[It's 2014: Are Corporate and USA Today still in McLean, Va.?]
Gannett is aiming for a high-profile home run by deploying its nascent ContentOne news service to cover President-elect Barack Obama's inauguration -- just in time to rally investors when the company releases fourth-quarter earnings in the weeks ahead.
The new service will be a major test of the cross-divisional leadership skills of two rising stars: Chief Digital Officer Chris Saridakis (left), and Kate Marymont (below), the recently named newspaper division news vice president. Corporate has said nothing about the project for public consumption since CEO Craig Dubow pitched the idea to media stock analysts at the UBS conference last month, telling them: "ContentOne is an entity that will completely change the way we share content across the company."
The few details that have surfaced so far suggest ContentOne is a reconstituted Gannett News Service: a 21st-century web wire, if you will. More broadly, however, the service is another key piece in a puzzle showing what Gannett might look like in five years or less: A 100% digital news and information provider, no longer printing newspapers or running today's version of broadcast TV. Let's call the future company by a name already in use: Gannett Digital.With ContentOne and USA Today as its editorial backbone, I imagine Gannett Digital producing and distributing information for a national audience mostly anchored in more than 100 U.S. communities where its legacy brands -- newspapers and TV stations -- now employ perhaps 35,000 U.S. workers. (How many will be working in five years or less? Keep reading.)
ContentOne is part of a wider bid to boost revenue and cut costs, by imposing more uniformity in content and technology on the company's disparate portfolio of websites. It's also the latest incarnation of the long-neglected 1980 Pulitzer Prize-winning GNS. The new web wire is apparently being run in some fashion by Gannett's official publicist, Tara Connell, a former top USA Today editor.Like the youth-oriented Metromix entertainment sites and the "moms" franchise, ContentOne aims to roll up all of Gannett's online readers into a mammoth advertising "buy." How big? Corporate is gunning for more than 50 million unique visitors in the Obama trial that began last Tuesday -- double the most recent reported average uniques. National ads would presumably be more price-competitive and easier to sell, because Gannett's community papers mostly adopted identical G04 website templates last year.
Consolidation hits newsrooms
ContentOne is the next step in Gannett's drive to reduce overhead by consolidating work to eliminate duplication. That effort has focused on areas including ad production, printing and finance. Now, Corporate is extending the strategy to newsrooms, in a move with implications for the recent emphasis on "local-local" coverage.
For example, suppose Gannett eliminated all the printed features sections, and substituted the new, edgier Metromix sites recently rolled out companywide. Management could shrink features staffing to a skeleton crew. Surviving staff would focus solely on cranking out updates, plus Metromix briefs and calendar items aimed at the audience where they already live: mobile devices and the Internet.If that worked, Gannett could apply the same model to other subjects as it keeps herding readers to the websites -- and shutters more printed news sections and TV newscasts. In their place: A network of websites, RSS feeds and other distribution channels carrying subject-specific products with long shelf lives.
"At its most innovative," CEO Dubow (left) told the UBS conference last month, "ContentOne will allow us for the first time companywide to view our content as a product, instead of a way to fill our products -- newspapers, websites and TV news broadcasts. We will become content creators for our advertising partners, pricing and selling our content for use by them."Dubow took over as CEO in July 2005; he had been chief executive of the 23-station broadcasting division for four years, after joining the division in 1981 as an advertising salesman.
He told UBS analysts that the news service "also will allow us to develop and gather information much more efficiently by eliminating duplication and allowing our local entities to focus on what's important -- a deep, rich local report. It is the logical next step from our local Information Center initiatives, creating a national head to the local content gathering bodies."
In a way, ContentOne delivers Gannett's Holy Grail -- but digitally: It marries the 85 community newspapers with USA Today. This lower-cost, shelf-stable strategy is revealed in a leaked memo about ContentOne's Obama plan, which includes a special "micro'' website anchoring news and entertainment coverage.
Obama blog, and new platform?
The memo says: "ContentOne inaugural site will power online coverage before, during and after the Jan. 20 inauguration. It will be one product with local branding, traffic and ad sales. On it, will be the best of USA Today's national coverage, local site local coverage, (plus) WUSA-TV's live video feed through Mogulus."
It continues: "There also will be a cross-network VOD sampling via Mogulus and Washington-specific entertainment listings through Metromix that will serve your local customers who may be going to DC for the celebration. The site also will allow for and encourage local coverage. We are planning a three-week window for this site -- two weeks before the inauguration through one week after -- with live coverage emphasis on Jan. 19, 20 and 21, when interest will peak."
