Google, Data, and Owning the Golf Club
March 11, 2010
I remember when I first interviewed with Barry Bingham Jr., then the boss of the Courier Journal & Louisville Times Co. The newspaper was a monopoly and it had a document from a government official saying it was okay for us to own the morning and evening newspaper, the top TV station, the top AM and FM station, and to have other information related businesses such as high volume printing, door knob ad packet hanging, a ham company, and, oh, yes, an electronic information publishing company. That unit was also number one in revenue per record on the big commercial online systems.
One of my recollections of that interview was my question about revenue and profits. I spoke with him in 1980, so my memory of that meeting in his sunny office looking down Broadway in Louisville from the Courier Journal’s main building was along the lines: “Don’t worry. When people spend money for advertising in this area, we get most of it.” He went on to point out that he would subsidize my riding the bus to work because after working in New York and Washington DC, I was not an automobile buff. He also pointed out that I was expected to volunteer in various civic groups, which for me included helping with youth soccer and contributing to the Chamber of Commerce’s first “Advanced Technology Council.” Yep, 30 years ago I thought Louisville was an advanced technology center. Go figure.
After that initial meeting, Mr. Bingham and I became friends. When he had a computer problem, he would come over to my house and we would fix his Mac. After the sale of the Courier to Gannett, he and I would have lunch at least once a year. I had to make sure I had my wallet because Mr. Bingham would often arrive in his beat up Datsun without any money even though he worth was in the big money.
At one of those lunches, he made a comment about owning the country club. My memory locked on to this analogy, and I want to share it before I suggest you spend some time working through a Google presentation about newspapers and advertising. Here’s the country club story. His view was that newspapers were the owners of the country club. The newspapers decided what to emphasize and in the case of the Courier Journal what issues to push. The Courier Journal, when I joined as an officer of the company, was ranked on a couple of lists as among the Top 25 news papers * in the world *. The Courier Journal employee ID pass was a sure fire ticket to many events. When I wanted carpet samples from the now defunct Stewart’s Department Store, I showed my Courier Journal ID and was able to haul off a dozen carpet samples. The salesperson told me, “I will come by your house, answer questions, and pick up the samples.” Now that’s power. In New York, a carpet sample to go required a driver’s license, a credit card, and a one page form. In Louisville, the Courier Journal was the owner of the country club, employees were members, and the influence of the company, its employee practices, and its reputation in the community was remarkable. I joined the Courier Journal after a stint at Booz, Allen & Hamilton and (if you can believe this), the Courier Journal had a bigger stick that the venerable firm founded in 1917 by George Booz. Amazing. What’s become of the Courier Journal? It has been Gannettized, and I don’t recall the paper’s receiving any big writing awards. Most of the special sections are recycled wire service stories and photo essays showing people with shoes or Derby hats.
Now navigate to Scribd and download Google Newspaper Economics: Online and Offline by Google’s chief economist Hal Varian. After you work through the data, ask yourself these questions:
- Who owns the country club? Traditional newspapers or the “flat” world of Internet content?
- Who are the caddies in the age of the “digital Gutenberg”? Internet companies or newspaper publishers?
- What must newspapers to do to regain their revenue flows?
- What can newspapers do to regain their commanding position in the information food chain?
I have my answers. Please, post yours in the comments section of this Web log. I won’t grade your responses, but I will look at them and see if I have missed anything in Dr. Varian’s data centric description of a business sector struggling to find a revenue stream.
Stephen E Arnold, March 11, 2010
No one paid me to write this. Since the presentation was given for an FTC group, I will just say, “Freebie.”
Real Journalists May Have Lost Touch with IT Reality
March 9, 2010
Keep in mind that the addled goose’s Web log, which you are now reading, is a marketing vehicle. It contains on good days old news. On bad days, the addled goose recycles his own talks which he delivers for tacos and Pepsis. I am not a journalist and I don’t pretend to be one. I am not even a public relations person. As I approach 66, I entertain myself capturing information that I otherwise would forget and documenting my thoughts, which are subject to change. When was the last time, a 65 year old could remember where he or she put the keys to the automobile? See what I mean.
When I read the Cnet write up about a post I saw last week, I thought, “CBS’s real journalists are now thinking about themselves in a meta-way.” Navigate to “Has Business Press Lost Touch with the Tech Industry?” CBS is a real company and it does real news. Cnet is a real news outfit, if I understand set theory. The point is that an azure chip outfit called ITDatabase figured out that the real journalists are writing about topics that are popular. I think this is using humans the way Google uses popularity algorithms. I am sure the “real” journalists would disagree. That’s okay.
