There Is Still Hope for the News Business

Classifieds aren’t completely lost as a means of generating revenue for news outlets. Rupert Murdoch’s views on Google News aren’t shared by many others in the news business. A Seattle Times exec says the biggest problem for newspapers is revenue, not readership. Redmond, Washington-based MSNBC.com is still growing and profitable.

And one recipe for success may be recipes themselves.

Those were among the insights from an MIT Enterprise Forum event in Bellevue, Washington, last night about the future of news. I moderated the event, with an experienced group of panelists—Patricia Lee Smith, VP of New Media at the Seattle Times; Anthony Bontrager, president of Kirkland-based startup 1Cast; Tracy Record of the West Seattle Blog, and Charlie Tillinghast, president and publisher of MSNBC.com.

Given the presence of Tillinghast, one topic of discussion beforehand was Comcast’s negotiations with GE for majority control of NBC Universal, which partners with Microsoft on MSNBC.com. Tillinghast, without going into detail, made it clear that he doesn’t see Microsoft taking advantage of the opportunity to change its role in the joint venture. As another attendee observed, it would be in Microsoft’s interest to make an additional connection with the cable giant via such a deal. (Microsoft at one point invested heavily in Comcast but later divested its holdings.)

During the panel, I pointed out that MSNBC.com in the past made a point of announcing that it was profitable (without disclosing specific numbers), but we haven’t heard anything on that front lately. Tillinghast said that wasn’t for lack of profits but because they have become routine.

The Seattle Times’ Smith kicked off the evening with a presentation on the challenges and potential opportunities facing the newspaper business. With print circulation of 360,000 and nearly 1 million registered users online, the Seattle Times has a “viable, dedicated readership,” she said. The real challenge for the industry is growing revenue, she said, calling on the people in the MITEF audience to help with technology solutions.

Smith said one key will be for newspapers to recapture, for the online audience, the breadth of life reflected in the printed product. As noted by Mark Briggs of Serra Media, who was in the audience, Smith said one measure of the relevance of newspaper websites will be whether people ultimately come to them for retail ads. Preprinted ads in newspapers are still a big business, accounting for most coupon redemptions.

I jokingly asked Tillinghast how many months it would take him to shut down the print edition of the Seattle Times if he (hypothetically) took over the newspaper. He said he wouldn't shut the print edition down, but he stressed the importance of thinking of multiple forms of news delivery, not just one, such as print.

Are classifieds completely lost as a revenue stream for news sites? Some areas, such as paid recruitment ads, are still viable, Smith said. In addition, the panelists noted that some readers prefer to connect with community members via trusted local sites, rather than Craigslist. As evidence of the demand, Record cited the example of West Seattle Blog readers spontaneously posting classified-style items in the site’s forums.

The panel generally agreed that Rupert Murdoch’s threat to remove his properties from Google News is misguided. As a competitor, Tillinghast joked that he’d highly encourage Murdoch to follow through on the threat.

Also represented on stage was one of the biggest philosophical divides in the business of selecting and delivering news. Bontrager, whose Craig McCaw-backed 1Cast came out of beta last month, lets people pick topics to build personalized video newscasts. That contrasts sharply with the concept of traditional media, such as the Seattle Times, where editors determine the selection of stories.

Smith said the risk in personalization is that people will only seek out opinions and news sources that support their own views. Bontrager said people using 1Cast pick the topics, but the news segments delivered by his company come from a variety of sources. Record asked why people couldn’t just replicate the experience with keyword searches on Google Video. Bontrager said the experience needs to be more streamlined.

One of the biggest trends over the past year is “hyperlocal” news, as evidenced by the growth of sites such as the West Seattle Blog, and Fisher Communications’ launch of its KOMO Communities sites in partnership with DataSphere Technologies. Record said she would prefer to see larger media companies put resources toward stories with meaning and impact for the region, rather than hiring people to post community events.

Another sign of the trend is MSNBC.com’s acquisition of EveryBlock. When I asked about that deal, Tillinghast said EveryBlock won’t necessarily be integrated into MSNBC.com, but will be allowed to grow and develop on its own.

Toward the end of the panel, I asked whether the panelists see events and products as a viable supplement to advertising for generating revenue. It depends on the situation and the nature of the readership, the panelists said. Smith cited the example of recipes and photos sold by the Seattle Times. Cookie recipes are particularly popular, she said, although recipes in general aren’t big moneymakers.

I joked with Smith that sports fans like me would probably buy tickets to see Seattle Times writers Danny O’Neil and Steve Kelley argue on stage.

We also delved into the question of subscriptions versus advertising as a model for the news business, with the consensus seeming to be that there will be a mix of both.

Given the makeup of the panel and the audience, my main goal for the night was to spark entrepreneurial ideas, so most of my questions focused on business models. During the audience Q&A portion of the event, Bill Will of the Washington Newspaper Publishers Association reminded everyone that they shouldn’t just be thinking about revenue, but also about the broader role that journalists play as a key pillar of democracy.

Thanks to everyone who came out last night, and to the hardworking team of MIT Enterprise Forum volunteers who put the event together. Of course, playing the role of moderator makes it difficult to take exhaustive notes or provide a complete summary, so I’d encourage other attendees to clarify or supplement my report in the comments. Also see tweets from the event at #mitforum and #mitef.

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Todd Bishop is managing editor of TechFlash.