The Obama microsites are woven into each local site; consider The Arizona Republic's.
Indeed, I wonder if USA Today's new White House blog, The Oval, was launched as part of ContentOne's debut. (Also interesting: The Oval's URL incorporates the word "communities," as does the newer Faith & Reason blog. Both appear to use a software platform that's not TypePad, which most of the paper's other blogs still use. What's the communities aspects about?)ContentOne also could lead to centralized editing and webpage construction, because it's a sort of web-based pagination system. Teams of editors and page builders could be employed inexpensively at the existing regional hubs in Wilmington, Del.; Fort Myers, Fla.; Des Moines, and Indianapolis. Gannett is already experimenting with regional copy editing and page design in at least one state: Wisconsin, where it owns 10 dailies that also share printing and production.
In this future scenario, local advertising sales could be handled by a small staff on contract. This is now a fully digital company, so there are no presses to ink up, no papers to bundle, nothing to hand-deliver to homes and offices; all those jobs would be gone.
It's already happening. As I post this, Gannett is junking presses at sites including Hattiesburg, Miss.; Asheville, N.C.; Richmond, Ind.; Battle Creek, Mich., and Poughkeepskie, N.Y. Those papers are now being printed at sister print sites. Yet, as papers get trucked further, weather-related delays are inevitable: Only today, the Poughkeepsie Journal apologized to readers; it's now being printed at The Journal News, 64 miles south in White Plains.
Meanwhile, marketing, human resource and finance work is being consolidated at the regional hubs, plus the Springfield, Mo., site. All these moves contributed to Gannett's reducing newspaper employment by more than 2,100 jobs, last month alone.
And the twin towers?
Gannett could sell the seven-year-old complex housing Corporate and USAT in McLean, Va., to a REIT, after the commercial real estate market recovers. The company could then lease back only the space it needs -- maybe a single floor or less -- in what new owners could rename the 7950 Jones Branch Corporate Centre.
This version of Gannett in five years or less is a leaner, more prosperous company. It's anyone's guess what revenues will be. And the U.S. workforce, now about 35,000 employees? Maybe it will tumble to 20,000.
Or maybe just 2,000.
What do you think? Please post your replies in the comments section, below. To e-mail confidentially, write gannettblog[at]gmail[dot-com]; see Tipsters Anonymous Policy in the green sidebar, upper right.
[Photo of Corporate complex: Kohn Pedersen Fox Architects]
Similarly, look for a national-ad-oriented "green" program to launch soon, focusing on environmental coverage.
ReplyDeleteWilmington is playing a key role in content development, and former Wilmington ME/newsroom scourge Pankaj Paul - returned from a bizarre and very brief stint in India as editor of the Hindustan Times - is involved somehow at corporate.
Personally, I think they'd get more mileage out of a Depression site - tips and information on how to house, feed, clothe, transport, warm and educate a family of four on a $330 weekly unemployment check. Now THAT'S news you can use.
This is an excellent summary of what Corporate should itself disseminate to the rank and file, indicating what the new emerging business plan for GCI is now. It is quite obvious that the economic problems are accelerating these plans and some ideas (the Oval) are being rolled out only half-baked and not well thought out. The problem that I see with this strategy is that there is not the sort of revenues needed on the Internet to support GCI's current payroll that I guess is now about 36,000. I see the next step in the newsrooms being to contract out and freelance most of the newsroom operations. There are a lot of unemployed journalists out there who can be tapped to provide the copy the newspapers need, and can be operated under even tighter editorial control than the current staffs.
ReplyDeleteHed fix needed: Should be "shrunken."
ReplyDeleteJim, an interesting scenario you paint. Sounds very plausible.
ReplyDeleteBut what happens to the much vaunted "local-local news coverage" that Gannett has claimed for years was the future? Your picture seems to downplay the importance of that content, in favor of broader information that can be sold to national advertisers.
As I see it, ContentOne replaces local-local completely, by centralizing initally the features sections, but eventually all of the sections. I have always thought that USAT was the logical local newspaper of the future, with small staffs at local levels feeding in some local news to make it relevant to readers.
ReplyDeleteThis ain't news. It's regugitation.
ReplyDeleteLooks like a souped up topix.