For me, the most interesting passage in the write up in Cnet was:
Enterprise IT is woefully underrepresented, despite being the cash-cow in the industry. “In the overall editorial agenda,” the report says, “enterprise IT is treated like consumer tech’s snaggletoothed twin. It barely even makes the family photo.”
Let’s think about this statement.
First, publicly traded companies are covered with a bit of fancy geometry by the investment analysts tracking these companies. The information is usually able to deliver a couple of nuggets. The reason is that most of the analysts talk to people * other than public relations * and * business development officers *. Most of the real journalists recycle familiar contacts, preferring to quote names the writer assumes the readers will recognize. So when the word “search” appears in a story the same handful of “experts’ get quoted. The result is that the stories really don’t change too much from article to article. Google is an advertising company. Bing is gaining share. Autonomy is the leader in enterprise search. The statements in the article are true because they are in the article. Tautology meets routine.
Second, figuring out what is going on in a technology field is tough for three reasons. [a] The jargon is impenetrable. A “real” journalist may not have the time to figure out what the words mean. Example: faceted search or taxonomy. [b] The sources are often running the game plan. Take a look at the comments by tech leaders. There are buzzwords and a jab or two at a windmill. Not much substance because the focus is the sound bite. [c] A tech company sells products that a really complex. The wizards at the company cannot be trusted to answer a question because the wizard might point out that a specific feature is different from the function described by the marketing person. Guess who gets in trouble? The tech person so there folks are shuttled away from the lights and the cameras.
Third, I heard that publishing companies are getting rid of staff. The numbers quoted at a conference last week struck me as pretty high. The person pointed out that newspapers were shedding jobs at the rate of 1,000 per month. Wow. What will be left? What’s left, if this number is accurate, are people who have to write from news releases, contacts who are warm and familiar, and topics that are listed on Tweetmeme.
When the money goes away, algorithms will do this work and, of course, folks with time on their hands like this addled goose. Just my opinion.
Stephen E Arnold, March 9, 2010
No one paid me to write about how I write this blog. Wait. If I buy myself lunch this afternoon, I will be getting paid. I will report the write-for-food angle to the FCC.
Possibly Unfair Criticism of Real Journalists
March 9, 2010
I heard about a frustrated programmer who found a livelihood as an azure chip consultant. The fellow tries hard. He writes a Web log that takes on software companies with a feather duster. When I read “UK Press: 21st Century Journalism hits an All Time Low”, I thought the author was writing about this blogger fellow and his simplifying gang of mavens. I was wrong. The article challenges the quality of journalism in the UK, and the author read old newspapers as part of his research. For me the most interesting passage was:
Some editors seem to have a funny idea of what’s newsworthy. They also seem to have an odd idea of what people find interesting to read and are bending over backwards to put press releases by celebrity agents instead as newsworthy stories, these are often recycled in other major newspapers. Round me, people are losing their jobs left right and centre and only today, I have had yet another person speak to me about regular elder abuse in care homes. Front page stories about celebrities are an insult to the British public.
I wonder how Google’s smart software would populate a newspaper with its snippet and segmenting technology mixed with a dash of its context server? Maybe some day.
Stephen E Arnold, March 9, 2010
No one paid me to write this short item. I will report the fact of non payment to the Department of State, an outfit on top of activities in the United Kingdom.
The Discovery Hoax: Commercial Databases Make Big Promises
March 8, 2010
I was given a box lunch and a can of Pepsi as compensation for my one hour talk at a conference last week. I had an interesting conversation with a former big wheel in commercial database publishing. I thought the wizard was a retired poobah. I was wrong. The fellow had his shoulder pads on, a sweatband, and Gucci cleats. He’s back on a commercial company’s publishing team. I am an old, cowardly goose, and it is with trepidation that I get too close to big people garbed for quasi-military re-enactments related to electronic information.
I asked the industry titan what his new gig involved. I recall one word, which he repeated several times to me, the addled goose. The word? “Discovery.” I thought I was having a The Graduate moment. In 2010, plastic was a loser. The winner? Discovery.
Yep, the lingo of the search and content processing market has reached the world of professional publishing and for-fee database access.
The idea, as I understood it, is that this commercial company will allow a user to enter a keyword; for example, employee stock ownership. The system will crunch away and present:
- Results from the firm’s for fee databases. Not just anyone can run a search. The user has to have access to an institutional account or sign up and pay. There is some free stuff, but this is a real, live make-money-or-die operation.
