Back in June 1977, I was in the first stages of my career as a stats clerk in the circulation department of The Guardian. The then circulation director, Michael Jack, asked if I could organise the removal of the board room fridge to The Guardian’s small office on Fleet Street so that a selection of glitterati could witness a procession event to Westminster Abbey, to celebrate the Queen’s Silver Jubilee.

Having called a taxi, I lugged the fridge from the board room to the taxi and into the Fleet Street office. A simple task. Except that by the time I got back to the main office in Farringdon Road, all hell had broken loose. I was a member of the wrong union to carry out manual work, and as a result there was a threat to stop printing, until the fridge was brought back…. from then, I suffered the ignominy of returning the fridge to its original home and apologising to the union’s ‘Father of the Chapel.’

Such was the power of the unions. This, plus the enormous salaries print workers commanded, came close to breaking the news industry. The result was Rupert Murdoch’s union-busting move to Wapping in 1986 which ushered in a new era of printing technology (and newspaper profitability). Today the threats to our news industry are far more formidable.

So, when I read the headline “Guardian Media Group journalists back strike in indicative vote on Tortoise Observer bid” my immediate reaction was “WTF! What a great solution for everyone involved. More jobs saved.”

Because in this digital age – when print newspapers have a half-life of six years – The Observer, with a circulation of around 100,000, is a dispensable subset of The Guardian’s world-leading online strategy (attracting a monthly UK audience of 22 million). I doubt the printed Observer, without the shared resources of The Guardian, is a viable entity alone. Online, its brand is currently seen as superfluous by Guardian Media Group.

When I first read about the Tortoise bid, I thought it was an opportunity for all parties:

• For Tortoise, it provides a wonderful brand from which to expand and promote its already commendable output
• For The Guardian, it avoids the cost of future staff redundancies and may also provide a capital income (although the terms of the deal have not yet been disclosed).

For The Observer brand (232 years old and counting) Tortoise ownership could be the best option currently on the table:

• Editor James Harding’s background couldn’t be better. He is a former editor of The Times and former head of BBC News
• Tortoise co-founder Matthew Barzun’s credentials include being a fundraiser for Barack Obama, US Ambassador to the UK and former chief strategy officer of technology and media news website CNET, helping to grow it to a peak valuation of $1.8bn in 2008. His involvement signals Tortoise’s ambitions to expand into the US market, as The Guardian has achieved so successfully.

Between them, I would suggest that they have as good a chance as any other news media player of sustaining a successful future for The Observer.

The Guardian and Observer journalists work for a not-for-profit entity, that takes a sympathetic view regarding its portfolio and employees. It is possible to imagine that a more hard-headed owner might choose to close The Observer rather than sell it, creating a major potential future rival in the liberal media space.

As someone who happily volunteers my monthly Guardian subscription, I expect the recipient to make the most from my contribution.

The decision to divest The Observer – in such favourable terms, for the company and the staff involved – seems to me an obvious strategic move. Striking over this would be an abuse of The Guardian’s million-plus voluntary subscribers and a lost opportunity for the staff involved.

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Press Gazette reports that Google’s plans to switch off third-party cookies on Chrome could kill ad-funded journalism on the open web.

It isn’t that long ago that Facebook’s algorithms were to blame. And so it has gone on for years.

Well tough doodoo! Publishers were far too quick to unquestionably romance with the digital big boys, and now we’re all paying the price of over-dependency.

Some 20 years ago at an event in Zurich, I told the assembled mediarati: “We are all feeling the allure of the likes of Google and Yahoo. So was I, but be careful: it won’t be long before they’re eating your lunch, then they’ll come back to eat the whole table.”

About six months later Gavin O’Reilly, then president of the World Association of Newspapers and chief operating officer of Ireland’s Independent Newspapers, said: “The search engines are increasingly aiming their strategic efforts at traditional content originators and aggregators like newspaper publishers… The irony is that these search engines exist, largely, because of the traditional news and content aggregators and profit at their expense.”

This was all in 2004, the year that Facebook launched; around the time when Rupert Murdoch acquired Myspace only to be blown away by the Facebook behemoth.

Our over-dependence on these digital titans has affected publishers across two fundamental dimensions:

• Loss of advertising revenue, directly, and because of transaction intermediaries
• Loss of control of the reader relationship.

Beyond the issue of advertising spend on space, an additional element of the revenue dilution is due to the role of the transaction intermediaries, such as Google’s Double Click. Whereas the value chain used to consist simply of the advertiser, agency, and media house, today a host of intermediaries take multiple cuts of the original spend, often in excess of 50%.

The second dimension of the impact of over-dependence relates to reading behaviour, and publishers’ relationships with their readers. Vast amounts of a newsbrands’ traffic is either directed from one of the digital titans, or indeed their content appears within their pages, depriving the publisher of any control.

