Friday, May 22, 2009

So what is journalism's value?

Over on BNET, Erik Sherman has a retort to Robert Picard's Christian Science Monitor article earlier this week, Why Journalists Deserve Low Pay.

In Why Readers Deserve No Journalism, Sherman adopts the "we're going to take our ball and walk away if you don't play (or pay) nice" stance. He's joined by several "woe is me" commenters who fall back on the canard that if we just go where the money is, journalism goes to hell.

Sherman falls prey to the same kinds of inaccuracies he accuses Picard of.

The key here is not absolute value, but perceived value - it's, after all, why an American Idol-winning singer gets multimillions, etc. I read Picard as arguing that journalists are not perceived to have skills particularly distinctive or specialized (and Sherman's rebuttal of Picard's example of electricians is off-base -- electricians have to be licensed, which, ipso facto, means society values their skills with enforced scarcity).

The problem really isn't so much commodity news as it is that when there is economic value it is so fleeting as to be uncapturable. Consider, the first bulletins and stories on 9/11 were practically priceless if you were anywhere near ground zero (or about anywhere, for that matter). But after five minutes, their value had dropped to pretty much zero. That is the underlying conundrum with much "news."

Can we produce journalism that has lasting value? I don't know whether we can produce enough of it or if the ROI on such stories makes them doable -- and at the same time produces enough margin to make it possible to do the things that many journalists argue the public really needs and wants but doesn't know it yet.

Which then brings us to the social benefits/costs. But those, of course, are rarely quantifiable, which is why we have government rules and regs to make businesses et al. effectively absorb them or the public pay for them. (It's really the raison d'etre of government, isn't it?) But that gets into a sticky wicket with journalism, doesn't it?

In a way, Sherman round about comes to the same conclusion as Picard -- that unless journalists can find a way to produce things with intrinsic or perceived value -- and value that can be captured -- then things deteriorate. Picard attacks it from the angle of better content. Sherman attacks it from trying to create a scarcity, which is really what media was based on for most of the 20th century.

Problem is, I think his suggestion will leave most people just yawning. Most people use news media primarily for surveillance. They don't need that much of it.

Or, sure, take your ball and go home. Just be careful what you wish for.

----

Update: Brandon Keim has an annotated critique of Picard's article. Aside from the occasional snark, it raises some good debatable points. But ultimately it seems to boil down to two points
  • Journalism is a victim of rampant fecklessness by the public which just doesn't seem to give a fig about the valuable work journalists due, accelerated by the infernal Internet.
  • The value of journalism is so great to society that some price should be exacted.
The last is encapsulated in his comment: Journalism’s benefits produce just as much value as ever. What’s changed is the price people pay for them.

And that's what too many journalists do not seem to understand - people never actually paid for the journalism. If they had, we could have been out selling our work individually on the streets (why have a middleman?). They paid for the aggregation, the convenience and the filtering function -- yes, the packaging, as much as anything .

Journalists needed the middleman. So did consumers. It was a nice symbiotic model. But consumers no longer need it so much. The business only works so long as both sides of the equation are in equilibrium.

I'm not debating that journalism has value. In that, I think Picard is a little narrow in defining its value as merely functional. There is a social value. But functional, social or otherwise, the main point is that it is almost impossible to capture given our current technological, economic and legal framework.

Now that Keim has had his shot at Picard, I'd like to see him take on the challenge of how to capture that social value.

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9 Comments:

At 5/23/09, 7:49 AM, Blogger ebsherman said...

I wasn't by any means taking the view you are ascribing to my piece. Perhaps I wasn't clear enough. I'm not suggesting petulance - more a sense of painful inevitability, because I don't see how things are going to change. The public clearly hasn't valued what reporters can do. That isn't chiding, but a statement of fact. That is partly due to publishers having lowered perceived value by making content available for free, and partly because I suspect that reporting is only appreciated when something dramatic comes about because of it.

I mentioned electricians because that was an example that Picard used. However, your are incorrect in thinking that they are licensed because society values them. No, they are licensed because society values keeping people who don't know what they're doing from practicing. It's not value through enforced scarcity, but society's protection of itself.

I agree that much news has fleeting value. That's why news organizations have such trouble with Google. Most people are satisfied reading only the headline and maybe the opening of most news stories because they get all they need.