- The system will also “discover” possibly related content and list that information in the form of links. I think the idea the titan was communicating is what Endeca calls “Guided Navigation” in 1999! Not exactly yesterday! To see the Endeca system in action just go to OfficeFurniture.com.
- Content from the public Web.
The idea is that a person using a commercial system will enter a search string and then see links to related content. This works for buying office furniture. I am not sure how a computational chemist would react to a suggestion she read a blog post about a meth lab that blows up.
Yep, our professional grade service needs those custom chrome wheels. Image source: http://www.up.ac.za/organizations/movup/images/minefun/indian_haul_truck.jpg
I asked what happened if I used one of the company’s business databases and entered the search term “management.” I got a bit of double talk and the titan backed up, trying to get away from me. The reason I asked about this type of search is that I know from hands-on experience that the use of a general controlled term in his firm’s databases does not generate a usable results list. Thus, any “discovered” information is likely to be wide of the mark. Broad queries don’t often work too well in the for-fee, quite specific content in certain commercial systems. A single word like “management” in a Google search box generates what is highly ranked by clueless millions like a link to the Wikipedia entry.
Quote to Note: Most Stolen eBooks
March 4, 2010
I read “E-Book Piracy Costs U.S. Publishers $3 Billion, Says Study” and was genuinely surprised to learn that something other than technical books were stolen. The most stolen books? Here’s the quote to note:
On average, nearly 10,000 copies of every book published are downloaded for free,” the report concludes. Business and investing books are stolen the most, at an average 13,000 copies per title.
Now what about those ethics classes in business school? Ever wonder why certain clauses creep into legal agreements on little cat’s feet?
Stephen E Arnold, March 4, 2010
No one paid me to capture this quote. I feel as though I should report non payment to the US Postal Service which seems to have cornered the market on doing work for modest compensation.
Financial Times Hopes for a Flood of Cash
March 3, 2010
The Financial Times * was * one of the most magnetic business information brands. Now I don’t think too much about the Financial Times. Its 2009 Newssift.com site (now mercifully removed from my browser’s bookmark list) is history. Newssift featured technology from Endeca, Nstein (now surprisingly part of OpenText, and Lexalytics (now a unit of Infonics). The dreams of the SharePoint-ish interface, the weird and colorful boxes of options, and the irrelevant results are just a reminder that online is tough. The decline in revenues in the most recent quarter is not heartening either, but the company did get out of the wax museum business. That was a positive step.
I just read “FT.com Tests PayPal To Rake In Paywall Fees”. The most telling comment in the write up in my opinion was this passage:
FT.com has more than 126,000 online subscribers and 750 direct corporate licenses, according to UK’s MarketingWeek. In 2009, content revenues increased by 15%, although revenues for the overall FT Group, which contains Interactive Data and FT Publishing, fell by 12% in 2009.
I thought about some of the free thinking ideas I heard at the NFAIS Conference in Philadelphia yesterday (March 1, 2010). NFAIS is a professional organization for those in the “old” abstracting and indexing business, but there were some young folks attending as well. I heard some speakers describe in general terms their employers’ monetization efforts.
I wanted to ask some questions, but I caused enough upset tummies when I mentioned in my invited luncheon address for members the following:
In the old days of online, the publishers ruled the roost. Publishers had memberships to the country club. Publishers organized the golf foursomes. Publishers got to pick who was allowed to entertain at the 19th hole. Today companies like Amazon, Apple, Facebook, Google and a handful of others are the country club members who organize the foursomes, and it is the Amazon, Apple, Facebook, and Google executives who decide who pays and who plays. The publishers are now the caddies for these newer info-giants.
Two people excused themselves. Quite enough of the addled goose I concluded.
Now the Financial Times is about to demonstrate that it has weak magnetic power. Why will its dreams of untold riches not materialize? Individual newspapers, even those with a chunk of the Economist in its hip pocket, lack the pull that other types of online services deliver. One example is the financial information available from AOL, Google, and Yahoo. If you have not explored these resources, take a gander. These services continue to improve, and I think that as the economy continues to wobble, the Financial Times will have to do quite a bit of work to get traffic and generate significant flows of online revenue.
Can the Financial Times achieve this goal? If Newssift.com is an early indicator, I think the odds are indeed long.
Stephen E Arnold, March 3, 2010
No one paid me to write this. I suppose I have to report writing for nothing to public affairs person at the National Railway Retirement Board.
