

Exterminate the Parasites: Mark Cuban's radical plan to save old media.  - edw519
http://www.newsweek.com/id/214832/output/print

======
thaumaturgy
I and two others are working on a third solution to this, one that we think
can meet everyone's needs.

News consumers now expect to be able to customize their news. Why sit and read
a newspaper, full of items that someone else picked for you, when you can read
a news feed that you've tailored specifically to your interests?

News publishers are now looking for ways to get their news directly to the
consumer, cutting out the freeloaders along the ways. They're starting to die
off and hit serious financial problems, and they're eager for a solution.

News producers are looking for a way to be a well-paid journalist without
having to restrict themselves to a single publication. Blogging has become
more lucrative for a lot of people than if they had become a columnist, even a
syndicated one.

At the same time, news consumers also don't want to be stuck with the stuff
that news producers think is important, filtered through the news publishers
and their biases.

And finally, advertisers are starting to get uncomfortable. I was among the
first to predict the dot-com bust, back when people thought I was crazy; I was
among the first to predict the housing bust, back when the realtors I knew all
thought I was crazy; I think the advertising market is next. It's already
starting to get shaky; I think in the next two years, the bottom is going to
fall out of advertising.

The indicators are all there: it's a heavily saturated market, it isn't
innovating well, audiences are developing not just software-based filters but
mental ones as well. The advantage to running a full-page ad in a magazine was
a guaranteed audience, and if you made it compelling enough, and glossy
enough, you could get someone to look at it for a moment before they turned to
the next page. As print media starts to stumble, if you're an advertiser, now
you're looking at having to push smaller ads to lots of different outlets, and
none of them can do much to guarantee an audience for you.

And, I think we can assume that subscription models aren't going to scale
well. In a way, you can think of the recording industry's model as a
subscription-based one -- in that they expect people to pay for access to
content on an ongoing basis -- and look at how that's gone for them. The more
pressure they put on the consumers, the more clever solutions the consumers
come up with to distribute the content for free.

I have an aunt who started a beautiful magazine for the central coast and
three different friends who have worked in various parts of the news industry.
I'm not just pulling these things out of my ass; I've heard about the industry
problems from people who are working in the industry.

But, I think we found the right lever that can balance all of this out again.
We've already submitted our app for YCW10, software is currently under heavy
development, and we're still polishing some edges on the business model. Can't
wait to see what happens.

~~~
michael_dorfman
I wish you luck, honestly. But I disagree with most of the premises you
outline.

 _Why sit and read a newspaper, full of items that someone else picked for
you, when you can read a news feed that you've tailored specifically to your
interests?_

Because the New York Times has a better handle on what's going on in the world
today than I do? I want to be informed about what's going on out there, and
every day at least once I read something interesting in the Times that didn't
meet some pre-defined "interest" of mine.

 _News producers are looking for a way to be a well-paid journalist without
having to restrict themselves to a single publication._

Really? I think most staffers are happy not to be free-lancers.

 _"In a way, you can think of the recording industry's model as a
subscription-based one -- in that they expect people to pay for access to
content on an ongoing basis -- and look at how that's gone for them."_

Huh? How is the recording industry's model even remotely like a subscription
one? Are you still in the "Columbia House Record & Tape Club" or something?

------
mixmax
The relationship between old media and aggregators isn't so much parasitic as
it is symbiotic. They both need each other. Aggregators need stories and old
media needs an audience for their articles. I've discovered a few old media
sites through HN and Reddit that I now read regularly. If old media closes off
their funnel of new readers where will they get their audience from?

~~~
travisjeffery
There's a big difference between the two sites you listed and the type that
Cuban listed and is referring to.

Hacker News and Reddit both link directly to the actual source material and
only show a title and a short description of the post.

The Drudge Report doesn't do it as badly, but Newser actually rips off
most/entire article on their site leaving no reason to go to the actual
material.

The only one benefiting from that relationship is Newser.

~~~
joe_the_user
Cuban's advocating blocking links from aggregators. He may mention newser but
the strategy would 'work' again HN as well.

This extremism seems silly - the sites could do click-through ads which
generate revenue for any deep links, also a few lines code - and growing
number of sites do this.

------
FiReaNG3L
I love how he puts 'copying' and 'linking' on the same level of 'bad'. You
don't want me to link to your stories? Please take a class of Internet 101 -
most sites would kill to have that many free links.

