton.

Ginsberg, Arango said, arranged a lunch between Bill Clinton and Murdoch in Harlem, and a year later with a New York Post newsroom tour. Eventually, the Post endorsed Hillary Clinton for the U.S. Senate in 2006 and Murdoch threw her a fundraiser at News Corp’s headquarters. (Yes, that is quite a feat to arrange for a newspaper that under Murdoch has leaned Republican more often than not.)

It’s also a feat to get a well-known Democrat to say what he said in the press release:

I will always be grateful to Rupert for the many opportunities he’s given me over the years… It was a difficult decision to leave a company that has been such a vital part of my life and I’ll miss the many talented colleagues who have helped make this such a thrilling and fascinating ride. But I’ve been thinking about leaving for a while now to pursue something new, and this seemed like the right time to do it.

Teri Everett, who spends plenty of time dealing with the horde of reporters who cover News Corp’s every move, will take over as the new communications chief. Reed Nolte will run investor relations.

November 13th, 2009

News Corp throws down the Google gauntlet

Posted by: Alexei Oreskovic

The war of words between the news media industry and Google makes for a great spectacle, and this week did not disappoint.

According to a report in the Silicon Alley Insider blog, Associated Press CEO Tom Curley is meeting with Google on Friday to press for the creation of a “news registry.” Here’s SAI on the AP’s move:

It hopes such a registry would propel its content to a higher rank in general search than the blogs that the news agency accuses of lifting its content.

Curley said the AP — which intends to form landing pages and a social-media desk, among other survival strategies — is “getting paid for about 12% of our content on the web.”

It was not clear what information SAI was basing its report of the AP-Google meeting on - the blog post didn’t specify whether one of its bloggers had spoken to Curley directly, or whether it was picking-up Curley’s comments from another report; nor did it have links to any other articles on the subject.

A Google representative emailed a statement that said the company regularly meets with its publishing partners to discuss a variety of initiatives. “We’re not going to comment on the specifics of any particular conversation at this time.”

One would hope Google is also having conversations with News Corp, which is ratcheting up the rhetoric of late.

Earlier this week, News Corp Chief Executive Rupert Murdoch told his own Sky News Australia in an interview that he was considering blocking Google from indexing its Web sites once the company begins charging people to read its articles on the Web.

On Friday, News Corp chief digital officer Jonathan Miller expanded on Rupert’s anti-Google gambit and stuck a timeline on the move, according to a report in Telegraph:

When asked how long it would be before Mr Murdoch took the step to block Google, which every media company relies upon to send them high levels of web traffic, Mr Miller said it would be soon - “months and quarters - not weeks”.

The story later quotes Miller dismissing the benefits that come from have its content accessible through Google:

“The traffic which comes in from Google brings a consumer who more often than not read one article and then leaves the site. That is the least valuable of traffic to us… the economic impact [of not having content indexed by Google] is not as great as you might think. You can survive without it.”

There’s been plenty of sabre-rattling from the news media when it comes to Google in the past. If News Corp doesn’t follow-through with its threat in the next couple of months, will it have proven itself to have no real clout in this fight?

November 4th, 2009

Zelnick’s New Media Dinner: a new ideas exchange?

Posted by: Anupreeta Das

On the evening of Nov 2, about 70 people — new media upstarts and old media stalwarts, brand-name investors and top company executives — gathered at the Manhattan home of Strauss Zelnick to talk shop.

This was the third such gathering that Zelnick and his co-hosts organized, with the aim of bringing New York’s best media-focused minds under one roof to talk about the future of the business. In keeping the setting intimate and the number of invitations in the ballpark of about a hundred people, the organizers hope to turn the “New Media Dinner” into a recurring salon-of-sorts, where ideas, capital and expertise can mix and match.

In a half-hour chat before the guests started arriving, Zelnick and two of the co-hosts, drop.io founder Sam Lessin and Thrillist’s Ben Lerer explained to me how this all came about.

For Zelnick, chairman of video-game publisher Take-Two and co-founder of private equity firm ZelnickMedia Corp, the idea of organizing the event sprang from “a desire… to meet the next generation of leaders in the media business.” Naturally, he turned to Lessin and Lerer, who are now in their 20s but who have known Zelnick since they were in their teens and frequently turn to him for advice on their ventures.

“I suspect that between the organizers, we collectively know almost everybody doing the most interesting things in new media in New York,” Zelnick said. News Corp’s Jeremy Philips and venture capitalist Stuart Ellman of RRE Ventures were the other co-hosts for the evening.

And sure enough, they pulled in a power crowd that included veteran dealmaker Quincy Smith, CBS’s Internet chief who is quitting to start his own advisory firm, former Doubleclick CEO-turned-ex-Googler David Rosenblatt, and even Ron Conway, Silicon Valley’s star angel investor who was in town for meetings.