Yes, 2:06 p.m. I have that question too. It looks like a long-term abandonment of the idea that "local coverage" is what makes newspapers valuable -- if you're not a national paper like the NY Times or USA Today. I'd expect a sprinkling of local coverage, done by a handful of people in each Gannett city, but not much else. This is sad and sickening -- on the brighter side, it will create a massive opportunity for others in a community to create local news -- a couple million financing and a handful of reporters and editors and you could possibly outcompete the local Gannett web site of the future.
ReplyDeleteI'm afraid local-local coverage was so 2008.
ReplyDeleteJim, part of this is premised off of bad information. You've repeated a couple of times that the 50 million uniques target for the inauguration is double Gannett's currently monthly uniques. That's just not true. Monthly uniques for Gannett sites in November and December were 80 million each month. Targeting 50 million uniques for content that will be up most of January isn't a stretch.
ReplyDeleteAlso, you miss completely the local focus that has to remain. Gannett has no choice; it's the key differentiation from other nationwide sites like CNN or the news aggregators like Yahoo and Google.
Finally, ContentOne isn't as fully developed as you seem to think. Tara and Kate made that clear in the conference call the other day, saying it wasn't "fully baked". It'll be used for big events like the inauguration and March Madness, and they're looking at universal concepts like a "green" site. But it's not going to replace local content in its entirety. It can't. Gannett's key mission will remain local. The company is trying to find ways to monetize those local audience with national advertisers. ContentOne is a part of that effort, just like MomsLikeMe.
The 10 Wisconsin papers also already have centralized Web design and programming, based in Appleton. However, each of the papers remains responsible for the content of its site.
ReplyDeleteJim is right. Great scenario.
ReplyDeleteLocal/local was 2008 and it's dead, along with Real Life/Real News, etc.
Why? Because Gannett knows nothing about small local news operations.
Look at what it's done to the Ohio sites. These were decent dailies under Thomson; very profitable with a fair amount of local news and sports coverage.
Guess what?
That worked.
Local readers and advertisers liked it and the 30-40% profit margins at most sites proved it. I was there. It happened.
Then Gannett tried to homogenize all the little papers under its big model and it didn't work.
Editors were worried about 2 diverse voices in a market with less than 2% minority population.
We also were so into breakout boxes and other points of entry we forgot about what people care about and that's reporting the news.
The local rags barely cover city council and school boards, let alone do any real enterprise work any more.
Staff cuts and other cutbacks have reduced the papers to advertorial dailies.
So what's left?
Digital. It's cheaper and quicker to produce and that's what the world wants today.
Quality? Don't think so. Doesn't matter.
Document a few hundred thousands page views (eye balls) and you can sell that real estate banner or nursing home skyscraper ad on your site.
It's 2009 and if print isn't dead it sure as hell is on life support.
Happy New Year!
I heard MetroMix was in trouble financially. Think the Tribune had some stock in the company. Did I not read on one of the posts that an LA paper canned MetroMix?
ReplyDeleteWill The Oval have paid commenters like the Moms sites, and will it be hooked up with the Ripple6 cloud communities?
ReplyDeleteFound this amusing:
ReplyDeleteYou might think newspaper companies such as New York Times (NYSE: NYT), Gannett (NYSE: GCI), and Washington Post (NYSE: WPO) have enough troubles, what with declining circulations and competition from the Internet. But here's a new one: lawsuits from disgruntled readers. A reader of North Carolina's News & Observer, complaining that reduced staffing has reduced the quality of the product, has sued the company. He may have a point -- layoffs sometimes seem unavoidable to businesses, but cuts that go too deep can compromise quality and send customers away.
Ok..what is going on? Several years ago, Gannett launched Homescape.com as its real estate brand. Today, I pickup the real estate section and it is HomeFinder.com
ReplyDeleteYep, the smaller New Jersey papers are totally consumed with local-local and IMHO they suck.
ReplyDeleteIt's really premature to call Saridakis and Marymont "rising stars." Saridakis sounds like a human being but is still an unknown outside of Gannett skunk works. Marymont was simply the person promoted to take the place of an overblown bureaucrat. They'll need to earn any stardom.
ReplyDeleteThe problem with local-local is that it doesn't bring in new readers. THis is because Corporate has screwed up implementing it. In our community, there is now a local newspaper that just runs mugshots of people arrested, and it is the talk of the town. We could have done this, but the editors wanted more trend stories or features, and didn't want to invest the time and effort into covering local crime. We are now paying the consequences with our jobs. Survey after survey showed that people wanted more local news in their paper, but we didn't provide even the basic crime news.
ReplyDeleteSo we shrink from billions in revenue to millions so we can "grow"? Love it.