~~~
joe_the_user
A double 'Bingo' to the parent!

There's legal recourse against sites taking more than fair use. And fair use
generates hits on your site. And if you can't monetize the hits on their site,
well, you'll be replaced by someone who can.

Uh, and lot of the dying old media were just dumber parasites - a local
newpaper twenty years was three lame local stories plus condensed AP and
NYTimes feeds. I don't feel sorry to see that go...

------
rwolf
Radical? We've been hearing the AP rail about this stuff for years. Newsweek
and Mark Cuban need to read a little news before they claim something is new.

------
kiba
Someone once said that most companies die by commiting sucide, not getting
killed by the competition.

Well, Mark Cuban's proposal is a crazy way to commit sucide. Imagine thousand
of companies of which employ tons of people in between going under, just like
that.

~~~
nir
I wouldn't be so certain this is committing suicide. It could be argued that
providing all content for free is committing suicide as well.

~~~
kiba
As far as I know, newspaper make most of its money from advertising, not from
charging subscribers.

~~~
nir
Honestly, I have no idea where most of newspaper revenues come from, but so
far it seems most (all?) of the major ones are failing to make enough money by
selling online ads. It's not a matter of theory or opinion, it's something
that's been tested for about 8-9 years now, and just doesn't seem to work.

------
Mcuban
Yes sir. Internet advertising is a booming business. Every pageview is sold
weeks in advance, right ? Not quite. The issue is the value of a referred
pageview. Today, its not worth much, if anything. The conversion value is
approaching zero.

Compare the conversion value of that pageview to the value of diminishing the
position of aggregators and its an easy choice.

The net has a business problem of unlimited news site inventory. So traffic
from aggregators isnt worth squat. So why put up with them leveraging your
intellectual capital ?

not worth it

~~~
jrg
"The conversion value is approaching zero" -- I think advertisers, some at
least, have forgotten how advertising can work. They've been lead to believe
by some that because they can track everyone's response to a campaign that it
always makes sense to do so.

It's not likely that I'm going to see a banner advert on a page and
immediately click on the link and respond to it. It interrupts whatever I'm
actually doing - i.e. reading the content. But I might well remember having
seen the advert later, and that might change my future plans.

(Here's an idea for free - make it easy for me to find the adverts I've
already been shown. When I'm reading a physical newspaper or magazine I can
flick back to the advert, or riffle through to find it again. Unless an
advertiser is doing saturation advertising across an entire ad network one
day, it's hard for me to do the same online.)

~~~
Mcuban
you may be right. But it doesnt change the reality that the destination site
gets nearly zero benefit from the referral.

------
zaidf
He misses the point: the value of a news item is going down because of the
advent of Internet and the rise of Internet journalists.

While they may not be of the caliber of a typical print journalist, that may
be a supply-demand thing. Meaning if all newspapers blocked news aggregator,
there is a high chance that there will be new folks producing newspaper-
quality content who'd be happy to get the aggregator traffic.

------
DannoHung
How would they even enforce it?

Most of these motherfuckers are just republishing AP stories anyway.

~~~
wmf
Referer blocking.

~~~
ojbyrne
Which means people who want to use their favorite aggregator sites would just
have to set their browser to not send referers. And the old media sites lose a
little bit of analytics.

~~~
Mcuban
How many people do you know that even know they can do this, let alone know
how to do it. Let alone would go through the process of it. Let alone would
understand the ramifications for other site interactions.

non event. You and 17 other people might do this.

~~~
ojbyrne
Presumably the aggregation sites would have instructions in big red letters at
the top of every page.

------
Tichy
It's just that there are many who want to have as many readers as they can
get, because they earn their money in other ways (like Joel On Software
selling his bug tracker). So they would be thankful about any incoming link.

Maybe some "old media" articles are a tiny bit better, maybe not. Maybe many
of the "old media" articles are actually also just advertisements in disguise
(because they subtly hype some company's product). Overall I think they are
not that much better that I would actively seek them out. Nobody links to
them, I don't read them.

------
MaysonL
Of course, not all old media entities are dying. See for example, NPR and the
Norwegian Shibsted media group, which is making profits, both from newspapers
_and_ online new sites. (Of course, the fact that they started up online in
1995 or so may have something to do with it)

------
fnid
We see this model in television today. The aggregators will become channels
where customers subscribe to them or see ads and the aggregators pay the
content producers for the rights to display the content on the sites.