Over dirty martinis and mini lobster rolls, denizens of “Silicon Alley” such as Betaworks’ Andy Weissman and Union Square Ventures’ Fred Wilson rubbed shoulders with some of New York’s media elite including Journalism Online’s Gordon Crovitz and my own boss, Thomson Reuters CEO Tom Glocer.

Crovitz and I had planned to chat at the dinner but I missed the chance, so we followed up on Tuesday. The former publisher of The Wall Street Journal, who now invests in early-stage media and technology companies, gave me his take on e-mail: “Technology has led to a period of intense creative destruction for the media and information industries,” he said. “New York is the center for this transition, with an enormous amount of innovation and reinvention by new media entrepreneurs and the old-media executives who understand this period of fundamental change.”

Some new media entrepreneurs, like Lessin, have been privileged enough to seek the help and advice of traditional media power players in navigating this changing landscape. “I’ve always had access to people like Strauss who’ve helped me figure out the landscape and told me when my ideas were terrible,” said Lessin, who is 26 and the son of investment banker Bob Lessin.

But the new media get-togethers are about “introducing my best, brightest and smartest friends to some of Strauss’s friends,” he said, adding that the past two events — in February and July — have spawned many interesting discussions between people who met at the venue.

Later, I mingled with many of the guests, picking up stray bits of conversation: here a pitch from an entrepreneur to a venture capitalist, there a bit of M&A gossip, chatter about which start-ups are working and which aren’t doing too well, mentions of the recent pay-models-for-journalism panel at Harvard’s Shorenstein Center, not to mention heated debates on the Yankees-Phillies game.

“It was a little bit of this and a little bit of that,” said Kenneth Lerer, chairman of The Huffington Post, when I followed up with him on Tuesday. “My guess is that a few investments and a few deals and a few hires will be made out of last night.”

“One of these (events) don’t mean much but if you have a series of them — and I think that’s what Strauss’s intention is — it’s smart, good business,” Lerer added.

Although most folks seemed to know each other already, I was happy to point out Fred Wilson and Tom Glocer to various entrepreneurs.

For many of New York’s young media entrepreneurs, it was also an opportunity to relax (not all of them were in ties) and catch up on industry chatter. The hosts made sure the booze didn’t run out, and there were few complaints about the first course of pappardelle with wild mushrooms, followed by entrees of prime rib roast and sea bass.

For dessert, the guests were treated to New Yorker writer Malcolm Gladwell, whose boss David Remnick spoke at the first gathering in February and was also at this one. Gladwell infused his short speech with healthy skepticism about the power of technology to bring about social change and improve our collective well-being. The audience took the bait spiritedly, and a brief back-and-forth followed. Then it was almost midnight, and the party was over. I have to believe that not a few guests were already thinking about the next one.

Photo: Strauss Zelnick (Reuters)

October 29th, 2009

FCC: There might be something amiss in media

Posted by: Robert MacMillan

Newspaper advertising is a joke, local TV stations are struggling to get ads of their own, journalists are losing their jobs and media executives are calling 25 percent revenue declines an improvement. It sounds like something might be amiss in the U.S. media world.

But don’t take our word for it if you’re the Federal Communications Commission, and you’re about to revisit media ownership regulations and see if they need some changing. See this item from Inside Radio:

[FCC] Chairman Julius Genachowski hires internet entrepreneur and journalist Steven Waldman to lead an agency-wide initiative assessing the state of media. Waldman will lead a team to conduct what’s promised to be an “open, fact-finding process” looking at how the economy is impacting media outlets and make recommendations for policy changes.

Waldman is the co-founder and former editor of the religious website Beliefnet.com, which was bought by News Corp. in 2007. … Waldman will join the Office of Strategic Planning and serve as senior advisor to the chairman. Genachowski says, “A strong consensus has developed that we’re at a pivotal moment in the history of the media and communications, because of game-changing new technologies as well as the economic downturn.”

Yes, but let’s make extra-special sure and hire a guy to check out the situation. You never know; everything might be just fine and we’re making a big mistake saying otherwise.

October 27th, 2009

MySpace: Be ready to read this story twice

Posted by: Robert MacMillan

MySpace, the online social network (can we still call it that now that it has ducked out of the Facebook/Twitter competition?), appears to be pursuing what I’ll call the “two-pronged news strategy.” You get used to it when you cover media and technology. For those of you who don’t enjoy this privilege, it goes like this:

  • Pick a news outlet that you like and whisper things to them about what you’re doing. It doesn’t have to be interesting, it just has to be exclusive. If you’re in public relations, you don’t even have to know that someone in your company is doing this. It works well for you.
  • Let the rest of the press read the story and bombard your telephone and e-mail with messages demanding to know if it’s true. Score a big hit on the news cycle. Because you either decline to comment or only want to talk “on background,” it heightens the air of mystery — and newsworthiness.
  • The official announcement of the news, which will always resemble 90 percent or more of what you read in the first round of anonymously sourced stories, will get just as much attention as that first round. It’s a 2-for-1 deal that is irresistible to many companies.