However, Picard was arguing that all journalists have to do is "create more value." I don't know that it's possible. When I said that perhaps people might appreciate news more if it goes away, I wasn't being truculent, but simply noting what seems most likely. I don't know how most news organizations will manage to stay in business, because I suspect that much of what they produce is of no interest to most of the public. That doesn't mean it isn't objectively important, like doing protective maintenance on a car. It just means that people often don't care until they realize that something has become critical. The Catch 22 is that if there is no reporting, people don't hear about the problem in the first place. So put me in the highly pessimistic column, because I don't see how you solve the problem, other than downsize organizations and possibly charge for access, because, clearly, online ad rates aren't high enough to support the old model.

My response to Picard was really that there is no "just offer more value" answer and that the final picture looks pretty gloomy. So do you think there is a solution?

 
At 5/25/09, 9:08 AM, Blogger Doug Fisher said...

Part 1

Value: It isn't that the public values much of what we do, it's that the digital era has lifted the veil of scarcity that made the value extractable. We've done "commodity news" for more than a century. We just didn't want to acknowledge it.

The publishers lowered the perceived value argument is a logical red herring. If they had somehow charged more and then the digital age had come along making much of that information free, do you think that "perceived value" would have stopped the rush to free?

But, you might say (I don't know that you would, but many have), most of the "real"/"good" info online comes from "news" organizations. Not true, when I can go and look at the source documents/press releases, etc. myself and when I can find a range of voices, like Picard's on his blog, that provide excellent, credible information in a range of topics.

Electricians: You fail to consider the alternative -- provide adequate instruction to all those who wish to mess around with electrical systems. That, of course, has not been practical, so we turn to the second way, which is to limit the pool. However, who is to say that many others simply can't access the pool because of financial circumstances, scheduling needs, etc. They might also make fine electricians The motive may be safety, but the end result is enforced scarcity. (To see it in action elsewhere, look at the way the ABA enforces scarcity in the legal profession by the way it accredits law schools. Take a look at the former Antioch law school asn an example.)

By the way, is it not possible to conceive of a day when, if I want to do some extensive electrical work, I go online, get the training and get "instantly" licensed for that particular job. I don't know -- there are excellent arguments to be made against that and for the apprentice system now in use.

But boy, that sounds a lot like journalists, too, doesn't it?

Except for that little tradition we have enshrined in the Constitution, after all, a cogent argument could be made to "license" journalists, too. After all, people do make changes in their lives based on what journalists produce. When you are messing with people's minds, what greater argument for scarcity in the name of "safety."

-- MORE--

 
At 5/25/09, 9:09 AM, Blogger Doug Fisher said...

Part 2
I disagree that there is no "just offer more value" proposition. I think the problem is that you are framing it from a legacy view. I'd like you to ponder some of what Dan Conover lays out http://is.gd/DbjZThe scary thing for journalists and news media owners, I think, is the realization that they actually are going to have to work for it. No more drinking from the fire hose of revenue. Now it's assembling rivulets, to use one phrase I've used here before. Or another metaphor -- it's bird hunting, not deer hunting.

No, most of what we produce is not of "general" interest. But most of what we produce has some value to someone. The innovative journalists are going to figure out what those value propositions are, whether they make sense from a business point of view, and then pursue them in a way that also allows us to fund the "public good" part of it for which there is societal value but for which it's dang hard to capture any economic value.

A few short examples I have mentioned on this blog before:
-- Why doesn't every paper make me watch a very short ad for the local florist to view the obits and then have that ad morph into a "click here to order flowers" button at the top of every obit?
-- Why isn't there a link in every photo caption saying "want a high-quality copy of this photo, click here"?
-- Why don't more copy desks do language blogs against which you can put a few Google ads?

We are leaving the industrial business and entering the retail business.

If you say "well, none of those will ever support a newsroom," you miss the point. Media managers of the future are going to have to balance dozens, probably hundreds of small revenue streams. They are going to have to not only know who their users/readers are and why they use the product, but just as important, they need to know who their non-users are and why. (And I've been in enough newsrooms lately to confidently say that information is not top of mind in many.)

And then they're going to have to have the skill of a tightrope walker to maintain the balance.

 
At 7/12/09, 5:19 PM, Blogger Erik Sherman said...