In print the number of people who read a title at some point in a week was and remains about double the daily audience. But when one adds digital audience into the mix, the figures become far more complex. Compared with one day’s print audience, over three times as many people read a newspaper across any platform – print, mobile, tablet, PC – on any one day. Over a week this ratio rises to ten-fold. And over a month it is approaching 20 times.

So, the scope for a publisher to build their daily audience from within their wider reader pool is enormous, but only if that publisher has control, which we have lost in the digital mix.

My experience is that, with a few exceptions, editors and their staff spend far too little time considering these issues. Partnering with the likes of Google and Facebook seems like the attractive – dare I say easy – option.

In recent years we have all witnessed the decline in news media’s audiences and revenues. Yet publishers continue to show remarkable resilience. There is an opportunity to utilise that resilience to ween ourselves off this dependence. The impact of the titans’ restrategising will only get worse. There are many ways that publishers can take back control of their audiences, improve direct relationships and claw back the elements of the advertising value chain that have been lost to the intermediaries.

Reach have gone some way to achieving this with their “Three Pillars” vision of collecting reader data directly, contextualising advertising, presumably bypassing the intermediaries, and removing other parties’ ability to track their audience. We’ll see. Judging by the state of some of Reach’s regional title sites, they have some more fundamental content issues to deal with.

Publishers can not only achieve greater levels of value-adding audiences and page views, but also increase the flexibility to introduce different access-pricing offers. And they can be confident that if they knock on the doors of media buyers to collectively wrest back their respective shares of the value chain they will enjoy a positive welcome.

There is a simple choice: continue to watch as our revenue streams are further eroded due to decisions beyond our control or create a new future built on the direct value streams that we can directly influence. And to me, that future looks good.

The post Why publishers need to wrest back control of content value chain appeared first on Press Gazette.

At first sight, the European directive: “General Data Protection Regulation” seems a massive constraint on all digital interaction and transaction.

In fact, it is the greatest opportunity for content publishers to recover the revenues and relationships lost in the eleven years since I wrote in Press Gazette: “There needs to be a united industry response to act as a counter to Google.”

As news publishers’ traditional revenues have plummeted and we’ve failed to convert our considerable audiences into revenue, we have enabled (not simply allowed) Google and Facebook to monopolise the digital economy and turn our data, copyright and IP rights to ashes.

The principle behind GDPR is that every individual must provide permission for their personal data to be used, in context and form. Every database holder must demonstrate such permission and also permission for that data to be shared with another holder.

GDPR effectively prohibits any party from holding, processing or sharing any data collected through cookies placed on a website, or any other harvesting, to which the individual concerned has not consented. So, Cookie sharing, without the original person’s agreement and understanding of use, will be banned.

GDPR is set to come into force in May 2018 and will apply in the UK regardless of Brexit.

Where once there was a simple value chain….

Advertiser > Publisher > Reader

…. today, in the digital world, it looks like this:

This anarchy was best described in April, 2017 by Procter & Gamble’s chief brand officer, Marc Pritchard:

“[We  need] simplicity in the agency business, which has become increasingly fragmented…”

He continued:

“[There is] too much complexity, crap and cost….It raises the question of whether it’s worth investing in advertising at all.”

Take this:

“Complexity not only leads to fraud, brand unsafety and other challenges….[At one time] P&G spent 50 cents or more of every ad dollar on… fees…”

Then in mid-August this year, the World Federation of Advertisers concluded that:

[too many advertisers] “realise they have lost control of their media activity.”

Marc Pritchard’s figures are modest. I reckon these intermediaries are sucking out between 75 per cent and 90 per cent of the revenue in the chain between the advertiser and the publisher.

We are not alone in our tardiness.

Here a recent email from a colleague at the Poynter Institute:

“There is a flavour of paralysis in US industry response….over the last 18 months.”

And from WAN-IFRA:

“Institutions and representative bodies move slowly due to their collective nature, whereas we should move fast.”

Johnny Ryan, ‘head of ecosystem’ at PageFair (a tech company which claims to enable publishers to serve block-proof ads), told Digiday (A must read) that: “[the regulations could] rip the digital ecosystem apart”.

I say good! For the stakeholders that matter – readers, publishers, advertisers –  the system is bankrupt, opaque and value-negative.

A perfect example of this consternation was an article in The Times by Alexi Mostrous, demonstrating that legitimate companies are finding themselves on various loony websites.

Here: travel company Sandals appears (credit: The Times) next to an appeal to Jihadis thanks to targeting the word “Kenya”.

Even the UK Telegraph, found itself on an ISIS recruiting site, Sunnah:

The fiasco of ‘programmatics’, ‘key-words’, ‘cookie-based’, ‘real-time-buying’ is exposed. Billions of pounds traded on a Ponziesque fairy tale.

Today: Alphabet (which includes Google and its ubiquitous Double Click ad-serving business), Facebook, Microsoft and Apple, globally control (my estimates based on various sources):

• 95 per cent of the world’s operating systems
• 72 per cent of browser experience
• 95 per cent of search
• 85 per cent of social media
• 98 per cent of admin (AKA MS Office) systems
• 80 per cent of video throughput
• 94 per cent of mapping
• And an increasing share of retail/finance/travel….. not to say social influence and debate, particularly among the next generation.