ReplyDelete2:51 pm: I write that Saridakis is aiming to double uniques to more than 50 million, based on the following information in the third-quarter earnings release:
ReplyDelete"In September, Gannett's consolidated domestic Internet audience share was 25.4 million unique visitors reaching 15.6 percent of the Internet audience according to Nielsen//NetRatings."
Now, what is your source for those much higher figures in November and December?
Jim ... you are really onto something here. Shrinking the current staffs and aiming to build a large national group that provides news from what's left of the smaller communities.
ReplyDeleteIn theory, the new ContentOne could also aim to repurpose the content throughout the company. So, Indy could cover the March Madness games (or whatever) and send the stories out to everyone, for print and digital use. Detroit could provide car news, reviews, etc. for everyone.
In turn, this could eliminate the need for AP. With shrunken newshole, publishers/editors/GMs or whoever could drop AP and go with ContentOne to supplement their local content.
Among the problems: breaking news from GNS has been a joke (will ContentOne be better?), going without sports agate and international news, and of course Gannett papers aren't in major markets such as Chicago, all of Texas, most of California, etc.
Sound crazy? Then it must be true.
Local local was so 2008, Jim reminds us.
ReplyDeleteBut his rollout of the future of Gannett had me thinking, "My God, Jim is a futurist!"
Do any of you remember when we were supposed to seek out sources who were "futurists" in our enterprise stories? I discovered a futurist was a person willing to speculate about the outcome of whatever problem or topic I was writing about. TV news programs have perfected incorporating these speculators 24/7.
The trouble is, Jim's "plan" seems perfectly possible to me.
1:45 writes "I see the next step in the newsrooms being to contract out and freelance most of the newsroom operations"
ReplyDeleteThis is a good point and would save money. It should start with departments that do not contribute on a daily basis such as news graphics. Why have full time graphic artists on staff with full benefits when they only actually work about 9 hours a week.
Jim, 2:51 here. My stats come from the monthly traffic reports Gannett puts out. Here's one key passage:
ReplyDelete"Combined for Gannett there were over 79.8 million monthly visitors and over 893 million pageviews in December 2008. Overall, time spent increased by 1 minute and 20 seconds (+15%) from last year. Search engine referral traffic remained steady at around 20% for December." USAT alone did more than 26 million monthly visitors in December.
7:20,
ReplyDeleteDon't know where you're working, but the graphic artist in Wilmington works his butt off. In addition to daily news graphics, he's basically in charge of NIE doubletruck pages and anything remotely fancy the design desk dreams up, including most skyboxes. That's in addition to locator maps, budget charts, etc.
8:22, It sounds like you have just one artist there and that is probably why he stays busy. In addition he sounds like he offers many different design skills. The artists left at my site do not do locator maps anymore, reporters and photographers upload their own locator maps on to the web. Our paper hasn't done a double truck in over three years. We do not have sky boxes designed, they are just photos. I haven't seen a news graphic in our paper in about 4 months and very rarely you will see a chart in the paper. I think they were suppose to contribute to the web but don't see much out of them.
ReplyDeleteDont look to Pointroll to lead the charge in this digital future; Metromix is the jewel in the crown here. Since Saridakis left Pointroll, we've got idiots like Paul Grassinger running the show and consequently, Pointroll into the ground. I wish Chris was back at the helm; at least you knew where you stood with him and there was a plan in place.
ReplyDeleteYou could easily contract out graphics to freelancers, who would be paid by the piece. There are a lot of hungry and very creative graphic artists out there.
ReplyDeleteThere's a difference between visitors and "unique" visitors -- If I look at my paper's web site 5 times a day that's a lot of visits but I'm one unique visitor. Not sure if I count once per day or once per month but that's the idea, no?
ReplyDelete2:51 pm: You don't give the source, but it sounds like Omniture data. You and are are comparing data for two different time periods, from two different sources. That is part of the problem.
ReplyDeleteBut I still don't understand how average uniques could be 25.4 million in September, then 80 million in November and December - even with two different tracking services.
Jim, I think your vision of where things are going is correct. Local-local will end up as window dressing. Listings and party pix and other free content delivered by readers and local PR people, with a smattering of crime and politics stories that bring out the screaming banshees who pump up the comments. Look at Metromix. Incomplete, outdated and stuffed with irrelevant non-local fill -- that's the model.
ReplyDeleteIt's the WalMart model.
