Exterminate the Parasites: Mark Cuban's radical plan to save old media.

http://www.newsweek.com/id/214832/output/print

by edw519 • 17 years ago

14 30 17 years ago

rwolf• 17 years ago

Radical? We've been hearing the AP rail about this stuff for years. Newsweek and Mark Cuban need to read a little news before they claim something is new.

kiba2• 17 years ago

Someone once said that most companies die by commiting sucide, not getting killed by the competition.

Well, Mark Cuban's proposal is a crazy way to commit sucide. Imagine thousand of companies of which employ tons of people in between going under, just like that.

nir2• 17 years ago

I wouldn't be so certain this is committing suicide. It could be argued that providing all content for free is committing suicide as well.

kiba2• 17 years ago

As far as I know, newspaper make most of its money from advertising, not from charging subscribers.

thaumaturgy• 17 years ago

I and two others are working on a third solution to this, one that we think can meet everyone's needs.

News consumers now expect to be able to customize their news. Why sit and read a newspaper, full of items that someone else picked for you, when you can read a news feed that you've tailored specifically to your interests?

News publishers are now looking for ways to get their news directly to the consumer, cutting out the freeloaders along the ways. They're starting to die off and hit serious financial problems, and they're eager for a solution.

News producers are looking for a way to be a well-paid journalist without having to restrict themselves to a single publication. Blogging has become more lucrative for a lot of people than if they had become a columnist, even a syndicated one.

At the same time, news consumers also don't want to be stuck with the stuff that news producers think is important, filtered through the news publishers and their biases.

And finally, advertisers are starting to get uncomfortable. I was among the first to predict the dot-com bust, back when people thought I was crazy; I was among the first to predict the housing bust, back when the realtors I knew all thought I was crazy; I think the advertising market is next. It's already starting to get shaky; I think in the next two years, the bottom is going to fall out of advertising.

The indicators are all there: it's a heavily saturated market, it isn't innovating well, audiences are developing not just software-based filters but mental ones as well. The advantage to running a full-page ad in a magazine was a guaranteed audience, and if you made it compelling enough, and glossy enough, you could get someone to look at it for a moment before they turned to the next page. As print media starts to stumble, if you're an advertiser, now you're looking at having to push smaller ads to lots of different outlets, and none of them can do much to guarantee an audience for you.

And, I think we can assume that subscription models aren't going to scale well. In a way, you can think of the recording industry's model as a subscription-based one -- in that they expect people to pay for access to content on an ongoing basis -- and look at how that's gone for them. The more pressure they put on the consumers, the more clever solutions the consumers come up with to distribute the content for free.

I have an aunt who started a beautiful magazine for the central coast and three different friends who have worked in various parts of the news industry. I'm not just pulling these things out of my ass; I've heard about the industry problems from people who are working in the industry.

But, I think we found the right lever that can balance all of this out again. We've already submitted our app for YCW10, software is currently under heavy development, and we're still polishing some edges on the business model. Can't wait to see what happens.

jrwoodruff• 17 years ago

You've piqued my interest. This field is definitely ripe for some experimentation. Be sure to post when you've got a beta, I'm looking forward to seeing what you've got!

michael_dorfman• 17 years ago

I wish you luck, honestly. But I disagree with most of the premises you outline.

Why sit and read a newspaper, full of items that someone else picked for you, when you can read a news feed that you've tailored specifically to your interests?

Because the New York Times has a better handle on what's going on in the world today than I do? I want to be informed about what's going on out there, and every day at least once I read something interesting in the Times that didn't meet some pre-defined "interest" of mine.

News producers are looking for a way to be a well-paid journalist without having to restrict themselves to a single publication.

Really? I think most staffers are happy not to be free-lancers.

"In a way, you can think of the recording industry's model as a subscription-based one -- in that they expect people to pay for access to content on an ongoing basis -- and look at how that's gone for them."

Huh? How is the recording industry's model even remotely like a subscription one? Are you still in the "Columbia House Record & Tape Club" or something?

mrkurt• 17 years ago

"And, I think we can assume that subscription models aren't going to scale well."

I'd be careful making that assumption. There are at least two large, well known magazines that are purely subscription based and doing pretty well (Cook's Illustrated and Consumer Reports). People value their content enough to pay for it, regardless of the delivery mechanism. Their costs are going to decrease substantially as customer preference moves to online delivery, too.

There's a great deal of content out there people will pay for and the floundering large publishing companies are responsible for a huge chunk of it. Their problem is, however, that they've attempted to move print style business models directly to the web. Delivering something at marginal cost (effectively 0 on the intertubes) while incurring massive fixed costs and counting on ads for revenue hasn't and isn't going to play out so well when advertisers don't value the audience and medium like they do for print.