I would have responded far sooner had I seen the response before this.

Lowering the perceived value is hardly a red herring. This is a fundamental business issue, and that's what we're really discussing. You are assuming, as much of the public does, that the Internet has made information "free." It hasn't. It has made the marginal cost of getting a copy of informaton virtually zero, if you don't count connection costs and someone's time in finding what they want. The fixed cost of producing news is as much as it ever has been. That cost exists even in what you call "commodity news." There are many commodities on the market, but they cost money to buy because someone has to invest a lot to make them available.

>> Electricians: You fail to consider the alternative -- provide adequate instruction to all those who wish to mess around with electrical systems.<<

Not even an alternative. You're assuming that the resources would exist even to make this possible. But there is a finite number of people who know how to handle wiring, and they have finite time. It can take years to learn how to do it well, or even do it correctly. So the teaching resources are too scarce and it's not an alternative at all. "Enforced scarcity" is a fine phrase, but vastly incomplete. No person could possibly learn to do everything they would need to do to live in today's world. There's an inherent limit to any trained undertaking because you can't have an economy built on all electricians.

>> By the way, is it not possible to conceive of a day when, if I want to do some extensive electrical work, I go online, get the training and get "instantly" licensed for that particular job. <<

I take it that you've never worked in any of the building trades. I have. The "possible" day you consider would involve bringing the computer around to watch your work and have people correct it over an extended period of time. Not everything can be learned out of a combination of books and videos, at least for the vast majority of people.

Could people learn to report news? Certainly - if they could afford to stop doing everything else they already do. But you might as well say that they'll be fixing their own cars, building their own housing structures, doing their own complex tax returns, sewing their own clothes, and so forth. You can't isolate this one thing and declare that it's everyone could do that.

... cont.

 
At 7/12/09, 5:35 PM, Blogger Erik Sherman said...

>> I disagree that there is no "just offer more value" proposition. I think the problem is that you are framing it from a legacy view. <<

Not at all. You're assuming that you can necessarily do something that people are willing to pay for. But when much of the audience thinks that everything should be "free," you're simply screwed. You cannot create value if they don't recognize it.

>> But most of what we produce has some value to someone. The innovative journalists are going to figure out what those value propositions are, whether they make sense from a business point of view, and then pursue them in a way that also allows us to fund the "public good" part of it for which there is societal value but for which it's dang hard to capture any economic value. <<

I'd put it differently - most of what journalists produce has no significant value to a general audience. There are a number of reasons, including lack of interest and alternative sources that don't cost anything. Some journalists will be able to make money - heck, I manage to do that. I do tend to focus on niche areas where I have far more practical knowledge and background than most other writers I see. But who does the general news? Who digs up the info that might eventually turn into headlines that satisfy many people? Most of that may end up going away, at least for some period of time, unless those doing the reporting get enough money to support their activities.

Your suggestions sound good, but you're assuming a lot - that news organizations don't try such things or that the pull through on advertising is strong enough to keep people wanting to advertise. The amount of money that online advertising pays is pretty slim. If it weren't, organizations like the NYT would be doing fine.

>> If you say "well, none of those will ever support a newsroom," you miss the point. Media managers of the future are going to have to balance dozens, probably hundreds of small revenue streams. They are going to have to not only know who their users/readers are and why they use the product, but just as important, they need to know who their non-users are and why.<<

It may sound good, but as I've said on BNET Media, show me the spreadsheet. To make a business work, you can't just guess. You have to plan how the revenue will come in and what you'll need versus what you'll spend. And I don't see you or virtually anyone else making these sorts of suggestions doing this kind of work to show that their ideas have practical merit. When I was in corporate management, if I had an idea, the first think I was asked for was a pro forma business plan so everyone could look at the numbers and see if they added up. You're talking about "hundreds of small revenues streams." How much management do you end up needing to cover them? How big are the revenue streams? Can you keep them separate enough from news operations to avoid conflicts of interest? What will it cost to do the news and service the revenue streams? When I see someone start cranking through numbers, I might start giving greater weight to their opinions. But until then, it's effectively arguing for a "solution" that will work simply because someone claims that it will.

 
At 7/12/09, 11:49 PM, Blogger Doug Fisher said...

