Monday, January 27, 2014

Advertising and old media

We stressed last week the fact that in the US, good journalists like Ezra Klein from the Post are willing to live the old industry and its Wonkblog to work with pure players, The Vox in the case of Klein.

The sad story of print advertising can only comfort these changes. Look for instance at the French regional newspapers. In 2013 their global advertising income went down by 6.3%.  It is the third year of decrease and 2014 doesn't look much better. It is a fact that the national income of web advertising for the same papers went up by 28% but it is still far from making for the heavy losses on print.

To day Wan IFRA delivered a fascinating study on classified ads (Wan-IFRA Classifieds Report). It shows through the success story of Schibsted the Norwegian press group that decided to move to the Web 15 years ago that old media and Internet don't work together so well. Why did Schibsted succeed? It is because its ads websites Finn and Bloket worked independently from the papers and even competed very successfully with them. Now Classifieds such as Leboncoin in France make most of the income and profits of Schibsted as newspapers keep declining.

So what is the solution? Pure players are best positioned to conquer markets in news and classifieds and move to the mobiles. If they are connected to a print media, they must keep their own strategy and recruit their own people. One needs new talents for the new field of journalism and advertising.

Friday, January 17, 2014

A revolution in news industry

The news industry is changing so quickly that it is hard sometimes to assess the organization that is emerging in front of us. We keep our eyes fixed on the old press and don't see how people get used to new ways of getting at the news.

Until recently, it seemed obvious that the information would be mainly delivered by websites connected to big newspapers such as the New York Times, the Guardian or le Monde and it is true that their audience is very large with tens of millions of subscribers.

And yet, something new is growing next to them and filling a gap. There are more and more pure players which manage to break even and provide useful information. Take for example, Politico, Quartz, Mediapart in France.

Also, some sites decide to improve their offer by recruiting good journalists and starting some kind of investigation. Look at Buzzfeed or Yahoo whose boss Ms Mayer is trying to set up a good news service that will make the difference with Google. It appears that Facebook and Twitter are ready to move in the same direction.

All these services are also moving as quickly as they can towards more mobile use. The time when people had to connect to their computer to get the news is over. Now users want to be able to catch any bit of information all the time on their smartphone or tablet. It is another challenge as money is not always following the consumers.

So the way is open to a new generation of media moguls who are on the starting blocks and ready to offer new services. After all it is how popular dailies or magazines appeared in the past century, coming from nowhere.

Friday, January 10, 2014

Nouvel Observateur. Is Niel the French Bezos?

The selling of the newsmagazine Nouvel Observateur by Perdriel, its aging but very wealthy owner raises many interesting questions.

First, who is buying? it has been said that the buyer is LML, Le Monde Libre, the holding company which owns le Monde whose three main shareholders are Pierre Berger, Matthieu Pigasse and Xavier Niel. However, Perdriel stated very clearly that he discussed  with Niel, the billionaire owner of Free, the best French equivalent of Jeff Bezos who is the strongman of LML.

Then, the real position of Perdriel is far from clear. His public statements show a will to keep in check the new shareholders and stay in charge for the main decisions. However, it is doubtful that he can still be the boss once he has sold 65% of the company. Remember that Niel promised to keep the top management of le Monde when he bought into the newspaper and the next day he fired the publisher Eric Fottorino. One wonders if Perdriel is aware of this outcome or if his statements are just window dressing.

The fact is that Nouvel Observateur, can only survive through a very thorough reorganization, the buying out of 50 journalists and possibly, a  sharp reduction of its sales which are boosted by an enormous direct marketing budget. These options won't make Perdriel happy.

And last but not least, nobody knows what Xavier Niel intends to do with his new press group. Synergies with le Monde are hard to find. The websites of both publications are competing for the same public. Telerama, the branch of group le Monde is facing Teleobs. It seems obvious that Niel, like Bezos, looks for power and influence but he doesn't like to lose money.