I don’t know that MySpace is doing this, and wouldn’t be able to confirm it if I asked. It could just be that the reporters who get the breaking news have great sources and the reporter asked smart questions that would yield good answers. I’ll let you judge.

The first example comes from Kara Swisher, tech blogger at AllThingsD, which is MySpace’s cousin in the News Corp family. She reports:

Microsoft’s MSN is in preliminary talks with MySpace about using the social networking site’s music service, MySpace Music, to help power music offerings on the giant portal. …

Sources said Microsoft execs don’t think they can do as good a job as MySpace is doing and don’t see the point in striking needed but complex deals with music labels, which the News Corp. (NWS) property already has.

MySpace, Swisher adds, would get a “gusher” of traffic. I asked MySpace whether we could talk about this. From spokeswoman: “Off the record I can’t comment.” OK.

The second example is this story in The Telegraph from Monday:

Facebook and MySpace are in talks about sharing content across both sites, according to senior figures at the two companies. The move could potentially see MySpace music and video footage being shared on Facebook via its Connect platform, which allows people to log into third party sites using their Facebook ID.

Sheryl Sandberg, Facebook’s chief operating officer, told The Telegraph: “Facebook is focussing on building the best technology which helps people share content, while at MySpace they are focussing on more a content-led strategy. We would like to have their content, as we already do with many other sites, shared across our network because it is good for our users.

On this one, MySpace CEO and former Facebook executive Owen Van Natta confirmed the talks on the record. But I’m in the position of only being able to refer you to that article.

On the record, MySpace wouldn’t comment. I suspect that the comments will come later when we rewrite the Telegraph’s story along with the rest of the press corps.

October 22nd, 2009

MySpace: A place for musicians… and their friends

Posted by: Robert MacMillan

It appears to be Music Wednesday on the Internet. On the same day that reports began circulating that Google and Facebook will launch a host of new music features, News Corp’s MySpace is turning up the volume on its own music offering.

The online social network will offer the following new features:

  • You already can buy music on MySpace through Amazon, but now you can also get it through Apple’s iTunes.
  • All music videos will now be available through a “hub” on MySpace Music. This includes music video recommendations based on what your friends are watching, along with a video player with a link to buy the ones you like, and an A-Z browser to find what you’re looking for.
  • An artist’s dashboard (pictured in this blog post). This is not something that fans would see. Instead, it is reserved for artists and bands that want to track their popularity among MySpace users. This is one of the more interesting things that we’ve seen on MySpace. It offers charts, graphs and snapshots of MySpace music data, including where fans are, song plays, profile views, friend count and profile visitors.

MySpace Chief Executive Owen Van Natta says that these moves give the service’s users a “more integrated and comprehensive experience — not just audio in one place and band interaction somewhere else.”

On a deeper level, they are part of a reconstruction of MySpace and its goals that started when News Corp earlier this year replaced top management and brought in Van Natta, formerly of Facebook. Recall that MySpace has not had a great go of things lately, having fallen behind Facebook in the few years since News Corp bought it for $580 million.

As a prelude to talking about music, I asked Van Natta about the big picture and what it was that he saw at MySpace that needed fixing. Some of what we talked about is ground already covered in plenty of previous stories. Here is something else he shared that I thought I should pass along to you:

“Candidly, when I looked at the product road map and plan, there was no better way to describe it than,… it was a mile wide and an inch deep. It was not focused to let the company execute well. We clearly defined the company mission and focused the product roadmap, and reduced the number of initiatives.”

MySpace closed some of the projects that it was working on, including services dealing with weather reports, classified advertising and others. At the same time, Van Natta said, it’s important to mess around and come up with products that might be a hit — but it’s also important to not let them go indefinitely. “If we’re doing a good job, we’re going to invent a lot of things that people don’t like, and that’s ok, and those things cease to exist.”

UPDATE: I neglected to mention this aspect that will be a benefit for MySpace. Here’s how the AP said it:

Social-networking site MySpace is launching a music video service that will pop into millions of profiles at rival Facebook as well. Starting Wednesday, music videos that MySpace has licensed for its site will run as well on the iLike music recommendation application, which the News Corp. unit acquired this month for $20 million.