ESPN has one of the more interesting models out there. They've done a really good job offering premium paid content in addition to their free web based stuff. I think you'll see other online publishers do something similar, with varying levels of success.

DannoHung• 17 years ago

How would they even enforce it?

Most of these motherfuckers are just republishing AP stories anyway.

wmf2• 17 years ago

Referer blocking.

ojbyrne3• 17 years ago

Which means people who want to use their favorite aggregator sites would just have to set their browser to not send referers. And the old media sites lose a little bit of analytics.

fnid• 17 years ago

We see this model in television today. The aggregators will become channels where customers subscribe to them or see ads and the aggregators pay the content producers for the rights to display the content on the sites.

FiReaNG3L• 17 years ago

I love how he puts 'copying' and 'linking' on the same level of 'bad'. You don't want me to link to your stories? Please take a class of Internet 101 - most sites would kill to have that many free links.

omouse• 17 years ago

You mean Web 101.

joe_the_user2• 17 years ago

A double 'Bingo' to the parent!

There's legal recourse against sites taking more than fair use. And fair use generates hits on your site. And if you can't monetize the hits on their site, well, you'll be replaced by someone who can.

Uh, and lot of the dying old media were just dumber parasites - a local newpaper twenty years was three lame local stories plus condensed AP and NYTimes feeds. I don't feel sorry to see that go...

mixmax• 17 years ago

The relationship between old media and aggregators isn't so much parasitic as it is symbiotic. They both need each other. Aggregators need stories and old media needs an audience for their articles. I've discovered a few old media sites through HN and Reddit that I now read regularly. If old media closes off their funnel of new readers where will they get their audience from?

Tiktaalik• 17 years ago

Can't they get their audience from the same methods they always have? Reputation? Advertising? Local expertise?

travisjeffery• 17 years ago

There's a big difference between the two sites you listed and the type that Cuban listed and is referring to.

Hacker News and Reddit both link directly to the actual source material and only show a title and a short description of the post.

The Drudge Report doesn't do it as badly, but Newser actually rips off most/entire article on their site leaving no reason to go to the actual material.

The only one benefiting from that relationship is Newser.

joe_the_user2• 17 years ago

Cuban's advocating blocking links from aggregators. He may mention newser but the strategy would 'work' again HN as well.

This extremism seems silly - the sites could do click-through ads which generate revenue for any deep links, also a few lines code - and growing number of sites do this.

Mcuban3• 17 years ago

Yes sir. Internet advertising is a booming business. Every pageview is sold weeks in advance, right ? Not quite. The issue is the value of a referred pageview. Today, its not worth much, if anything. The conversion value is approaching zero.

Compare the conversion value of that pageview to the value of diminishing the position of aggregators and its an easy choice.

The net has a business problem of unlimited news site inventory. So traffic from aggregators isnt worth squat. So why put up with them leveraging your intellectual capital ?

not worth it

jrg• 17 years ago

"The conversion value is approaching zero" -- I think advertisers, some at least, have forgotten how advertising can work. They've been lead to believe by some that because they can track everyone's response to a campaign that it always makes sense to do so.

It's not likely that I'm going to see a banner advert on a page and immediately click on the link and respond to it. It interrupts whatever I'm actually doing - i.e. reading the content. But I might well remember having seen the advert later, and that might change my future plans.

(Here's an idea for free - make it easy for me to find the adverts I've already been shown. When I'm reading a physical newspaper or magazine I can flick back to the advert, or riffle through to find it again. Unless an advertiser is doing saturation advertising across an entire ad network one day, it's hard for me to do the same online.)

Mcuban3• 17 years ago

you may be right. But it doesnt change the reality that the destination site gets nearly zero benefit from the referral.

Tichy• 17 years ago

It's just that there are many who want to have as many readers as they can get, because they earn their money in other ways (like Joel On Software selling his bug tracker). So they would be thankful about any incoming link.

Maybe some "old media" articles are a tiny bit better, maybe not. Maybe many of the "old media" articles are actually also just advertisements in disguise (because they subtly hype some company's product). Overall I think they are not that much better that I would actively seek them out. Nobody links to them, I don't read them.

zaidf• 17 years ago

He misses the point: the value of a news item is going down because of the advent of Internet and the rise of Internet journalists.

While they may not be of the caliber of a typical print journalist, that may be a supply-demand thing. Meaning if all newspapers blocked news aggregator, there is a high chance that there will be new folks producing newspaper-quality content who'd be happy to get the aggregator traffic.

MaysonL• 17 years ago

Of course, not all old media entities are dying. See for example, NPR and the Norwegian Shibsted media group, which is making profits, both from newspapers and online new sites. (Of course, the fact that they started up online in 1995 or so may have something to do with it)

Exterminate the Parasites: Mark Cuban's radical plan to save old media.

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