ISOJ 2008

1. DEVELOPING AN
ONLINE
NEWSPAPER
BUSINESS MODEL
LONG DISTANCE MEETS
THE LONG TAIL

2. Online Newspaper Backgrounder
 Revenues up, market share down
 Online ad gets 20-30 % of print ad’s worth
 Online profit margins half of other media

3. Current Models
 Pay-by-view
 Free
 Free w/some pay-by-view
 Result: Publishers say, “Online is key, but I
won’t be experimenting or doing anything
positive about it as part of my investment
strategy” (WAN 2006 survey)

4. The Search for
Competitive Advantage
 Implies: Resource-based view theory
 Suggests: A firm’s strengths lies in its
resources
 The place to start: A firm’s value chain
 Process: Dis-assemble, then re-assemble
the parts or elements to meet the new
market’s needs

5. Then what?
 Core competencies
 Mistake: Match products w/demographics
 Better: Deliver convenience,
comprehensiveness, timeliness; not a niche
 Examine assets for value, from customer’s
viewpoint, but also for “inimitability”

6. Distance in Online Context
 Online = global reach
 Online value in eyes of customer
 “Proximity” takes on new meaning in online
 Two online audiences:
local and long-distance (Chyi & Sylvie,
1998 & 2007)
 Distance audience basically ignored

7. Along Comes the Long Tail
 LT: In distributing a commodity, info tech –
specifically the Internet – increases the
share of niches (Anderson, 2006).
 Online Benefit: Internet markets arm
audience members with search capabilities.
 A Big “But”: The consumer – not the
newspaper – determines the product (GLT)

8. Key: Partnering & Distribution
 Why?: Media have intended & unintended
uses, rendering the newspaper ill-equipped
in marketing, audience knowledge, delivery
systems and context of use.
 So: Make news for non-newspaper delivery
vehicles
 Such as?

9. Possible Partners
 Mobile media; it…
 moves
 has willing-to-pay users
 headed to broadband sophistication
 allows time shifting
 is growing in use

10. Possible Partners (cont.)
 Local, retail businesses; they…
$ aren’t classified ads
$ attract people and invite socializing
$ have bonded with their customer bases
$ are venues that make papers unobtrusive
$ invite informational searching
$ spend $ online

11. GLT Pluses
 Content-as-search eliminates much guessing
about what attracts consumers.
 Searchable content resolves usability design
issues and provides “original” content and
eliminates need to ally with a popular browser to
drive traffic.
 Offers a sense of community without imposing the
journalist’s or editor’s view of that sense.

12. Challenges
What’s Not to Like?

13. Challenges (seriously)
 Training – creating value for some, learning
value for others
 Organization – serious local R&D
 Organization – outsourcing
 Organization – tech infrastructure (search
interface)
 Organization – planning (continuously)