>>You are assuming, as much of the public does, that the Internet has made information "free." It hasn't. It has made the marginal cost of getting a copy of informaton virtually zero, if you don't count connection costs and someone's time in finding what they want. The fixed cost of producing news is as much as it ever has been. That cost exists even in what you call "commodity news." There are many commodities on the market, but they cost money to buy because someone has to invest a lot to make them available.<<

You confuse cost with value. Certainly producing news has cost (as does producing any commodity). Value comes from what a willing buyer is willing to pay. My argument is that news, as it is largely produced today, has little value or that the value, such as it is, is so short it is economically infeasible to extract it in an era when the Internet has severely damaged the traditional aggregation model.

>>But there is a finite number of people who know how to handle wiring, and they have finite time. It can take years to learn how to do it well, or even do it correctly. So the teaching resources are too scarce and it's not an alternative at all.<<

No, there are not a finite number of people. The number of people is limited by the teaching and testing resources - but in the digital age, those are changing, too. (OK, I'll stipulate that there are a certain number of people for whom electricity will always be a mystery, as will journalism to others, but we are far from that threshold, methinks.)

>>No person could possibly learn to do everything they would need to do to live in today's world. There's an inherent limit to any trained undertaking because you can't have an economy built on all electricians.<<

Granted. Specialization is the foundation of an industrial society. But that does not mean that if I want to put up a chandelier or rewire a room in my house, I might not be able to learn enough to do that (sounds a lot like citizen journalism, doesn't it?). What you fail to recognize is that the digital distribution of information changes such barriers; I would not be surprised to see various forms of testing/permitting evolve (although electricians, like journalists, will fight it).
Doesn't exist in the real world? Well, when I do human-subjects research, I have to submit my work to a review board. Before I can do that, I have to show I am up to date on the issues involved. I am not a research ethicist, but for this situation, I am provided educational materials and then a test so that I am "certified" to know what I am doing at some essential but lesser level.

>>I take it that you've never worked in any of the building trades. I have.<<

So have I. And I still do light carpentry and electrical work.
(more)

 
At 7/13/09, 12:00 AM, Blogger Doug Fisher said...

Part 2
>>You cannot create value if they don't recognize it.<<

Seems that's what I've been saying. Unlike you, however, I do not ascribe it primarily to the idea of "free." The paper has always been close to free, and TV certainly has been free to its users over most of its life. I ascribe it to the content itself having less and less value to the audience for numerous reasons.

>>I'd put it differently - most of what journalists produce has no significant value to a general audience. ... But who does the general news? ... Most of that may end up going away, at least for some period of time ...<<

Gee, we're starting to sound like we agree. I do think "general" news is in trouble as we define it. But what if we defined the entire "report" as a mosaic of different news tiles. So now that story about the abandoned house in Neighborhood A that might be of great interest in that area (enough so that there might be value) gets covered. (Example, westportnow.com and its coverage of tear-downs.) And over here someone is covering a zoning dispute of interest to Neighborhood B. I don't want to sound too Pollyannish, but this is where the curator role of the new journalism business may come in. It just may be that there is no economic model anymore for the metro news organization to do this kind of general news. But there may be one for smaller operators and then a new aggregation model.

>>And I don't see you or virtually anyone else making these sorts of suggestions doing this kind of work to show that their ideas have practical merit.<<

I am working with a small community newspaper doing just such stuff. Your questions are exactly what we're trying to work through. (I was a corporate manager, too.)

Problem is, with such radical changes as we see in today's business environment, sometimes you have to throw some Jell-o just to figure where the walls are, let alone if it will stick.

Bell particularly didn't have a business plan when he invented the phone. (And, yeah, that's why AT&T faltered till Hubbard basically took control.) I think we're still in that era where business plans are useful but pretty much conjecture till we fully understand the ramifications of the invention, which is why I say folks will figure it out.

 
At 7/13/09, 3:21 AM, Blogger Erik Sherman said...

>> You confuse cost with value. <<

Not at all. I'm saying that when people perceive that there is no cost, they generally don't expect to pay. The question of whether news has value is more complex than a binary yes/no. If news literally had no value for people, they wouldn't bother to consume it. But more in the next bit of response.