ReplyDeleteWalMart would go to a reputable, brand-name American manufacturer and wow them with a huge contract. Great news, right? Ramp up production to meet the terms, everybody's happy. Ignore all your other customers because, hey, WalMart needs you!
Then "Always the Low Price" would start digging in. We need you to drop your price per unit 47¢ this year. Followed by another, and another. Sooner or later, you couldn't support their demands. You lose the contract, you have no other customers, so you have to sell the company. A buyer takes your good name, closes down your facilities, and restarts production somewhere else, pretending that their crap is equal to your historic name. And WalMart buys from them.
How is this different from telling folks in the future that they are getting the "Hattiesburg" paper, the "Iowa City" paper, the "Zanesville" paper, the "Lafayette" paper - when the stories are chosen by someone 50 miles away, the printing is done out of town, the ads are built in India, the circulation problems are handled in Kentucky, the photos are fixed in Des Moines, and your bill comes from Springfield?
Is this the end result plan? Putting a four page local wrap around USAToday, requiring one writer, one photographer, one ad designer, one salesperson and six directors for each of our 84 local bureaus (formerly daily papers)?
If it is, let's get it done. The sooner we give our markets the finger, the sooner our competition reappears and we have job opportunities again.
Indeed, there are internal site usage numbers (Omniture) and external (comScore). It is not uncommon for the two tracking volumes to be significantly different, but a 3x+ delta is wrong. Visits and Unique Visitors are not the same. The 25.4 million UV's/month and 900 million pageviews/month have remained remarkably consistent since 2006.
ReplyDeleteNo ad buys are based on internal data, that's why we have 3rd party sources, just like ABC for print circulation. I'm not a fan of comScore's methodology, but it is the one of the leading barometers for providing an apples-to-apples comparison of site traffic.
About website numbers, are visits by staff counted in those totals and pageviews?
ReplyDeleteWith the exception of the creation of USA Today, I defy anyone to specify a single Gannett innovation that simply did not involve mercilessly cutting costs and turning out a crappier product. It is all these 'leaders' know.
ReplyDeleteLocal-local may be "so 2008" but it is a niche that no one else is filling. You can get your national news anywhere, but where are you going to get information on your city and county government? I'm all for living la vida local-local.
ReplyDeleteJim, you're correct that these are Omniture numbers and, yes, you'll get different results depending on the tracking service. But the point is that the 50 million figure cited in the ContentOne description is also an Omniture figure. So Gannett is not seeking to double unique visitors with the inaugural section.
ReplyDeleteCould the page view totals have anything to do with the acquisition of Ripple6 and the bigger share of CareerBuilder?
ReplyDelete10:49 am: No; the numbers I'm citing are from Nielsen. This is what Gannett wrote in its third-quarter earnings statement; to the best of my knowledge it's the most current PUBLIC traffic data reported by the company:
ReplyDelete"In September, Gannett's consolidated domestic Internet audience share was 25.4 million unique visitors reaching 15.6 percent of the Internet audience according to Nielsen//NetRatings."
That's from the third-quarter earnings statement: http://tinyurl.com/9kg3f9
This web strategy is preposterous. Do the math. Let's say Gannett can generate 100 million page views per month. With a page yield of even $5 CPM (which is way higher than reality), that's only $500K/mo. This grand strategy is to build a $6M annual business? Heck, quadruple the CPM and it's still smaller revenue than one average, mid-size daily.
ReplyDeleteThe strategic error in the entire plan is to build a business with display advertising as your primary revenue source. Regardless of the cost structure to produce and deliver content, online advertising, with the exception of search, has already become commoditized. There is simply too much supply (and growing)and publishers have zero pricing power. The vast majority of online ads served by Gannett today fetch CPM's of less than a dollar.
Consider Facebook. With all of the innovation, the enormous page view traffic and virtually no costs to produce content, they still lose money! When will people wake up and realize that if you're not Google there are no scalable businesses to be built on the back of online display advertising.
"We will become content creators for our advertising partners, pricing and selling our content for use by them."
ReplyDeleteHow much more directly does Dubow have to say it before it sinks in?
What do advertisers or research companies pay for a spot in the Ripple6 cloud communities?
ReplyDelete1:25 pm: Excellent question! (The commenter refers to the Ripple6 technology Gannett bought late last year. As I understand it, Ripple6 is applied to forums and social networks where there are lots of consumers -- like the moms sites. Researchers then use it to track consumer buying trends, or assemble off-line focus groups for marketers including Procter & Gamble.
ReplyDeleteAmen 3:27 PM and 6:54 PM ...
ReplyDelete