It hasn’t been lost on the European Commission that all these companies are American.

Donald Trump is pictured below (credit: Reuters) chairing his American Technology Council 19 June 2017.

Microsoft chief executive Satya Nadella and Amazon founder Jeff Bezos are pictured with him. Alphabet’s Eric Schmidt was in the room as was Apple’s Tim Cook. Mark Zuckerberg was “otherwise pre-occupied”.

For governments, issues of copyright, privacy, IP, are worthy causes; that these Forbes Top 10 monopolists are destroying the viability of news is an inconvenience.

The intermediaries are keen to ‘partner’ with the ‘legitimate’ content media. Google’s News Innovation project has so far generously shelled out €74m: half in investment to established players and half to new ventures (in return for their intellectual property).

Facebook and Twitter appear similarly keen to work with the news industry on journalism projects.

These intermediaries should be good partners, but our laxity in the bargaining arena has turned them into threats.

Our goal must be for advertisers and real content providers to define transparency and agree objectives and methods of trading.

GDPR presents the opportunity to detox publishers and advertisers from the opiate of these value suckers. GDPR compliant trading systems already exist – such as Addaptive.

This alone will transform our industry’s finances while also dramatically increasing the ROI of advertisers and their media buyers.

It will also remove the abuse/theft of publishers’ and advertisers’ audience data and control.

In the ten years since I first raised the Google ‘threat’, I’ve learned that local or publisher initiatives are pointless. The Commission’s GDPR action and Google’s €2.4bn fine for “abusing dominance” demonstrate that only pan-national initiatives work.

With no disrespect to local publishers, and associations, the solution is for the global power players – publishers and advertisers – to determine what they and their customers want, and have the balls to stand up to this existential threat, and re-write the rule book. Starting in May 2018.

The journalism industry delivered Watergate, MPs’ expenses and the Panama Papers – yet we seem incapable of sorting a system that is damaging far more of society than just news.

Jim Chisholm has been a media consultant for 25 years.

The post Why the European Union’s General Data Protection Regulation directive could save the journalism industry appeared first on Press Gazette.

This chart for the UK indexes the relative shares of left and right wing newspapers over the last thirty years, exemplified by the combined sales of the Telegraph/Mail versus the Mirror/Guardian.

I’ve ignored the others because their positions were as much about opportunism as conviction.

Back in Thatcher’s 1980s, the left titles indexed combined sales around 20 per cent above the right titles. Today, the titles on the right have over double the market share of those on the left.

This picture is also apparent in countries such as Spain, France and Germany, where the media-right are steadily increasing their dominance.

The right is where the money is and money, and commercial acumen, rather than principle is what has driven the increasing dominance of right-wing media.

But as always the story is more nuanced.

The chart below shows that the Daily Mail’s commendable market share rise (in red) has in fact been cyclical, and diametrically opposite to the strength of Tory majority parliament (in blue).

The red bendy line shows that the Mail’s market share rise slowed during the Tory years, but blossomed in the Blair years.

The chart clearly shows that against the general upward trend, the Mail gained more in opposition. And the same data shows, that The Guardian did far better against the Tories, (and in the Blair years, which it regarded as the same thing!).

The fact is that partisan news media attract more readers when in opposition, than when they are sympathetic.

In this “post truth” age of Trump and Brexit, there is some consolation in the fact that, against a generally increasing dominance of right-wing media, the evidence suggests this can be thwarted.

But the long-term question, in this increasingly divisive, extremist world, is how does the news media, whether established or emerging, better reflect all opinions rather than what I regard as the increasingly distorted “Enemies of the State” messaging.

Citizens welcome clarification and direction. But they, particularly younger people, are abandoning news media, in part – one part – because the news media are either emasculated – from the miserably managed Scotsman, to the UK’s now official state broadcaster, the BBC – or representatives of the rich and self-RIGHTeous.

I’ve written before about the potential for the ever-increasing number of independent “New News” creators. Individually many/most struggle commercially, but collectively this is a great new force, that can challenge and replace the distortions that we are now witnessing every day.

Finally, I offer two (perhaps more subjective) observations:

In the international context, British newspapers’ print audiences have fallen far faster than most other European countries. In the case of the regionals I put this firmly down to the profiteering of the publishers, but in the Nationals I believe it is due to our uniquely jingoistic editorial style.

A sensational headline may win the day, but the reader is left with a bad taste in their mouth, and the position of the press is slightly diluted.

The other is that media born around fads tend to fail, as the fad fades. Just as the ultra-nationalist Wings Over Scotland saw its audience soar to over that of The Scotsman during the referendum, only to plummet afterwards, so I suspect Breitbart will last little longer than Trump’s credibility. And the sooner the better.

Jim Chisholm is a news consultant and mediatrician

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