>> No, there are not a finite number of people. The number of people is limited by the teaching and testing resources - but in the digital age, those are changing, too. (OK, I'll stipulate that there are a certain number of people for whom electricity will always be a mystery, as will journalism to others, but we are far from that threshold, methinks.)<<

I was saying that there is a finite number who know enough to teach it. That is the limitation, because there are only so many people they can teach. Plus you have the other limitation that not everyone can be an electrician, because society and the economy cannot support more than a given number.

>> But that does not mean that if I want to put up a chandelier or rewire a room in my house, I might not be able to learn enough to do that (sounds a lot like citizen journalism, doesn't it?).<<

Not really, it doesn't. Putting up a new chandelier or even bathroom light is a one time thing (no matter how long it takes because of the incompetent job someone did installing the bloody electrical box in the ceiling - can you tell that I had to do this recently?) But citizen journalism isn't a one-time project you're doing for yourself. If you only do it once, then you probably haven't developed the skills to do it well. Even my experience installing the light is based on a lot of related experience, both in construction and electrical.

>> What you fail to recognize is that the digital distribution of information changes such barriers; I would not be surprised to see various forms of testing/permitting evolve (although electricians, like journalists, will fight it).<<

I don't fail to recognize that at all. But some things, like building trades, cannot be taught purely from a book or videos. By the way, I don't extend that to journalism, as clearly it can be straightforward to pick up. In fact, my general suggestion to students interested in the field is to major in something else that might interest them. It's easy enough to learn the specific skills (assuming that one has enough verbal facility).

>> Seems that's what I've been saying. Unlike you, however, I do not ascribe it primarily to the idea of "free." The paper has always been close to free, and TV certainly has been free to its users over most of its life. I ascribe it to the content itself having less and less value to the audience for numerous reasons.<<

I agree, as you later point out, that we've been largely agreeing, as that was my argument in the first place. But if you ever asked people about newspapers, I bet they didn't consider their subscriptions close to being free.

When I talk about "free" news, I see it as an expression of a lack of broad value. The price that people once paid for news was bound in with the delivery. The price of gathering it was invisible. That was in print. In broadcast, it was "free" because advertising paid for it. When distribution costs go to nothing, people expect free news because, after all, it no longer "costs" to distribute it.

And that's the nub: you cannot just "make" value. You have to sell someone into perceiving it, and while that might be possible in niche cases, I don't see it happening broadly enough to support the infrastructure necessary to do broad news coverage.

-- more --

 
At 7/13/09, 3:21 AM, Blogger Erik Sherman said...

>> But what if we defined the entire "report" as a mosaic of different news tiles. So now that story about the abandoned house in Neighborhood A that might be of great interest in that area (enough so that there might be value) gets covered. (Example, westportnow.com and its coverage of tear-downs.) And over here someone is covering a zoning dispute of interest to Neighborhood B. I don't want to sound too Pollyannish, but this is where the curator role of the new journalism business may come in. It just may be that there is no economic model anymore for the metro news organization to do this kind of general news. But there may be one for smaller operators and then a new aggregation model. <<

We agree that general news may go away because the revenue possible for an organization, based on perceived value, won't pay the cost. I'd also agree that some niche areas will do well. For example, I write for a number of targeted trade magazines, among other things. They are doing far better than many of their more general brethren because they deliver something focused that has value to someone, whether readers or advertisers. (Or both.)

There may be some hyper local approaches that will work - on a very small basis. How many people can you actually employ to do news for a given neighborhood? It may be one or two or three. Many small weeklies are surviving because they serve communities that are otherwise ignored. But the community has to be large enough to generate enough revenue through whatever model to bring in even this much. In the very small town in which I live, you could never make a go of it. Over a number of the towns in the area, it is possible for at least one paper. In a big city, the number of reporters may end up being a dozen or two tops and expected to cover everything. I would think that in many places, the day of the big metro are finished.

>> Problem is, with such radical changes as we see in today's business environment, sometimes you have to throw some Jell-o just to figure where the walls are, let alone if it will stick. <<

I understand, and if you're doing that, more power to you. There's an advantage in the community paper because it often has that old-fashioned newspaper combination lock on distribution and sole outlet for local advertising.

I also agree that business plans aren't any sort of insurance of success. But they are still necessary so you at least have thought through what it's going to cost, what you need to make, and where you think it might come from. You have to start somewhere and then test your guesses.

One question: if general news goes away, how important to society is journalism? I'm guessing not very.

 

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