UK Readers Digest Cut Loose?
February 28, 2010
Short honk: Yep, the old turnaround at the Readers Digest is humming along. You can read about the amputation of the UK arm in “Talks Under Way for Sale of UK Reader’s Digest” and get the details. Will this move reverse the slide for this venerable curator of the recycled content from other publications? The goose consults the leaves floating in his mine run off pond and says, “Nope.”
Stephen E Arnold, February 28, 2010
No one paid me to write this. Is this type of article under the jurisdiction of the GPO? I will report nevertheless.
German Google Books Activity
February 26, 2010
A reader sent me an email filled with useful information. A happy quack to that person. Here’s the key information from that message.
I know you like watching these efforts.
Munich Digitization Center of the Bavarian State Library does the scanning. The product: The German Digital Library (Deutsche Digitale Bibliothek, or DDB). The Fraunhofer Institute in Sankt Augustin, near Bonn, is responsible for the DDB’s computer technology and may be based on Theseus. The goal is to integrate the DDB with Europeana. See information here.
Another article on the Fraunhofer Institute linked from Silobreaker looks at developments in 3-D scanning of museum pieces and the possible building of an online repository of culture and archaeology. See the China Post’s “Digital Depot May Archive World Culture in 3-D.”
Great idea for Germany, but with the European Union’s financial challenges falling on Germany’s broad shoulders, I am not certain the flow of money needed to deliver a Google-scale project will be available if Greece, Italy, Spain, and Belgium go south.
Stephen E Arnold, February 26, 2010
No one paid me to copy and paste a reader’s email. Because I used the word “mail”, I will report sending a message without official payment to the US Postal Service.
Reed Numbers
February 23, 2010
Short honk: I read “Reed Looks to IT Outsourcing to Cut Costs”. I wanted to know if there was any magic behind the company’s financial reports and I was curious about how outsourcing was going to impact existing staff. For information about Reed, click here.
Well, not much was new in the info department, but I did notice several items.
First, the big payday was the result of an acquisition. I noted this telling passage:
Reed saw underlying revenues and adjusted operating profits fall 4 percent and 15 percent, respectively.
Second, Reed is banking on legal and professional information to put the ball in the net. The only problem is Google’s plugging away in the legal information arena. Google has dumped legal info into Google Scholar, but there are some interesting links in Google’s US government index, and from what I hear on the goose pond, there is more legal info coming. Google gives away legal info, allowing advertisers to foot the bill. Reed will have to find a way to compete with Google’s subsidized business model.
Third, the fancy talk about more software and better customer support is interesting, but these are words that may keep the Wall Street folks happy, but I think that this is an old cassette tape stuck in the boom box.
My view is that Reed will face increasing pressure going forward. Last time I checked, there were fewer and fewer attorneys willing to spend big bucks to tap into expensive legal databases. Libraries have some money but there is fierce competition for those dollars which means marketing and sales costs are going up and up.
Outsourcing is a fancy word for getting rid of staff and finding lower cost sources. Interesting but what happens to the “quality” and “value” of the information products? Fun to watch this info giant move forward in my opinion.
Stephen E Arnold, February 23, 2010
No one paid me to write this. Because I mentioned costs, I will report not payment to the Treasury Department. Money wizards there for sure.
Baffled about Real Journalists
February 23, 2010
I am not a journalist. I don’t even know how one becomes a “real” journalist. I learned when I read “Why We Don’t Trust Devil Mountain Software (and Neither Should You)” that big publishing companies don’t know either, assuming the information in the write up is accurate. I guess I should not be surprised. I learned last week at a person who writes about electronic information is officially an “expert” on electronic information. I suppose that means that if I were a crime reporter and I wrote about an alleged illegal activity, I would be qualified to talk about wrongdoing as an “expert”. I wonder how the professionals in law enforcement, military intelligence, and related disciplines feel about “real” journalists becoming experts by virtue of talking to people and reading news items? I suppose faux expertise and “real” journalists are products of the modern world. I find the footprints of these types of folks when I work to mop up after search and content processing disasters. There is a downside to the lack of information about complex subjects even at outfits who are supposed to “know” what’s “real” and what’s not. One thing is sure. This flap is great for the search engine optimization crowd.
Stephen E Arnold, February 23, 2010
No one paid me to write this. I do use a persona—namely, the addled goose—when I write this column. But I received no crumbs for this article. As a fowl, I will report this bedraggled condition to Fish & Wildlife. I wonder if the “real” journalist was paid for his dual roles?
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