(Photo courtesy of MySpace. For what it’s worth, the numbers have been falsified so you don’t actually get to see how the Black Eyed Peas are doing on MySpace Music)

October 21st, 2009

The Wall Street Journal — now for ‘professionals’

Posted by: Robert MacMillan

The Wall Street Journal, ever on the hunt for new ways to please its readers and new ways to make money (and what, we ask, is wrong with that?), will launch a new, pricier version this November. Called “The Wall Street Journal Professional Edition,” it is designed for business readers who want more than what the daily newspaper and website provide on their own.

Essentially, it is the Journal’s daily offering, with reports from Dow Jones Newswires and a reservoir of news and information from Factiva, the news archive that Dow Jones owns — and a bunch more stuff:

  • Information from more than 17,000 global sources, some of which are not available to the public.
  • A one-year archive of Factiva’s global business sources and a two-year archive of wsj.com content.
  • More than 30 industry pages, managed by Dow Jones editors
  • Six industry sections managed by Journal editors who select news and information for readers on pharmaceuticals, healthcare, energy, media and marketing, telecommunications and technology.
  • Personalized homepages and news alerts for when things break.

Dow Jones plans to sell the edition to businesses, which would make it available to employees through “site licenses” (ie, your business buys a license that makes the professional edition available to X number of people for a price to be determined). In January, it will be available to people for $49 a month, or just under $600 a year, said Clare Hart, head of Dow Jones’s Enterprise Media Group, which oversees Dow Jones Newswires, Factiva and Dow Jones Indexes.

So why have a professional edition for a paper that is arguably already for professionals? According to Hart, it is an attempt to recognize the middle ground between “regular” readers (like my mom) and financial clients who use the super-charged “terminals” from Thomson Reuters and Bloomberg that provide news along with sophisticated and deep financial information.

“It’s a response to what customers are driving us toward. Customers want the simplicity of a consumer application with the sophistication of an enterprise application,” Hart said.

Robert Thomson, who edits the Journal and oversees Dow Jones’s editorial operations, offered a hypothetical example of an oil service company employee in Boise who might not be in the market for a Bloomberg or Thomson Reuters computer, but needs more information than he or she would get in the paper.

“You’re interested in oil import prices, you’re interested in currencies,” Thomson said. “To be honest, it would be hard to find you as a client on the professional end.” With WSJ’s professional edition, he said, that employee could customize a feed that would send an alert when something happens in China that affects oil prices.

On another level, the Journal is trying to capture readers for whom paper is not enough, while financial professional-grade data feeds offer too much at too high a price, and don’t look all that pleasing to the eye. The information that readers get would be more sophisticated, but presented in an easy-to-view way, just like the Journal or the Times or most other news outlets present it to readers on their Web pages now.

It sounds like a promising introduction and an effective way to give readers a more comprehensive look at Dow Jones’s information offerings than they might have gotten before. But how will it play? Company officials won’t share projections.

It might be that Dow Jones, now part of Rupert Murdoch’s News Corp, already has a bunch of happy customers who don’t need to be made happier. It’s hard to say how many untapped readers there might be for this new service, either through business licenses or through individual subscriptions. If nothing else, it’s an experiment done at a time when news outlets need to experiment even more than they are.

(Photo: Reuters)

October 14th, 2009

Wall Street Journal vs USA Today — Part II

Posted by: Robert MacMillan

Earlier this week I brought you the brewing circulation tussle between USA Today and The Wall Street Journal, and which paper will be able to claim to be the largest one in terms of circulation. You can read that here, but for the recap, here are the main points:

  • Editor & Publisher reports: USA Today was set to report that circulation fell “17% to 1.88 million for the six months ending September 2009, a drop of about 390,000 copies. The decline could also threaten USA Today’s position as the No. 1 newspaper in the country by circulation.”
  • The Wall Street Journal and The Associated Press report that the Journal would be the largest paper by circulation, according to the Journal.
  • USA Today responds, “We are confident that even with this latest economic impact, USA TODAY will remain the nation’s number one newspaper in total print circulation when the ABC statements are released October 26th.”

As I wrote at the time, it seems that the Journal is counting print and online subscriptions together, and why not? Both are made up of paying subscribers. USA Today, of course, is counting printed newspapers.

We won’t know until their circulation numbers are published on October 26 what the final, comparable figures would be. But today, the Journal revealed its latest numbers:

Circulation was 2,024,269 as of the six-month period ending in September 2009, compared with 2,011,999 in the same period a year ago. Individually paid circulation, a number that advertisers like to watch, grew to 1,437,853. That’s impressive, having any growth at all.

As to how it stacks up to USA Today, and who will be able to claim to be the No. 1 newspaper publisher by circulation, we’re going to have to wait until the 26th.

(Photo: Reuters)